Thursday, April 14, 2011

What is it worth to you?

Last week, I attended the Digital Now meeting in sunny Orlando. Picked a perfect time to get out of New York and into some terrific weather. While the social media conference was all work-related, I did get a few gems that could be applied to my writing life, as well. One of the session leaders, Patrick Mork CMO of GetJar app store said one of the most profound things I’ve ever heard, “In the race to the bottom, you only succeed in devaluing your brand.”

His statement about providing cheap applications for smartphones made me think a lot about the correlation to the 99 cents pricing of e-books. I’m a huge advocate of the idea that e-books should be cheap. It’s the reason why I don’t buy e-books from major publishers that are $9 and above. I have done the upload process and know that there is no additional cost for a publisher once an e-book is available. It’s different from the printing and distribution of a paperback or hardcover, where there is a manufacturing process involved in producing a bound copy of a book. Basically, large publishers will never be able to defend their high prices on e-books to me.

But when we’re talking cheap, how competitive is cheap? I’ve heard varying opinions on books priced 99 cents:

“It’s cheap, so not a big deal if I don’t like it.”

“If it’s only 99 cents, how good can it be?”

“If it’s any good, I might be another one from the author.”

In most of what I hear is the underlying but common opinion that it can’t be any good if the author is willing to sell for 99 cents. Yet, I know so many readers like myself who balk at buying an e-book or sometimes a paperback that costs more than $8. What is the perfect price of an e-book?

Last month I experimented with 99 cents pricing for On Falcon’s Wings, in the same way that other self published authors have, just to see if I could produce similar results, i.e. more sales. I did. March has been one of my best sales months. Still, I noticed something. When I reduced the price on Amazon to 99 cents, the same book still sold on Smashwords for $2.99. Sultana, which was released one month earlier at $3.99, continued to sell consistently. Its sales also picked up in March. One month later, both e-books are continuing the upward trend. Still, at the 99 cents pricing, I started thinking about the types of readers I might be attracting. By offering a book at a ridiculously cheap price, was I also feeding into readers' poor expectations? Told you this was related to Patrick Mork’s quote.

Were those readers who bought my book thinking that 99 cents fit the amount of risk they were willing to take on an unknown author? If so, did they actually read it? Or, did they buy it because it was 99 cents with the intention of getting to it eventually? Did they decide to buy Sultana too? Or, had they looked at both my offerings and decided 99 cents was worth the risk, but $3.99 was not? I’ll never know unless I actually get some reader feedback. The question that arose for me was: do I want people who will purchase something, anything just because it’s 99 cents, or do I want readers who might think, “I liked this book based on what I’ve read so far. I might buy another from this author, even if it’s a couple of bucks more.” Can you guess which kind of reader I’d prefer?

So, I’ve since raised the price of On Falcon’s Wings back to $2.99 and it will stay there, in part because I had so much trouble with Amazon getting the new price shown on the Web. That’s another discussion for another time. The other point is I want readers who are motivated to buy based on the sampling of the book or my other books, not just because of the pricing. Like many of them, I think pricing is a crucial factor but ultimately, it should not be the only factor motivating readers to open their wallets.

I’d love to know what blog visitors think of e-book costs. I encourage you to share your experiences.
  • What are your expectations as a reader of books priced at 99 cents or those that offered at $10 or more?
  •  How much does pricing affect your decision to buy?
  •  Do you search Amazon and other sites looking for books by their pricing, or do other factors influence your choices?
  •  As an author, have you experimented with the pricing of your books and what were the results, if any, that you can share?


Ann Simon said...

I haven't experimented with the price of Jaguar Sees: The Lacquer Box. I have heard that there are readers who only shop the 99 cent books and wondered why that is. Why would $2.99 be too high a price? Would a lower price really convince someone to buy my book? Or do these readers just believe that there is so much talent out there that they can satisfy their reading requirements for 99 cents. I mean, writing talent certainly abounds, but isn't selection severely limited by such a low threshold? I wish I knew the answers!

Hart Johnson said...

I think it's a GREAT idea to have ONE book super cheap like that and the others for more--people unsure of you can test you out... some people see them together and think 'I don't want the cheap one, I want this better one', where others think, 99 cents, what is there to lose. Seems like you win all around. (looks like your numbers support that, which is great!)

Lisa Yarde said...

Thanks for the comments so far

@Ann, as for knowing the answers, yes you and I and many others wish we had them cause then we could move more books at optimal prices. To me, up to $5.99 seems like a reasonable price for an e-book. When I first debuted OFW, I sold some at $5.99, at $3.99 and then $2.99. All my sales at 99 cents have eclipsed all those others totaled in terms of volume sold, but of course, not royalties earned. I don't want to make snap judgments about anyone who buys at 99 cents but I do wonder whether they actually read those books or buy them just because they're cheap.

