Running an Amazon ad campaign can be a great way to introduce your book to new readers and increase sales, but there’s no denying that Amazon Advertising comes with a learning curve. Let this article serve as your introductory guide to effective Amazon ad campaigns. 

As of October 2020, you can run two types of ads through Amazon Advertising: Sponsored Product Ads and Lockscreen Ads. Sponsored Product Ads appear on relevant search result pages and individual product listings, while Lockscreen Ads are shown on readers’ Kindle lockscreens.

When creating either type of campaign, you’ll have the option to enter a list of relevant keywords that will determine which shoppers see your ad. Good keywords are words or phrases that your ideal reader might search on Amazon when looking for their next great read. For example, if you’ve written a sword-and-sorcery fantasy novel, then some of your ad keywords might include:

• epic fantasy

• magical quest

• Brandon Sanderson

• Lord of the Rings

• hero’s journey

Choosing strong keywords that are relevant to your book boosts the number of “impressions” your ad receives (i.e. the number of times your ad is shown to shoppers). The number of “clicks” your ad generates indicates how many shoppers clicked through your ad to view your book’s listing, while “orders” refers to the number of sales your ad has generated. 

From these three numbers — impressions, clicks, and orders — Amazon derives two metrics that determine the overall effectiveness of your ad campaign:

1: CTR (Click-Through Rate)

This is the ratio of clicks per impressions. Essentially, CTR indicates the percent of shoppers who, after seeing your ad, choose to click on it to learn more. The higher your ad’s CTR, the better.

2: ACOS (Advertising Cost of Sale)

This is the percent of your ad’s sale revenue that you spent running the ad. ACOS is calculated by dividing your sales revenue by your ad spend. The lower your ACOS, the more effective your ad.

With Amazon Advertising, ad spend is determined by the number of clicks your ad receives rather than sales or impressions. If your ad receives a large number of impressions but no clicks, then you won’t spend a dime. If your ad receives a large number of clicks but no sales, then you’ll be in the red.

Therefore, it’s important to ensure that your ad copy accurately represents your book and that your book’s listing (i.e. its description, reviews, cover, and inside look) effectively entices readers to purchase. 

Let’s create your first Amazon ad together…

After logging into your KDP account, scroll to the book you’d like to advertise and click the “Promote and Advertise” button. On the next page, find the “Run an Ad Campaign” section and choose the Amazon marketplace where you’d like your ad to run from the dropdown menu. Then select “Create an Ad Campaign”.

You should now have the option to choose which type of campaign you’d like to create, a Sponsored Product Ad or a Lockscreen Ad. Most writers choose to run Sponsored Product Ads for two reasons: 1) Only Kindle readers will see Lockscreen Ads, severely limiting the reach of your campaign, and 2) It’s very easy for readers to accidentally click on a Lockscreen Ad, which drives up ad spend and decreases profit. 

In this tutorial, we’re going to create a Sponsored Product Ad together. Ready to dive in?

Step 1: Name your campaign

Under “Settings,” give your new ad campaign a name. I recommend creating a naming system that will help you better identify your ads once you have multiple ongoing campaigns, such as: Book Title + Ad Type + Ad Focus + Date. 

Using this system, I might name my campaign “BYBWL SP Publ 7/20,” which indicates that this Build Your Best Writing Life campaign is a Sponsored Product ad launched in July 2020 that’s geared toward writers interested in self-publishing resources. 

Step 2: Choose your ad’s start and end date

If you’d like your campaign to run for a specific amount of time, then enter that information now. If you don’t know when you’d like your ad to end, simply choose “no end date.” You can pause or archive an active campaign at any time.

Step 3: Set a daily budget for your ad

Your daily budget is the max amount you’d like your campaign to cost per day. Setting a budget might seem daunting, but generating clicks (and thus, ad spend) on a new campaign is difficult. I’ll explain why in a moment, but suffice it to say that new campaigns rarely spend more than a buck or two per day.

Set your budget somewhere between $5 – $20, and you should be good to go. If you find that your ad is spending more than you’d prefer, you can always pause or edit your ad as needed. 

Step 4: Opt-in to manual targeting

Under “Settings,” you’ll be prompted to choose between “automatic targeting” and “manual targeting.” Automatic targeting allows Amazon to choose keywords for you based on information from your book’s listing. These auto-generated keywords are rarely as effective as those gleaned through active keyword research. Therefore, I highly recommend selecting manual targeting. 

Step 5: Set your campaign bidding strategy

A “bid” is how much you’re willing to spend should a shopper click on your ad. I’ll explain how to set an effective bid in Step #9. For now, simply decide your bidding strategy, or how you’d like Amazon to manipulate your bid based on the likelihood that you’ll earn a sale. You can choose between three bidding strategies:
 

1: Dynamic Bids – Down Only 

Choose this option if you want Amazon to lower your bid when your ad is unlikely to make a sale, which will prevent you from overspending on clicks made through non-competitive keywords.

2: Dynamic Bids – Up and Down 

Choose this option if you want Amazon to raise or lower your bid depending on the likelihood that you’ll earn a sale. Some writers don’t like this option because it offers limited control over how much Amazon might raise their bid.

