Let’s talk about pricing your e-book. Which isn’t necessarily the same thing as figuring out how much your book’s worth, but rather how much readers are willing to pay for it.
For e-book distribution I use two services: Amazon’s KDP, which allows me to sell my e-books through Amazon’s e-stores, and Smashwords, a distributor and online store founded by Mark Coker, which makes your e-books available on various retailers: iTunes, B&N, Kobo, Sony, etc.
That being said, how much should you be charging for your self-published title?
99¢ is so last Summer
There have been a number of self-published authors who have sold a lot of books mostly because they were among the first to price them at 99¢. A few years ago there were marketing plans which revolved around this price for e-books.
For instance, Amanda Hocking. She priced the first titles in her series at 99 cents each in an attempt to hook readers. She priced the rest at $2.99. And it worked. She sold around 1.5 million copies, made the headlines with a 2 million dollar book deal, and is now a traditionally published author.
John Locke is another writer who sold 1 million e-books priced at 99 cents. And there are many others who have taken advantage of this price level.
But now things are changing, and it’s probably worth knowing that the world of publishing, or e-publishing, is an ever changing one. So it’s never a good idea to follow trends. If there’s one thing I’d like for people to understand about self-publishing, it is simply this: there’s always room for experimentation and improvement. And the most successful writers are doing just that. Through trial and error they’re finding new ways of reaching readers.
Why isn’t 99 cents working so well now?
Because the way readers perceive e-books has changed. Two, three years ago, e-books were still in their infancy. There were few e-readers available, fewer titles, and pricing an e-book for less than the cost of a hamburger (that’s true for Romania, at least) was a good idea. Especially for indie titles.
But perceptions change. Now, more and more readers are willingly buying self-published titles (every month or so a new self-publisher becomes a New York Times Bestseller.)
The main disadvantage is that KDP only pays you 35% royalties when pricing less than $2.99 or more than $9.99. So you earn 35 cents from each sale.
With Smashwords, things are different. You earn 58% – that’s 56 cents for each sale.
Sales made through retailers such as Apple, B&N, Kobo, etc. are subject to a 60% rate, so you’d be earning 59 cents from each sale.
My advice to all this: pricing your book at the lowest possible level is a good way to maximize readers. But it also provides a biased perception of value, one that will be difficult to change once your readers will think that you’re worth less than a buck.
I use this pricing to market stuff that’s already very difficult to market: short stories. Each of my short stories are approximately 5,000 words long, so asking for more would be suicidal.
One — at least theoretical– way to go about this would be to submit short works (between 5,000 and 30,000 words) to KDP Singles Program. Thus, you’d be able to choose the 70% royalty option even when pricing at 99 cents. Oh, and Amazon is going to do some insane promoting and marketing on your behalf as well.
$2.99 — probably the best price in the world
Why? Because, for once, you’re earning more. It’s the minimum pricing level which allows you to take advantage of the 70% royalty rate from KDP. So you’re earning around $2 for each sale (you never earn exactly 70% because Amazon charges you for delivering your e-book to the buyer — the bigger the file, the bigger the delivery cost.)
At this price level, Smashwords pays you 74% for sales made through its online store and 60% for sales made through online retailers.
Secondly, it’s still significantly lower than the price of e-books published by traditional houses.
More than $2.99. Does it work? Is it crazy?
Anything can work. This is the beauty of it. You can price your book at $9.99 (the maximum price which still earns you 70% royalties on KDP) and sell. If your readers feel that your book is worth that much, by all means, price your book at that.
This is probably another thing worth considering. And I’ve said it before. Your book isn’t worth how much you think it’s worth. It’s worth how much people are willing to pay for it.
Another thing that has to be taken into consideration is the fact that, ultimately, you’re choosing between more money per copy/less readers and more readers/less money per copy.
In the long haul, selling more at a lower price results in more exposure. So it’s all about what you’re aiming for. Pricing your book higher requires less sales to actually make some money, but it also means having less people to talk about your book. Some can live with that, others can’t.
E-books are the dominant medium, so it’s maybe wise to secure as big an audience as possible.
Also, I’d like to point out that there have been cases of books which failed to sell well at lower pricelevel, and when changed to $2.99 or higher, sales exploded. So there’s no playing it safe. You could be making more money at 99 cents, than let’s say $2.99, because you’d be selling a lot more copies.
This has to do with your target audience and how much that specific audience is willing to pay for your books. It’s also well to research other titles in your genre to see what’s the average price level. For instance, how-to guides usually perform better when priced higher, probably because readers feel there must be more valuable information inside.
But how much does a traditionally published author earn?
Depending on the contract the author signs with the publishing house, he earns anywhere between 8 to 10% for paperback sales and 10-15% for hardbacks. He also earns 25% royalties on any e-book sales. Or something like that.
So at any price level, you’re actually earning more in terms of percentage (and most of the times, in terms of cash as well) than a traditionally published writer. This gets a lot of people very excited. It’s like they’re winning the lottery or something.
But it’s not like that. You’ll have to work really hard to actually make any money. And you’re doing the work of several other people… you’re like a miniature publishing house.
As much as I’m posing as this troubled artist type, with my essays about the creative process and all that, self-publishing is a business. And I spend insane amounts of time researching, trying new things in terms of marketing, and following other self-publishers.
It might seem funny, but there’s one similarity between self-publishers and traditionally published authors. Nothing can guarantee sales. There’s no sure way. Not in terms of advertising/marketing, not in terms of the quality of the work you’re presenting the world, not in terms of the writing itself.
I don’t want to discourage anyone, but when it comes to the publishing world – and it has always been so – the difference isn’t made by how good the writing is. It’s a sad truth, actually, but it’s worth remembering that, while there is a bestselling writer of all time (I think that one is Agatha Christie — I may be wrong,) there is no one considered to be the best writer in history.