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Author Topic: $0.99 sells a lot of eBooks  (Read 7482 times)
dreed
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« on: March 09, 2011, 10:14:42 AM »
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To follow up on the post about pricing of electronic files vs physical books comes this:

"And yet, when I lowered the price of The List from $2.99 to 99 cents, I started selling 20x as many copies--about 800 a day. My loss lead became my biggest earner."

A Newbie's guide to Publishing
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feppe
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« Reply #1 on: March 09, 2011, 11:27:31 AM »
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To follow up on the post about pricing of electronic files vs physical books comes this:

"And yet, when I lowered the price of The List from $2.99 to 99 cents, I started selling 20x as many copies--about 800 a day. My loss lead became my biggest earner."

A Newbie's guide to Publishing

Good to see someone has the busines sense to price to the market, and not for prestige. There's only so long book publishers can get away with asking same or even higher prices as paperbacks - people understand that there are immense savings in manufacturing and distribution.

Perhaps more importantly, he (and some others) have seen their profits surge as they have slashed the per-unit price of their books - even when it means that Amazon takes a much bigger cut of their earnings (30% of $3 vs. 70% of $1 or thereabouts IIRC).

Business 101 but unfortunately poorly understood by artists.
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Slobodan Blagojevic
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« Reply #2 on: March 09, 2011, 11:50:36 AM »
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... Business 101...

If it were only that simple. The cute story is yet another example of the survivorship bias. We are hearing only about a guy who took that path (i.e., slashing prices), hit a sweet spot (on the demand curve), and succeeded (survived). We do not hear anything about similar attempts that ended without success. We also do not hear (or at least not at the same time) about opposite success stories, i.e., someone raising their prices, say tenfold, thus escaping the perception of a cheap crap, finding their value-driven audience, and increasing sales volumes as a result.
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feppe
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« Reply #3 on: March 09, 2011, 11:57:19 AM »
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If it were only that simple. The cute story is yet another example of the survivorship bias. We are hearing only about a guy who took that path (i.e., slashing prices), hit a sweet spot (on the demand curve), and succeeded (survived). We do not hear anything about similar attempts that ended without success. We also do not hear (or at least not at the same time) about opposite success stories, i.e., someone raising their prices, say tenfold, thus escaping the perception of a cheap crap, finding their value-driven audience, and increasing sales volumes as a result.

Good points throughout, but my points were that people are slowly realizing they are taken to the cleaners when a ebooks are priced on par with its dead tree edition, and that the equation high price = high profit isn't necessarily (or even most of the time) true.
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alainbriot
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« Reply #4 on: March 09, 2011, 12:20:09 PM »
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If it were only that simple. The cute story is yet another example of the survivorship bias. We are hearing only about a guy who took that path (i.e., slashing prices), hit a sweet spot (on the demand curve), and succeeded (survived). We do not hear anything about similar attempts that ended without success. We also do not hear (or at least not at the same time) about opposite success stories, i.e., someone raising their prices, say tenfold, thus escaping the perception of a cheap crap, finding their value-driven audience, and increasing sales volumes as a result.

Agreed 100%.  Also lots of negative reviews on Amazon. Some saying they would give the book less than 1 star if it was possible...
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Alain Briot
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JeffKohn
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« Reply #5 on: March 09, 2011, 12:38:07 PM »
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We also do not hear (or at least not at the same time) about opposite success stories, i.e., someone raising their prices, say tenfold, thus escaping the perception of a cheap crap, finding their value-driven audience, and increasing sales volumes as a result.
eBooks aren't exactly luxury/prestige item, I think the notion of charging premium prices to attract a high-end clientele doesn't really make any sense there. And even if it were possible I'm not sure why it would be desirable. With an ebook there are no real production costs associated with each individual sale; so what advantage is there to the author to sell 100 books at $100, versus 10,000 at $1? If anything, the latter approach is a lot more appealing because it means gaining more name recognition in the market.

The real revolution with ebooks is self-publishing. The big publishing houses are going to find themselves obsolete once authors realize they don't need them in the ebook model.
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feppe
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« Reply #6 on: March 09, 2011, 02:29:51 PM »
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eBooks aren't exactly luxury/prestige item, I think the notion of charging premium prices to attract a high-end clientele doesn't really make any sense there. And even if it were possible I'm not sure why it would be desirable.

The ebook market is very different than fine art print market: the potential clientele is much smaller in the latter even when selling prints at cost. Going for such $1 prices makes sense when the market is large, but for a smaller market and/or luxury product pricing has to be higher due to manufacturing costs alone.

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With an ebook there are no real production costs associated with each individual sale; so what advantage is there to the author to sell 100 books at $100, versus 10,000 at $1? If anything, the latter approach is a lot more appealing because it means gaining more name recognition in the market.

