Category advertising

Jul 7 2015

KDP’s AMS Advertising now offers Subcategories… Finally

Image from ShutterStock.

Image from ShutterStock.

ADVERTISING IMPROVEMENT WITH AMS AT KDP

Kindle books enrolled in KDP Select can be advertised on Amazon via AMS through KDP.

There have always been two targeting choices:

  • product targeting. Select specific products to target.
  • interest targeting. Select a category to target.

Until now, the category choices for interest targeting were very broad.

But now, after you select a category, you can select a subcategory.

Some of the subcategories are still themselves quite broad.

  • For example, for a math or science book, I must choose the category called Other.
  • Then the appropriate subcategory is Math and Science. But that includes very many different subjects.
  • It would be better if the subcategories were further divided. For example, I might choose astronomy, if available.

However, it is an improvement. Interest targeting is better now. It’s a nice step in the right direction.

If you want more precise targeting, the obvious solution is to choose product targeting instead.

KINDLE ADVERTISING TIPS

  • I used to recommend product targeting. I still favor that, but I just tested out the refined interest targeting so that I can compare. It has some merit.
  • Set the end date as far in advance as possible. It lets you go about six months ahead.
  • Choose to display your ad as quickly as possible. Generally, it’s not easy to make impressions unless you overbid. This option helps if you bid reasonably.
  • Make a catchy headline that’s likely to help create interest in your book, and which is quite relevant for your content.
  • Bid low to begin with. It’s okay to underbid.
  • Wait 3 days before raising your bid. Sometimes reporting is significantly delayed. See how it’s going before you ‘fix’ it.
  • Try expanding your targeting before raising your bid to see if that helps make more impressions.
  • If you do raise your bid, just raise it a little. And wait 3 more days before raising it again.
  • You’re not obligated to invest the whole $100. You can pause or terminate your ad at any time.

With my strategy, I have several affordable bids. Sometimes, I’m able to generate 100,000 to 400,000 impressions in one month with less than $10 spent. I have multiple ads where I spent about $12 to generate $24 in sales (at 70% royalty).

I observe some nice indirect effects on similar books and on my print books. (I tend to sell more print books to begin with, so that makes sense for my books.)

Write happy, be happy. 🙂

Chris McMullen

Copyright © 2015

Chris McMullen, Author of A Detailed Guide to Self-Publishing with Amazon and Other Online Booksellers

  • Volume 1 on formatting and publishing
  • Volume 2 on marketability and marketing
  • 4-in-1 Boxed set includes both volumes and more
  • Kindle Formatting Magic (coming soon)

Follow me at WordPress, find my author page on Facebook, or connect with me through Twitter.

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May 20 2015

Advertising on Amazon with AMS via KDP: Research, Experience, & Tips

Advertising Research

Images from ShutterStock

 

ADVERTISING BOOKS WITH AMS

KDP now lets indie authors advertise their KDP Select books directly on Amazon.com through AMS (Amazon Marketing Services).

I’ve now placed 36 different ads through AMS on over a dozen books in multiple author names, with different targeting and bids from 2 cents to $1.01 per click. So I have quite a bit of firsthand experience with this. Although I publish nonfiction, I’ve also discussed AMS with several fiction authors who have used it—including some who love it, some who hate it, and more with mixed feelings. Many of these authors have shared their AMS numbers.

EASY MONEY, HUH?

Well, not ‘easy.’

Marketing books is never easy. But advertising books on Amazon through AMS, like other marketing tools, has potential; the trick is learning how to use the tool effectively, and whether or not this tool is a good fit for you and your books.

BENEFITS OF ADVERTISING WITH AMS

  • Prime real estate. Your ad shows directly on Amazon product pages, where customers are already shopping for books. You’re not trying to make people leave one site to visit another.
  • Optional product targeting. You can hand-pick specific books (and even movies and other products, if applicable) to target. This allows you to tailor your targeting to your unique book.
  • Budget-friendly. Although you must set an advertising budget of at least $100, you’re not committed to spend one penny. You can pause or terminate your AMS ad campaign at any time. (However, the ad report does not show in real-time, so when you pause your campaign, the expenses may be higher than you realize. If you bid low, this won’t be an issue, but if you bid very high, you can be out of budget before you realize it.)
  • Free impressions. You only pay for clicks. If 2,000 people see your ad, but nobody clicks on the ad, you don’t pay a penny.
  • Product page data. The AMS ad report shows impressions, clicks, detail page views, and sales generated through the ads. This lets you see what percentage of traffic to your product page actually buys your book. Even in the worst case that your ad is an utter failure, learning your sales-to-clicks ratio can help you assess the effectiveness (or lack thereof) of your book’s product page at selling your book to your target audience.
  • Improving. AMS at KDP is improving. For example, you can now enter a phrase designed to catch interest and at least one of the possible ad locations shows this as an orange headline directly above your ad.

CHALLENGES YOU MUST OVERCOME

  • Competition. Many other authors bid high (often, much higher than they should), which can make it challenging to get impressions with an affordable bid, especially in competitive genres. However, there are ways to deal with this (like wise targeting).
  • Tiny thumbnail. The ads show a tiny image of your cover thumbnail. The ads come in a few different sizes, but many book covers are difficult to make out in the ads. (Obviously, if you design a cover that stands out well and is easy to read at this tiny size—possible, as I’ve seen it done—you have a distinct advantage.) So although impressions are free (you only pay for clicks), possible branding benefits from those impressions are somewhat limited.
  • Click-throughs. The CTR (click-through rate) can vary considerably from one book to another, but often it’s in the ballpark of 0.1%. That is, for every 1000 times your ad displays, 1 person will click on your ad. This isn’t really a downside though, since you only pay for clicks; impressions where the customer ignored your ad don’t cost you a penny.
  • Closing rate. The closing rate and your average CPC show whether or not your ad is a success or failure. The closing rate is your sales-to-click ratio. The books with the most marketable product pages and wise targeting can achieve a closing rate of 10% or better, but some books achieve a much lower closing rate.
  • Not real time. The ads do not show in real time; there are often delays of several hours (or more). So you must be patient and wise. Too many authors conclude prematurely that nothing is happening, so what do they do? They raise their bids to make something happen. That’s a great way to lose money fast.
  • Targeting. Take time to target wisely. This is one thing you have much control over, but you have to take the time to do the research. And when things don’t seem to be working, this is one area you can try to improve. The more frequently your ad shows to customers who are likely to be interested in your book, the better your chances of achieving a better closing rate.
  • Stoppage. Your AMS can actually be stopped due to low relevance by Amazon. Low relevance is either a sign of poor targeting, or a product page that has room for improvement (cover, blurb, Look Inside, even the book idea comes into play here). Your ad is likely to be stopped due to low relevance if your CTR is well under 0.1%. If only 1 out of 3000 people who see your ad click on it, there is a good chance that your ad will be stopped. If your ad is stopped, you can create a new ad, but be sure to strive for more relevant targeting.

RESEARCH & EXPERIENCE WITH AMS

I placed my first ad through AMS on January 29, 2015, shortly after the program was launched at KDP. I have now placed 36 different ads through AMS on several different books under a few different author names.

In February and early March, I had bid too high (upwards of $1 per click). But my primary goal was to get valuable data, even if that meant cutting into my ROI.

Most of my early ads were making many impressions (as many as 461,673 impressions). I received as many as 661 clicks (on an ad with 108,689 impressions). Most of my CTR’s (click-through rates) were in the neighborhood of 0.1% (1 in 1000), though I had a few above 0.5%, but also a few below 0.05%. But the CTR really doesn’t matter, since you only pay for clicks. (Well, it does matter now: If your CTR is well below 0.1%, there is a good chance that your ad will be stopped for low relevance.) From my numbers and stats that other authors have shared, 0.05% (1 in 2000) to 0.5% (1 in 200) is typical; if your CTR is below this, you can probably improve it through targeting (well, your cover matters, too).

I had a few ads with a closing rate (sales to clicks) of 10% or more, but most of my ads had closing rates below 10%. I had some closing rates of just a few percent. This stat is very important, as it determines how much you can afford to bid and whether or not your short-term ROI (return on investment) is worthwhile. With a variety of books, success rates, and targeting strategies, I’ve learned some ways to help improve my closing rates (reflected in my more recent ads). I’ve met a few other authors who achieved closing rates above 10%, but many more authors with closing rates closer to 5% or less.

I’ve placed 12 new ads since April 19, 2015, with wiser bids and targeting, based on my prior experience. The new ads are much more successful in terms of short-term ROI. I now have more ads where the short-term royalties exceed the amount spent on the ad. I also have some slower-running ads that are getting very cheap exposure. For example, I have one ad that’s been running for 31 days, which has cost me a total of $2.16, but has generated 177,537 impressions, 73 clicks, and already returned over $4 in royalties. That’s not much in terms of sales for a whole month of advertising, but look, that’s not bad for having invested a whole two dollars. I have some ads generating activity with as little as 2-cent bids. A low bid may not make many impressions (though occasionally it does), but it’s also more likely to earn a short-term return rather than a loss (and if it earns a loss, imagine how much you would have lost bidding high).