@Hart, your suggestion is what prompted my 99 cents experiment. I had expected to see sales for Sultana in dribs and drabs, while OFW climbed steadily. Just didn't happen that way. Instead, it became a 2:1 ratio. For Sultana ebooks I made $2.74 per sale, with OFW at 99 cents, my royalty was 35 cents. I could see myself on the losing side of that equation very quickly. Still it was an interesting experiment and I can only hope anyone who read my books thought they were worth the money spent.

Dawna Rand said...

Hi Lisa,

I always love to drop in on your blog, there are always such interesting discussions :)

I know that self-published authors often use the music industry as a comparison.... doesn't ITunes sell songs by Beyonce or (my favorite!) Aerosmith for 99 cents? They seem to be fine with a 99 cent price point...And I wonder if Beyonce or Aerosmith really cares if anyone actually listened to the songs or if they just bought them because they're cheap? Why would they care? Would they really think more of one type of customer vs. another? :)

If an author's first book is cheap, it will get people to buy it who might not have otherwise. If the first book is also EXREMELY good, it will probably persuade readers to buy the next book at a higher price.

This is especially true for self-published authors - why pay $5.99 for an e-book by an unknown (untried) author, when you can get a book (whether printed or published) by an established author for about the same price?

I just wonder if - initially - the goal for a self-published author should be to earn royalties.... or to build their readership?

At least initially, those two goals might be mutually exclusive. :)

Have loved the pics from Spain and Portugal by the way - I'm so jealous!

Hope all's well your way!

Lisa Yarde said...

Hi Dawna,

Since Beyonce and Aerosmith are established artists with bazillions of dollars lining their pockets, they probably could care less about revenue from a 99 cents song. A self published writer, assuming that he / she is also not sitting on a bazillion dollars, has a very different viewpoint.

I've often wondered why writing is viewed as one medium where the artist is expected to throw his or her work out there for free or very cheap consumption. I get that books aren't like music or movies; you'd likely watch a movie or play a song several times, but maybe you read a good book, even a favorite, once or twice. You don't get the same usage.

But I don't see first time musicians, like the guys that want to promote their demo CD on the street going, "buy my CD for 99 cents." It's more like buy it $10. They are the closest comparison to self published authors that I can think of because they're also unknowns just hawking their stuff.

Don't see why expecting to be paid AND building a readership at the same time shouldn't go hand in hand for a self-published author. If I didn't want to earn a decent rate for my work (gotta pay for that eventual move to Spain somehow!) I'd just upload my stuff on Scribd or Smashwords for free and revel in the downloads. As I've found the prevailing view is that something must be wrong with a book (and it's author) if it's just 99 cents, I wonder what people think of full length novels that are free? I'd be curious to find writers like me who are offering their stuff for free and learn what their readership is like. Do they see any benefits to working on a full-length novel and giving it away by having loyal readers willing to buy something from them next time around? In the meantime, keep those royalties coming, Amazon!

Dawna said...

lol!!! Thats an interesting perspective, Lisa, but I wonder if the independent musicians who sell tjeir songs online are very sucvessful selling tjem online for $10....? And for that matter, how sucvessful is the guy on the streetcorner who does it? I read Bob Mayer's post the other day on the Newbie's blog, and even Bob is selling his first novel in his nrw series at 99 cents, and Bob is a NYT best selling author (and a really good guy... I've attended his workshops and they are FAB). Every othet book of his is sold at $2.99, with one exception. :) Still, for me, this is ALL about business, which isn't about what's fair or what we think we should be able to reasonably expect... Business is solely about what the market will bear, and what customers expect and will pay for :) Anyhoos, best of luck, and I look forward to hearing how everthing pans out!

Lisa Yarde said...

Part of what I love about self-publishing, Dawna, is that there is no "one size fits all" approach. If there were, everyone would be doing it and there would be no genuine successes to cheer. Each author has his / her own measure of success, be it growing a readership, earning money, etc. It's good to sometimes check out your neighbor and see how business is growing, but imitation is no assurance of similar success. We each find our own path in this crazy publishing business.

Thanks for checking in on the blog, you always give me different perspectives to think about.

Alison said...

I must say that your books are selling so well because you are one hell of an author. Obviously you are working hard at building your brand, which is fantastic.

My lone Night Watchman Express is available for 2.99, but I think I'll drop it to 99 cents when my sequel comes out this summer.

Lisa Yarde said...

Hi Alison, I think having more than one book helps the sales too. Please let me know how dropping yours to 99 cents helps. I've seen lots of people not named Amanda Hocking do very well at it. I wonder if maybe I'm not patient enough.

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