At the end of this past week my ninety-day exclusive Kindle Select contract with Amazon expired.  One of the lesser known benefits of Kindle Select is the ability to create Amazon ads. There it was, the ad button, beckoning me. Of course I pressed it.

You have two ad options: sponsored or product. Sponsored ads appear with keyword searches. Products ads appear when people look at specific books.

I chose Sponsored. You enter the title and description text for your ad, choose a daily budget and your keywords. Amazon suggests several based on phrases which have led to your book, but you can add custom ones.

And now, the tough part: determining the maximum bid for each keyword.  When someone enters your search phrase, Amazon checks all the active ads using these phrases and the highest bidder wins. The actual bid will be one penny above the second place bidder.

Note you don't actually pay anything at this point. This gets you an impression (that is, your ad appears on the search page). Impressions are free. You only get charged if someone clicks on the ad.

What happens after the click doesn't matter. You pay once the click occurs, regardless if a sale occurs.

So, the internet told me to expect 1 click every 1000 impressions. Somewhere between 1% - 10% of those clicks will turn into sales.

And...math. My 99 cent book pays me a 35 cent commission. If I could miraculously manage a 100% click-to-sales rate, then it would be unwise to pay more for a click than my commission ($0.35).  At a 10% click-to-sales rate, I shouldn't pay more than 1/10 of my commission. This caps my bid at a depressing $0.03.

So, I start with that, just to see what happens. And....zero impressions. Everyone's bids are higher than mine.

In the spirit of science, willing to take a loss, I up the bid. My max daily budget is capped at $6, so, I can't get into too much trouble. Amazon's ad dashboard actually encourages tinkering by showing you all of your keywords, bid amounts, impressions, clicks, and sales.

You can quickly deduce from the screenshot that "science fiction books" at 2 clicks in 223 impressions is a much better match than the general "short stories" at 1 click in 2453 impressions.

After after two days, my rate looked like this:

Similar to what the internet told me. One click every thousand impressions. My average winning bid was $0.34. Which, incidentally, means that my book would need to sell at $4.85 to break even on the ad.

I think that, with some keyword tinkering, I could probably lower my max bid and still get impressions with better targeted keywords. You can see "sci-fi" in the first screenshot has a CPC bid of $0.03 and still got 6 impressions. I think, though, it's probably not worth it to do ads for 99 cent books.

The real time analytics of the dashboard were helpful though to see how different keywords performed, and this gave me some data to update my book's regular sale keywords.

At the end of the ad run, I only had the 3 clicks, costing me $1.34. There were no sales, but I did get some insight into how different keywords performed, which was not a bad investment for a little more than a dollar.