Another thing that I’ve seen are indirect benefits. Many other authors have seen similar indirect benefits. Several authors have seen an increase in borrows. A couple authors reported an increase in borrows, then a decrease in both sales and borrows when the ad stopped, and a return when a new ad was run. A few series authors have reported improvement in other books in the series. But not all authors have seen such improvements; indirect benefits are not guaranteed.

I sell about 9 paperbacks for every Kindle e-book, overall (I have a few books where it’s the other way around). When I ran my ads in February and early March, I saw a substantial increase in related paperback books. I toned down my advertising significantly in late March and early April (I had been bidding upwards of $1 per click; I stopped some of my ads, and lowered my bids in others). My paperback sales declined. Around April 19, I placed several new ads (remember, the ads are for Kindle e-books), but with lower bids, and I’ve seen sales of paperback books improve again.

I’ve tried a variety of targeting strategies. I only used category targeting for a couple of ads, and didn’t generate many impressions that way. The problem is that every other book with the same targeting category is competing for the exact same list of books. Product targeting seems to give you an edge, even when all of the books on your list seem to fit into the same broad category. But product targeting also lets you select specific books outside your genre or category, and even other kinds of products, like movies. I’ve tried compiling narrow lists of 50 books, long lists with 1000 books, books of very popular and very similar products, movies and other products likely to interest my target audience, and lists of books that aren’t too popular and which are more likely to appeal to an indie audience. There are a lot of possibilities when it comes to targeting.

If you select fewer than 50 products, it will be tough to make impressions (unless you pick some hugely popular products, even then, you have to outbid others). If you target movies or other products likely to interest your target audience, but they only interest a small fraction of your audience, this can greatly diminish your CTR, putting you in danger of low relevance (so your ad may be stopped), especially if those movies or other products are hot items. You really have to judge your target audience well to make the most of your targeting (you can go back and change product targeting; but if you select category targeting, the only way to change it is to pause your ad and start a new one). If you target books where the readers are more likely to actually purchase your book once they reach your product page, this can help your conversion rate. It pays to spend extra time contemplating the probable habits and interests of much of your target audience (and it may take some trial and error).

But you probably don’t care so much about my experience, as what I’ve learned from it. So let me move onto tips and suggestions, based on my experience with AMS.

TIPS & SUGGESTIONS FOR USING AMS

  • Create a short catch-phrase likely to interest your target audience (and sound relevant to the subgenre, subcategory or content) to use for your headline. Don’t simply copy your title into the headline. This shows above your ad (when the headline displays).
  • Click the option to display your ad as quickly as possible (don’t let Amazon spread it out evenly). Unless you’re overbidding, it’s hard to make impressions, so get as many as you can.
  • Change the month of the end date. Set the end date as far into the future as the system will let you (several months). You can end it anytime manually.
  • Choose product targeting instead of interest targeting. Check the box to include similar products.
  • Devote some time to research books (and perhaps other products, like movies) to target. Think about whether the majority of the target audience for those books (or products) is likely to be interested in your book. Browse for similar books and products on Amazon before you start working on your ad campaign so that you have ideas ready. Select a minimum of 50 books, perhaps several hundred is better, but it really depends on your book and audience.
  • Some of the books you target need to be popular enough for your ad to show enough times to make impressions. Some need to be not too popular, otherwise you’ll be consistently outbid (or you’ll be overpaying). Select several less popular books too, as there may be less competition for those ads.
  • Enter specific keywords, even key-phrases, highly relevant to your book, in order to help find more books like yours. Try a variety of keywords and phrases, but remember that relevance is key.
  • Relevance matters when targeting, not only to get the most out of your ad (you want it to sell once you get traffic), but also to prevent your ad from being stopped.
  • Bid low to begin with. You can always raise your bid later. If you do, only raise it a little at a time.
  • Don’t raisee your bid more than once in a 48-hour period (better yet, wait at least 1 week). Stats don’t show in real time, but can actually be delayed by several hours (even more than a day). Don’t let your impatience squander your money.
  • Be patient. What’s the hurry? Why pay $1 to spend your money fast, possibly with little to show for it? Let your ad run for weeks, or even months, if necessary. The most common way to lose money with AMS is to bid too high too fast.
  • Remember that there are many other authors, and their bids and targeting change over time. So if you aren’t getting many impressions now, a few weeks from now when other ads run out, you might get more. Sometimes, simply waiting out higher bidders can help you generate impressions at a lower cost.
  • Remember that you can go back and change product targeting. Try to find wiser ways to target effectively before yielding to the temptation to raise your bid.
  • Keep an eye on your ad report. You can lose a lot of money fast if you’re not careful. Out of the blue, an ad that had been going slow can start getting several clicks. If you’re spending tens of dollars, but not generating sales, stop your ad before you lose more money. Try to improve your ad before running it again.
  • Look at your short-term ROI (return on investment). Compare your royalties (the report shows sales instead; you have to figure this out) to the money spent so far. If you’re losing money (more than you wish to risk), pause the ad. You can try changing your targeting. Try bidding less. Something isn’t working, so either stop the ad or try to improve it. (Or if it’s only a small loss, maybe indirect or long-term benefits will offset this; that’s a tough decision that you have to make.)
  • If your closing rate (# of sales divided by # of clicks) times your royalty exceeds your average CPC, your ad is making money; if not, your ad is losing money short-term. Example: 100 clicks, 8 sales, royalty $2.10, average CPC is 15 cents. Divide 8 sales by 100 clicks to get 0.08. Multiply 0.08 by $2.10 to get $0.168. This exceeds the average CPC of $0.15, so this ad is yielding a short-term ROI (so any indirect or long-term benefits will be gravy).
  • Bidding much less can improve your short-term ROI. If you’re losing significant money short-term, first try lowering your bid significantly. Your impressions, clicks, and sales rates may go down, too, but your short-term ROI is likely to be better. It’s better to make a small profit at a slow rate, than to lose money at a fast rate. Only bid what you can afford to bid.
  • The alternative to lowering your bid is improved targeting (or improving your product page and Look Inside). In some cases, it may take a combination of a lower bid and improved targeting. And we know that not every book can be saved, so the same is true with ads. Sometimes, it’s just not in the cards.
  • If your CTR (clicks divided by impressions) is less than 0.05% (1 in 2000), your ad is in greater danger of being stopped due to low relevance. Try changing your product targeting. (If it does get stopped, you can start a new ad, but again you’ll want to try to improve your product targeting.)
  • If you plan on using this in the future, when designing your next cover, strive for a layout and color scheme that will catch attention even at this tiny ad thumbnail size (and still look good as a regular thumbnail and also full-size).
  • You’re not obligated to spend your whole ad campaign budget. You can pause or terminate your ad at any time.
  • Imagine you’re at a casino. If you’re having bad luck, get out fast! Walking away when you’ve lost $15 is a lot better than losing $100.
  • Don’t place ads for multiple books simultaneously, unless you can do so with significantly different targeting.
  • If you have multiple books or plan to run multiple ads, change the name of your ad campaign to help you remember which book the ad is for. The default names aren’t helpful at all.
  • Create an ad with limited, focused targeting. After getting appreciable data, stop the ad. Start a new ad with different, but still limited, focused targeting. Compare your results. You can learn a lot with brief controlled experiments like this.

Write happy, be happy. 🙂

Chris McMullen

Copyright © 2015

Chris McMullen, Author of A Detailed Guide to Self-Publishing with Amazon and Other Online Booksellers

  • Volume 1 on formatting and publishing
  • Volume 2 on marketability and marketing
  • 4-in-1 Boxed set includes both volumes and more
  • Kindle Formatting Magic (coming soon)

Follow me at WordPress, find my author page on Facebook, or connect with me through Twitter.

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May 11 2015

Why Was Your AMS Ad Stopped?

Stopped

AMS AD STOPPED

Advertisements for KDP Select books placed through Amazon Marketing Services (AMS) can now be stopped by Amazon.

Why are some KDP ad campaigns stopping?

Due to low relevance.

Low relevance can mean more than one thing.

The most common explanation is that the click-to-views ratio is very small, probably small compared to 1 in 1000 (or 0.1%). If you’re getting 4000 views per click, for example, your AMS ad is likely to be stopped due to low relevance.

That’s not the only possible explanation, but the click-to-views ratio is the simplest way for Amazon to measure the relevance of your ad. If only 1 out of 4000 people who see your ad clicks on it, your ad evidently isn’t very relevant to the people who see it. In contrast, if 1 out of 300 people who see an ad click on it, that ad is more relevant to the people who see it.

There are other ways to determine relevance, such as comparing the list of targeted products to the categories and keywords of the book.

Most of the factors that affect relevance also impact the click-to-views ratio, so this probably is a very good indicator.

Why does Amazon care?

  • Authors only pay for clicks, not views. So Amazon is losing money on ads with very low click-to-view ratios.
  • The advertisements will lose their effectiveness if many ads have low relevance, as people will start ignoring them out of habit. (Don’t worry: Amazon is preventing this by stopping ads that show low relevance.)
  • A few authors have indubitably abused the system by intentionally targeting products with low relevance. (Yes, I can think of examples, but I won’t share them. Let’s not add to the abuse.)

