Pricing is one of the most controversial aspects of e-books. When I started BooksForABuck.com, my market research indicated that many e-book publishers had set price points above those charged by traditional publishers for paper books. I love e-books and can understand charging more for the portability, adjustable font, and convenience. The problem is, you have to try e-books before you discover the advantages. My market research indicated that high prices kept many from bothering.
Logical savings for the reader
There is a logic that if a publisher doesn’t need to pay for paper, for shipping, invest in printing thousands of books that might not sell and might get returned at some future point, there should be a savings for the reader. That made sense to me. Certainly for small publishers, the cost of printing is non-trivial, and the risks of offset printing a quantity (as opposed to the extremely high price for POD printing) are substantial.
I came up with the “Books For A Buck” concept and sampled everyone I could reach; a high percentage indicated that they’d be intrigued by affordable books, and that a buck was a heck of a price. Many of them indicated that they’d be willing to experiment with a new author if they could buy a book at a price low enough that they wouldn’t feel too disappointed if they ultimately didn’t enjoy it.
Why $1 isn’t the usual price
After some experimentation, I determined that $1 was not a sustainable price. For one thing, most sales come through distributors (like Fictionwise, Mobipocket, the Kindle Store, and All Romance eBooks) rather than directly. And as these distributors normally charge approximately 50 percent of the price, a list price of $1 leaves, well, essentially nothing for the publisher and author.
I decided, therefore, to adopt a pricing model with a $1 introductory price and a still-affordable standard price of $3.99. The $1 introductory price encourages at least some readers to visit our Web site, read the free excerpts (another way I and many other e-publishers reduce the purchase risks), and buy both the books listed at introductory pricing and additional books listed at standard pricing.
Share your thoughts on price
Pink Petal has a point about price being used as a signal. An excessively low price can signal that the item being sold is of low quality (and hence not worth a higher price). I truly believe, however, that the e-book market in general, and BooksForABuck.com in particular, can best grow through offering a high-quality product at a price that’s slightly below the price of paper books. I’d love to hear feedback. Check out the site and post your feedback here.
The Motel 6 precedent
With continuing inflation, it’s possible that the $1 pricing model, even as a promotional price, will become unsustainable (just as Motel 6 no longer can sustain the $6 pricing that originally gave them their name). For now, though, I like to give people a reason to come back often and grab bargains.