Amazon's Sales Rank Explained

Understanding Amazon's sales rank wll teach you how to win at the game of selling the most books possible on Amazon.

There's no better person to explain sales rank than David Gaughran. He knows his stuff.

This David Gaughran quote explains why Amazon is winning:
Amazon’s genuinely unique strength, the aspects that make the Kindle Store so attractive to readers and so hard for others to compete with, is something less obvious: the network of algorithms which constantly rearranges the Amazon bookstore so that all your favorite types of books are right there under your nose.

As an author, your job is to make sure Amazon arranges to place your books in front of your readers.

Here are some resources you may find useful:
What follows are some notes from David Gaughran's talks...

Sales Rank = Sales + Time

  • Sales rank is a measure of how your book is selling relative to other books. It's not a measure of absolute sales.
  • A rank of one means your book is selling best in that hour. If your rank is one million that means there are 999,999 books selling better than yours.
  • Sales decay over time so there’s a recency bias. A sale today is worth about half as much as a sale tomorrow and half again the day after that.
  • Sales rank decays quickly. If you sell a book today it counts for almost nothing in a week's time towards your sales rank.
  • A borrow is worth the same as a sale. It’s not worth more or less.
  • If someone buys your book, within 1-3 hours it will hit your reports. An hour after that it will affect your sales rank.
  • It’s better to not have your rank slip. The best sales pattern is four or five days of consistent sales. Ideally, you want rising sales. This will cause the Amazon recommendation engine to start working for you.

Relevancy Matters Most

Amazon's approach to book selling is different than everyone else's. Amazon wins by displaying items you probably want to buy. They don't show you the books making the most profit or that they have in inventory. Amazon only shows you books you’re likely to buy. Amazon knows if they show you books you want to buy you’ll grow to trust them. That’s why they try to recommend books to irregardless of price.

Amazon values relevance. They look at the results of recommendations. If they see bad conversions, then they recommend your book less. If they see stellar conversions they’ll recommend your book more. So categories matter. You can end up in categories you don’t even know you’re in. Remove categories that aren’t relevant to your book.

You want excellent conversion rates. Think about relevancy all the time. Everything should point at the same ideal reader.

Relevancy is more important than how much people spend. So over time ads become more relevant and more personal. Amazon always wants to show you the products that you're most likely to purchase.

Amazon's Popularity List

There’s a popularity list on Amazon. It drives recommendations to KU subscribers. Amazon actively suppressed pre-orders on the popularity list because KU readers don’t want pre-orders, they want books they can read now. On launch day it jumps up on the popularity list because that’s where it was all along. It stops being suppressed.

  • Lots of free downloads improves your position on the popularity list which helps with KU readers.
  • Borrows don’t count towards KU so don’t target KU readers, target buyers. You don’t want to attract just borrowers. Attract sales. Lead with discounts. Lead with freebies to maximize your position on popularity list.
  • In algorithmic terms, there’s nothing like releasing new books. You get 30 days of attention.
  • Reviews don’t play an algorithmic role, but they do convince people to buy your book. Reviews tip readers one way or another.
  • Amazon cares more about total reviews count than average reviews, so even those one star reviews help.
  • Price does not influence sales rank.
  • Five to six million authors are trying to leapfrog over each other. People are promoting non-stop. If you stand still and do nothing your book will be pushed down naturally.
  • Kindle store rank has its own natural gravity. Books fall if you do nothing.
  • The Kindle Store is organized into over 13,000 different categories. Each category has its own bestseller list for paid books, freebies, and new releases. Every type of book has its own best seller list. These lists update hourly.
  • There's a built-in churn to algorithms based on recency weight. Readers on Amazon use charts to find new books to read. Amazon knows this, so they make sure there’s a new selection of books every few days. There are more new books in best sellers list on Amazon than you’ll see on other retailers.
  • Spread the love. Don’t push only on launch day. Split up your email list. Run ads in quarters. Run ads later. Have list swaps go out later. Spread it out. Try to spread promotions over four or five days. You want Amazon algorithms to sell your book for you.
  • The popularity list is rolling 30 day average of all your sales. Popularity list has price weighting. It suppresses new releases a little.
  • There's a four-day lag on sales to count on the popularity list. On KU keep pricing down to keep your rank up. Your page reads take four days to kick in, so wait before raising prices.