HOW TO IMPROVE RELEVANCE

If your AMS ad was stopped due to low relevance, you can start a new KDP ad campaign for the same book.

You’ll want to improve the relevance for your ad so that your next ad doesn’t get stopped.

Here are ways to improve your ad’s relevance:

  • If you originally targeted by interest, switch to product targeting instead.
  • If you originally targeted by product, select a shorter list of more relevant products. Spend more time researching a product list.
  • If your cover may not instantly reveal the book’s genre or content, a cover that better attracts your target audience may impact your relevance.

Better targeting is usually the cure to improved relevance.

Write happy, be happy. 🙂

Chris McMullen

Copyright © 2015

Chris McMullen, Author of A Detailed Guide to Self-Publishing with Amazon and Other Online Booksellers

  • Volume 1 on formatting and publishing
  • Volume 2 on marketability and marketing
  • 4-in-1 Boxed set includes both volumes and more

Follow me at WordPress, find my author page on Facebook, or connect with me through Twitter.

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Mar 14 2015

Advertising Books with AMS, BookBub, ENT, GR, FB, Twitter & More

Images from Shutterstock

Images from Shutterstock

ADVERTISING BOOKS

Millions of books are on the market, with a few thousand released each day.

Striving to get your book discovered, advertising is one option.

It may not be the best option for you. But if you’re thinking about placing an advertisement for your book, you want to advertise in the right place and you want to get the most out of it.

But there are so many places to advertise:

  • Right on Amazon with AMS (if your book is enrolled in KDP Select).
  • Through social media with Facebook, Twitter, etc.
  • On websites geared toward readers, such as Goodreads.
  • E-book promotion websites, like BookBub, Ereader News Today, Book Gorilla, and a host of others. See the end of this article for a more comprehensive list.
  • Websites related to the interests of your specific target audience.
  • Contacting bloggers, going on blog tours, social media groups, and so on.
  • Local newspapers, local radio stations, magazines, online magazines, etc.
  • Offline advertising with flyers, bookmarks, business cards, etc.
  • With contests or giveaways.
  • Running a blog or building a content-rich website.
  • & many more.

WHICH IS MOST EFFECTIVE?

Wouldn’t you love to know?

Author Nicholas Rossis has taken the initiative to find out. How? By asking authors to complete a simple 3-question survey.

If you’ve ever placed an advertisement for a book, please visit the following page to share your book advertising experience:

http://nicholasrossis.me/2015/03/02/take-the-3-question-ad-results-survey

Please help. We need more authors to complete the survey for the results to be meaningful.

It’s quick. It’s easy. And when you finish, please encourage other authors to take the survey, too.

Once there is enough participation, Nicholas Rossis will share the results with helpful analysis.

That will help us answer the important question, “Which advertising service should you use?”

BOOK ADVERTISING ADVICE

Here is my advice for getting the most out of your book advertisements:

  • If you write a series, once you have multiple volumes out, you have a distinct advantage as one sale can lead to multiple sales. If you have multiple similar books, you have a similar advantage. If you only have one book out, advertising may help to build a small fan base and establish your brand, but might be more effective after you deliver more quality content to the market. In that case, you might invest more of your current time toward writing.
  • If you have a complete online author platform and if you use free marketing strategies, that will help supplement your advertising efforts and the combined traffic may be more effective than driving traffic from just one source.
  • Start out with free and very low cost book marketing and advertising strategies. Gain experience with paid advertising by beginning with affordable options. This minimizes your risk, helps you assess your prospects for advertising, and helps you learn how to advertise effectively before investing larger sums of money. Advertise wisely.
  • Interact with other authors. Learn what they have tried in the way of advertising, including what worked and what didn’t. Research your advertising options before trying them out. However, realize that every book and author is unique, so what’s true for others may not be true for you.
  • Long-term planning and thinking is far more likely to lead to success. Put your priorities on (1) writing quality content, (2) targeting a viable audience, and (3) packaging your book wisely in terms of cover design and blurb. Devote a little time toward (4) slowly developing a complete author platform, (5) learning new marketing strategies and trying them out, (6) interacting with other authors, and (7) slowly growing a fan base, but put most of your time into writing until you have a few similar books out.
  • Throwing money at advertising isn’t a substitute for learning how to market your book effectively and developing your brand as an author.
  • The more your cover attracts your specific target audience and the better it visually signifies the precise subgenre or subject, the more potential your advertising will have. The better your blurb and Look Inside sell your book, the more effective your advertising will be.
  • Advertising options with more specific targeting will be more effective, all other things being equal.
  • Driving traffic to your book’s product page isn’t your only advertising option. For example, at Goodreads you can place an advertisement to drive traffic to a giveaway or to help get your book added to more to-read lists. At Twitter or Facebook, you can place an advertisement to help grow a following or drive social media engagement. If you run an Amazon Giveaway for a print book, this can help you attract a following at Twitter. These other options may not be as good as driving traffic directly to your book’s product page, especially if your main focus is on immediate sales, but they may have some relevance depending on your goals.
  • Short-term discounts and freebies help you promote a sale price, rather than simply announcing your book. These tools can be effective if you promote the discount effectively; they also help to provide a sense of urgency to the customer. However, price by itself doesn’t sell books. To get the most out of a discount, you must research websites and blogs that can help you spread the word about your sale price to your target audience. This includes e-book promotion websites like BookBub, E-reader News Today, Book Gorilla, and more, as well as blogs and even other kinds of websites on topics that may interest your readers (like a sport that relates to your book).
  • Branding, marketing, and advertising take time and patience. People don’t run to the store after they see a commercial on television. Rather, months later when they’re shopping for a product, they tend to prefer a product they’ve heard of before. Similarly, many people who see your ad won’t run over and buy it immediately. Branding, through occasional repetition among your target audience over a period of months, can help readers recognize your book months down the line when shopping for a book like yours.

LIST OF E-BOOK PROMOTION WEBSITES

There are several e-book promotion websites that can help you spread the word about a temporary price reduction:

Tip: Type the names of a few of these sites together into a Google search to help pull up comprehensive lists.

READING SURVEY

If you haven’t already done so, please participate in a survey on how people read books. The more participation we get, the more meaningful the results will be.

Here is one question, for your convenience. (If you’ve already answered this before, please don’t answer it a second time.)

You can find more questions here:

https://chrismcmullen.wordpress.com/surveys

Chris McMullen

Copyright © 2015

Chris McMullen, Author of A Detailed Guide to Self-Publishing with Amazon and Other Online Booksellers

  • Volume 1 on formatting and publishing
  • Volume 2 on marketability and marketing
  • 4-in-1 Boxed set includes both volumes and more

Follow me at WordPress, find my author page on Facebook, or connect with me through Twitter.

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Mar 1 2015

Advertising on Amazon w/ AMS via KDP—Is it Worth it?

Images from Shutterstock

Images from Shutterstock

MY EXPERIENCE WITH ADVERTISING ON AMAZON

The new option for KDP Select authors to advertise their Kindle e-books with Amazon Marketing Services (AMS) is intriguing.

I have now run 14 different ads through AMS. I’ve also studied the results that several other authors have posted.

Today, I’m sharing some of my preliminary results and offering my thoughts on this critical question:

IS IT WORTH IT?

I’ll also mention a couple of alternative uses of this tool.

CONTENTS

  1. Initial Return on Investment
  2. Estimating Short-term ROI
  3. Your Safe CPC Bid
  4. Advertising Results
  5. Possible Side Benefits
  6. Long-term ROI
  7. Countdown Deals and Freebies
  8. Creative Uses of Book Advertisements

1. INITIAL RETURN ON INVESTMENT

The short-term return on investment (ROI) depends on these factors:

  • your average cost-per-click (CPC) bid
  • the royalty you earn for each sale
  • your sales-per-click (SPC) conversion rate
  • possible side benefits, like selling similar books, like selling print copies, or like getting more Kindle Unlimited downloads

You already know your royalty when you place your ad.

You can cap your average CPC by setting a modest bid.

But you won’t know your SPC conversion rate until you’ve invested money in an ad.

From running 14 different ads, I see firsthand that it’s reasonable to attain an SPC conversion rate of 4 to 10%.

A few other authors, including one who shared a screenshot, have shown that it’s possible to achieve an SPC of 10 to 20%. My feeling is that 20% will be quite rare.

On the other side, I’ve seen data for SPC’s of 1% or less.

Your SPC conversion rate depends on:

  • how well your product page (cover, blurb, Look Inside, reviews) sells your book
  • how well you target your advertisement to your specific audience
  • how well what your ad conveys (visually in the tiny thumbnail, along with the first words of the title) matches what shoppers discover on your product page
  • whether or not there is an audience for your book

The third point can have a huge impact. If customers glance at your tiny thumbnail and expect one thing, but find something different on your product page, this will kill your SPC.

The second point you can control through a wise choice of product targeting (not necessarily books). What matters most for your SPC is how well the target audiences of the selected products fit your book. But you must weigh this with how frequently you wish to make impressions: If the targeting is too precise, your ad might struggle to get impressions.