An author featured in a similar story from UK has exactly the same reasoning:

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Yet while he is making significant sums just through ebook sales "up to 11,000 a month" he still only sees it as a sideline to his main writing career. "I never went into this to make money. I went into it as a way of widening my readership. My hope was that readers would read my book on Kindle, say, 'I really enjoyed that', then when my new thriller came out with Hodder, they'd remember it and buy that too."
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Ray
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« Reply #7 on: March 10, 2011, 06:08:50 PM »
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The great attraction of the e-book concept for me is not only the lower cost but the significantly reduced bulk and weight which can be major advantages when travelling.

I've just downloaded 3 e-books in PDF format for free. They are the user's manuals for the Nikon D700, D7000, and SB-700 Speedlight flash unit.

The D700 manual is 444 pages; the D7000 is 326 slightly larger pages, and the SB-700 manual 164 pages. These 3 manuals together, in paper book format, weigh more than my Kindle DX with carrying case and power cord/charger.
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John Camp
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« Reply #8 on: March 10, 2011, 07:08:25 PM »
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All of this is much more complicated that a .99 model. The .99 cent model basically is for amateurs, people who are trying to break in, get something viral going, so they can raise their prices. A physical paperback book basically costs a buck (depending) to produce and deliver. Everything else is sales costs and overhead. On a $9 paperback, about $4 (depending) will go to the store. The other $5 goes to the publisher -- but of that $5, about 15% (depending) will go to the author. The rest goes for producing the book, including editorial, delivery, advertising, artwork, and profit.

Once the .99 market is saturated with, say, about ten or fifteen million or fifty million self-published books (and those numbers are not imaginary -- around a half-million books are submitted to NY publishers every year; and that's only the US, and there's a huge backlog of unpublished stuff) how will you find what you want to read? Probably through publishers, who'll provide advertising, editorial support, an implicit guarantee that a book meets certain quality standards, etc. All that will be gone from the model is the relatively insignificant cost of the paperback. The publisher, seller and author are still going to want to get as much as they can -- why would that change? So there are *not* huge savings in on-line books.

One big difference is that certain bestselling authors may be able to make direct deals with Amazon and B&N and take, say, 25 percent of the proceeds...but they have to become bestsellers first.

If a book is good enough, it will find a traditional publisher. Most of the .99 cent books haven't -- because they're not good enough. So, you can pay .99 for crap which you wouldn't spend anything on in a store, or, you can pay more for something good. I already waste enough time, and I don't really plan to waste even more reading somebody who can't get published, just because it's cheap.   
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feppe
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« Reply #9 on: March 10, 2011, 07:44:13 PM »
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All of this is much more complicated that a .99 model. The .99 cent model basically is for amateurs, people who are
...

That's a very simplistic and statist view of the business. Just because publishers provide a valuable service now doesn't mean it can't and won't be crowd-sourced, distributed, or shaken to the core by an upstart with a novel business idea.
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alainbriot
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« Reply #10 on: March 10, 2011, 09:19:02 PM »
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John is absolutely right. A publisher is a lot more than someone who foots the bill for printing.  Without good promotion no one will know about your book.  It's no different than any other product, photographs included.  Right now offering ebooks at 99c is a form of promotion, but it won't last long.  Plus, some of the ebooks offered at that price are not very good.  Just look at the reviews on Amazon.  As I pointed earlier many reviewers would give these books less than 1 star if it was possible.
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Alain Briot
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John Camp
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« Reply #11 on: March 10, 2011, 10:14:38 PM »
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That's a very simplistic and statist view of the business.

Which part?

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Just because publishers provide a valuable service now doesn't mean it can't and won't be crowd-sourced, distributed, or shaken to the core by an upstart with a novel business idea.

I'm not saying it won't be -- just the idea that a few very large authors could step outside the publishing model potentially means a big loss of business to publishers -- and if that happens, publisher's will suffer a large loss of revenue, which will engender further changes. The way that would happen, is this: Barnes and Noble, with the fall of Borders, winds up controlling most of the paper-publishing business, as well as a good share of the e-book business, along with Amazon and Apple. So, the author cuts a deal with B&N -- he'll deliver a fully edited book, ready to go to the printer, with cover art and everything else, for 25% royalties; B&N will publish the paper editions, and the author reserves the right to sell the eBooks to B&N, Amazon and Apple, for, say 30% royalties. But to do this...ah, you need to get to the place where people will pay attention to you, and that's neither easy nor cheap.

