After launching an advertising campaign, one of the prominent statistics on the Amazon ads dashboard is something called the ACOS score. At first I had no idea what this was. But folks like Mark Dawson and Joanna Penn seemed to swear by it in terms of Amazon ad sales.
So I took a closer look.
“ACOS” stands for advertising cost of sales. It is important because it’s a good way to measure your return on investment. A low ACOS score is a good indication that you are earning more on book sales than you are spending on advertising. The ACOS score is listed as a percentage, and according to the indie publishing experts, any ACOS score under 70% means that a book is earning more than the advertising costs to promote that book.
From my experience, that seems to be the general consensus. But there’s more to consider, such as cost of book production, price point of the book, and profit margin.
Here’s a good way to understand the ACOS score…
The Naughty Week paperback is listed for $12.95. If it costs me $12.95 in advertising spend to receive one sale, then the ACOS score is 100%. If I am receiving a 30% royalty on book sales, then a 100% ACOS score means I’m losing money.
In order to break even, I would need to spend approximately $9.07 on advertising sales to earn that one sale—which gives me an ACOS score of 70%. The lower the ACOS score, the higher the return on investment.
If the goal is to make lots of money on book sales, then you want to make sure your ACOS score is as low as it can be. If the goal is simply creating awareness of the book, then ACOS score doesn’t really matter.
Note: As of July 2020, Amazon includes a “KENP read” box on the dashboard that calculates the Kindle Unlimited page reads. This can help authors that are exclusive to KDP’s KU program determine advertising returns on ebooks.
I made my first sale from one of my ad campaigns yesterday. It was a great feeling. Finally, after about a week and a half of running ads, a sale!
I am seeing that for every $10 on ads that I spend, I should be getting anywhere from 20-30 clicks. Of those clicks, if I can convert 3 to sales, then I’ll at least be turning a small profit.
My current ACOS score is around 60%. The keyword that made the sale has an individual ACOS score of 22%. I’d like to keep my overall ACOS percentage below 50%. I need more sales. Again, we’re in the testing phase here. Sales should get stronger starting in November.
The keyword string that sold the copy was “christmas books for kids.” It was one of the many that I mined from Publisher Rocket, but it was likely one of the initial keywords that I used when I first launched the ad campaign.
Last week, or maybe it was more recent, I noticed that that keyword was getting a lot of impressions. It might have been my top keyword for impressions. Definitely top five. It had also gotten some clicks. I raised the minimum bid to $0.75. It got more impressions, a few more clicks, but no sales.
Until yesterday.
According to the ACOS score, the amount of money that I have paid into ads versus the money I’ve earned from the one sale is not sustainable. But this is the test month. My goal is to create awareness. For people searching for books, just seeing the ad and the cover of my book is enough. When it’s closer to Christmastime, they’ll be further down the sales funnel and ready to buy, and they’ll have already been introduced to my book.
I made some other small tweaks for my ads. I raised some minimum bids and lifted the daily budget to my primary campaign to $10.00. I am still in the test phase, but I wanted to see if that made any difference. There’s no way I’ll be spending that much per day.
I was able to not look at my numbers yesterday. I’m pretty obsessed about it. Any chance I get, I’m looking at the ad impressions or CTRs. I’d like to reduce the time I’m spending on that, but it’s exciting and I’m learning the system.
I started reading The Phantom Tollbooth. It’s so wonderfully magical and imaginative. I think for the Swedish Fish to work, it can’t be a straightforward Middle Grade drama. That’s not interesting. It needs to have some magic to it. I need to inject some imagination. And it needs to happen right away.
In The Phantom Tollbooth, Milo is off and running on his adventure within the first few pages. It made me think about Naughty Week. Would I have done anything differently? Not sure. I like the book the way it is, but I’m not sure it would capture a seven- or eight-year-old’s imagination like the Phantom Tollbooth. Because I didn’t originally set out to write a Middle Grade novel. I’ve been pretty clear about that.
