The Engineering Problem
Amazon Ads are not "set and forget." They are a bidding war. Most authors treat ads like a lottery ticket—throw money at Amazon and hope for sales. That's not a strategy. That's a donation.
This guide treats Amazon Ads as an engineering system. You will learn the math, the metrics, and the tactics to turn ads from a money pit into a profit engine.
By Ameen A. Mohiyuddin - Software engineer and author of 101 Myths, Bizarre Facts & False Memories Millennials Grew Up With. I approach publishing like I approach code: systems over luck, profit over revenue.
The ACOS Rule: Your Profit Firewall
If your profit margin is 30%, and your ACOS is 40%, turn off the ad.
You are paying Amazon for the privilege of selling a book. This is not marketing. This is financial self-harm.
The Math:
• Book Price: $4.99
• Net Royalty: $3.26 (after 70% royalty - delivery)
• Profit Margin: 65% ($3.26 / $4.99)
✅ Safe ACOS: Up to 65%
❌ Danger ACOS: Above 65%
Campaign Types: Choose Your Weapon
1. Sponsored Products (Start Here)
Your book appears in search results and on competitor product pages.
Best For:
- • New authors building visibility
- • Books with proven conversion (reviews, cover, description)
- • Testing keywords and categories
Pro Tip: Start with automatic targeting to let Amazon find your audience, then harvest winning keywords for manual campaigns.
2. Sponsored Brands (Series Authors)
Banner ads featuring your author logo and multiple books.
Requirements:
- • Enrolled in Amazon Brand Registry
- • At least 3 books published
- • Professional author brand
The Math: Higher CPC, but better for series. If Book 1 has 50% read-through to Book 2, your lifetime value doubles.
3. Sponsored Display (Retargeting)
Ads that follow readers who viewed your book but didn't buy.
Best For:
- • Remarketing to warm traffic
- • Targeting competitor audiences
- • Advanced authors with budget
Warning: More expensive. Only use if Sponsored Products is already profitable.
Negative Keywords: The Most Important Button
This is where you stop paying for clicks from people who will never buy.
Example: Hard Sci-Fi Author
You write hard science fiction. Amazon shows your ad to people searching for "fantasy magic wizard."
The Problem:
- • You pay $0.50 per click
- • Fantasy readers click, see "sci-fi," and leave
- • You just donated $0.50 to Amazon
The Solution:
Add "fantasy," "magic," "wizard," "dragon" as negative keywords. Amazon will never show your ad to those searches again.
Common Negative Keywords by Genre
Romance (Contemporary)
Negative: paranormal, vampire, werewolf, alien, time travel
Thriller (Psychological)
Negative: cozy, mystery, detective, amateur sleuth
Non-Fiction (Business)
Negative: fiction, novel, story, fantasy, romance
Sci-Fi (Hard)
Negative: fantasy, magic, wizard, dragon, elf
Bidding Strategy: Bid Low, Bid Wide
The Contrarian Approach
Instead of bidding $1.00 on one keyword, bid $0.30 on 1,000 keywords. Catch the cheap traffic that your competitors ignore.
Step 1: Start Low
Begin with bids at $0.20-$0.30. Amazon will tell you "suggested bid is $0.75." Ignore it.
Why? Amazon's "suggested bid" is designed to maximize their revenue, not yours. Start low and scale up only if you're profitable.
Step 2: Use Broad Match
Broad match lets Amazon show your ad for related searches. This is how you discover hidden gems.
Example:
• Keyword: "space opera"
• Broad match shows for: "best space opera," "space opera series," "military space opera"
→ Harvest the winners, add losers to negative keywords
Step 3: Scale Winners, Kill Losers
Check your campaign every 3-7 days. Look at the Search Term Report.
Decision Matrix:
- ✅ACOS < Profit Margin: Increase bid by 20%
- ⚠️ACOS = Profit Margin: Keep bid the same
- ❌ACOS > Profit Margin: Lower bid by 30% or pause
Calculate Your Max ACOS
Use Kitaab's profit calculator to find your exact break-even ACOS. Don't guess. Know the math.
Calculate Your ACOS →5 Mistakes That Burn Money
❌ Running Ads on a Bad Book
If your book has no reviews, a bad cover, or a weak description, ads won't save it. Fix the product first.
❌ Ignoring Negative Keywords
You're paying for clicks from the wrong audience. Add negative keywords weekly.
❌ Set-and-Forget Campaigns
Amazon Ads require active management. Check your campaigns every 3-7 days minimum.
❌ Bidding Too High Too Fast
Start low ($0.20-$0.30). Scale up only when profitable. Don't trust Amazon's "suggested bid."
❌ Not Tracking Profit, Only Sales
Revenue is vanity. Profit is sanity. If ACOS > Profit Margin, you're losing money.
Your 30-Day Amazon Ads Action Plan
Week 1: Setup
- ✓Calculate your max ACOS using Kitaab
- ✓Create 1 automatic Sponsored Products campaign ($5/day budget)
- ✓Set default bid to $0.25
Week 2: Harvest Data
- ✓Download Search Term Report
- ✓Add top 20 converting keywords to a manual campaign
- ✓Add non-converting keywords to negative keyword list
Week 3: Optimize
- ✓Increase bids on keywords with ACOS < profit margin
- ✓Pause keywords with ACOS > profit margin
- ✓Add 10-20 new negative keywords
Week 4: Scale
- ✓If profitable, increase daily budget by 50%
- ✓Test product targeting (show ads on competitor pages)
- ✓Repeat optimization cycle weekly
Stop Donating to Bezos. Start Profiting.
Amazon Ads are a system, not a lottery. Know your numbers, optimize ruthlessly, and profit.
Calculate Your ACOS →Maximize Profit Guide →