Amazon Ads Budget: How Much to Spend/Bid on a Campaign
When setting up an Amazon Ads Campaign you want to consider two things. The first is your ROI and the second is your total sales.
Your ROI is certainly important. You want to be profitable with any ad campaign you start. In the end though, total sales end up being more important.
The more sales you have the larger your audience and the larger your reach is. The more sales you have the better you do in Amazon’s rankings, and the more sales you have the more money you make.
If you want to bid conservatively you can bid $0.05 – $0.10 a word and you’ll be more likely to have a positive ROI. Bidding conservatively may lead to fewer impressions (displays of your ad) and fewer overall sales.
If you bid $0.25 or more per click you will get more impressions and you’ll likely find more profitable keywords to use in your ad campaign over time because Amazon will show your ads to more readers. These keywords may be more expensive but they will often lead to more overall sales.
Amazon will tell you the minimum budget for a campaign is $1/day. Derek thinks it’s best to budget between $3 to $5 per day for the first week. Derek likes a week of data to really tell how a campaign is going.
So for around $20 you can test a campaign and see how it’s going to go.
Setting up an Amazon Ads Campaign
You can setup a campaign from your KDP dashboard. What you want to do is start an ad campaign and choose a “Sponsored Product” campaign. From there choose the book in your dashboard you want to advertise.
At this point you can choose between “automatic targeting” and “manual targeting.” Manual targeting allows you tell amazon which keywords you want to advertise for.
Amazon will allow you to have up to 1,000 keywords in a campaign. It’s best to cast a wide net when choosing keywords for your campaign. In general, more keywords lead to more profitable campaigns because you never really know which keywords will convert browsers into buyers until you test it.
Amazon only charges you when people click on your ad. So if you have keywords that aren’t getting any clicks on your ads they won’t cost you anything.
Pro Tip: If you don’t have a paperback version of your book, get one, especially if you’re running an Amazon Ads Campaign. It’s true that Amazon ads will take you to the kindle book page, but Derek and I have seen significant increases in paperback sales as well as ebook sales when running Amazon ad campaigns. If you don’t have a paperback version of your book you’re just leaving money on the table (Here’s a free guide to get your book published in paperback with CreateSpace).
Keyword Research for Amazon Ad Campaigns
There are several different ways to approach keyword research when it comes to Amazon ads campaigns.
1. Look for popular authors and books in your genre. These will be good keywords to use in your campaign. Search across genres. Think about your audience. Who might be interested in your book?
2. Use amazon suggested searches. These are the searches that pop up as you’re searching in amazon’s search bar. Suggested searches are used a lot because they are what amazon has found people type in a lot to the search bar.
3. Use paid keyword research software. There are several software tools that give you information about what people are searching for on Amazon. There are links to some software in the links section below.
4. When you find a profitable keyword see if there are keywords related to that keyword that might also be profitable.
5. In general test out as many keywords as possible. You never know which keywords will be the best for you until you try them and find out.
Ways to Minimize Your Risk in an Amazon Ads Campaign
There are three ways to Minimize your financial risk when running an Amazon Ads
1. Bid conservatively – The first thing you need to realize is Amazon has built its ad platform so it’s really hard to spend a lot of money quickly, unless you bid high on your keywords. A reasonable bid for most categories if you’re just starting out is between $0.05 and $0.10 a click. This won’t be competitive for some keywords. But it’s a good starting point if you’re on a tight budget.
2. Cap your daily budget – You can cap your daily budget on an Amazon Ads Campaign so that no matter what, you’ll only spend a certain amount each day.
3. Set your campaign to run for a limited time – You can also set your campaign to only run for a certain length of time. This way you don’t have to worry about remembering to turn it off. This can be particularly effective if you set a daily cap on the amount you spend as well as setting an end date. If you set your budget to $3/day, and you set the campaign to end in a week, you know that you won’t spend more than $21 for your campaign.
4. Get educated – The best way to mitigate your risk is knowledge. The reason most people lose money when trying a new advertising strategy is they dive in without knowing how anything works. Get educated before you start, and you will save yourself time, money and frustration.
How to Troubleshoot a Book that Isn’t Performing Well
There are two areas to consider if your book isn’t performing well with Amazon Ads.
1. The book page – Does the book have a cover and description that converts well? If the book page itself doesn’t convert well to start with, you’re going to end up paying for traffic that doesn’t give you the results you want.
2. The Keywords You’re Targeting – If you know a book page converts well the next place you want to look for problems is in the ad campaign itself. You want to make sure the words you’ve chosen are relevant to the book you’re advertising.
You also want to make sure the keywords you’re targeting aren’t too broad. If you choose a keyword like “book” you might get a lot of impressions and clicks but there’s no way of knowing where those people are coming from. It defeats the purpose of trying to define a target audience.
3. Change Your Bid – You may want to consider tweaking your bids. There are times when bidding less for keywords will actually lead to more sales. One of the factors Amazon uses when determining where and when to display ads is individual buyer preferences. Increasing your bids on keywords may help you get seen by people who Amazon would exclude because of their preferences.
How to Track Your Amazon Ads Campaign Once it’s Going
One major problem right now with Amazon Ads is the sales reporting is very poor. As of March, 2017, the Amazon Ads dashboard only gives you stats for your whole campaign on the day you check it. This means within Amazon’s dashboard it’s impossible to compare results over time.
This is why it’s important to take screenshots of your Amazon Ads dashboard on a regular basis so you can see if a previously profitable campaign has become unprofitable.
Derek suggests taking screenshots at least twice a week and as often as once a day. You should screenshot your overall campaign and keywords that are performing particularly well.
There are going to be ups and downs with book sales. You shouldn’t worry too much about daily fluctuations. You should look for trends over time.
When it comes to Ad Campaigns you really need at least a week of data, thousands of impressions and 100 clicks to come to any meaningful conclusions.
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