2. ESTIMATING SHORT-TERM ROI

There is a formula to calculate your short-term ROI:

(s.t ROI %) = (royalty) x (SPC %) / (ave. CPC)

EXAMPLE 1: Your book earns a royalty of $4.20. Your average CPC bid is 25 cents. Your SPC is 5%.

Your short-term ROI = $4.20 x 5% / $0.25 = 84%.

This example has a high royalty, a modest bid, and a decent SPC.

EXAMPLE 2: Your book earns a royalty of $2.10. Your average CPC bid is 25 cents. Your SPC is 5%.

Your short-term ROI = $2.10 x 5% / $0.25 = 42%.

If you earn a lower royalty, you either need to have a high SPC or bid lower to make up for it.

EXAMPLE 3: Your book earns a royalty of 34 cents. Your average CPC bid is 10 cents. Your SPC is 10%.

Your short-term ROI = $0.34 x 10% / $0.10 = 34%.

Here we have an excellent SPC and a lower bid, but that 34-cent royalty is the killer.

The lower your royalty or the lower your SPC, the lower you should bid.

3. YOUR SAFE CPC BID

Let’s spin this formula around and look at it from another angle:

(safe CPC bid) = (royalty) x (SPC %) / 100%

This tells you the maximum CPC bid you should place if you want your short-term ROI to break even. You need to have some prior experience to properly estimate your SPC %.

EXAMPLE 4: Your book earns a royalty of $2.10. Your SPC is 5%.

Your safe CPC bid = $2.10 x 5% / 100% = $0.105

In this example, a bid of 10 cents is safe (provided that your SPC turns out to be what you expect).

Not getting enough impressions? So what. With a safe CPC, you’re not losing anything (again, assuming your SPC is reliable; that’s a big IF, but you can monitor your ad and pause or terminate it at any time). This basically works out to free publicity, with possible long-term benefits.

4. ADVERTISING RESULTS

I’m not going to bore you with complete data from all 14 of my ads. I’ll share what I believe may be helpful.

My original ads had click-through-rates (ctr) of about 0.1% to 0.2%. After becoming more experienced with product targeting, my most recent ads have ctr’s of 0.4% to 0.9%. My last two ads are 0.85% and 0.90%.

The ctr doesn’t matter directly, since you pay for clicks, not impressions. Your impressions are free. However, better targeting will make your ad more cost-effective, so your ability to improve your ctr is one step toward getting the most out of your ad. It’s not uncommon for online advertising to yield a ctr of 0.1%. Most of my ads have done much better than 0.1%. That’s a plus for AMS, though of course it will vary by genre and by book. Not all books will achieve a ctr higher than 0.1%. But the potential is clearly there.

Several of my ads have a sales-to-clicks (SPC) ratio of 4%. My highest is 11%. I’ve heard from a few other authors who’ve done better (upwards of 20%); one shared a screenshot. I’ve also heard from authors who’ve done worse (1% or lower). SPC conversion rate is highly sensitive to targeting and packaging. Some books won’t get 1%. But 4% to 10% (or more) is attainable.

One reason my SPC may be under 10% is that my books tend to sell more often in print than in Kindle, and my print sales actually improved during the ad. Thus my short-term ROI may be better than it seems.

My recent average CPC bids have ranged from 25 to 35 cents. A week or more ago, these were around 50 cents. I’ve heard from other authors who also see their average CPC’s coming down. The value does depend strongly on genre or subject, as well as targeting. But in general, it seems to be coming down. This is expected, as there was a bidding frenzy in the early weeks, and it’s probably fizzled out to some extent. The bids may continue to come down, a nice reward for those who have exercised patience.

Remember, Amazon’s recommended CPC bid is 5 cents. I predict a day will come when that 5-cent bid can generate a decent impression rate, or at least a 10-cent bid.

Here are the numbers for a couple of my most recent ads (for educational books; one is in a pen name, yet the CPC and SPC are very similar):

  • 21,365 impressions / 181 clicks / $0.28 average CPC bid / 7 sales / 0.85% ctr / 3.87% SPC
  • 47,499 impressions / 174 clicks / $0.35 average CPC bid / 7 sales / 0.37% ctr / 4.02% SPC

One of these books sells for $5.99, so the short-term ROI is around 60%. The other sells for $2.99, so the short-term ROI is around 30%.

But maybe I just bid too high. If my average CPC bid had been 15 cents, my ROI’s would have been much higher (assuming I could achieve similar results with a lower bid).

However, I observed some strong side benefits during the ad campaigns, which I discuss next. My short-term ROI would actually exceed 100% if these factors are attributed to the ads.

5. POSSIBLE SIDE BENEFITS

Print Sales

One of my books, which ordinarily sells better in print than Kindle, saw paperback sales double during the month of February. This wasn’t just double January, but double months from 2014, too.

When I first started running KDP ad campaigns, I saw a bump in print sales of a few of the advertised books. Only one saw print sales double, but a few saw them improve.

I don’t think it will be typical of advertised books to sell more in print. This clearly favors books that ordinarily sell more often in print.

Similar Books

Another thing that I noticed was that for several advertised books, similar books saw an increase in sales.

In the best case, I saw sales of a closely related title double in February compared to previous months. This was the most extreme case, but I saw significant improvement in many titles where a similar book had been advertised.

If these two factors are due to the ads, then my short-term ROI’s on these ads actually exceed 100%. I need more data to be sure, but it’s encouraging.

Series

I don’t have a sequential series like many fiction authors have, but I have interacted with series authors who have seen sequential volumes sell much better after advertising the first in the series.

It helps to already have a measure of your progression ratios. For example, R2 = Vol. 2 sales / Vol. 1 sales, R3 = Vol. 3 sales / Vol. 2 sales, and so on.

Suppose R2 = 50%, R3 = 40%, and R4 = 25%. Then for every 100 copies of Volume 1 you sell, you should expect to sell 50 copies of Volume 2, 20 copies of Volume 3, and 5 copies of Volume 4. (For example, 100 x R2 x R3 x R4 tells you how many copies of Volume 4 you should sell, on average, for every 100 sales of Volume 1.)

If you have good measures of your R’s, you can actually calculate how much you can afford to lose advertising Volume 1 and still come out ahead overall. (If you’re thinking about making Volume 1 perma-free, there is a similar calculation that you’d like to apply.)

Kindle Unlimited

Another possible side benefit is that the ad might result in more Kindle Unlimited downloads. (Your book must be enrolled in KDP Select in order to be eligible for an AMS ad campaign.)

This helps your sales rank, and if they are read to 10%, they also show up as borrows.

6. LONG-TERM ROI

Even if your short-term ROI is a loss, your book advertisement may still be profitable.

It’s harder to predict and measure long-term benefits. If you can break even short-term, or at least only suffer a small percentage loss, then you have good prospects for reaping long-term rewards. If you suffer a large short-term loss, then you’re putting pressure on those long-term benefits just to break even.

However, there may be situations where you have other goals, like just getting readers as a new author, branding an image, going all out for a hot promotion, supplementing other marketing, etc. In those cases, it may be worth a short-term loss for possible long-term gain.

Possible long-term benefits include:

  • creating brand recognition (this is how advertising really works: people tend to buy products they recognize; most people don’t run out to the store when they see an ad, but after enough repetition, months later they tend to favor a product they’ve heard of before)
  • future sales from readers who want to read more of your work
  • improved exposure through sales spurts, customers-also-bought list expansion, improved sales rank, etc.

If you’re taking a big short-term loss, this can get stressful. It’s hard to count on possible benefits. You hope to see actual sales.

It may be easier if you currently earn good monthly royalties. If you only invest a small percentage of your average monthly royalties on paid advertising, this lessens the impact of your advertising risk. When you’re a new author investing more than you’re initially making, the risk seems much more significant.

7. COUNTDOWN DEALS AND FREEBIES

An interesting possibility is running an AMS advertisement to help promote a Countdown Deal or KDP Select free promo.

Two downsides of the freebie are that you don’t earn any royalties during the promo and “sales” won’t show on your KDP ad report, so you won’t know if any of your “sales” came from the ad or not.

However, it’s not uncommon for authors to pay for advertising to help promote their freebies. For example, this is common with BookBub. So for those who already do this, running a KDP ad for a freebie is just another possible way to bring exposure to freebies. Obviously, your immediate ROI will be 0%. This is a big risk, but a possible way to bring exposure.

Freebies and Countdown Deals are sort of hit or miss. I tried a couple of Countdown Deals coupled with advertisements. I didn’t do any external promotion. (That’s not recommended; I was just testing this out.)

Two of my advertised Countdown Deals turned out to be duds; just slight improvements to sales when advertised at regular price. But one of my advertised Countdown Deals was extraordinary, bringing 20 times as many sales during this week compared to advertising at regular price. In this case, the added sales easily made up for the lower royalty of the promotional price.

Why did two show a slight increase and the other explode? Great question! I think it helps to get lucky; a few initial sales help to get the ball rolling. Once sales rank takes off, if it does, things can really get rolling with an advertised hot promotion.

