Why AMS (Amazon Marketing Services) don’t work

Amazon Marketing ServicesSome time ago, Amazon launched their Amazon Marketing Services. This service enables authors to run advertising campaigns for their books. I decided to give this a try to see what the results would be although I had read already in several forums that most of the people who tried this were not very successful.

I decided to take 6 of my books and let it run for about 3 weeks. I decided to use product targeting. For that, you type in one or more keywords and Amazon proposes you a list of books and other products that are related to your keywords. In my case, I just went with the 146 products that Amazon proposed for each book.

I ran this from 23 Mai till 15 June 2015. And here are the results :

amazon marketing services stats

amazon marketing services stats

To summarize, for the 6 books I got 170.300 impressions resulting in 122 clicks at a total cost of $8.39 and….. 1 sale. Which made me $2,10 . In short, I lost $6,29 with this little experiment. Not a big deal.

If we look closer, I had a conversion rate of 0,8%. Now let’s do some backwards calculations. If I sell a book for $3, my royalty is $2,10. Let’s assume that the average CPC is $0,10. (In my case it was $0,06). That means that you have to make a sale on every 21 clicks. Which roughly comes down to a conversion rate of 5%. And as we can see, with my 0,8% I’m faaarrrr of from 5%.

Even if I would fiddle around with targeting, I doubt that I could multiply my results with a factor 7!

Now what conclusions can we draw from this? Personally, I don’t think that a conversion rate of about 1% isn’t too bad. The problem is simply, that the product I’m trying to peddle is not expensive enough. Or if you want, the margin of the product is too low to do any efficient (paid) marketing.

Can you do something about the CPC? Not really, because that is determined by some secret formula behind the scenes. Also notice that if you set your CPC low, you still will get clicks, but at a lower speed. And then the question is: Do you want to run an ad campaign for 6 months at $0,01 per click to (maybe) sell 1 copy?

Can you do something about the targeting? My reasoning is, because you pay per click and not per impression that targeting is not that important. When someone is looking at books for cars, and you are selling a book on diets, maybe that person has also a dieting problem. So when someone clicks on your ad , he has some reason to do so. Even if the book/product he is looking at is something completely different.

On one of the books, I noticed another interesting phenomena. This book was getting about 50 impressions per day for the first week. And then suddenly, from one day on the other, without me having changed anything it went to around 5000 impressions a day, and after a couple of days it went back to around 1000 a day ! Why? I can only guess. Were there less advertisers and my book got suddenly boosted? Did Amazon tweak their targeting formula? I don’t know. But bottom line was, the result remained zero sales.

To conclude, I think that my results are in line with what I have read in other places. And I think the simple explanation is : books are too cheap with a margin too low, to do any efficient paid marketing. Of course, my results might have been completely different if I were selling $25 books. But I’m not.

signature Timo Hofstee


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