BookBub Ads? I’m calling it. The patient is dead.

First test ad

First test ad

You may recall that I was skeptical about BookBub Ads when they were first announced. While it’s exciting to get a crack at that population of known book buyers, I didn’t really think CPM advertising (paying for impressions, rather than clicks) made sense, since they count opening the email as an impression. Yet you have to scroll down to see the ad. That means that a lot of those “impressions” aren’t really impressions at all, so we would expect the CTR (click-through rate) to be low. Well I’ve run a lot of tests, and I can tell you that my skepticism was justified. The CTR on BookBub ads is horrible. Pretty consistently about 0.4% for what should have been a very clickable ad. (See above.)

To make sure I was being fair to BookBub, I just ran a Twitter ad campaign. I’m using this tweet, which I think is pretty much the same creative as that ad:

Okay, so it’s got more going on than that ad, but BookBub gives you a pretty tiny footprint, so I did my best to capture the essence.

I tried targeting Erotic Romance, Contemporary Romance, and Chick-Lit readers. And I tried targeting Amazon and iBooks readers. And I got the same 0.4% CTR for all of them. I also found that all of those markets had the same CPM: $2.30. I couldn’t get any impressions at a $2 CPM bid, and if I bid $2.50, I’d get a bunch at that $2.30 level.

After spending $70 on BookBub, I had 128 clicks that converted to 5 sales. That’s 4%, which is neither good nor bad. It’s just a normal conversion rate. (My first test got a pretty high 7% conversion rate, but that didn’t hold up, so it was just sampling error, apparently.) 128 clicks for $70 is a CPC of $0.55. Let me put these numbers in context by comparing them to that Twitter campaign.

BookBub Twitter
CPM $2.30 $1.29
CPC $0.55 $0.12
CTR 0.40% 1.05%
Conversion 4% 3%
CPS $12.00 $4.04

(CPM: Cost for 1000 impressions; CPC: Cost per click; CTR: Click-thru-rate; Conversion: % of clickers who buy; CPS: Cost per sale.)

In BookBub, you say “I’ll spend $2.30 for 1000 impressions” while in Twitter you say “I’ll spend $0.12 when someone clicks the link.” So the click-thru-rate in Twitter doesn’t really matter, except that if it’s low, you won’t get as many impressions for your bid. The first three lines in that table are really data about the marketplace. The next line is data about the audience (or how well I’m targeting the audience). The bottom line is the bottom line: What is each of these sales costing me. If BookBub had a killer conversion rate, it could make up for the high CPM or the low CTR. But it doesn’t.

Note that the CPS is not doing that great for Twitter, either. It’s costing me four bucks to sell a three buck novel that I make two bucks on. Also, those Twitter impressions are almost entirely coming from the UK. It seems the US advertising market has not settled down from the inflated US Election ad rates yet. (This especially sucks because I make even less on UK sales because of that insidious VAT that has to appear in the list price; in the US, sales taxes are on top of the list price.)

So here is what we can conclude: BookBub ads are a terrible way to sell books. I think other advertisers have figured this out, because the ads I’m seeing in my BookBub emails are all for home security systems. And I think, in a way, that’s the reason the book ads don’t work. The CPM for BookBub book ads should be about $0.50. But the CPM for ads in general is almost five times that high. And since BookBub is mixing book ads from their publishing partners with general ads from anybody, those general ads drive up the book ad CPMs to make them unjustifiably pricey.

A couple other notes if you want to try BookBub ads: their support people are very responsive and very nice. But they don’t understand the ad market at all. (The nice woman suggested I narrow my targeting to just followers of individual authors, to lower my CPM. I explained that narrowing would certainly increase my CPM, because that’s how markets work. She checked with someone and apologized for the bad advice.) Also, their dashboards are riddled with math errors. So be very careful when you look at the data. I reported all these errors, so I suspect they’ll fix them soon. Daily numbers seem to be reported reliably. It’s the roll-ups that are messed up.

If anyone from BookBub happens to read this post, here’s my advice if you want to make BookBub ads work for authors and publishers of books:

  • CPC bidding, not CPM, since your impressions aren’t impressions
  • Better demographic data, so we can at least tell who is clicking the ads
  • Throw out the random advertisers and have a pure book market

Every one of those things is going to cost BookBub money, so don’t bet on any of them ever happening. For now, I’m going to stick to Twitter ads and lower my CPC bid so I’m not losing money on every sale. Because you should never pay people to read your book.

