Read Time: 4.5 Minutes

Budgeting is a big topic, and there's certainly no cookie-cutter answer or off-the-shelf solution to "How much should I spend on Ads?"

There are so many variables at play from author to author; the biggest of which are cash flow and goals.

If the majority of your royalties come from Amazon, what you earn this month won't land in your bank account for 2 months.

That's a long time to wait.

If you sell your books directly to readers on your own store, you can choose how often to deposit funds into your bank account; once a week, once a day, fortnightly, etc.

Ad platforms want their money, and you need the cash ready for them to take.

So that's the first thing to think about; cashflow.

The second thing to consider is your goals; specifically, where you are right now in your author business, and where you're headed in the next 3, 6, 9, 12 months.

Please don't fall for the trap of comparing your chapter 1 to someone else's chapter 20.

That's not going to help; it's going to cause you to feel like you're lagging behind and potentially fall victim to making budget decisions based on emotion rather than data.

It could also impact how far adrift you stray from your goals.

If you're at a stage where you have cashflow, but you have a goal of building up reviews, or building your audience, with profit as a secondary goal, you could afford to breakeven on your Ad Spend, or even drop into the red a little.

If, however, your books are supporting your family and your current lifestyle, profit is key to keeping the lights on.

Or maybe you're still working a 9-5 and the money you're earning from your books is just pocket money right now, but you have aspirations to make writing your full-time gig. If this is you, you could potentially afford to breakeven or make a loss on your Ad Spend for the next 3 months, for example. After that 3 month runway, that's when things need to start turning a profit.

You could be in a position where you just want to figure out how to run Facebook Ads or Amazon Ads, and money is no object at this time. You've perhaps budgeted $1,000 that you can afford to lose on Ads to test and build up your confidence.

These are just a handful of the countless scenarios that could apply to where you are right now.

Which makes it hard for me to give you a definitive answer.

All I can give you is the worst, easy cop-out answer I can... "it depends".

But let's get a little more specific with some advice that will hopefully apply to you wherever you are along your author journey.

#1: Spend Money To Make Money

Gone are the days when you can throw your books up on Amazon and watch the royalties roll in.

Today, if you're not actively advertising or promoting your books, you're toast.

Your books will never see the light of day.

So investing in advertising is now a requirement for success, not a nice-to-have.

Whether you're spending $10 per day or $10,000 per day, please invest something into advertising if you're serious about building an author business.

#2: Spending $1 Per Day Isn't Going To Cut It

When you're advertising, on any platform, what you're doing is simply buying data.

You're looking for trends, patterns and clear signals as to what works and what doesn't.

To collect enough data in a reasonable amount of time is going to cost more than $1 per day.

Sure, you could spend $1 per day on Facebook Ads, for example, but you'll be running Ads for months before you collect any statistically significant data you can make decisions on.

My advice, budget $10 per day, per Ad platform. An absolute minimum of $5 per day.

#3: Pick ONE Ad Platform

Spreading your budget, your time and your energy learning and running Ads on multiple platforms, especially in the beginning, is going to be harder than climbing Mount Everest wearing lead shoes and carrying a rucksack full of bricks.

Instead, go all-in on ONE ad platform, learn the ropes, understand the nuances of that platform, collect data, gather insights, and fully understand the inner workings of this platform.

This process could take anywhere from 3-6+ months.

Once you have this first Ad platform ticking over, only then start considering layering on another Ad platform.

If you have $20 per day to spend, you will learn more and get better results by spending that full $20 on one Ad platform instead of splitting it across 2-3+ Ad platforms.

#4: Know Your Numbers

Tracking your numbers is key to understanding the health of your author business and keeping a good pulse on where you're money is going and how hard it's working for you.

At a minimum, here's what I recommend you track:

→ Royalties

→ Ad Spend

→ Profit

→ ROAS (Return on Ad Spend)

If you want to go deeper, break out Ad Spend by marketplace (if applicable) and also record sales/page reads of each marketplace.

Running Ads on multiple platforms?

Track the Ad Spend and performance of each platform.

Want to get even more advanced?

Track the Cost-Per-Sale and Conversion Rate of each Ad platform, and compare and adjust budgets accordingly.

Tracking is a deep topic and one that we could go down the rabbit hole on.

But keep it simple and make sure you can collect all the numbers and understand the health of your business in no more than 5 minutes per day.

And if you're anything like me, don't spend 1-2 hours collecting and filling in data; you'll be so overwhelmed with numbers and statistics you won't know what to do with it all.

When you have the relevant data, you can then decide how much to spend on each Ad platform based on performance, goals, budget and cashflow.

#5: What Is Your ROAS (Return on Ad Spend) Goal?

If you want to breakeven (i.e spend as much as you earn), your ROAS goal would be 1.

If you want to double your money, your ROAS goal would be 2.

Triple your money? Your ROAS goal would be 3.

And so on...

In the beginning, for the first 1-3 months, breaking even is a realistic goal. Having said that, there are plenty of authors who see profits within 1-2 weeks of starting Ads; I'm just telling you the worst-case scenario here.

To give you some context, now my wife, Lori and I have been running Ads to her books for some years, have built up a good reader base, reviews and authority on Amazon, our ROAS goal is 2.5. But we're hitting 3-3.5 most days.

Once you know what you're aiming for with ROAS, you can adjust budgets accordingly.

Just keep in mind that day-to-day ROAS will fluctuate; what I'm talking about here is ROAS over a 7, 14, 30 day period.

Wrapping Up

As you can see, there is no definitive answer for "how much should I spend on Ads", because there are so many variables at play.

If I could give you one piece of advice to finish up here though, it would be this:

Don't spend more on Ads than you can afford to lose.

Why?

Because there are zero guarantees in advertising. Zero.

You could lose everything you put in, but on the other hand, you might make all of it back and then some.

Just keep your eye on the prize and focus on your goals; don't let someone else's goals become your goals.

Know where you're heading, set a course and full steam ahead.

You got this.

To Your Success
– Matt