But if the ball doesn’t get rolling, your promotion just sits there and fizzles out before it starts.

So my recommendation is to market your promotion externally, and just use AMS as one of multiple means of bringing exposure to your promotion. Use BookBub, E-reader News Today, Book Gorilla, or other means of externally bringing attention to your promotion, and consider combining AMS with this. (Or advertise externally and then at regular price, just after the ad finished, perhaps AMS can help you capitalize on some added sales at regular price.)

CREATIVE USES OF BOOK ADVERTISEMENTS

Measure Your Book’s Marketability

I recommend running an ad just to measure your SPC conversion rate. Divide your sales by your clicks. If this is about 1% or less, it suggests that your product page (or targeting) have substantial room for improvement. It could be the cover, blurb, Look Inside, or book idea, for example. If your SPC is 10% or higher, it shows that your book has great potential for sales, and should motivate you to work hard at your marketing, knowing that you have good prospects for selling books if you can just drive (relevant) traffic to your product page. When only 1 out of 100 customers who reach your product page buys your book, it’s a lot harder to be motivated to market.

Test the Market

I saw another author run two short-term ads with very specific targeting in order to gauge the popularity of similar, but different products. The author was deciding between two book ideas. This was a creative way to use these ads.

Chris McMullen

Copyright © 2015

Chris McMullen, Author of A Detailed Guide to Self-Publishing with Amazon and Other Online Booksellers

  • Volume 1 on formatting and publishing
  • Volume 2 on marketability and marketing
  • 4-in-1 Boxed set includes both volumes and more
Feb 8 2015

How Your KDP Ad on Amazon Might Be Better than You Think

AMS Ad

AMAZON MARKETING SERVICES

I love that Amazon now lets indie authors advertise with Amazon Marketing Services (AMS) through KDP Select.

Think about this: Traditionally published authors can’t find a self-service, low-cost advertising option on Amazon.

But if you’re enrolled in KDP Select, you can.

How cool is that?

Anyway… If you try one of these ads, you might just get 1 click for every 1000 impressions or so, and you might get a few sales for every 100 clicks.

If you also bid high to get more impressions, you might see a small short-term return on investment (ROI).

However, things may be better than they seem—i.e. better than the sales column in your AMS ad report might suggest.

Here are 14 ways that your Amazon ad might be more effective than it seems:

  1. Non-clicked sales. Clicking on your ad isn’t the only way to reach your product page. If a customer sees your name or the title of your book, the customer might search for it later. Or the customer might see the ad on his/her pc or laptop, but get out a Kindle to search for your book (instead of clicking on your ad). Thus, you might get a couple of sales that don’t show up on your ad report.
  2. Kindle Unlimited. Customers who click on your ad might download your book through Kindle Unlimited. These won’t show on the sales column of your ad report.
  3. Audio sales. Customers who click on your ad might see your audio book linked to your Kindle product page. A few customers may prefer the audio format.
  4. Print sales. Customers who click on your ad might see your print book linked to your Kindle product page. Some customers prefer print. (I tend to sell more print books than Kindle books, so this is significant for me.)
  5. Add to cart. The customer was busy buying something else when he/she saw your ad. So after clicking on your ad, if the customer likes your book, the customer might simply add your book to his/her shopping cart and revisit your book several weeks later. If the purchase isn’t made within 14 days, the sale won’t show on your ad report.
  6. Delays. Sales reporting on the ad report can be delayed. First, there can be a payment processing delay of a few days. The ad report itself says that sales reporting may be delayed by 2-3 days. The customer might not buy the book immediately after clicking the ad, too. The ad report will allow a customer 14 days from the click date to make the purchase, and still report the sale on the ad report.
  7. Series. If your ad succeeds in selling the first book of a series, some customers will also purchase the second book, third book, etc. Each sale can potentially be several sales.
  8. Similar books. A customer who clicks on your ad might check out your other books, too. In fact, the customer might buy one of your other books instead of the one you advertised. Or the customer might purchase multiple books.
  9. Multiple books. Authors of multiple similar books have a distinct advantage. One ad might result in multiple sales. But you only see sales of the advertised product in your ad report.
  10. Future sales. A customer who reads your book today might buy more books from you in the future. Including books you haven’t even published yet. When you release your next book, each fan you add today may impact your new release.
  11. Sales rank boost. If your ad succeeds in generating any sales or Kindle Unlimited downloads, this sales rank boost has the potential to generate additional sales.
  12. Branding. Anyone who sees your ad or reads the title has learned that your book exists. The next time they see your book, this improves the chances that they will buy it. Branding has good long-term potential. Even though the thumbnails are small and the ads only show a few words, people are clicking on the ads occasionally, so there is some branding effect in play.
  13. Recommendations. Any customers who buy your book as a result of the ad and who enjoy your book may recommend it to others. This can be a very long-term effect, but if you can get recommendations, they can have a big impact on sales many months down the road.
  14. Feedback. If nothing else, the ad report gives you some data that may be useful. For example, if your sales-to-click ratio is around 1% or less, it’s a good sign that you can improve (A) the marketability of your product page, (B) the targeting of your ad, or (C) your thumbnail or title so that they better attract your target audience through the ad.

Here are a few advertising tips that I’ve learned from my preliminary data from my KDP ad campaigns:

  • Product targeting appears to be much more effective than interest targeting.
  • Try to get into the mind of your target audience. Think of the people most likely to purchase, read, and appreciate your book. Which other books and products are they very likely to be shopping for now?
  • About 50 to 150 highly relevant products can work well, if you select them wisely.
  • It’s not just the popularity of the other product, but also how receptive those readers may be to your book.
  • It may be okay to add a highly relevant movie (on DVD or Prime, for example). This might help you break free of competition for ad placement.
  • It’s presently hard to make impressions with lower bids, say around 10 cents or less. Wise product targeting can help to make impressions.
  • Bid competitiveness is showing a few signs of possibly coming down in some categories. Patience may get your better return on your investment.
  • Here’s a new KDP Select tool that appears to reward higher-priced books. With a $100 budget and pay-per-click, earning a 34-cent royalty on a 99-cent book will have a really tiny short-term ROI. That doesn’t mean this can’t be useful to advertise a lower-priced book, just that doing so carries greater risk and requires much better long-term results to be worth it.

Chris McMullen

Copyright © 2015

Chris McMullen, Author of A Detailed Guide to Self-Publishing with Amazon and Other Online Booksellers

  • Volume 1 on formatting and publishing
  • Volume 2 on marketability and marketing
  • 4-in-1 Boxed set includes both volumes and more

Follow me at WordPress, find my author page on Facebook, or connect with me through Twitter.

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Feb 3 2015

“$EN$IBLE” ADVERTISING

Sensible Advertising

Images from Shutterstock

SENSIBLE ADVERTISING

Authors can now advertise their Kindle Select books on Amazon.com.

But is it worth it?

The minimum KDP ad campaign budget is $100 and the minimum bid is 2 cents.

You can also advertise on Facebook, Twitter, or Goodreads.

Or you can advertise a promotion with BookBub, E-reader News Today, and a host of similar sites.

Will this be money well spent?

Or would it be better sitting in your pocket?

CONTENTS

  1. Temptations
  2. Advertising Goals
  3. Advertising Budget
  4. Short-term ROI Expectations
  5. Other Considerations

1. TEMPTATIONS

If you try an ad with bidding options, you may find yourself tempted to make potentially foolish decisions.

Here’s what might happen. You might place an ad with a 2-cent bid, but when you check your reports, you might see very little activity.

So you might raise your bid to 5 cents. You might see a little more activity, but still very little.

Then you might try 10 cents.

You want to see something happen, right? This is the age of instant gratification, after all.

So the natural tendency is to keep raising the bid until something happens.

And when it finally does, you might suddenly get thousands of impressions and hundreds of clicks.

And before you realize it, your $100 is all gone.

With little to show for it.

Amazon Marketing Services is new to KDP, so thousands of KDP Select authors are playing with it. Many are bidding higher and higher just to see some activity in their reports.

Also, there may be delays, stalls, or bugs in the reporting. It may not be instant feedback.

Before you make a rash decision, you want to think this through. Try to make a wise and informed decision, with specific goals in mind.

Be patient. Especially with Amazon Marketing Services, since it’s new, if you just wait days or weeks, eventually things will settle down and a lower bid will get you more impressions for your money.

Thus, waiting may get you more bang for your buck. Remember, Amazon recommends a CPC (cost-per-click) bid of 5 cents, so in the long run, lower bids are likely to make many more impressions than they appear to be making right now.

2. ADVERTISING GOALS

The first step is to identify and rank your advertising goals.

Unfortunately, most advertisements do not pay good short-term returns when it comes to books.

So if your primary goal is to make a quick buck, advertising probably isn’t the tool you’re looking for.

You might take a sizable short-term loss when you advertise.

That’s the risk you take, with the hope that other benefits will outweigh the short-term loss.

But the short-term return is also worth figuring when weighing benefits against risks. Look later in this article for help figuring this.