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BookBub Ads Experiments Continue

First test ad

First test ad

When last we met our hero, the BookBub gatekeepers had smote his attempts at a featured ad, and he was trying BookBub ads as a backdoor to get into the email boxes of all those potential readers. (I had to look up the past perfect of smite for that—it’s had smote—who knew?) I now have a little more data, and some preliminary conclusions.

The first thing to note is that there isn’t just one BookBub advertising market. Assuming you target by genre (and not by author, which seems insanely hard), I would expect the going CPM rate (the amount you pay for 1000 impressions of your ad) to be wildly different, depending on which genre you choose. My numbers are for Erotic Romance.

The next variable is targeting. I’m targeting people who signed up to see Amazon books in US, UK, and Canada, because I’ve never had a Twitter ad work in any other market, so I figure I should stick to the markets I can compare to Twitter.

After that is the variable of conversion rate, which is a function of your price, and of how good your blurb and reviews are. Yours might be better than mine, or it might be worse. But the important thing is that it’s not the same as mine.

So the bottom line is that these results apply only to me. You can use them as a benchmark, or to help you shape your own experiments, but you must not assume your results would be anything like mine, because I can pretty much guarantee they won’t be.

Okay, so that said, I ran a $30 campaign Friday through Sunday. I paid $2.30 CPM, which works out to 13,000 impressions. Remember that we are a little skeptical about whether an impression is really an impression, since opening the email will count as one, even if the person does not scroll down to view the ad.

My initial test ad got a click-through-rate (CTR) of 0.7% which is almost identical to the CTR I get on Twitter. However, that was either a total fluke, or it was due to the fact that I left India and Australia in that first test. Regardless, with proper targeting of US/UK/CA, I’m getting a CTR of just 0.45%. That means my $30 bought me 56 clicks on my ad.

My conversion rate was really good: 7.1% (in other words, 4 of those 56 clicks turned into sales; 2 UK, 1 US, 1 CA). At the $2.99 price point, I’d expect about 5% with Twitter ads targeted at the same geography, and people who follow popular romance authors. However, the last big Twitter ad campaign I ran got much lower conversion of about 2.5%. Also, my Twitter campaigns included some Kindle Unlimited read-throughs, and I’ve since dropped out of KDP Select, so we are only looking at straight ebook sales here. So the bottom line is that BookBub ads are kicking Twitter ads ass in conversion rate. These people are buyers. A low conversion rate is also a sign of click fraud, so this high conversion rate is an indication that BookBub is trustworthy.

Unfortunately, you put all those numbers together and they kind of suck. $30 in advertising sold 4 books, resulting in $7.72 in my pocket.

I can’t get impressions with a lower bid, so I’m stuck with the CPM of about $2.25. That means to break even, I need either a higher click-through-rate (CTR) or a better conversion rate. A better conversion rate is not happening, since this conversion rate is already awesome. So we need a higher CTR. How much higher? A lot higher. I need the CTR to be 1.67% just to break even. It’s 0.45% now. It needs to be 4 times as good.

I ran an experiment today to tackle the low-hanging-fruit. The creative I was using was blurry, because BookBub beats the crap out of ads in JPG compression. So I tried re-creating the ad in photoshop and uploading a nice PNG. I’m sure they converted it to JPG before they served it, but I don’t have any way to see what they are actually serving. (I’ve asked them to fix that, because that’s kind of bonkers.) Anyway, the campaign ran all day with the cleaned-up ad you see at the top of this post and my conversion rate is… drumroll please… the same. Actually slightly lower 0.38%. Sigh.

There aren’t a lot of things I can play with to get the CTR higher. I can try to improve that ad (any ideas?). I can try putting “SALE” on there, but that’s prone to drive up CTR at the expense of conversion, since $2.99 isn’t a compelling sale price.

I can try targeting just the UK, since I’ve typically gotten better numbers there than in the US. I think maybe they like the flowers on the cover.

I can try targeting iBook users instead of Amazon. However, I just got on iBooks and I have no reviews there, so I suspect my conversion rate would suck there. It’s still worth a $10 experiment, of course.

My mission now is to improve my CTR. I’m going to try a bunch of different things and then I’ll report back. Stay tuned!!!

