One of the most controversial issues related to e-books is how to price them. How much is too much? Is giving them away for free a good strategy? Is selling them cheap (say, 99 cents) a way of promoting your sales or selling yourself (and fellow authors) out?
I wish I had a simple answer to all these questions. Unfortunately, the real answer to how much to charge for an e-book is that no one knows.
Having said that, I'll speak from experience when I say that, if you're a lesser-known (or even unknown) or new fiction author, you're probably better off charging on the low side for your books.
How low? That really depends. There are so many variables, it seems impossible to simply come up with a single one-size-fits-all price.
One thing I'd suggest is taking a look at what other (more established) authors in your genre are charging for their unpublished or backlisted books.
I've noticed that many such authors in my genre are charging $1.99 per download. So, I initially set my price a bit lower, to be competitive. I was charging $1.59 per download for several months. My sales were good, but not spectacular.
So, I decided early last December to hold a sale. I dropped the price to $.99 per download. Suddenly, my sales spiked. I was selling downloads by the gross. This trend continued up until and after the first of the year. January saw record sales of 1,124 downloads. February started off with a bang--71 downloads sold on Feb. 1 alone. I simply couldn't believe it. And my February sales surpassed those of January. 1,258 downloads in a month. Amazing.
During this time, my e-book was maintaining a rank in the hardboiled mystery category in the Kindle Store of around #3 or #4, fairly consistently. As well as the same rank for hardboiled mysteries on Amazon in general.
Things began to slow down toward the end of February. Maybe my price reduction was just in time for Christmas and my book appealed to new Kindle users, looking for deals.
Keep in mind I was marketing and promoting my book online (the subject of next week's post), so I was helping the process along with my efforts.
And if you have any more doubts that $.99 downloads can benefit new authors, just check out this post by Elisa Lorello, a new author whose book made the Kindle bestsellers list--and she charged $.99 per download and did a lot of marketing and promotion.
Though I've told other authors about my $.99 download success (and even did a semi-scientific market comparison on the question of how to succeed in selling e-books), I've recently seen authors who've reduced the price only to sell one more book than usual (or even none).
I can no more explain this than I can explain why I succeeded with my pricing and marketing strategy.
I only know that, at the moment, it's best for fiction authors to keep their e-book prices low. Especially if you're unknown and want to get additional exposure.
There is a complicating factor, at least with respect to Amazon. Right now, Amazon pays authors one-third the retail price in royalties. However, at the end of June, Amazon will up the royalty payment to 70%, if (and it's a big "if") the author sets the price at no less than $2.99 per download.
Considering what a difference a mere 60 cent drop in my price made in sales, I'll have to think about this. How many sales will I lose due to raising the price? And will the difference be made up in greater royalties? Plus there's the whole exposure issue. I want to be paid, naturally. (See my Web site's slogan. :)) But I'm willing to take less, in order to spread the word about my books.
Besides selling e-books cheap, may actually enhance print sales. (It seems to work that way for free e-books, anyway.)
Plus based on the backlash I've been reading on various e-reader forums about the MacMillan-Amazon dust-up over the publisher's desire to charge $12.99 - 14.99 for e-books, which I've written about here and here--well, unless you're writing really expensive textbooks or other books that make that price a deal by comparison, I wouldn't go there, if I were you.
I know this isn't the quick and easy answer you probably hoped for, but check what your peers are doing (and be sure to compare with others in your genre--different types of fiction and non-fiction could command different prices) and try things. See what happens. If your sales aren't what you hoped for, try running a sale or doing a promotion. Which leads to the topic for next time.
Next week: Marketing and promoting e-books.
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