However, there is no one novel business idea that will shake the business to the core -- a lot of very smart people have been obsessing over this for a long time, ever since (and even before) the CD business crumbled. Speaking of which...what .99 cent freelancers have made it huge in the music business? Uh, none. They ALL require things that publishers (or their equivalent) provide: exposure, advertising, support, licensing, agents, lawyers, etc. Those things exist for a reason, which I'm sure you can work out for yourself...and they cost money, which boosts the costs of the book, in whatever form. The idea of the .99 cent outsider making a fortune is romantic, but essentially fatuous, just as the idea of hitting it rich in the lottery is romantic but fatuous. Some people do it, just not you.

What happened in the music business, by the way, is what I see happening in publishing --  there will remain a large paper-book business, but eBooks will become a large business as well. Essentially, it'll be just another format, like recorded books.

The biggest danger to publishing, IMHO, is the possibility that people simply stop reading novels. That the 'net creates a culture of short-form readers, and that novels are simply passing out of fashion, because they take too long to read, and are too subtle.

JC  
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Slobodan Blagojevic
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« Reply #12 on: March 10, 2011, 10:33:19 PM »
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... The biggest danger to publishing, IMHO, is the possibility that people simply stop reading novels. That the 'net creates a culture of short-form readers, and that novels are simply passing out of fashion, because they take too long to read, and are too subtle...

What!? In the age of YouTube and reality shows, someone is still reading!?
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LesPalenik
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« Reply #13 on: March 10, 2011, 11:12:29 PM »
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John is absolutely right. A publisher is a lot more than someone who foots the bill for printing.  Without good promotion no one will know about your book.  It's no different than any other product, photographs included.  Right now offering ebooks at 99c is a form of promotion, but it won't last long.  Plus, some of the ebooks offered at that price are not very good.  Just look at the reviews on Amazon.  As I pointed earlier many reviewers would give these books less than 1 star if it was possible.

I looked at the Amazon reviews, and it appears that 99 cents price level is about right for this literal jewel. Some readers even said that 99 cents was too much.
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dreed
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« Reply #14 on: March 11, 2011, 06:07:56 AM »
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All of this is much more complicated that a .99 model. The .99 cent model basically is for amateurs, people who are trying to break in, get something viral going, so they can raise their prices.

I disagree.

I think that Apple has set the tone for the market by making downloaded songs $0.99 via iTunes. The music that they're selling online via iTunes is not from amateurs trying to break into the market.

If you're buying apps for the iPhone or iPad, you expect a similar price for most apps. But some high quality apps are much higher. For example, The Photographer's Ephemeris ($8.99).
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Robert Roaldi
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« Reply #15 on: March 11, 2011, 12:25:43 PM »
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I think that Apple has set the tone for the market by making downloaded songs $0.99 via iTunes. The music that they're selling online via iTunes is not from amateurs trying to break into the market.



I don't think that experience carries over well. A 3 minute long pop song, even from the Beatles or the Stones, is not quite the same as a 250 page literate well-research novel (or nonfiction work) that took 3 years to write and edit. There may be millions of people worldwide who want that tune on their ipods, but are there that many that will read the Matt Minogue novels of John Brady, say. Looking at it from a pure entertainment-per-minute point of view, I may listen to that song, say, 20 to 30 times in my life, maybe more if it's filler during a car trip, but I will get hours of pure pleasure from that novel. That's worth way more than 99 cents to me. And if it weren't for a publisher risking their money to put that novel on a shelf at my local bookstore, I may never have seen it. I've tried browsing online sites, it's awful, can't do it, but browsing in a store is fun. (And I wrote software for a living for 25 years, so I'm not a technology luddite.)
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« Reply #16 on: March 11, 2011, 12:29:13 PM »
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(Sorry for the two separate posts, I clicked send too quickly.)

It strikes me as ironic that it was not that long ago that people on this site and elsewhere were decrying the advent of $1.00 micro-stock sites. Now some think that a 99 cent book is just fine. I guess buyers and sellers see things differently.

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« Reply #17 on: March 11, 2011, 06:41:57 PM »
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Actually, I am willing to bet the vast majority of those 99c books haven't been edited. I've bought a few low price novels and, usually, while the central ideas/plot structures weren't very different from mainstream stuff, the lack of editing was painfully obvious. Sometimes it is tolerable, sometimes it is unbearable. The difference is probably similar to the one  that exists between an amateur photographer that will nail a great shot of the bride in 300 pictures and a professional that will deliver a book with 50 consistently good shots. Good point about the different perceptions from either the giving or the receiving end. And anyway, it's a bit hard to ruin oneself buying full price books, video tutorials, music, etc... Business models are shifting, that's all. Highly rated computer games are in general more expensive as a download than shipped as boxed  DVDs for the first few months after their release. Then, after a year or so, they can virtually be downloaded for an incredibly low price from the download sites while their physical copy price has stabilized.


