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Is AMS "Payola" for Indie Authors?

Updated: Aug 4, 2019

I'm not much of a conspiracy theorist. I don't think the moon landing was faked, that 9/11 was an inside job, that there are aliens at Roswell, or that Oswald had a partner in crime. But I am very skeptical of, and cynical about, Amazon's marketing services, their mysterious "algorithms," and "cost-per-click" advertising in general.

It may be a bit overly ambitious of me to tackle this topic. I've done a fair bit of research but I'm in no way an industry expert. So please take this with a healthy dose of skepticism (advice I'd also apply to just about anything you'd read/see on the internet). Hell, it might even be reckless, essentially biting the hand that feeds. But it's been on my mind a lot lately, so I'm just gonna dive in.

Amazon Sales, Rankings and Most Popular Authors

If you're an indie author you've probably looked at the Amazon charts once or twice and wondered how in the hell some of those authors manage to get there and stay there. Most of them seem to be indies, just like you. So why can't you compete?

According to Bowker's ISBN stats, Amazon crossed the 1-million ebooks mark in 2017. Many of these are from indie/small press titles, perhaps less are traditionally published, and some are even from Amazon's own publishing imprints.

That means every time you release a new title you're competing with over one million other titles for readers. And thousands of these titles are being boosted by Amazon Marketing Services (AMS) ads.

With figures like that, no wonder it's so difficult to get those initial sales that can take your book from obscurity to success.

Over the past few years, I've seen dozens of indie horror writers reach the 100 Most Popular Authors in Horror. I've hit the list several times myself. But it's a short-lived high, the product of a Bookbub Deal boost or some successful anthology coinciding with a sudden burst of sales on another book or two.

(Note: I do know writers who are continually in the Top 100. They work incredibly hard to get there and stay there, writing multiple books per year. Others have amassed gigantic, responsive mailing lists and a large backlist of work, usually long-running series. A few have built a following on social media or sites like reddit/nosleep. I'm not talking about these people.)

So why do so many "bad books" sell? And why are so many writers no one but the most diehard genre fans have ever heard of continually beating household names or lesser known legends in the charts?

Why are so many books with covers showing tanned and faceless ripped male abs or slim women dressed in pleather holding medieval weapons with their hourglass butts turned toward the viewer charting alongside King and McCammon and Lovecraft et al?

There are several answers to these questions, ranging from authors gaming the genre categories to "clickfarming" (illegitimate clicks/buys from paid sources). The biggest reason may just be Amazon Marketing Services' cost-per-click (CPC) advertising.

Cost-Per-Click Advertising

Cost-per-click (CPC) is an advertising model that has been adopted by many major internet websites over the past couple of decades. In 2006, when it was just beginning to see a massive rise in popularity, many critics believed it was a conflict of interest for search engines like Google in particular to be employing this practice. In 2007, then Vice President of Google Search Products and User Experience Marissa Mayer said CPC or CPA (Cost Per Action) marketing "is the Holy Grail for targeted advertising." Which explains why in 2006 Google's then CEO Eric Schmidtt said the perfect solution to fraudulent clicks is to ignore them. Whether the clicks were organic or fraudulent, Google still got paid. Why should they care if their advertisers lost money?

Cost-per-click asks the advertiser to bid against other advertisers. CPC bids range anywhere from pennies to dollars, and if your bid is higher than the other bidders, your ad will be shown to potential customers. If they click, you pay. If they don't click, you don't pay.

Just to get readers to click on your ad in the first place is difficult in itself. Hooking them with your cover, your synopsis, your reviews and Look Inside sample is harder.

With a certain amount of luck and practice, anyone could feasibly get ahold of Amazon's "Holy Grail," not just Big Five-published authors. But it's a steep learning curve for keyword/target relevance, ad copy, etc., learning that can cost you a whole lot of money. And that's not even taking into account the click-through-rate (CTR - the number of clicks vs the number of "impressions"), average cost of sale (ACOS - the cost per click vs your royalty per sale) and return on investment (ROI - which takes into account overall sales vs overall spent).

If you can manage to get AMS ads to work for you, they will get your books seen more often and sometimes even lead to direct sales. WIth a limited budget, CPC (or CPA) marketing can be the best solution to get your books in the hands of voracious readers.

Is it worth it, though? The expense, the time and effort to learn? And are you just paying Peter to get robbed by Paul?

