A Brief Discussion of Amazon Ads

I think I regularly mention the necessity of book marketing and promotion, and I recently commented on some issues I was having with Amazon ads. However, I thought it might be beneficial to pull back the curtain a little on that.

Amazon ads follow an auction format, where sellers bid for ad placement. Basically, when someone goes to Amazon and searches for, say, “energy drinks,” ads will pop up for said beverages.  All other things being equal, the company that bid the most will have the ad for its drink appear first amongst search results. (Needless to say, being the first product on the results page is the ideal result.)  The process is pretty much the same for other products, including books. So, if I bid $1.00 for an ad and everyone else bids 99 cents, I win the auction and my book will be the first thing folks searching Amazon will see.

During certain times (like Black Friday events), Amazon reserves the right to double bids for particular ads. Thus, in instances where I was willing to bid up to $1.00, Amazon will raise my maximum bid to $2.00.  Purportedly, this is to get me more sales. However, they’re also doubling everyone else’s bid, so that person who bid 99 cents before is now bidding $1.98.  My bid is $2.00, so I win, although I only pay $1.99. (That’s because the winner of tha auction is only charged 1 penny above the next-highest bid.)  In short, I’ll still win the auction, but now it’ll cost me almost twice as much as before Amazon started doubling things and without an appreciable benefit. The only person really benefitting from all this is - shockingly - Amazon.

This is just a simple overview and doesn’t account for everything involved in Amazon ads, but it’s not hard to see how doubling someone’s ad bid can swiftly make things spiral out of control. That’s exactly what happened, and then I had to spend an inordinate amount of time trying to “normalize” everything. Thankfully, order has been restored on the ad front, and I can rest easy in that regard. For now, anyway…