Both David Gaughran and Lindsay Buroker have guest posts from Edward Robinson about how Amazon calculates the rankings on its popularity lists. Both posts are worth reading, and if you're really interested, you should also read Robinson's many blog posts on the subject.
The gist? Amazon has changed its popularity rankings so that you get less of a boost from giving away free books via its exclusivity program. Also, cheaper books may get less of a boost than more expensive ones.
I was wondering if something like this would happen, because one of the things Amazon does very well indeed is enable book discovery. Compromising that to promote books from its own or allied publishing houses (like Barnes & Noble did for Macmillan) or to promote its exclusivity program is the kind thing that can really backfire with consumers. If Amazon's book suggestions are perceived as being unreliable or junky or skewed by some corporate agenda, consumers will just ignore them--and maybe if they're really annoyed, they'll go find another Web site that makes better suggestions.
Authors, I think, need to get wise to the big picture here: AMAZON'S ALGORITHMS CHANGE. They may change in a way that helps you, they may change in a way that hurts you, but they have always been changing and they will always be changing.
Focusing your attention on gaming the Amazon system is, at best, a short-term strategy. Expecting Amazon's algorithms to take care of all your marketing needs is a really bad idea.
You don't want to be like those companies that become utterly dependent on their Google ranking, and then Google tweaks the algorithm, and their entire business collapses.
And there's no need for it. If Amazon is helping you right now, that's great--it works and it's free and it's really easy. I can totally see why people get into the habit of thinking that this is the only thing they need to do.
But if you don't diversify, the rug can get pulled out from under you in an instant. If you don't make the effort to try out other forms of marketing, then if Amazon's algorithms stop helping you, you will know nothing useful. You will have no Plan B.