Heidi Thorne is a self-publishing advocate and author of nonfiction books, eBooks, and audiobooks. She is a former trade newspaper editor.
In March 2022, Amazon opened up advertising availability for traditionally published authors. I’ve talked about how authors who get a book deal with a traditional publisher still need to build their author platform, or fan base, before and after publication.
But are Amazon ads worth doing for traditionally published authors? I’m not so sure. Let me explain why based on my experience from running Amazon ads for my self-published books since 2016.
So there’s no confusion, just for this discussion, when I talk about authors, I’m specifically referring to traditionally published authors. However, self-published authors may also gain more insight into this advertising opportunity, too.
The New Traditional Publishing Paradigm
In the past, authors were responsible for writing books. Publishers produced, printed, marketed, and distributed them. But the thing about the publishing industry is that the competition for books or book-like content keeps increasing. This is because the old books don’t go away. In fact, many publishers’ major income stream is from backlist books published years, even centuries, ago. So after a new book is published, publishers are on to the next project to keep up with all the old and new books on the market.
At the dawn of the 21st century, you can add self-publishing, social media, blogs, and video content which can also steal dollars and attention from traditional publishers.
All of this can put strain on traditional publishers’ marketing budgets. Authors who create book content may need to fend for themselves in marketing their books. Plus, even before contracts are offered to authors, authors may need to prove how market-worthy they are. That may mean having a substantial social media following or a history of successful book sales.
Amazon Ads Are Not a Sure-Fire Book Marketing Tactic
I was quite puzzled at some of the enthusiasm for this new advertising capability.
Let’s look at this logically. The publisher, who controls the distribution and availability of an author’s book, may discontinue or reduce marketing support for the book after launch. The publisher may be a big company, not a one-person author business. But now, the solo author is personally taking over the hard dollar investment in marketing the book.
The costs are now being borne by the author. I had to laugh during a webinar about the topic where one of the panel members said that you could test out Amazon ads for around $5-$10 per day. As I always say, do the math. That’s a potential spend of $1,825 to $3,650 per year without blinking. Even if it’s half that, it will eat into any advance or royalties you earn as a traditionally published author.
While it’s true that Amazon is slower to spend up your daily budget when compared to money-hungry ad platforms like Facebook and Google (did I just say that?), depending on the keywords you choose, there’s the potential for you to have a spend up to that amount.
Consider, too, that many authors don’t earn out the advance they get as part of their book deal. When you get an advance as an author, the publisher estimates how much the book will earn in its market lifetime. Then they’ll estimate how much to pay the author as a portion of that. When the book has earned enough to pay off the advance, the author will earn a royalty percentage for all sales above that.
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As a side note, some book contracts may require that if sales are insufficient to cover the advance within a specified timeframe, the author may need to pay part or all of the advance back to the publisher. Though I’ve heard it doesn’t happen that often, it is worth noting if that stipulation exists in your book deal. Author beware!
Any costs the author absorbs in marketing the book will go against the amount received as an advance and any earned royalties. When presented with a traditional book deal contract, consider the potential money you might personally spend on advertising and marketing. If the proposed advance can’t compensate you properly for both the writing and marketing of your book, it's time to negotiate. Discuss all contracts with your agent or business attorney to protect your rights and investments.
The Key Metrics You Need to Watch (ACoS and Sales Conversion Rate)
“But if I advertise, the book will make more sales for the publisher, and I’ll get more royalties after I’ve covered my advance.”
That may be true. But, again, you would have to earn over and above any advertising costs you invest to make any money.
The ACoS (Average Cost of Sale) needs to be less than 100 percent to break even on ad cost. But that doesn’t mean you’re profitable. You have costs to run your author business. So your overhead percentage must be added to the ACoS to figure out if your ads are performing to meet your needs.
The other metric that authors will want to watch is sales conversion rate. This tells you how successful any particular ad is at driving sales. If you are running multiple versions of your ads, you’ll be able to tell which ones are working, then adjust or drop the rest.
Remember, though, that these metrics are for your Amazon ad campaigns, not those of your publisher. If your publisher reports how many sales are made on Amazon total, you’ll be able to tell how many sales your ads are driving as compared to those of your publisher. If this is not reported, you’ll be guessing at what percentage of sales your ads are generating. That would be an interesting comparison. I love to hear about your experience with this.
Like all advertising and marketing, Amazon ads require experimentation. That means you’ll be spending some money, maybe lots of money, to get it right. You’ll also need to be doing some consistent and frequent monitoring to keep your ad costs from running out of control when compared to results.
Authors, both traditional and self-published, can get sucked into the “but it’s branding” cost justification. True, your ads on Amazon are not just drivers of sales; they help your market exposure, too. But overspending on advertising that doesn’t yield results just wastes your money.
Why Did Amazon Open Up Advertising to Traditionally Published Authors?
Only Amazon knows why they do anything. But let’s put some backstory to this new Amazon offering.
Amazon may have been hearing from or hearing about traditionally published authors who want more control over their book marketing and who are willing to pay for it. That’s understandable since it’s pretty well known that traditional publishers may offer minimal marketing support beyond the launch. But why are these authors so willing to do so? There can only be one reason. They’re not making enough or sustainable income from their book deals.
Plus, now that the Amazon ad platform is quite mature, it’s very competitive, with advertisers willing to spend more money to get visibility. Another win for Amazon with yet another group of hungry advertisers.
Advertising on Amazon, or anywhere, can be quite an investment of time, skill, and money to start achieving positive ROI. If you want to experiment, fine. But monitor your results and costs consistently and frequently.
This article is accurate and true to the best of the author’s knowledge. Content is for informational or entertainment purposes only and does not substitute for personal counsel or professional advice in business, financial, legal, or technical matters.
© 2022 Heidi Thorne