Is It Expensive To Run Ads?

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Amazon ads are not expensive if they earn back more than they cost. You pay per click, you set the bid and the budget, and the real question is the return. I start with a 15 cent bid, shut an ad down after it loses $2 and aim to break even. Below: how the math works, why break even is enough, and how I find keywords.

Is it expensive to run ads?

It depends on what you mean by expensive. If I charge you $10 and you get back $15, that was cheap. If you pay $1 and get 50 cents back, that was expensive. Your return on investment (ROI) tells you.

Amazon ads for KDP books are cost-per-click: you pay only when someone clicks, and you choose your bid per click and set your own budget. When you add a card, Amazon places a temporary $50 hold that your bank releases in 3 to 7 business days, and you are only charged for actual ad spend (Amazon Ads for KDP books).

When I started I thought ads were for big businesses. Then I took a cheap training on running ads and saw my earnings go up. Ads put your cover and title in front of possible readers again and again, and readers often need several views before they think about buying.

How do I work out the cost per sale?

With the royalty, not the sale price. A Kindle ebook earns 70% on Amazon.com for list prices from $2.99 to $12.99 (KDP list price requirements). Paperbacks pay 60% of list price at $9.99 and above, 50% below, minus printing cost (KDP paperback royalty).

A simple example: you make about $2 on a $3 Kindle book. At 10 cents a click, you need a sale every 20 clicks to break even. That is the math I look at, not the sale price. I’ve seen several of my ads make a profit, but profit on the ad alone is not the goal.

Why is breaking even on ads enough?

Because a reader you win is worth more than one sale. Many people buy later, or click and then buy the hardback, an IngramSpark version or my audiobook, and none of that is credited to the ad. I’m fine breaking even because I see my audiobook sales going up, and I get a reader I can put on my email list, who then learns to know, like and trust me and buys future books.

My rules: run ads at about 15 cents a click (it was 10 cents before competition pushed it up, so check what clicks cost in your category today), and if an ad loses $2, I shut it down. I’m willing to give an ad up to $2, which at 10 cents is 20 clicks without a sale. If one of those 20 clicks sells, the math changes. Reporting is delayed and sometimes wrong, but that doesn’t mean you shouldn’t run them. See Amazon ads for authors for my full method. If ads still feel too costly, content marketing is the cheaper way to build an audience.

How do I find keywords for my ads?

With Publisher Rocket. Type a keyword like “puppy training” and it lists related keywords you might not think of. Some rare keywords that seem unrelated still brought sales for me.

If you chose a niche that is profitable and not too competitive, it’s much easier to find keywords that pay. If you’re in a competitive niche and can’t run ads profitably, Publisher Rocket is how to find better keywords. You can also let Amazon do automatic targeting. Amazon says it “can help you learn as you go” if you’re new (Amazon Ads guide for authors). I set a maximum bid, let Amazon optimize, and watch closely. The tools I use for this are in my top 3 self-publishing tools.

Are Facebook and Instagram ads worth it for books, and is $100 enough?

For me they weren’t: I tested Facebook and other places, and they weren’t nearly as effective as Amazon. Meta does not name a budget that is enough, but its own help pages show why a small one struggles. A new ad set has to get through a learning phase first, and that usually takes about 50 results in the week after you set it up or make a big change.

Meta’s page About the learning phase says results are less stable and usually cost more during that phase, and that a significant edit sends the ad set back into it. If it can’t get enough results, Ads Manager shows it as “Learning limited”. So $100 is only enough if it can buy something close to 50 results in a week. If the result you pay for is a book sale, divide $100 by what one sale costs you through the ad and see how close you get.

Meta’s best practices for minimum budgets say to give each ad set enough budget for the result you choose, and that a purchase may need more budget than a landing page view. If you don’t want to spend more, Meta suggests choosing a result that is easier and cheaper to get.

On Amazon, by contrast, readers are searching for exactly the book they want, with their credit cards out.

I have run roughly $30,000 to $40,000 of ads through Amazon at a profit, but my profit has fallen over the years. Amazon opened book placements to sellers of physical products about a year before I made the video, so competition went up. Whoever spends the most on ads wins, which is why it matters to earn back on the back end, and having more books to sell helps you do that.

Should my ad go to a landing page or straight to Amazon?

This part is my advice. If you want a sale, send the ad straight to the Amazon book page. Every extra page is one more click a reader can drop out at. Use your own landing page when the goal is a newsletter sign-up instead.

Be careful with clicks on a “Buy on Amazon” button. They don’t show you sales, because you can’t see what happens once the reader is on Amazon. Amazon’s free tool for seeing that is Amazon Attribution. I explain what it reports in my post on Amazon Ads strategies for beginners, so I won’t repeat it here.

Have you started running ads? Tell me in the comments how they’re doing. If you’d like me to look at your ads and book listing, book a free 25-minute discovery call.

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