Being a self-published author on Amazon is like stumbling in the dark woods with one small pack of matches. Amazon has been very privy about the data they share with authors for years. I published my first book in 2013 and it was like that back then. Nothing really changed over the years.
Their Amazon advertising system (aka AMS) is not much different than the normal way they operate. There is some data, but most of them are useless and some of them are downright misleading.
I advertised hundred books with success. I have a 4-figure system that supports my family because I am able to read those figures and make sense of them. I’ll help you to navigate through the murky waters of AMS ocean of data.
This is how my AMS dashboard looks:
There is more data in the dashboard and I occasionally use them. But those five metrics are enough to tell me, at a single glance, if I’m in red or in green.
The main metric which should occupy your mind, hands down, is:
1. Impressions.
Impressions are the raw material of your ad campaigns. If you get only a trickle of impressions, you cannot get anything else. No impressions
Of course, it doesn’t mean that if you get oodles of impressions your ads will be successful. You still can lose a fortune. In fact, if you advertise the wrong way, a huge number of impression is the quickest way to bankruptcy.
Impressions are of the utmost importance because they are a fabric of your campaigns. You cannot have a piece of cloth without a fabric. The style means nothing when there is no fabric.
You must get impressions to move forward. Period.
How many?
Those are results for my least-liked book by Amazon. I say, 100,000 impressions a month for one book is about the minimum that provides meaningful information and chances for success.
You cannot see this on this screen shot, but those impressions were generated mostly by 61 ads.
Analyzing impressions at the level of the particular campaigns is usually a waste of time. If a single campaign won’t generate impressions in tens of thousands, this is just not enough data to make it analyze-able.
This is the first secret expert lesson: analyze your data on the book level, not campaigns level.
Well, most of the time anyway. Sometimes you may be interested in the performance of single campaigns or even single keywords, but those are exceptions, not a rule.
As a rule, 98% of your time you should analyze your AMS data at a book level or above – a series or your whole catalogue. Only then the data are aggregated enough to carry some meaning. At least, the meaning readable for us poor human beings.
100k impressions is the minimum. If I cannot generate 10k impression for a book in a day, I don’t feel like I have enough data to understand what’s going on with a particular book.
In fact, if I cannot generate 10k impressions, most likely it means that Amazon doesn’t like this book and it won’t get much traction.
2. Clicks.
Clicks are second in the order of importance only because they cannot materialize without impressions. People need to see your ad first, before they can click on it, don’t they?
Without clicks, there are no chances for sales, for readers, for your author career. They meant someone saw your ad, and it was interesting enough for them to click and check out your book.
A click also means you will pay money to Amazon. I’m not overly concerned when I get zillions of impressions and only a few clicks.
I’m
Here I smuggled another secret: the particular metrics rarely mean anything on their own.
Only in connection with all the others, they get a true meaning, which you can actually analyze. Having 10k clicks means nothing if you don’t match it with the number of impressions and sales.
The number of clicks alone means you will pay and nothing else. The more clicks, the more you’ll pay.
It also means that more people will land on your book’s page. This is important. The real book marketing magic starts here. When you write a book and put it out there, you can only guess how people will react. When they find your book, read the description, you get a taste of their reactions.
How many clicks do you need?
If your AMS ads are done correctly, as many as possible. When you earn money on your ads, even if it’s a cent per 10 clicks, you need more of them. However, scaling up has always been a mystery with AMS.
When I get 20 clicks per book a day, I’m happy. If I get 100 per day, I’m happier. If the book gets less than 10 clicks a day, the picture is too bleak to conclude something with certainty.
3. Impressions to Clicks.
This metric tells you how many of people who have seen your ads were interested enough to visit your book’s page. Authors agonize over this metric all too much. It’s ambiguous. I don’t care if only one person in 10k click on my ads, especially if one million folks see the ad every day and a third of those who click, buy the book.
This metric is ambiguous because it may be influenced by a number of factors:
-your cover,
-your review rating,
-your title,
-your subtitle,
-the ad’s blurb
-if the ad is displayed in front of the right crowd.
You have some control over the first five factors and they are the visible parts of the ad. If the cover is nice and catchy, you will get more clicks. If your title is interesting, you will get more clicks. If your review rating sucks, you will get less clicks.
The mishmash of those factors result in the final impressions to clicks conversion ratio.
And there is the 6th factor, which you control only to a degree. You have no idea where Amazon will decide to display your ads.
You may try to affect it by the selection of keywords you use, but it’s not a foolproof method.
You may target a title in your
You may have everything perfectly aligned – an awesome cover, great title and subtitle, 5-star rating and a wonderful blurb – but if Amazon puts your philosophical treaty in front of romance readers the crossover is meager. So is impressions to clicks ratio.
