Practical Pricing of eBooks

Lately I’ve been reading quite a few articles offering advice on pricing an eBook.  They range from the adamant insistence that all eBooks should be 99 cents to the almost snobbish claims that artistic integrity demands that eBooks be priced the same as paper books – and hard bounds at that!  Most of the proponents of a particular view have a good point to make, but these points are all too often used to whitewash the entire spectrum of eBook genres and their authors with a one-size must fit all attitude.  I vigorously disagree with that, and I’d like to chime in on some of the other views I’ve heard discussed and add one or two of my own.  

The Cheaper the Better

Let’s start with the “everything should be 99 cents” school of thought. There are several very successful authors insisting that the 99 cent pricing model is highly responsible for their success.  And that may be, but to make it work they need to be churning out a new novel every month or so and they must quickly develop a large following so they can make enough income to live on while they devote themselves to writing novels as fast as possible.  It takes a lot of sales, at 35 cents a pop (a 99 cent book’s royalty),  each and every month to keep the mortgage paid; even more if you want to eat as well.

Less prolific authors will have a very hard time making this mass-production business model work.

Is It Too Cheap?

A few pundits have asserted that any novel that is priced at less than $3.00 just screams out that it is self-published crap and they’d rather pay more for a “professional” book.  I take offense at this statement because I know full well that there are a lot of self-published books that are very well written, and professionally edited.  But I have bought some eBooks that were, in all honestly, hastily written and barely edited crap.  However, many years ago I learned an amazing lesson about perceived value.

At the time I was focusing my energies on making wooden fountain pens.  These were hot with aficionados of fine writing instruments and big wheels who wanted to impress others.  I made some very nice pens, but I decided to undercut my competition on price.  My sales were disappointing.  One weekend I was doing a show and ended up in the booth next to another pen turner.  His sales were brisk, and his work was no better than mine.  Finally I asked him what he was doing differently.  He said, “You do excellent work, and your sales technique is OK, but you need to double your prices.”  What?  How in the world could that help?  He patiently explained that it has to do with perception of quality.  People looking for a fine item expect to pay a certain amount for it.  When they encounter something that looks good but costs considerably less, they’ll pass it by because they assume it is inferior.  People who want something cheap won’t buy these anyway, they’ll go to Wal-Mart and get a package of Bic’s.  Kind of snobby, but that’s how it works.  I doubled my prices and they began selling well.

I don’t think this business model works well for fiction novels.  I do not mean to be insulting here, but most fiction is sort of the “disposable” end of literature.  Most people I know will read a novel once and move on.  Non-fiction is most often bought as a reference which will be used over and over again, kept handy and referred to often during a project or study.  Non-fiction writers can shoot themselves in the foot if they’re producing worthwhile books and selling them really cheaply.  I’m not talking about PLR knock-offs, but good, original, non-fiction.

How Much is Too Much?

I will admit that as a consumer of other author’s novels, I rather like the idea of having a wide variety of titles to choose from and all offered at minimal expense.  However, I am not opposed to paying a reasonable fee for a good piece of entertainment.  What is “reasonable” will vary from person to person.  For me and my financial standing, $2.00 to $3.00 is a comfortable expense for a good eBook.  $4.00 to $5.00 is doable if the book is something exceptional.  However, just the other day I finished a Kindle sample from a Sci-Fi author who is highly rated and has many books available.  I enjoyed the sample so I popped into the Kindle store to buy the book.  Upon arrival I found that the full eBook (just a single book mind you, not a series) was priced at $11.99!  GASP!  I waited until my heart rate returned to normal and the dark spots no longer floated before my eyes to check and make sure I had not misunderstood.  Nope, that’s what it said.  I hit HOME and moved on to my next sample.  Yes, he was a good writer, yes it seemed to be a good story, but it wasn’t *that* special.

With the number of books being offered growing by leaps and bounds, commanding an exceptionally high price will take developing some exceptionally committed fans.

Setting a Hook with Pricing

What does seem to work well for lesser known authors is to set a low price (even free) on their first novel, then a higher (but sane) price on subsequent work.  Some offer several free short stories as an introduction.

Amazon does not allow you to set a price of free on an eBook, but if you offer the same book for free on Smashwords or through your web site, then report yourself (there is a ‘report a lower price’ button near the bottom of the product listing page)  Amazon will price match the book in their listing.  Just be careful not to set up the 70% royalty option when you submit the book; that can put you into a situation where they have to pay you a royalty on a free book and they’ll put the boot to you for cheating.

Even a 99 cent novel will be enticing enough for most people to give you a whirl, if you dance well they’ll remain your partner through many more numbers.  If you step on their toes, even a bargain basement price tag won’t bring them back.

Having Said All That…

I am picky.  I am selective about what topics I spend my time reading.  I am insistent about the quality of the writing.  Misspelled words, wrong words, editing fragments, and grammatical errors serve as stumbling blocks that trip up the flow of the story and spoil it for me.  I have discussed book topics with others who are just the opposite.

They don’t care about spelling, editing, or grammar (some would not know the difference) they are after a feeling.  They read for emotion.  The printed stuff is just the vehicle that takes them on the journey.  Most of these have voluminous appetites and will go through several books a week.  Low prices win points with them and they love the markets opened up by self-publishing.

Virtual vs Physical

Most people I’ve talked to feel that pricing of eBooks should be lower than paper books.  Paper books represent a manufacturing process above and beyond the production of the manuscript.  It involves paper and ink and printing presses and bindery work.  Then there is storage and shipping and handling.  And in the end you have a physical object that you hold in your hands, or put on a shelf or share with as many friends as you want just by handing it to them.  An eBook is a collection of electrons imprinted into a memory medium.  The file can be copied indefinitely and distributed to buyers at little or no cost to the distributor.

Claiming that an eBook is exactly the same book as a paperback or hard cover book and therefore should carry the same price tag seems nonsensical to me.  Distributors like Amazon and Barnes & Noble seem to agree because they insist that eBook prices be at least 20% off the price of paper versions (although that doesn’t seem to be holding for books from The Big Six lately).  The author may have put the same amount of work into producing either a paperback or an eBook, but the distribution channels, and their expenses, are vastly different.

In Conclusion

Is there a Golden pricing model for all eBooks?  No.  Determining a fair price for a book requires considering the author’s notoriety and skill, the genre and target audience, and the author’s proclivity for production.  However, there is no rule that says that once you’ve set a price you have to leave it there.  Feel free to play with it.  Offer a special price to coincide with a promotional effort, when sales pick up, tweak the price to match the new popularity.  And keep writing; having multiple books in your genre offered through all the major channels helps to establish you as a respected author.

These are my thoughts on the topic of eBook pricing, what say you?