Amazon ads for books: what they cost, a careful first campaign, and how to read the results

This guide is about the ads themselves. Setting up the book on KDP (ISBNs, preorders, pricing, A+ Content, Author Central) is covered in how to launch a book on Amazon; do that first.

The ad types available to KDP authors

KDP's advertising help page says authors can choose between two self-service ad types. Amazon's book ads page adds a third, managed option.

For a first book, that leaves Sponsored Products. KDP lists the countries where KDP titles can be advertised: the US, Canada, Mexico, the UK, Germany, Italy, Spain, France, the Netherlands, India, Australia and Japan. Each country is a separate ads account, and ads for audiobooks are available only in the US.

Sponsored Products offer two kinds of targeting. Automatic targeting lets Amazon choose where to show the ad based on details about your book, and Amazon's guide suggests it for beginners. Manual targeting lets you pick keywords (phrases readers search) or specific books and genres to appear beside. You can also add negative keywords or books, so the ad does not show for searches you know are wrong for it.

Before you advertise

• The book must be on sale or on preorder in that country, and new: Amazon's moderation guide says used and refurbished books are not eligible.
• Add the book to Author Central. KDP says that when you claim a new pen name, it can take up to 48 hours to show in your ads account.
• Get the detail page ready. KDP's page puts it simply: a strong detail page can help convert clicks into a sale. A clear description, the right categories and keywords, A+ Content and some honest reviews come first, because every click you pay for lands there.
• Check the subject rules. Every book ad goes through a review Amazon calls moderation, usually within 24 hours and up to 3 business days. The moderation guide lists subjects with extra limits, including self-help, religion, politics and weight loss, so check the book ad policies first.

How billing works

Every fact here is from Amazon's Ads FAQ, its author guides and KDP's advertising page.

• Cost per click, set by auction. Seeing the ad is free; you are charged when someone clicks. You set a bid, the most you will pay for a click, and Amazon says that bid, along with how relevant the ad is to the search, decides whether your ad is shown.
• A daily budget, averaged over the month. The minimum is $1.00 a day. Amazon describes the daily budget as a daily amount you are willing to spend over a calendar month: at $100 a day you may receive up to $3,100 of clicks in a 31-day month. Spend is not paced through the day, so a small budget can be used up in minutes, and some days can run over while others run under.
• A ceiling you control. Amazon says the final cost will never be more than the amount you have set for the campaign's duration. Its author guide puts it this way: $10 a day for 30 days never exceeds $300 for the month.
• When your card is charged. First when you reach $1.00 of clicks, then each time you reach your credit limit, which starts at $50 and rises after each successful payment to $150, $200, $350 and finally $500. Any balance from the previous month is charged on the third day of the month.
• A temporary hold. Adding or updating a card places a $50 pre-authorization hold, which KDP says your bank releases within 3 to 7 business days.
• Each country bills separately. Campaigns in the US and the UK are two bills.

Amazon does not publish an average cost per click for books, and neither does this guide. Its author guides illustrate the auction with a bid of $0.75 beating one of $0.60 for the keyword "war novels," but that is an example of how bids compete, not a typical price. Your own average cost per click appears in your reports once the campaign runs.

You also choose how Amazon may adjust your bid. Dynamic bids, down only lowers your bid when a click is less likely to lead to a sale. Dynamic bids, up and down can raise it by up to 100% for the top of the first page of results and up to 50% elsewhere. Fixed bids use exactly what you set.

A cautious starter campaign

Here is one way to set up a first test so the most you can lose is a number you chose in advance. The dollar figures are an example, not Amazon's recommendation and not a typical result; pick amounts you could lose entirely without regret.

Amazon's Sponsored Brands guide suggests no end date, so you can watch and learn. If you might forget to check, an end date is your safeguard.

After about two weeks, which is when Amazon's author guide suggests adjusting bids, open the search terms report. Amazon's reporting guide says it shows the searches that led to at least one click. Searches that led to sales can become keywords in a second, manual campaign. Searches that spent money and sold nothing can become negative keywords. The guide recommends checking in every two weeks after that.

When to start? Amazon describes ads as useful before and after release. Many authors wait until the book has some reviews and test in the first 90 days.

How to read the results

ACOS, from Amazon's definition

Amazon's FAQ defines advertising cost of sales (ACOS) as your total ad spend divided by your total sales, as a percentage. Its example: spend $5 and generate $25 in sales, and ACOS is 20%. Return on ad spend (ROAS) is the same numbers the other way up: sales divided by spend. Amazon's ACOS guide adds that there is no definitive good ACOS, and that new campaigns tend to have a high one because they are new.

Why a book's ACOS needs one more step

For a book, "sales" in your ad reports is the full price readers paid, not what you earn. KDP's page says the ad account shows the total value of your books sold within 14 days of a click on your ad. You earn a royalty, which is a fraction of that. So the ACOS at which you break even is your royalty divided by the list price.

For many nonfiction authors, royalties are not the main return. If the book brings clients, talks or a team trained on your method, a campaign that loses a little on royalties may still be worth running. Decide that before you look at the numbers, and write it down.

Other things to know about the numbers

• The reports lag. KDP says order data can take up to 12 hours to appear, and payment failures and cancelled orders are removed within 72 hours. Do not judge a campaign on today's figures.
• The two dashboards disagree, by design. Your ads account shows only sales attributed to ads; your KDP reports show every sale. Paperbacks appear in ad reports on the day of purchase and in KDP reports when they ship.
• Pages read are counted separately. Ad sales do not include pages read by subscribers who borrow the ebook; KDP shows those as an estimated page count.
• Look at the whole book, too. Amazon's author guide suggests watching overall sales and TACOS, ad spend as a percentage of all your sales, along with reviews and sales rank in Author Central.

What not to do

• Do not advertise a page you would not buy from. Every click lands on your detail page. Fix the description, cover and reviews first.
• Do not put prices or customer reviews in ad text. Amazon's moderation guide lists both, along with unsubstantiated claims, among the things to avoid. Claims such as "bestseller" must be supported on your detail page, KDP says.
• Do not choose up-and-down bidding on a tight budget. It can raise your bid by up to 100%.
• Do not judge in the first days. Reports lag, and Amazon says new campaigns tend to show a high ACOS.
• Do not leave a campaign running unwatched. Set an end date, or put a check in your calendar every two weeks.
• Do not buy ads instead of readers. The same money could mail books to people who matter to your goal; the launch budget guide compares the options.

Scribe Media, which makes this site, sells book publishing and marketing services, and its book marketing page says Amazon ad campaigns are available to its authors through preferred partners. Everything above can be done yourself from your KDP account. If you would like a person to look at your launch plan, book a free consult.