What is a good ratio?
I’m alarmed when it goes over 3,000 impressions per click. I’ve seen as low ratio as 300 impressions per click.
The smaller the ratio the better; you need only a fraction of impressions with 300 ratio to generate the same traffic you’d have needed with 3,000 ratio.
My rule of thumb, coming from experience is that anything below 1,000 means a perfect alignment of the audience and the ad. The ratio above 3,000 means the wrong crowd and usually no overall positive results.
4. Spend.
Cost is a direct result of the number of clicks (and the level of your bids, of course). Money is always important. The Spend metric in AMS is even more so, because this is the only real and absolute metric. All the others may be interpreted in this or other way. This one simply is.
Of course, it’s prone to interpretation, every metric is. If you earn a
For me nowadays, it would be a major headache to secure such an advertising fund. I had customers who cut their advertising budgets from $100 to $40 a month.
5. Sales.
Unlike ‘Spend,’ this metric in AMS dashboard is totally fake and almost meaningless without other metrics. I use it because I prefer it over ACoS, which is even more worthless.
This number says how much money Amazon customers (probably) paid for purchasing your books advertised via AMS. I will spell it for you very clearly:
THIS IS NOT THE AMOUNT OF MONEY THAT COMES INTO YOUR POCKET!!!
This is the amount of money that went out of your readers’ pockets. Why the heck does Amazon show it? The only two reasons that come to my mind are:
-because they are morons; (hint: they are not, they run multi-billion dollar company)
-because they want to lull you into thinking your ads are making money, so you spend even more, so they will make more mullah.
So, the first service this number does for me, is a reminder that Amazon is not my dear friend. Rather, it’s a big bully who is after my money.
If I wasn’t explicit enough – Sales metric of $10.49 means that a reader paid $10.49 for your book. Amazon will deduct various fees and their share out of that. You will get some leftovers (in this example – I get about $4.14 for $10.49 paperback copy).
Why use such a worthless and misleading metric? Well, matched with the number of orders it makes some sense.
For example, I advertise my book A Personal Mission Statement: Your Road Map to Happiness. The Kindle copy of the book is priced at $0.99. The paperback costs $10.49 and I make $4.14 on a single copy. Which is a dozen times more than I make on a Kindle.
AMS doesn’t distinguish if the orders were for paperbacks or digital copies. In case of this book 10 orders may mean that I made $3.5 or $41.4 depending on the version of the book. The Sales metric clarifies which scenario was more likely.
Also, if you have a good track record, Sales can serve as your real ACoS metric.
If you know that for the past three months the number of digital copies was 340 and the number of paperbacks was 70 (real numbers for personal mission statement book), you can calculate the estimated royalties out of your Sales presented in AMS.
I get about 37 cents out of the dollar in Sales for that book.
If your advertising catalog and strategy is fairly consistent, you can conclude even the rough overall ratio of royalties from Sales.
Which is quite significant! You can now compare this figure with the Spend metric and know at one glance (and a pinch of mental calculation) if your ads are making money or not.
6. Orders.
Oh, I’m so glad the mighty Zon provided this metric with their latest update to the AMS system. BTW, it’s notoriously inaccurate. Amazon representatives openly admitted that the orders shown in your AMS system may be for not your books, but someone else’s!
Yet, the inaccurate number of sales is infinitely better than lack of this number (which was the case in AMS from the very beginning till January 2019). Keep firmly in mind that the number of orders is estimation, not reality.
Like with almost every AMS metric, this one makes little sense in isolation. As I pointed out talking about the Sales metric, you don’t even know if they were orders for Kindle or paperback.
A tidbit here: The AMS system doesn’t register your audiobook sales.
I know for a fact that some clicks on AMS ads convert into audiobook sales. My audio had been selling only a few copies a month ‘before the ads’ era and they have been selling dozens of copies since I started advertising. But you will find not a blip in your AMS dashboard about this.
Recently I got a new client and I was happy with his results… till we compared his KDP figures with AMS figures. His AMS orders were 13% higher than his sales in the KDP dashboard.
Remember, the only true data about your sales and royalties, thus your revenue side of th e equation, are in the KDP.
This is how much you will earn. Everything in the AMS dashboard regarding your revenue side is just a hazy picture that may or may not be true.
This metric is very useful when you couple it with other metrics. For example, Impressions to Orders will tell you how many impressions you need to generate a sale. It may affect your bidding decisions. However, it’s best served with Clicks.
7. Clicks to Orders.
This is the ultimate profitability metric. It’s a shame Orders are not really orders of your book.
Well, we need to work with what we have.
This metric is the ultimate one because it finally connects two numbers that should be the focus of every advertiser: cost and profit.
It says how many clicks you need to generate a sale. You know the royalty share you get per a copy of your book.
