Friday, 25 November 2011

Olives Book Pricing Thinks

Forex Money for International Curency
Image by via Flickr
How do you put a price on a book these days? Many authors are selling Kindle books for $0.99, many others $2.99 but mainstream publishers are putting prices at $5.99 and more - all of Iain Banks' books will cost you $8.02, for instance, while Jeffery Deaver's Carte Blanche will set you back a cool $16.05 - his backlist is set at $8.02.

Amazon pays publishers/authors either a 35% or a 70% share on sales. The 70% share only applies to books priced between $0.99 and $9.99. So the mad thing is that while you pay double for Deaver's Carte Blanche compared to his back list, the publisher only gets the same as selling it for $8.02. Go figure.

So how do I price Olives the novel wot I have writ? I decided on $5.99 for the e-book, equivalent to £3.99, which is the UK price (and €3.99 for Europe). I actually make less from a US sale than a UK or European one because of the withholding tax. How did I decide on that price? Purely on an average price of novels I scanned that were from published authors. I can't really say that I'm in this for the money, although it'll be nice to break even. But I'm not selling my work for less than the cost of a couple of pints or a t-shirt. It's worth more than that. And this is really where my pricing strategy is at.

Other writers have proper strategies. Poster child for Kindle success Amanda Hocking, for instance, sells each book in her trilogies for different prices with a low entry level, typically $0.99 rising to $2.99. Interestingly, now she's signed to a publisher, her new books seem to be priced at $8.99 - I've seen no sign of any great outcry about that yet, but would expect one to come!

Finding out book prices in the Yankee Dollar isn't as easy as it first appears, BTW. Amazon works out you're an Amazon UK customer and 'games' the dollar prices to make them equivalent to the Sterling prices - super sneaky, huh? This must at least in part be due to the appalling disparity in Kindle prices - the entry level Kindle in the USA costs $79, while in the UK it's an unjustifiable £89 ($133!!!).

The same is true of the international print edition of Olives- the price for the printed book is $15.99, which is about equivalent to average book prices for this type of work as far as I can tell. With the Amazon edition of Olives the booky book, I make varying amounts of money from each copy sold depending on the platform its sold across. And again, I lose 30% to Uncle Sam. This is painful to me as a resident of the gloriously Tax Free UAE even though, as I say (and will keep saying until everyone believes me), it's not about the wonga.

The Middle East Olives book price is based on the Amazon price and again is based on an average price on the back of books, with slight reductions for Jordan and Lebanon based on anecdotal evidence of street prices for books there (I asked pals on Twitter, in other words).

And that's it. The whole brilliant Olives the book pricing strategy laid bare.
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James O'Hearn said...

I think, at $5.99, you are setting it too high. Lee Goldberg, Joe Konrath, and a number of those who have successfully made a go of this publishing route generally stick to $2.99, with an occasional foray north of that for more popular series, but generally with an absolute ceiling of under $5.

I'd pay $5.99 for an established author I liked, higher than that for a book I have been desperately waiting for, but would hesitate on that price for an author I did not know.

$2.99, however, is still in the realm of "impulse buy", low enough that I would give it a go, but high enough that the author actually makes a decent amount on the sale.

Joumana said...

I think selling ebooks for 0.99 or even 2.99 is ridiculous and devaluates one's work: it's to be left to mass market stuff and other junk. Selling them for the same price as a print copy is pure ripoff as there are no expenses whatsoever to justify it. I don't think 5.99 is too high at all: generally I feel between 5 and 10 is quite fair for this format. Some of my ebooks are even more expensive, but they consist in 100 illustrated pages of. The way I set my own prices is see what price I'm forced to set for the print edition, due to print-on-demand, and divide that in 2 for the ebook. Nobody's ever complained about cost, on the contrary, sales are high. I think as long as the ebook represents a good deal relative to the printed one, people will appreciate that. I would buy a lot more ebooks if those damn greedy publishers didn't sell them at the same price as the print.

James O'Hearn said...

Selling an e-book at 0.99 or 2.99 doesn't undervalue the work at all. It's simply a price point for maximizing revenue. The point is to sell books, as many copies as possible, and build a readership. Being able to point to a high price point and feel proud about the exclusivity of that amount is counter-productive.

What the experience of those who have already made a go of this route of publishing shows is that success comes through two things - a) cultivating a readership, and b) building a backlist. The price is important because it can have a serious effect on the former, which in turn hampers the efficacy of the latter.

But as to the notion of devaluing a work, in the non-financial sense, Iis the culmination of the blood, sweat, tears and effort of a single person over months or years denigrated by this demeaning price point? That's a good question.

For example, when you buy an episode of, say, "The Office" for 2.99 on iTunes (the same price point I proposed), what you get is something that took several million dollars to produce, and the efforts of an army of writers, actors, crew, and production staff to make. The financial outlay, effort, and sheer man hours involved in making that single episode is vastly disproportionate to what it took a single person to write a novel. Yet those selling the show seem fine with a price point of 2.99. Why?

It has noting to do with the intrinsic worth of a work. It's just economics.

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