Amazon Advertising, “You will never find a more wretched hive of scum and villainy”. *coughs* Okay!
Well a writer has the right to some hyperbole, and Star Wars quotes. But today we’re going to talk about some of the risks/pitfalls to be aware of when stepping into the murky waters of running ads on Amazon.
Now, I know a huge of percentage of writers aren’t at this point yet. Advertising is definitely something you should hold off on until you have multiple books for the sell through. But I wanted to show you one of the ways advertising companies can misrepresent data to make you feel like you’re performing much better than you are.
(FIRST NOTE: If any of the below goes over your head, you’re not ready for advertising yet. It’s a huge learning curve; learn about it before experimenting because it’s an expensive learning curve too.)
So, in the lead up to Christmas, I kicked on my advertising for GameNite, P.I. Penguin, and Christmas at Rosings. These three are the books that will do best over this holiday season and so are the ones worth giving an advertising boost.
If you look at the graph, the lines look like they’re performing relatively on par with each other. The green line is the SPEND (what the ads have cost) and the blue line is the SALES. There are a few days where the spend is less than the sales.
The trouble is, when Amazon counts your SALES they base it on the List Price. So when my ad sells a copy of GameNite, the ad lists the sales value as $9.99 on the US market, £7.99 on the UK market.
The thing is, list price is NOT what I take home from those sales.
I take home $3.69 USD on the US market and £1.90 on the UK market.
THIS is why that graph is ineffective. You HAVE to read the lines per advert to know if you’re doing okay. Don’t just assume that if you spent $30 AUD on your ad, and sales are $40 AUD that you’re making a profit. You very likely aren’t; except when you are.
Fortunately, GameNite ads actually are some of my absolute best. The $9.99 US which is only $3.69 US only cost 44c US. It has a high click to conversion rate for book one and the cost per click is only 15c. But it ALSO has two other books in the series with about a 75% sell through rate. So actually, that 44c earns me more like $11.00 US and Amazon Ads don’t count the sell-through rate.
Again, this is why your Spend to Sales is NOT an accurate figure.
Sadly, there is no way to have the Ads Dashboard show the actual earnings. So when you’re running ads you MUST compare the Ad spend to your Royalties Estimator. And remember that print sales don’t count royalties until they are shipped so your ad spend will always be a few days out of your earnings.
And when you’re working out if your ads are running at a loss or a profit, you’re not judging it from your ads dashboard, you’re judging it from your actual spend to income. Your cost per click. Your clicks per sale. Your impressions to clicks. etc.
Understanding Amazon advertising, is MUCH more complicated than it seems. I recommend not even trying it until you’ve spent a LOT of time studying how it all works. And then test the water’s slowly.
One last note: Some genres perform better than others when advertising. My YA novels can CHURN through the clicks but convert terribly. (I might need to hire a marketing pro to help me figure out why.)
And the biggest tip? First of series tend to be the best thing to advertise unless you have a seasonal (like my P.I. Penguin #5) because the sell through on series tend to make them likely to be the most profitable even if your initial cost per click is higher.
I’m still learning effective advertising. And it’s one of those things where it only makes sense once you’ve got several books into the world. But hopefully what I’ve shared with you today can help you navigate the churning waters. Or at least approach them with caution.
Wishing you the best of sales; and a happy holiday season!
