Words on a page, that’s all it takes to help [a writer] separate himself from the forces around him, streets and people and pressures and feelings. – Don DeLillo
…[a writer] learns to…ride his own sentences into new perceptions. – Don DeLillo

Understanding How Amazon Ads Work

Amazon ads College-co-edshoulder-length-chestnut-brown-hairheight-5-foot-3weight-110-poundspeachy-complexio-613465980work on an auction-based system.

In essence, with your ad campaign you tell Amazon, “I want to show my book to people who are searching for x, and I’ll pay X dollars to do so.”

Your book, of course, is what is you’re advertising. The lowercase x stands for the keywords people type into Amazon when searching for a book to buy. The capital X is the dollar amount you’re willing to spend to have that ad appear on the pages that pop up when readers type in those keywords.

When a reader enters a keyword that you selected for your ad campaign, Amazon’s bots instantly look for all of the authors out there who have said they want their book shown when that keyword is typed in. It then gives preference to whoever has typed in the largest dollar amount for that x. If another author has a higher amount than you, then they outbidded you. If you typed in the highest amount, then you outbidded them and get preference.

Fortunately, you won’t get outbidded every time. That’s because authors set limits on their daily spending. So if an author bid $1 for a keyword but has a daily budget of $5, the sixth time that keyword is shown, they’re out of money and the next highest bidder gets preference. With far more than 200 million people typing keywords every day into Amazon, don’t worry, your turn will come.

In a nutshell, that’s generally how it works. Of course, Amazon’s system is more sophisticated than this as there are other variables. For example, if you set your bids to be “dynamic,” Amazon’s bots on their own will identify keywords that best sell your books and then raise your bid to make sure your ad pops up.

But like all software and algorithms, human intervention is needed to make sure everything works the way you want it to. A danger of the dynamic bid, for example, is that Amazon’s bots will start bidding a dollar amount higher than the amount of profit you would make from the book sale. A sale is great, sure, but not if you’re losing money on it…but more on that later.

In a future entry, we'll show how to set up an ad campaign for your book.

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