I've decided to give it a go. Put through my application yesterday, and got approved just before I went to bed. I've found the PPC model effective with AdWords, and on sites like Etsy, so I figured why not.
Rather than targeting categories, I targeted products, including the best sellers in my genre. I'm also going with a slow burn on this one, and set the campaign to run for six months. If I show eight sales a month, I'll break even. If it looks like it's going to cost me more than it makes, I'll let it run an extra month and then cancel it.
It takes a while for everything to update. I'm going to check back tonight and see if I'm getting impressions, or if it's just really slow to update. You also don't get any real analytics. It tells you how many clicks and impressions you have, and your average CPC, but it doesn't tell you where those clicks are coming from. There's no way to know how your targeting is actually working. With AdWords, it tells you exactly which keywords are performing, and which aren't. It also seems like there are a lot of people using this and raising their max bid to absurd levels. I kept mine at 5¢, with the intention to extend the campaign until my $100 runs out, should it prove successful.
I'm a bit suspicious of Amazon's move to sell advertising to KDP authors, I admit, but I wanted to try this one time.
This is how Etsy's promoted listings work. If you get your targeting down, it's an effective model. I don't mind paying a little more to the distributor in exchange for a few more sales. The trouble comes from the amount of people using it right now who don't understand it, and put their bid up to a dollar, and then target EVERYTHING. The reason I set my campaign to run for six months is in the expectation that by then, the system may finally even out as these people either wise up or pull out.