BookBub Features and Ads Update

EntropyI was rejected once again in my attempt to get a Featured slot on BookBub. The difference this time is that my book is now on lots of different stores, not just Amazon-exclusive. BookBub chooses very few Amazon-exclusive books, so I thought maybe my chances would be better this time. No such luck. I’ll keep trying.

Meanwhile, BookBub has allowed me into their advertising program. I wrote about this when they first announced it. I did a small test campaign to figure out how it compares to Twitter ads. I haven’t been able to use Twitter ads for a while because the election jacked up the CPC rates. When you have to compete like that to get impressions, the economics of advertising stop working.

My First BookBub Ad

My First BookBub Ad

That’s the ad. It looks a  little fuzzy because BookBub compresses the crap out of ad images. If you scroll to the bottom of your latest BookBub spam, you’ll see that whatever ad is there also has the crap beat out of it. I chose that text because it’s the heart of the tweet I have been most successful with on Twitter Ads.

I bid $3 CPM (I started at $2 and got no impressions, so I increased it), and because there’s an auction, I ended up paying $2.29 for a thousand impressions (that’s what CPM means: cost per mille [thousand]). I ran it for $9 worth, and got 4,229 impressions. That led to 29 clicks, which works out to a CTR (click through rate) of 0.7%. That’s almost identical to the CTR I get for Twitter ads.

So let’s compare pricing. Twitter charges me per click (CPC) and I can generally get impressions within my target audience (people who follow romance authors) with a bid of $0.10-$0.15. (Well, I could before the election; hopefully the rates will settle back down there now.) For BookBub, I have CPM=$2.30 generating 7 clicks per thousand impressions, so that’s a CPC of $0.32. About twice what I was paying for Twitter Ads.

However, the people clicking on BookBub ads are really well targeted. They signed up for a newsletter specifically to find out about books they can buy. So although these clicks cost twice as much, the conversion rate might just be twice as high.

As it turns out, the 29 clicks I got on my little test campaign resulted in no sales. But my book is full-price at $4.99 right now. My conversion rate at that price should be right about 0%, if you follow that chart in the post I linked. So we really don’t know about conversion yet. To do a fair test of that, I need to lower my prices.

I had my prices cranked up to $5 primarily to make a $0.99 deal look a lot better to the BookBub reviewers to get a featured deal. And that didn’t work. So here’s what I need to do:

  • Drop my price back down to $2.99 which is the optimal price for advertising-based customer acquisition.
  • Try another BookBub campaign, just like the one I did, but maybe only US/UK/CA, since that’s how I’ve been running Twitter campaigns.
  • Try Twitter Ads again and see whether the CPC rates have settled down, now that the politicians aren’t buying up all the ad space.

I’ll keep you posted!

BookBub CPM Advertising? I doubt it.

Yesterday I, and every other author I know, got invited by BookBub to apply to be in the beta test of their new CPM advertising service. If you aren’t familiar with BookBub, it’s a relatively new player (about four years old) to the book advertising business. In a very short period of time, they built up a rather astounding mailing list and reputation. Their reputation is:

  • Exceptional performance. Books advertised in their emails often see thousands of purchases.
  • Ridiculous prices. Depending on your genre and what kind of a sale you are running, a single ad could be over $1000, and all ads are at least a couple hundred dollars.
  • Highly selective. They take only a quarter of the ads for free books and a fifth of ads for books that are merely on sale. The exact chances depend on your Amazon reviews, the genre, and how deep a discount you are running.

I haven’t yet tried them. As you know, I will never give away my novels for free. However, I will run a $0.99 sale now and then. It’s a risk/reward issue. If an advertising experiment like Amazon Giveaways fails, I’m out a few bucks. If a BookBub experiment failed, I could easily be out several hundred (romance is one of the more competitive genres, so the prices are very high).

I have read dozens of blog posts by people who have run BookBub ads. Unfortunately, these are all authors, so almost none of them turned the numbers into a meaningful metric. A click-based ad campaign should be able to report:

  • Impressions. How many people saw the ad
  • CTR (Click-through rate). What % of people who saw the ad, clicked it
  • Conversion. What % of people who clicked the ad bought the book

I don’t care what happened to your “bestseller ranking” because that doesn’t matter. It’s odd that nobody reports any of these numbers. Gross sales are nice to know, but that’s not enough information for anyone else to compare to. If your conversion rate sucks, but the impressions and CTR were great, then you won’t get good sales but it’s not BookBub’s fault. If your conversion rate is awesome, but you didn’t get many sales, then the service is overpriced. Without these numbers, I have no idea whether BookBub would be a good value or not for me.