Here are examples of goals that you might have with your ad campaign:

  • branding your book
  • exposure for a new book, series, or author
  • help promote a short-term discount
  • landing on a hot new release or bestseller list
  • initial sales
  • improved sales rank
  • long-term sales, recommendations, reviews
  • establishing a reader base

The hope is that if you take a short-term loss with paid advertising, there will eventually be long-term gains to make up for it.

If paid advertising always returned your initial investment, everyone would do it.

Here are some of the possible long-term benefits:

BRANDING

The ad itself is likely to create impressions. These impressions help with branding.

People who see your book multiple times over a long period are more likely to recognize it. People are more likely to buy products they feel familiar with.

Branding can lead to long-term sales, sometimes several months down the line.

SALES & RECOMMENDATIONS

Advertising tends to bring very many impressions, some clicks, and few sales.

The short-term sales may seem dismal. If so, you hope that branding makes up the difference several months later.

If you have a hot promotion going on, an ad may be somewhat more successful. But then you earn less royalty on the short-term sales.

Some authors actually pay for ads to promote freebies, often hoping to help build buzz for a new book and to generate word-of-mouth recommendations and reviews from early readers.

If your ad is successful at generating sales, long-term if not short-term, eventually those sales can add to your reader base, post reviews (only a tiny percentage though), recommend your book to others, buy more books you’ve written, follow you online and buy your next book, etc.

Every follower you add may potentially buy several of your books (but your book has to really merit this).

3. ADVERTISING BUDGET

How much can you afford to invest in advertising?

You’re obviously limited by the finances you have on-hand.

But even if you have money to invest, you should also ask yourself:

How much do you currently net in monthly royalties?

It’s a lot easier for an author earning $1000 or more per month on royalties to invest 10% of that in advertising than it is for an author earning $50 per month to part with $100.

Spending a fraction of your royalties on advertising is a reasonable investment. You have something substantial to show at the end of the month even if it’s a bust.

Spending more than your monthly royalties on advertising is risky. You might face a net loss, for all your hard work to write the book.

But you’re hoping to advance from low monthly royalties to medium or high monthly royalties, right? You’re hoping that the investment will help you move on up.

So consider my next question.

Do you have compelling reason to expect significant growth in your royalties (aside from the possible benefits of advertising)?

Will you be writing more similar books? If so, are you getting some consistent sales (even if it’s a very low frequency) with your current book?

Are you presently seeing an overall trend of growth in sales over a long period of time?

Ideally, you’d like some sort of evidence to suggest that your future royalties will help cover a possible investment today.

If not, it might be worth starting out with free marketing and publishing more books, to help build consistent sales.

Once you see evidence that future royalties may be enough to warrant your advertising expense, then you’re in a better position to try it.

But there are a few authors who really do their research (comparing similar books in the beginning), who have some marketing experience, etc., and who launch their books with a bang and have the confidence that it’s going to work out. Advertising is a risk, but if you have done your homework and you have such confidence, you must decide if you an afford this risk. The worst-case scenario is that it’s a bust. Can you afford that?

What are your book expenses?

Some authors invest a large sum of money on editing, cover design, formatting, and other publishing expenses.

(Maybe I should have written a post on $en$ible publishing expenses before writing this one…)

It’s tempting to think, “I’ve already spent several hundred dollars, so what’s another $100 on top of that?”

Well, if your book will make a $2 royalty, for example, that’s an extra 50 books that you have to sell to recover your expenses.

Especially, if it’s your first book, knowing that many stand-alone books don’t sell too many copies, that’s making an already big risk even bigger.

If you have more modest expenses, you still must factor them in when setting your advertising budget.

Your goals may factor into this, too.

Some authors invest a lot of money into their books and honestly don’t care about royalties.

A few authors actually donate their royalties to charity. A few don’t need the money, write merely as a hobby, and just want the readers, however they may come.

Most authors want or need those royalties for one reason or another, and so the financial aspect is significant to them.

But if you have unique goals, that can change your perspective on setting an advertising budget. (But at least consider things like living expenses, income, retirement, etc., i.e. make sure that you can afford to invest in advertising.)

Investing a fraction of your net monthly royalty income on advertising is reasonable.

The more consistent your monthly royalties have been and the more compelling reasons you have to expect growth, the better you can afford to invest a higher percentage of your monthly royalties.

4. SHORT-TERM ROI EXPECTATIONS

Short-term return-on-investment (ROI) can sometimes be quite low for book advertising.

For this reason, it really helps if you have other strong goals besides quick sales. You might not get any extra sales from your ad, and if you do, they might be fewer than you’re hoping.

Here are two typical numbers to be aware of:

  • 0.1% ctr (click-through rate). You may average 1000 impressions per click. Some ads do better, some worse, but this is fairly common.
  • 1% closing rate. You may average 100 clicks per sale. This figure can vary quite a bit, but 1% is respectable.

So if you run an ad and it creates 100,000 impressions, for example, you might get 100 clicks and 1 sale (on average).

Ideally, if you’re investing $100 or more, you’d like to create several hundred thousand impressions so that you might receive hundreds of clicks and hopefully a few sales.

The impressions and clicks help you with branding and exposure, so the hope is that these numbers will help in the long run, even if the short-term ROI is quite low.

Or, for authors running hot promotions, trying to climb onto hot new release or bestseller lists, those few extra sales, if they can get them, may make the difference.

With KDP’s ad campaign through Amazon Marketing Services, you only pay for clicks.

In this case, if you aim for a 1% closing rate (sales divided by clicks), with a $100 budget, here is how your short-term ROI relates to your average CPC (cost-per-click) bid:

  • An average 2-cent bid gives an estimated ROI of 50 times your royalty.
  • An average 3-cent bid gives an estimated ROI of 33 times your royalty.
  • An average 4-cent bid gives an estimated ROI of 25 times your royalty.
  • An average 5-cent bid gives an estimated ROI of 20 times your royalty.
  • An average 10-cent bid gives an estimated ROI of 10 times your royalty.
  • An average 20-cent bid gives an estimated ROI of 5 times your royalty.
  • An average 50-cent bid gives an estimated ROI of 2 times your royalty.

So if your book royalty is $2, if you can achieve a 1% closing rate, you could actually break even. Not all books will achieve a 1% closing rate though.

Amazon’s recommended CPC bid is 5 cents. If your average bid is 5 cents, you earn a royalty of $2, and you achieve a 1% closing rate, your estimated short-term ROI would be about $40. That’s a $60 short-term loss, with potential long-term gains. If your ad runs its full course and you get all 2000 clicks, you might make a couple hundred thousand impressions, which may help with branding.

If you earn a higher royalty, like $3 or $4 per book, this allows you to bid somewhat higher, or you can go with the recommended bid with higher hopes for returns.

Especially, if your book normally sells on its own. If not, you’re probably less likely to see that 1% closing rate. Advertising probably isn’t the answer to, “Why isn’t my book selling?”

If you can achieve a higher closing rate, like 3% to 5%, this nets you a higher short-term ROI, or you can afford to bid more. But you won’t know what your average closing rate is until you’ve run ads and have received several hundred clicks. If you get a lower closing rate, like 0.1% to 0.5%, this will give you a much lower short-term ROI.

Bidding higher will probably help your ad make impressions faster and get clicks faster, which means that your ad will be over sooner. You also get fewer clicks overall with higher bids, which means a much lower short-term ROI.

If you have a hot short-term promotion to advertise, it might be worth bidding high enough to make all of your impressions while your book is on sale. But remember, you get fewer clicks and a much lower short-term ROI by doing so. More of your hope is on long-term dividends.

If you earn a small royalty, like 34 or 70 cents, your ROI is much less. Your ad is much more likely to have a dismal short-term ROI. But if you succeed in getting many extra sales, albeit at lower royalties, there could be some long-term benefit. Your lower price won’t necessarily net you significantly more sales, though. You really need to supplement freebies and Countdown Deals by free marketing (e.g. relevant bloggers helping to spread the word) or other directed paid marketing (like BookBub and E-reader News Today) to get the most out of a free or sale price. In this case, a KDP ad campaign should just be one of your promotional strategies.

High bids, like 20 cents and up, are very risky. These eat up your clicks faster and pay much smaller ROI’s. You really need a compelling reason to take this large short-term loss. Maybe if you have a large following, the next book in your series has good prospects of hitting the hot new release or bestseller lists, and you want to go all out for every last sale in case it makes the difference.

5. OTHER CONSIDERATIONS

There are many factors involved in advertising, including:

  • more books: The more similar books you have, the more potential benefit there is. Customers might buy more than one book.
  • current sales: Books that sell on their own are more likely to benefit from advertising. Spending money on ads isn’t likely the magic cure.
  • reviews: Do you have enough to attract readers and to minimize the risk from one bad review?
  • targeting: Advertising tends to be more effective when you reach your specific target audience. On the other hand, if your targeting is too narrow, you might not make a significant number of impressions. It pays to do some research.
  • cover: A cover that clearly signifies the genre and attracts your specific target audience (even in the tiny ad thumbnail) has a distinct advantage.
  • product page: The better your blurb and Look Inside, the better impact these will have on your closing rate.