3: Fixed Bids 

Choose this option if you only want Amazon to spend the exact bid amount you specify.

Step 6: Choose your ad format

Because high-quality sales copy can encourage shoppers to click on your ad (thus increasing the likelihood of a sale), I recommend selecting the custom text option in this section.

Step 7: Select the product you’ll advertise

You can feature one edition of a book in your ad campaign, so choose the edition you’d like to promote wisely. The menu provided in the “Products” section allows you to scroll through each edition of the books you’ve published through KDP. 

Step 8: Identify your targeting strategy

If you selected “Manual Targeting” in the “Settings” section, you’ll now see a “Targeting” section that presents you with two options: Keyword Targeting and Product Targeting.

I recommend selecting Keyword Targeting as this option allows you to target the largest number of potential shoppers via search terms. Choose Product Targeting if you’d prefer that your ad only be shown on specific product or category pages. 

Step 9: Add your keywords & select your bids

If you selected “Keyword Targeting” in the last section, you’ll now be prompted to add the keywords you’d like to target. Though you can choose from a list of suggested keywords that Amazon has generated based on your book’s listing, manually entering a list of relevant keywords that you’ve compiled via research will drastically increase the success of your campaign. 

Check out this article from Dave Chesson of Kindlepreneur.com to learn how to conduct effective keyword research.

Next, choose your bid (i.e. the price you’re willing to pay for clicks) for each keyword. Rather than using Amazon’s suggested bid, I recommend selecting “custom bid” from the dropdown menu and setting a very low bid (e.g. 11 cents, 16 cents).

Setting your bids low when creating your first ad campaign will help you build “relevance” within the Amazon Advertising algorithm, which I’ll explain in detail in the last section of this article.

When adding keywords to your campaign, you can also choose your keyword “Match Type” from among three options:

1: Broad — your ad may target any variation of keywords included within a keyword phrase (e.g. “steamy regency romance novel” may target “regency romance” or “steamy romance novel”)

2: Phrase — your ad will only target the exact keyword phrase or sequence of words within a keyword phrase (e.g. “Steamy regency romance novel” may target “steamy regency romance” but not “steamy romance novel”)

3: Exact — your ad will only target the exact keyword or phrase you enter (e.g “steamy regency romance novel” will only target “steamy regency romance novel”)

I prefer to select “phrase” and “exact” match types for my campaigns, since these options allow for moderate control over which shoppers see my ads.

Step 10: Exclude negative keywords (optional)

In the next section, enter any keywords you don’t want your ad to target. You might enter keywords that would exclude shoppers searching exclusively for free books or for unrelated products that bear a similar title or author name.

Step 11: Add your custom text

If you opted to add custom sales copy to your ad, then your last step is to enter this text. You only have 150 characters, so use them wisely.

What words would entice your ideal reader to dive into the pages of your story? If you’re promoting fiction, then try utilizing your story’s hook in your custom text. If you’re writing non-fiction, use your custom text to identify the pain point your book will help readers resolve.

Step 12: Preview & launch your campaign

Review your ad in the preview section, checking for any grammar or spelling issues and other mistakes. If all looks good to go, select “Launch Campaign” to submit your campaign for review. Most campaigns are moderated within 48 hours. If your ad is approved, then it should receive its first impressions within several days. 

You’ve now created your first Amazon book ad. Congrats!

It’s important to note that marketing your book on Amazon is not a get-rich-quick scheme. Building relevance within the Amazon Advertising algorithm takes time, which means you likely won’t make much profit from your campaigns for several months—or even upwards of a year. Why?

“Relevancy” is the metric by which Amazon determines whether your campaigns are worth showing to shoppers. The greater your relevance, the more impressions your campaigns will receive, thus allowing you to scale your ads to make far more significant income.

To build relevance, you need to prove to Amazon that your ads can generate a high CTR (click-through rate) and a low ACOS (advertising cost of sale). In other words, if Amazon sees that a high percentage of shoppers are not only clicking on your ads but buying the product you’re promoting, then they’ll increase the pool of shoppers who see your campaigns. The greater the reach of your ad, the more revenue the ad is likely to make. 

Building relevance doesn’t happen overnight. Instead, you must use your early campaign data to hone all of the factors that feed into the effectiveness of your ad: your book’s keywords, bid strategy, custom copy, book description, and even your book’s cover. 

Setting high bids when running your first ad will earn your campaign a large number of impressions. But if you haven’t targeted the best keywords or written the most effective sales copy, then your campaign will likely have a poor CTR and ACOS that kills your relevance within the Amazon Advertising algorithm. Digging yourself out of a low relevancy rating is much harder than slowly building strong relevance in the first place, so be patient. 

Use the first six months of advertising as a learning experience. Review your campaign statistics frequently, identifying which keywords are resulting in clicks and sales. Create multiple campaigns to test different sets of keywords and sales copy, and see what sticks.

If your ads aren’t performing well despite strong keywords, then consider revamping your book’s cover and description. Continue to study the data and hone your marketing strategy, and you’ll soon develop a powerful Amazon Ad strategy that helps you reach new readers and grow your sales.