The 30-Day Cliff and the 90-Day Expiry Date

No, this is not a workout program and unfortunately, it's also not a conspiracy theory. This is a very real thing that has been tracked by multiple sources over many years. I've seen it happen myself countless times. Thirty days after very successful Bookbub deals, with anywhere from one to five thousand sales, the rankings and sales immediately plummet. Thirty days after a new release with decent rankings and sales, that same sudden drop off the "cliff."

Indie authors stick together through it all.

It's as if overnight readers are no suddenly longer seeing your book. And that's exactly what is happening.

When those initial sales start to dwindle, if your book is lacking in relevant "Also Boughts" and positive reviews, you can literally watch its ranking drop from the low thousands to the high hundreds of thousands in the span of a few days.

My second horror collection in Clive Barker's Also Boughts.

That's because Amazon's inscrutable algorithms are telling the site to show your product page less. And after it hits the "90-day expiry date" browsing customers (ie. customers who haven't come to Amazon specifically looking for your book/s) will no longer see your page at all—-as if the book no longer exists.

At that point the only way to get sales from browsers are your Also Boughts, publishing a brand new book (which triggers an email alert to people who have bought your other books), or paid advertising.

Some authors will "rapid-release" a new novel every one to three months to keep from falling off that cliff. Others are paying upwards of $5000 per month just to keep selling.

So that's what you're up against. Why do so many writers, whether indie or traditionally published, get fatigued? Burn out? Quit writing for good? I'd say this is a big part of why.

After your inevitable drop off that cliff, if you want to get your books seen by random customers, which is the largest source of sales outside of mailing lists and a solid fanbase, you're essentially forced to pay Amazon (or some other marketing service like Facebook Ads) for the privilege.

Amazon is the single biggest market in the world for books. You can peddle your work to brick and mortar bookshops. You can sell them on the street corner or at cons. You can "go wide," like I have, and hope your sales at B&N and Kobo make up for the money you might make for Amazon-exclusivity in Kindle Unlimited.

And Amazon knows they're the MVP. Which is why they created Amazon Marketing Services in order to "enhance the discoverability" of your product.

What Is Payola and How Does It Relate to Amazon?

In the 1950s, music labels began offering bribes to radio DJs in order to play their latest singles. More radio play meant more sales. The ROI (remember from above?) typically made such a transaction worthwhile. This practice was nicknamed "payola," also known as "pay for play," and it was a huge scandal over the next three decades. Congressional investigations began in 1959, followed by huge investigations in the 1960s (targeting industry heavy hitters like Alan Freed and Dick Clark). Payola is still ongoing, via third party promoters. And though it's not technically the same, music labels are able to pay for their songs to appear in Sponsored Songs lists on Spotify.

Dr. Johnny Fever don't take bribes.

My biggest problem with Amazon being in the business of CPC advertising is that it feels like a modern form of payola. Actually, even though it's not bribery, Amazon Marketing Services' CPC ads might actually be worse.

At least with payola, disc jockeys basically guaranteed play for pay. With Amazon Marketing Services, there is no guarantee your book will be bought by the customer who clicks your ad. Instead of pay to play it's pay for the possibility of play.

Kindle Direct Publishing is a fantastic resource. It's free. It's easy to use. It gets your books in the hands of readers as easily as the traditional publishers. Easier, even. It's been a huge blessing (and a slight curse) for the industry as a whole.

But when "algorithms" like the 30-day cliff and the 90-day expiry date come into play, to me that smacks of Amazon playing dirty pool. That's like an undertaker burying a loved one before they're dead. If you want them dug back up you have to pay.

Amazon makes money on both ends of the deal. They're paid by you when you advertise, and paid by the customer when your book is sold. It's a win-win for them. For you, once you start relying on AMS for sales you'll always be paying. You may get used to the high. But after the high there's always the comedown, that 30-day cliff yawning up ahead, waiting to swallow your book whole.

I'm not saying you shouldn't use AMS. I've tried it a few times myself. I've had a bit of success with a few campaigns and massive failures with others. Okay, okay, most. I've never learned to master them and I'm not even sure if such a thing is possible—though there are many, many gurus who believe it is possible and would be happy to sell you their tactics at exorbitant rates if you want to try.

What I am saying is be wary. Dabble a little. A few hundred dollars from your royalties pot—if you have one—here and there. Just don't be surprised by that steep decline once the ad has run its course.

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