Monitor your ad. You can pause your ad if things aren’t progressing as desired. You can even terminate your ad, if necessary. If you’re not happy with the results, try editing your ad (though not every option may be editable).

Keep an eye on your product page and on your ad stats. You might see the money vanishing rapidly without results to show for it, for example. If you catch this early on, you can at least try changing your ad up or pausing it, rather than just let your entire budget run its course.

SICK OF AD ARTICLES YET?

I’ve been fascinated with this new option to advertise KDP Select books with Amazon Marketing Services, and so I’ve now written several articles on the subject.

You’re probably sick of reading about it on my blog.

Well, don’t worry.

I have some different topics coming up. 🙂

Though eventually when I have a good statistical sample of data, I’ll probably report it. It will be a while before that day comes, however.

Chris McMullen

Copyright © 2015

Chris McMullen, Author of A Detailed Guide to Self-Publishing with Amazon and Other Online Booksellers

  • Volume 1 on formatting and publishing
  • Volume 2 on marketability and marketing
  • 4-in-1 Boxed set includes both volumes and more

Follow me at WordPress, find my author page on Facebook, or connect with me through Twitter.

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Jan 29 2015

Tracking Views at Amazon—Finally..?

Image from ShutterStock.

Image from ShutterStock.

TRACKING VIEWS AT AMAZON

Don’t you wish that you could see how many people are viewing your book’s product page at Amazon?

Then you’d be able to see how good your blurb and Look Inside are at closing the deal, or how well a promotion is working.

Well, now you can get tracking data at Amazon.

Amazon marketing services is now available for books enrolled in KDP Select.

For as little as a $100 budget and bids of 2 cents, you can advertise your book on Amazon.

Visit your Bookshelf and click the link under the KDP Select column called Promote and Advertise.

When I did created an advertisement this morning, I received an approval email that said:

  • “Please allow 1 day for clicks/impressions to appear…”
  • “…and 2-3 days for detail page views to appear.”

IMPRESSIONS AT AMAZON

This will show how many impressions are made all together. That’s the number of times that your ad is shown to potential customers.

You don’t pay for impressions that don’t result in clicks. You only pay when someone clicks on your ad.

But every impression helps with branding and discovery.

CLICKS TO YOUR BOOK

Divide your budget by your bid. That’s the minimum number of clicks that you’ll get if your entire budget is used up. (If it’s not used up and you’d like it to be next time, either increase the duration or try a higher bid.)

For example, a $100 budget and 2-cent bid will give you 5000 clicks if the entire budget is used up. (First convert 2 cents to $0.02. Then divide.)

But you’ll get even more impressions. You might get tens of thousands of impressions or more for your $100.

AMAZON CLICK-THROUGH RATE

Compare your clicks to impressions to compute your click-through rate. That is, what percentage of the time do people who see your ad click on it to view your product page?

click-through rate = ( clicks / impressions ) x 100%

The smaller your click-through rate, the less effective your cover is at attracting the audience who is seeing your ad. The problem is either that the cover doesn’t appeal to your audience, or you’re not targeting your ad to your specific audience effectively.

VIEWS AND CLOSING RATE

Amazon will evidently also show how many people are viewing your detail page. This is valuable info that many authors have requested in the past, but never had access to. Now there is a way to get this data.

Compare your sales to views to compute your closing rate. This shows how good your blurb and Look Inside are at sealing the deal once traffic arrives at your product page.

closing rate = ( sales / views ) x 100%

The smaller your closing rate, the less effective your blurb and Look Inside are at selling your book.

TARGETING CUSTOMERS

Amazon Marketing Services offers two ways to target traffic:

  • target by product
  • target by interest

When you choose interest, select the category that’s the best fit for your book. The choices are fairly broad, so unfortunately you’ll also catch some people in the category who aren’t in your subcategory, but the targeting does help to deliver your ad to a narrower audience.

When you choose product, you can find similar books (or relevant products) and target your ad to customers who view those products (or perhaps who have used those products in the past). You can choose multiple products.

BOOK DATA AT AMAZON

KDP Select authors can place an advertisement and, in addition to any benefits of the ad itself, receive valuable sales information regarding their books.

It may be helpful for planning your next book.

It might help establish whether something you’ve changed recently is helping or hurting.

It might help you see how well a promotion is doing.

It’s valuable data that we didn’t have before.

Once you run more than one ad at different times, you have some basis for comparison.

However, this tool may be more effective in the beginning, while it’s still new to customers and other authors.

AMAZON MARKETING SERVICES

Advertising isn’t a band-aid for a book that doesn’t sell on its own.

Advertising isn’t a substitute for learning how to market a book effectively.

Advertising is more helpful for authors who have multiple books out and already have some positive marketing experience.

Advertising is better when you supplement it with free marketing strategies.

Advertising is more effective when it’s targeted well.

Advertising is more effective when your cover is visually attractive to your specific target audience, and when it reveals the genre or subject very clearly.

Advertising may riskier when you have few reviews.

Advertising directly on Amazon.com is potentially much more effective than marketing on Facebook, Twitter, or Goodreads. Instead of asking people to stop whatever they’re doing with their social media and hop on over to Amazon, now you’re showing your ad to people who are already shopping at Amazon.

Advertising can help you brand a name.

Advertising does carry a risk. Weigh the benefits and risks carefully. The worst-case scenario is that you’re out $100 with little to show for it. Can you afford that risk? What are you doing to supplement the advertising to help minimize this risk?

Chris McMullen

Copyright © 2015

Chris McMullen, Author of A Detailed Guide to Self-Publishing with Amazon and Other Online Booksellers

  • Volume 1 on formatting and publishing
  • Volume 2 on marketability and marketing
  • 4-in-1 Boxed set includes both volumes and more

Follow me at WordPress, find my author page on Facebook, or connect with me through Twitter.

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Jan 29 2015

Advertise Your Book on Amazon—New Opportunity

Background image from ShutterStock.

Background image from ShutterStock.

ADVERTISE ON AMAZON

There is a new opportunity available to advertise your book on Amazon.

https://kdp.amazon.com/help?topicId=A2DJUTY13KIH2C

How would you like to advertise your book directly on Amazon.com?

That would be cool, huh?

What if you could do this on a modest budget?

Even better!

Well, now you can:

  • minimum campaign budget is $100
  • minimum bid is 2 cents
  • pay per click

But there’s a catch:

It’s only open to KDP Select authors.

I think it’s a nice benefit for enrolling in KDP Select, on top of current benefits like Kindle Unlimited.

So if you bid 2 cents, a campaign budget of $100 can net you 5000 clicks.

Higher bids are more likely to result in advertisements being shown and result in clicks. But then you get fewer clicks for your money, also.

I like that the charge is per click. You’re not charged when people see your ad, but don’t click on it.

This helps with branding. However many clicks you get, even more people who didn’t click on your ad saw it, which helps you brand your image.

Another nice feature:

targeting

Amazon will let you target your advertisement to a specific genre, for example. This helps your ad reach a specific target audience.

Compared to advertising on Goodreads, Twitter, or Facebook, advertising on Amazon doesn’t drive traffic to leave one site and visit another. These customers are already on Amazon. That’s cool!

BOOK ADVERTISING

Advertising expenses often don’t produce immediate results for book sales. Unlike paper towels, there are millions of other books to choose from.

Some of the most effective book marketing you can do is free. If you make the most of your free marketing potential, advertising will supplement this.

The more books you have out, the more potential paid advertising has. Then someone who clicks on your ad might buy several of your books instead of just one.

But with a minimum bid of 2 cents and campaign budget of $100, advertising on Amazon isn’t too expensive of a risk. Nobody wants to throw $100 away though. (If you do, feel free to borrow my trash can.)

It’s even more important to have a compelling cover that conveys your genre clearly. This will help you get clicks with your ad.

And it’s even more important to have a great blurb and Look Inside. This will help you close the deal once you get the traffic.

And it’s even more important to have a great book, as good as you can make it. This will give you your best chances when it comes to reviews and recommendations.

Another thing that might be worth doing is waiting until you have several reviews before you advertise. You’d hate for one of your first reviews to be a real stinker shortly after paying for an advertisement.

Last tip: Consider putting your book on sale with a Countdown Deal. Then you have something more compelling than just a link to your book.

HOW TO DO IT

The book you wish to advertise must be enrolled in KDP Select.

Visit your KDP Bookshelf.

Click the Promote and Advertise link under the KDP Select column.

Click the Create an Ad Campaign button.

This will take you to Amazon Marketing Services, but it will say Return to Kindle Direct Publishing at the top of the page.

Select one of your books.

Target your ad by product or by interest.

  • By interest lets you choose one broad category. Unfortunately, it doesn’t appear to let you select a subcategory.
  • By product lets you target similar books or products on Amazon. Note that if your book already appears on the first page of the Customers Also Bought list, people viewing those books are already seeing your book. That doesn’t mean you shouldn’t include those books, especially if they’re highly relevant; the additional ad might make the difference. It’s just something to consider.

You can select multiple interests or products (but not both interests and products). I would select several similar products, but I would only select one interest.

The remaining steps should be straightforward.

