tightrope walkingBook Business has a great article on the e-book pricing issue. Celeb Mason asks if publishers shot themselves in the foot with higher e-book prices.

The issue, as he explains, is that every product—book, or otherwise—generally follows the same path of market segmentation: the early adopters buy first, then the general customers, then the ‘laggards.’ The difficulty is in balancing your pricing so that you don’t lose too many potential customers at every stage.

The problem, Celeb Mason asserts, is that the publishing industry doesn’t really have too much data on when and why people ‘leave.’ Netflix does. They released data last year on some of their original shows which measured the episode at which people who got that far were pretty much hooked on the whole thing. The publishing industry lacks this data.

So, let’s say you start with 1,000 readers who all want to read the book. And you price it at hardback paper levels. How many of those 1000 will wait? What percentage of these potential buyers will go on to the next stage, the trade paperback price level? And what percentage of those will wait around for the mass market paperback?

Nobody knows. And there isn’t really a way to measure it, to, as the article calls it, conduct an ‘exit interview.’ If I have a book oh my Amazon wish list for a year, and then I remove it, why did I do that? It could be that they priced me out of it. Maybe, while I was waiting for the price to drop, it came in at the library. Maybe I found another book to read on that topic. Maybe I simply lost interest. Or maybe—and this is the dangerous part—I spent the money not on a different book, but on a different media offering altogether. Maybe I bought a movie, or a game.

That’s bad! Convince yourself that I am buying some other book instead of your book, and you can still make up that lost sale. That’s what happened in the old days. I’d go into a store which sold only books, and I would make the choice to buy this book, or some other one.

But we don’t live in that world anymore. If I am buying on a tablet, you aren’t just competing with the other books. You’re competing with music, apps, games—heck, I can even order food, all from the one device. I can decide not to buy a book, and spend the money on pizza without even getting up from the couch.

So, where does that leave publishers? It leaves them facing an uncomfortable question. Do the laggards they priced out of the game at the hardback price point still have any money left to buy the book, at this point? Can they make up enough sales in that tier to offset the ones who dropped out early?

Photo credit: Here.

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"I’m a journalist, a teacher and an e-book fiend. I work as a French teacher at a K-3 private school. I use drama, music, puppets, props and all manner of tech in my job, and I love it. I enjoy moving between all the classes and having a relationship with each child in the school. Kids are hilarious, and I enjoy watching them grow and learn. My current device of choice for reading is my Amazon Kindle Touch, but I have owned or used devices by Sony, Kobo, Aluratek and others. I also read on my tablet devices using the Kindle app, and I enjoy synching between them, so that I’m always up to date no matter where I am or what I have with me."


  1. I bet Amazon has precisely all that data. I suspect Scribd does too. I am a heavy ebook reader, but I must say my purchasing has changed considerably since the legacy publishers raised their prices. Now, before I buy a book (I read exclusively ebooks now, between 110 and 140 books a year) I check Scribd to see if it’s available there, then Amazon (the Kobo, Nook, and Play Book ecosystems have nowhere near the options and depth of Amazon’s). If the price is over $10, I mark it on ereaderiq to be notified when the price falls to a level I’m willing to pay. On rare occasions, if the book is 700+ pages ( I read a lot of non-fiction) I *might* pay up to $14, but with so many books available on Scribd, KU, and under $10, why would anyone pay more. The legacy publishers are shooting themselves in the foot, unless, of course, their goal is to eliminate ebooks.

  2. I have to agree with ecw0647. Prior to Agency pricing I would not hesitate to buy a book that was priced 5.99 to 11.99. When one book I was considering jumped from 5.99 to 11.99 I was troubled enough to research about Agency pricing. I decided enough is enough…no 14.99s unless the book is 700-1000 page”great book. I started borrowing from Maryland’s Overdrive system. I even started trying some self published books for the first time. I am sure that Agency pricing kept me from purchasing more than 50 books from Big 5 publishers last year.
    Zero sales at 14.99 or 50 sales at an average of 8-9 dollars…Which is better? I also read ebooks exclusively so no print book sales occurred. Sales Lost. I feel sorry for authors(not publishers) losing money…hopefully more good authors will go independent!!!
    I am curious to see what Author Earnings reports for 2015’s sales.