Week 3: How to Analyze if Your Ads are Converting (Sept 9 | 47m)
How to analyze conversion and profitability:
- Get sales, page reads, and revenue data for advertised book during period you’re advertising along with entire series’ revenue and series ad expenses. Make sure these numbers are only for the region where you’re currently advertising. (in this example, US numbers for September 3rd – 7th)
- Calculate baseline (average daily #s prior to whatever change you made) for sales, page reads, revenue (these three metrics are for the advertised book only), and then series revenue and series net profit. Make sure these numbers are only for the region where you’re currently advertising. (in this example, calculated baseline for two periods: Aug 1 – Aug 13, Aug 24 – Aug 30).
- Conversion = sales – baseline sales (7.4 sales – 7 baseline sales = 0.6%)
- KU conversion = borrows – baseline borrows (17.2 borrows – 14 baseline borrows = 4.4%)
- Also track rank of advertised book to see if it’s improving (this is a signal that people are buying the book / borrowing it in KU).
- Series revenue – series ad spend = net series profit
- Series net profit – baseline series net profit = net profit above baseline
- Also just eyeball the series profit over 3 – 14 days to see if it’s rising, staying flat, or going down to assess whether the ads are profitable.
Two focal points with the creatives going forward:
- Breaking apart viral BookToks to see what’s resonating socially. I think these are the likely tropes / structures / formats etc. that will perform well in ads.
- Making the creatives modular, where I can easily swap out pieces to create entirely new creatives to test. In particular, structuring things so that the video opener (likely the first three seconds, but might be shorter) can be easily changed out to immediately create a new creative with a different lead.