If you try it, good luck. 🙂

Chris McMullen

Copyright © 2015

Chris McMullen, Author of A Detailed Guide to Self-Publishing with Amazon and Other Online Booksellers

  • Volume 1 on formatting and publishing
  • Volume 2 on marketability and marketing
  • 4-in-1 Boxed set includes both volumes and more

Follow me at WordPress, find my author page on Facebook, or connect with me through Twitter.

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Oct 17 2013

Book Marketing through Paid Advertisements

Fourth Quarter Pic

The first question is whether or not it may be worth paying to advertise a book. See my previous post for more information on that.

Once you decide to advertise, there are many advertising services to choose from.

What you really want to know when making this decision is this:

  • What percentage of the people who see your advertisement are in your book’s target audience? Don’t buy advertisements that aren’t effective at reaching your target audience.
  • How many people are likely to see your advertisement? (It will certainly not be 100% of the readership or viewership. It will only be a fraction of the published circulation number.)
  • Do the possible additional short-term sales and/or long-term prospects outweigh the costs of the advertisement?
  • How good will your advertisement be (image, strapline, and any additional description)? Will it interest your target audience? Your advertisement needs to be marketable and geared toward your specific target audience in order to be effective.
  • Is your book highly marketable? Advertisements won’t help a book that lacks marketability.

There are many different ways to advertise.

Social media sites like Twitter and Facebook offer advertising which is geared toward businesses hoping to get views (branding), clicks (visits to their websites), Likes (popularity), Follows (interest), and reposts or comments (interaction). The question is whether or not you can effectively target your audience and, if so, how responsive those people will be to an advertisement for a book in this context. Note that Twitter lets you target followers of specific people (could be authors of similar books). If you’re going to target a category, make sure it’s a very good match for your specific target audience (targeting books or readers, for example, is way too broad to be effective).

Goodreads has a similar advertising structure compared to Twitter and Facebook, while being focused on books and reading. On the other hand, there are several authors and publishers advertising on Goodreads, and many of these ads look highly professional and flash different images to get attention. The basic self-service advertisement (which is much cheaper) shows a very tiny image (it says 50 x 66 pixels) and is static. It may be tough for indie authors to compete with advertising on Goodreads. However, the giveaway program is much less expensive (just the cost of the book plus shipping). You might not get any reviews or sell any books through a giveaway (it happens), but you might get a few hundred to a thousand (or so) views. This is an affordable way to gain some exposure, create a little buzz, and help a little with branding. The possible long-term benefits may be worth the small investment even if the giveaway doesn’t help with short-term sales or reviews.

There are a variety of websites and email newsletter subscription services that may be helpful for short-term promotional discounts (not necessarily free). Examples include BookBub, Ereader News Today, Kindle Books & Tips, Book Gorilla, Book Blast, and Pixel of Ink. Note that some of these specifically service e-books. Some of these services have minimum average-star or other requirements, but some don’t. These services can be very helpful in getting more exposure from a free promotion, and can also help to promote a sale that isn’t free. (In the case of a freebie, you have to ask yourself if you really want to invest money in the advertisement on top of giving away books. If you’re going to advertise, it might seem desirable to recover some of the investment quickly with some early royalties. If you have a series, though, a promoted freebie may lead to sales for the other books in your series.) Yet another consideration is whether the market is primarily in the US, UK, or elsewhere.

You can find many other websites online where you can advertise. Search for online websites, magazines, newsletters, and activities that are likely to attract your specific target audience. If you can find a place to advertise that’s a good fit for your target audience, that may turn out to be more effective than going with websites with bigger names.

Another route is the blog tour. Depending on the tour, it may be better for you to plan ahead and try to contact bloggers individually. Also, people you follow and interact with regularly may be more receptive, since you have a rapport together and often support one another, than a stranger; this also gives you more insight into the blogger and lets you see firsthand how many active participants there are on the blog and how many of those are a good fit for your target audience. If you’re looking for exposure from bloggers, you definitely want to ensure that the blog is a good match for your specific target audience.

There is also the potential for offline advertising, like small newspapers, magazines, and circulars. Once again, the magic words are “specific target audience.”

Research the advertising service.

Advertising services generally publicize relevant statistics, such as:

  • Size of the viewership, readership, or circulation.
  • Classification of the circulation by genre (e.g. what percentage is mystery, romance, fantasy, etc.).
  • Average percentage of views, clicks, Likes, follows, or sales. The average isn’t a guarantee, but is a compromise between ineffective and highly effective advertising. The marketability of your book and of your advertisement are very important, as are additional promotional activities (especially, free and low-cost marketing to supplement your advertisement). Some authors who have large fan bases to begin can drive these averages up.

Even if you don’t have any intention of advertising on Twitter, Facebook, or Goodreads, it’s worthwhile to check out their advertising options because they have a lot of helpful information and tips. Also, when you check out the stats of other advertising services, you can compare it to the information that you see at these websites. Any data you find here will give you some type of benchmark, like the average percentage of clicks at Goodreads.

In addition to numbers, try to find authors who have used the service and learn what they have to say about it. (Another issue is how much you can trust the published numbers.)

Only a fraction of the circulation number will see your advertisement.

The first question to ask yourself is how much of the circulation consists of other authors. Authors who want to advertise with an email newsletter probably subscribe to it first as readers to check it out.

However, authors are readers, too, and many indie authors are likely to read other indie books when they aren’t writing. So to some extent it’s okay if there is a healthy percentage of authors in the circulation. But it’s probably desirable to have many readers who aren’t authors in the circulation, too.

Many people won’t open an email newsletter that they have subscribed to; or they may only open it once in a while—e.g. when they happen to be in the mood for a book.

No matter how you advertise, some people in the circulation won’t see your ad. Even on television, some people watching the show will be in the bathroom, cooking, or on the telephone during a commercial. In a magazine, most people who read it won’t see every page. And so on.

Of those who see an advertisement, only a tiny fraction will actually click on it, visit the website, Like a page, Follow you, or buy a book. Just the percentage who click on it compared to those who see it is typically very low—although this number can vary considerably depending on the marketability of the book and the effectiveness of the advertisement. It can also vary considerably from one advertising service to another.

Gear your advertisement toward your specific target audience.

Any image in your advertisement needs to attract your target audience. It’s just as important as cover design is for marketability. The image might even be your book cover (but not necessarily). Check the size of the image, aspect ratio (you definitely don’t want this to be distorted), and quality (e.g. pixilation). Ensure that the text is legible and crisp on the photo for the ad.

You need a good strapline that’s likely to draw interest from your target audience. If you’re advertising a short-term discount, contest, or free content of some kind, for example, this may draw more interest than simply advertising your book.

Check all of your writing very carefully. Any mistakes in the little writing you do in the advertisement won’t bode well for the quality of thousands of words written in a book. Remember that the goal of any writing in an advertisement is to catch the interest of your target audience and make them curious for more. Get feedback from others (especially, in your target audience) before placing your ad.

The cost of an advertisement can be calculated in different ways.

Some services charge a flat fee—e.g. $80 to place the ad.

Some services charge a fixed fee that depends on choices you make, such as the price of your book. For example, it might be $60 to place an ad for a freebie, $120 if the price is 99 cents, or $180 if the price is $1.99.

Some services charge a fee based on activity (like a fee per click, or a fee per Like or Follow).

Some services require you to bid on the ad. For example, you might bid 5 cents to a few dollars. In this context, different ads compete with one another for the chance to be viewed. You can usually place an upper limit on your daily spending and/or on the total amount for your campaign. For example, you might bid 25 cents for the ad with a maximum daily limit of $5.

When you bid on your ad, very often views of the ad are free, but you pay based on activity (e.g. a click, Like, or Follow). In this case, your ad may actually benefit from hundreds of views without any charge to you. What percentage of people view your ad actually click, Like, or Follow can vary significantly depending on the effectiveness of the ad and the content you’re advertising. Also, at some sites, clicks, Likes, or Follows are much more likely than at other sites.

The bid is usually the maximum that you’re willing to pay, and will often be less. For example, if you bid 50 cents for the ad, sometimes you may be charged less than 50 cents (any number from the minimum bid to 50 cents). Your ad competes against other ads in an auction format, so when you bid 50 cents, you’re basically saying, “50 cents is the most I’ll pay, but if possible I’d like to pay less.”

I recommend starting out at the minimum bid with a cap on your daily spending. Monitor your stats for a few days before raising your bid. This way, you can see what effect your bid has while keeping the risk low in the beginning. If you’re happy with the results, then you can safely avoid higher bids.

Don’t rely on the advertisement to do all the work for you.

I discussed the need to supplement advertisements with free and low-cost marketing in my previous post. Advertising isn’t a substitution for the need to market your book; it’s a supplement that can help improve the sales of a marketable book.

How would you like to participate in a Black Friday type of sales event designed specifically for books? Check out Read Tuesday. It’s going to be HUGE!

Chris McMullen, author of A Detailed Guide to Self-Publishing with Amazon and Other Online Booksellers, Vol. 1 (formatting/publishing) and Vol. 2 (packaging/marketing)