For The Art of
My Clicks to Orders ratio (CTO) for this book in the last few months was 2551/95=26.85
So, I need 27 clicks on my ads to generate a single sale. Here is the magic: I divide $4.2 by 27 and get 15.5 cents. This is the average bid that will guarantee to break even on this book, assuming that nothing else changes.
If my clicks will cost me 16 cents, I’ll start losing money on advertising this book.
OK, now that you are bored to death with math, I will give you the breakdown.
I’ve seen a whole range of values for this metric for my books and my customers. I’ve heard stories about some crazy values for other authors.
Generally, the lower CTO the better. Of course you would love to have a sale for every click on your ads!
I consider anything below 20 CTO a golden mine. CTO of 21 to 25 is OK, and most of the books I advertise land in that range. 26 to 30 is making my life complicated and anything above 30 is a minefield.
There are some exceptions. I have a customer whose Kindle is priced at $8, so he makes $5.5 on a copy and $10 on a paperback. His CTO is about 32. He can afford that.
Another customer of mine has a CTO as high as 37. His ads are profitable because his average cost per click is a meager 6 cents.
The point is CTO allows you this kind of math. You can finally get a clue how much should you bid to earn money instead of donating it to Amazon.
8. Average CPC.
I don’t have this cost in the main dashboard, but it’s my favorite supplementary metric. As I demonstrated in the previous point, you need to know how much you are paying for clicks to figure out how many clicks you can afford to generate a sale.
I like to filter the dashboard by a
Obviously, the lower Average CPC, the better for you. You can afford lower prices of your books. You can afford sloppy copywriting. Low CPC gives you more leeway. The whole art comes to generating enough impressions to generate enough clicks at those lower bids.
It’s an art indeed, and it’s very tricky for fiction authors. I bid 50-100% higher for fiction books to generate the same volume.
Another obvious, but often overlooked, observation is that your Average CPC is always lower than your bids. The AMS system is an auction system. You don’t always pay your highest bid. In fact, it happens quite rarely.
So, expect your Average CPC to be about 65% of your bids.
It’s not an exact science, but it gives you the idea for your initial bids level.
The goal is to earn more than you spend. You need to be smart to achieve this. Don’t be another starving author who donates money to Amazon. Get a grip over those metrics. It significantly increases your chances for success.
The Breakdown
OK, here comes the rapid breakdown, without excessive ruminations.
1. Impressions.
Says a lot about how much Amazon likes your book.
100,000 impressions per book per month is an absolute minimum to
a) achieve any meaningful results
b) not be misled by some random data flukes
From 10,000 impressions a day per book starts the ‘real data’ range. Anything less is just too little for making informed decisions.
2. Clicks.
10 clicks a day per book is a minimum to read the data without a crystal ball. The more, the better.
The number of clicks directly translates into your costs and number of people landing on your book(s) pages.
Clicks mean much more when correlated with other metrics.
3. Impressions to Clicks.
The lower, the better. Below 1,000 means a perfect alignment of the audience and the ad. The ratio above 3,000 means the wrong crowd and usually no overall positive results.
This metric says also things about the quality of the elements of your ad per se – the cover, title, subtitle and the blurb.
4. Spend.
The only reliable metric (next to clicks that translate to Spend) in the AMS dashboard. Amazon is very good at tracking your Spend because that’s their revenue.
5. Sales.
A reminder that Amazon is not your dear friend.
Absolutely worthless metric on its own. Helpful in determining the ratio of Kindle and paperback copies in your sales.
Having a lot of historical data, it may be use to assess your royalties at one glance.
6. Orders.
It’s assessment, not a reality. A good metric to break down Sales into Kindles and paperbacks.
A good metric to use with other metrics.
7. Clicks to Orders.
This is the ultimate profitability metric. Tells you exactly how many clicks you need to cash your royalties from a sale.
Anything below 20 CTO is a gold mine.
CTO of 21 to 25 is OK, and most of the books I advertise land in that range.
26 to 30 is making your life complicated and anything above 30 is a minefield.
8. Average CPC.
Coupled with Clicks to Orders it’s the best metric to dictate your bidding decisions.
I personally love to see ACPC below 13 cents.
I’M SLOW BUT AFTER GOING THROUGH THIS A FEW TIMES, I GET IT!
Great content! Thank you.
One question, what if you calculate your clicks per profit rate. Says that’s 15p per click. So anything over that means a loss. However, what if you are in the situation that bids lower than this rates don’t create impressions? This means that you have to raise the bid rate to get the impressions but this advertising at a loss.
Thanks, John.
Right, John.
Then, you either accept loss for the sake of gathering data, or optimize your book page, so it converts better, or try to target more precisely, so it takes less clicks to generate a sale.