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Ray
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« Reply #18 on: March 11, 2011, 09:06:54 PM »
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I wonder why we are discussing on a photographic forum the quality and price/value of cheap thrillers and dumb pop songs at 99 cents.

The best literature that has ever been written, including even the Analects of Confucius (and needless to mention the entire works of William Shakespeare) and in fact any noteworthy book that has been out of copyright for 50 years, is available for free on sites duch as Project Gutenberg which employs volunteers to scan the classics for conversion to electronic format.

As I've mentioned before, e-books and the e-book reader is a revolution at least as great as the transition from film photography to digital, and just as with film diehards the same sorts of objections to the new e-book medium crop up, from those who are traditional, inflexible and apparently incapbale of recognising a good thing when they see it.

I'm very pleased with my Kindle DX which has a high resolution screen (for an e-book reader) of 1200x824, and a decent size screen  of 9.7"x7.2".  It has 4Gb of memory, which is sufficient to store about 3,000 average size novels, or 1,000 more serious tomes that might have a thousand pages on average. It weighs in total, with cord and recharger, about as much as a cropped-format DSLR body.

The fact that one can carry around on one's person, whether visiting the local doctor or dentist, or travelling to the Himalayas on a 3 month trek, a large personal library of 3,000 books, pdfs, camera manuals etc, that weigh in total just 800gms, is absolutely remarkable.

Thats what I call progress.
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John Camp
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« Reply #19 on: March 11, 2011, 11:57:48 PM »
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As I've mentioned before, e-books and the e-book reader is a revolution at least as great as the transition from film photography to digital, and just as with film diehards the same sorts of objections to the new e-book medium crop up, from those who are traditional, inflexible and apparently incapbale of recognising a good thing when they see it. <snip>
The fact that one can carry around on one's person, whether visiting the local doctor or dentist, or travelling to the Himalayas on a 3 month trek, a large personal library of 3,000 books, pdfs, camera manuals etc, that weigh in total just 800gms, is absolutely remarkable.
Thats what I call progress.

I disagree. Digital photography actually changed everything, including process; not only did it greatly extend what cameras can do, the function of the camera, it greatly extended what people can do with resulting photographs. Despite what film enthusiasts say, film has almost *no* real advantage over digital. The case with e-books is quite different. After all the jumping up and down is done, you still read the book. E-readers didn't give us higher ISOs, or encourage us to manipulate the texts, or provide us with an easier way to make our own texts. All they did was provide us with another, and not always better, way to read - and some people, including me, will tell you that e-readers are not as good an experience as paper books. I read books on an iPad, and that's fine; and though I was really on-board with the idea of being able to carry dozens of books and manuals when I travel, and all the other things that make iPads handy, after having it for more than a year, I have five or six books on it, including one PDF manual. And that's about it. And of the several people I know who have iPads, we're all about the same. We might buy an e-book, but then we read it, and that's it. We don't read it again. So we have a few books, but they're essentially irrelevant, because we're done with them. If they'd been paperbacks, we would have given them away. When traveling, we use them to find Starbucks, or call up a map...but the last time I traveled across the country, I forgot mine, but it didn't make too much difference, because I had my laptop with me. I guess what I'm saying is, the iPad (and the Nook and the Kindle) are interesting innovations, but not critical innovations, as the digital camera was. Or the cell phone. Or the laptop. The innovations with those things was that they cut us free from various tethers -- but with books, we were already pretty much cut free. Didn't even need batteries.

But the thing about paper books...I have a large collection of art books. The color prints inside are far better than anything I can get on an iPad, which actually has a pretty great screen. Not only that, if I have, say, a history of Impressionism, but I want to look at a particular painting, but don't remember the name of it (which is pretty common), or if I want to look at certain kinds of paintings, I can just flip through the book in a few seconds and find it. I flip through by thinking, "Okay, Impressionism is going to be toward the end of this book, and I think that painting was on the left-hand page, but even if not, when I start seeing Impressionist paintings I'm close..." That experience does not exist with e-books. Looking at an index is not the same as browsing.

I do think that e-books will be an important format, especially in certain niches. Guidebooks, for one. Guides in general. Reference books, perhaps. Scholarly journals may quickly move to all-electronic formats. But those are relatively minor categories of books...and I can tell you, neither Confucius nor Shakespeare is really burning up the best-seller lists...So it'll be an important format, but basically, just another one. In 20 years, we'll still be reading be reading paperbacks, because they're cheap and sturdy and disposable. But in twenty years, you'll be hard-pressed to find a film camera, a wired phone, or a typewriter.

JC

 
« Last Edit: March 12, 2011, 12:00:54 AM by John Camp » Logged
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