Eventually I suppose I’ll have to cough up the money and find out for myself.

But anyway, that’s not the point of this blog post. BookBub is introducing CPM (Cost-per-mille) advertising. That means you bid a price to pay for 1000 ad impressions. A computer looks through all the bids that match a given email viewer, and they choose the highest bid. They charge you the price of the second-highest one, which makes you feel good, but with any large pool of bidders it doesn’t actually make any difference because every auction will end with a tie.

Most advertising platforms have moved to a CPC (Cost-per-click) model. In theory the two are basically the same, since for any ad you can pretty quickly measure the CTR and then  do a little math to find an equivalent CPM, and then run the CPM auction I just described. For example, the CTR of my Twitter ads is about 1%. So when I bid $0.10 per click, Twitter actually treats that as a $1 CPM (1000 impressions x 0.01 CTR x $0.10 bid). This is better for the advertiser for a couple reasons:

  • CTR is highly dependent on audience targeting, and it’s impossible to predict in advance. So a low-performing ad won’t lose you a lot of money, it’ll just win fewer auctions.
  • The service can play fast and loose with the definition of “impression.” If the service counts impressions where nobody actually saw the ad, it will drive down the CTR for everyone equally. So it doesn’t really matter.

In contrast, if you are offering CPM service, an impression had better be an actual impression. Otherwise your advertisers are going to revolt. And this is the first concern I have about BookBub’s service.

They say that they are going to count someone opening the email as an impression. If the ad was a banner up top, then that’s fair. But it’s not. They are going to put the ads clear down at the bottom of the email. When was the last time you scrolled to the very bottom of a newsletter? I certainly don’t. If they were running CPC auctions, this slight-of-hand would not matter. But when you are selling impressions, you can’t do that. Given how few people are going to scroll all the way to the bottom of a newsletter, I suspect the CTRs of these BookBub ads are going to really, really suck. Instead of 1% like I get on Twitter, it’ll probably be more like 0.01-0.1%. (Update: turns out the answer is 0.4%, so not as bad as I predicted, but still terrible.)

An obvious question about running any kind of auction-based advertising in a newsletter is the time-travel question. How do they know what ad to put in the newsletter before they know if it will be opened? In this case, I think I get what BookBub is planning, and it’s genius. The email will contain an image link and a click link for the ad. When the email client asks for that image, the BookBub servers will run the auction at that moment and serve up the winning ad. That way, they don’t have know in advance which emails will be opened. It’s exactly how banner advertising or google ad words works on web sites.

However, there’s a really hard technical problem here: gmail. You might not be aware of this, but Google doesn’t actually show you the email you were sent. When gmail gets an inbound message, it goes through and replaces every image “src” attribute with a URL that goes to Google. When you view the email and your client (gmail app or web browser) asks for that image, Google’s servers request it from the source and then save it in a cache. This has been a nightmare for email marketers. It’s absolutely impossible for you to know if someone viewed an email more than once, because the second view will go to Google’s caches 100% of the time. That’s not a bad thing in this case, because it just means that the auction will only run once per person, instead of once per open.

The nastier issue is that Google ignores certain things about the URL when it does the caches. So if you aren’t very clever in how you serve up your ads, every gmail user is going to see the same ad. BookBub has been in the email marketing business for a while, and so I would hope that they are all over this particular issue. But it’s definitely something as an advertiser I’d want to know how they are addressing.

My other concern has to do with BookBub’s reputation and advertiser base. The vast majority of people advertising on BookBub have no idea what the fuck they are doing. And this concerns me because I’m afraid they are going to bid crazy high. There is such perceived value in being on BookBub that people will throw money at these auctions even if they don’t work at all. This isn’t BookBub’s fault, of course.

If you compare this to Twitter, Facebook, Amazon, or Google advertising, you can imagine that marketing-illiterate authors are going to make up a tiny portion of the advertising base. So the fact that they don’t know how to bid properly isn’t going go mess it up for everyone else. But imagine running an auction for a chocolate bar in a room full of kindergarteners. You’d have kids bidding 10-100 times what the chocolate bar actually cost. That’s what I’m afraid BookBub’s CPM auctions are going to be like.

Anyway, I applied for the beta just like everyone else. So on the very unlikely chance that they let me participate, I’ll report back.

Update: I got into the program and ran an ad.