Amazon Just Re-Wrote the Rules

Hi Folks,

I'm not feeling well enough yet to sit at a keyboard for long periods, but I saw this article and wanted to pass it on. It appears that those of us who are publishing on Kindle or Kindle Select need to keep a sharp eye on the way Amazon ranks our books. The rules have changed. What worked last month will not work this month. Here's a pretty clear explanation of what's going on:

Updates to Amazon’s Book Ranking Algorithms: The Death of 99-Cent Ebooks? An End to KDP Select Perks? Posted by Lindsay | Posted in Amazon Kindle Sales | Posted on 18-05-2012 42

Ever wonder how Amazon’s ranking algorithms work? Why one book gets recommended to readers and another doesn’t? The difference between the popularity lists and the bestseller lists? Well, indie author Edward W. Robertson doesn’t work for Amazon, but he’s a stats junkie who’s been studying the e-seller’s algorithms for a while. Today, he’s here to answer questions on how books get ranked and recommended along with new changes that could punish 99-cent titles and take some of the appeal out of the KDP Select program.

Amazon Algorithms Examined

You seem to enjoy studying how Amazon’s algorithms work for ranking and recommending books. Before we talk about what’s new, could you give authors an idea of how things work, at least insofar as you know? What goes into ranking a book and causing it to appear on such-and-such bestseller list? Also, what’s the difference between the bestseller lists and the popularity lists?

Yeah, studying these things is a lot of fun for me. I don’t have any formal training in numbermancy (which I’m pretty sure is the term), but spending the last 10-12 years reading about the statistical study of baseball appears to have taught me a few things about data analysis. Perhaps I wasn’t wasting my life after all!

On to the lists. Everyone who’s spent much time on the Kindle store has seen both the bestseller and the popularity lists. The bestseller list is the Top 100 of a given category of books. For instance, here’s the bestseller list for Epic Fantasy.

The popularity list is the list of all books in that category. Here’s the popularity list for Epic Fantasy.

What you’re currently seeing on those lists will depend on when you’re reading this, but you’ll note they aren’t identical. That’s because they differ in key ways. The bestseller list is essentially a gauge of how many copies a book has sold over the last 24 hours. It takes longer-term sales into account to a degree, but the last 24 hours are far and away the most important factor. A book can rise and fall extremely swiftly on the bestseller list.

The popularity list is more complicated. For one thing, Amazon changes the formula for how it’s calculated a few times a year. Currently, to the best of my knowledge, the popularity list is the accumulated sales of a book’s last 30 days compared to those in its category–but free books given away only count for roughly 10% of a paid sale, and price is factored in as well, in that the higher your price, the more each sale counts for on the list. Lastly, borrows aren’t counted as sales for purposes of popularity list rank. The formula looks something like this: (sales + (0.1 x free downloads)) x (unknown sales factor) / last 30 days

A simpler way to think about it is gross revenue earned by your book over the last 30 days (with an additional boost depending on how many copies you’ve also given away). I’m not sure that’s a 100% accurate way to put it, but it fits the data we’ve seen well enough to work as shorthand.

In short, then, appearing on the bestseller lists is mostly all about having sold a bunch of copies in the last 24-48 hours. To appear high on the popularity lists, however, you need strong sales (or an extremely strong giveaway) over the last 30 days. Additionally, the higher your price, the fewer books you’ll have to sell to do well on the popularity lists; the lower your price, the more you’ll have to sell.

That’s a lot of information! What is the popularity list actually used for? It sounds like that’s what the changes are effecting, but, as a shopper, I wasn’t particularly aware of it until recently, so I never used it to find books. Do people actually browse through it? Or is it used for determining recommendations?

The popularity lists are pretty important. Obviously, Amazon has an almost endless assortment of ways to promote books from within the store itself, but I think the popularity lists are one of the major factors. See the main Kindle store page? With all those links on the left to a variety of different genres? Those bring you to the popularity lists.

So they’re pretty prominent. Both for browsing and, yes, for recommendations–when Amazon sends out emails along the lines of “You might enjoy these other books in Epic Fantasy,” the links they include take you to the popularity list for that category of books.

Of course, the importance of any given category varies quite a bit by its overall popularity with readers. Romance > Romantic Suspense might be just a little more important than Basketry > Underwater Basketweaving. Ranking high on the popularity lists of small categories won’t make much difference. But in the well-trafficked ones, it’s pretty big.

It’s hard to know just how huge unless you are actually Amazon, but if I were to make conservative guesses based on my experiences, being on the first page in Epic Fantasy might lead directly to 20-60 sales per day based on your visibility there alone. (And maybe much more. This will vary a lot depending on your book’s overall appeal. I’m sure A Game of Thrones benefits from it just a little bit more than my dinky indie title did.) In Science Fiction > Adventure, I’d say it might be good for as many as 30-100 sales. For the biggest categories like Romance and Mystery & Thrillers, the visibility the popularity lists provide to the top books might be responsible for thousands of monthly sales by themselves.

Key word “might.” This is really tough to estimate. But in my experience, a lot of people see these lists, both when they’re browsing around Amazon and when they’re directed there by emails. Based on post-free results from hundreds of different authors, I’m positive the popularity lists were the main drivers for the big sales Select authors used to see after making their books free. Now that it’s so much harder to achieve high visibility on these lists via free alone, I’m afraid Select authors are in for some much leaner sales.

This post will be continued tomorrow.

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Amazon Just Re-Wrote the Rules