Ebook Pricing: The Bloody Big Dilemma

ebook pricing dilemma

NOTE: Some interesting debates developing in the comments section. Please let your opinion be heard!

In my five months of blogging and scouring other writing blogs, I’ve seen a lot of talk surrounding the topic of eBook pricing. It seems to be that one topic us authors simply can’t avoid doing a blog post about, simply because it’s still so up in the air that literally everyone has a different opinion of things.

Where do I stand on eBook pricing? Well, I don’t think it’s quite as easy as just answering the question like that. In an ideal world, we’d price our eBooks at the publisher’s standard of around $9.99, sell copies, and live happily ever after.

But it’s not an ideal world. Far from it, in fact.

I want to start at the lower end of the pricing spectrum. J.A. Konrath once split opinion when he suggested that $2.99 was the pricing sweet spot for novels. It brings in around $2 royalties via Amazon, and offers value — basically, the author and the reader both leave happy.

On one hand, I agree with Konrath. $2.99 is an attractive price point. It’s not so cheap as to suggest inferior quality, but cheap enough to warrant a few impulse purchases.

The problem with the $2.99 is that it makes things like novella and short novel pricing somewhat difficult. Say one person has written a 100k epic, and another a 30,000-word novella, both having invested in professional cover design and editing, how do they decide on pricing? If the 100k novel is priced at $2.99, then does that make the novella worth less than that? If the novella is a $2.99 book, then what is the 100k? I guess these price issues crop up in any system, but it becomes more difficult to manoeuvre with such a low pricing standard.

Personally, I don’t mind the $2.99 price point. I think it’s a great entry point for new authors. I don’t think it devalues the novel, because I don’t buy into devaluation as a concept, not really. That said, Konrath himself argues for higher prices now, and I am inclined to agree.

The Devaluation Myth

Some people argue that the 99c/$2.99 price points devalue the novel. I’m not totally sure I agree. If anything, I see ebook pricing at the lower end of the spectrum for the first few books as a marketing ploy to gain more writers. Sure — if you’re only planning to launch a few books, then perhaps 99c is a little low to be making any money. However, if you’re planning on making a career out of writing, then surely there are worse places to start.

Dean Wesley Smith argues that all authors, new and old, should be pricing their novels at the $7.99 point. He suggests that the price difference in eBook and physical book will still be enough to suggest a bargain, not to mention the fact that many publishers are still charging around $9 for their eBook releases.

I like Dean and I like his ideas, but I find pricing a novel at $7.99 hard to justify. I wouldn’t buy an eBook at $7.99 simply because I think it’s too much to pay for a digital file. $4.99, I’ll consider purchasing if it’s really good. $3.99, I’ll buy it. $2.99 – well, I’ve already bought it.

I think Dean’s stance on eBook pricing works better for long-established authors, but not so much for new authors. Maybe this will change in time, were Amazon to cut the 70% royalties for example, but for now, I’d find it difficult charging so much because I know I wouldn’t spend that amount on a throwaway file myself. Because that’s what eBooks ultimately are — throwaway files.

Tahlia Newland recently suggested a nice balance between Dean Wesley Smith and J.A. Konrath’s ebook pricing points. She argues for novels above 85,000 words to be priced at 4.99-5.99, 60-85 at 3.99.

I like this strategy, and it isn’t far off my own at all. I still think the 5.99 price point is a little steep for newer authors, but the 4.99 point allows for much manoeuvring below (2.99 for short novels, 1.99 for novellas, etc).

My eBook Pricing Strategy

So, I like the 4.99 point and I like the 2.99 point for novels. This brings me to one conclusion on eBook pricing: 3.99.

Without further ado, here is my planned pricing structure for future releases (in USD — I’ll move on to my UK home shortly). Consider them starting prices to be tweaked and toyed with.

Short stories: $0.99

Novellas: $2.99

Standalone novels: $3.99

Sequels: $4.99

I like the 99c point for short stories. I’ve sold my shorts at this price point for a long time, and I think a standard is emerging. Short stories don’t sell loads of copies, but the 99c price point is designed for them. I think 99c is too low to price a novel, end of story, bar the occasional promotion.

I also like the $2.99 price point, and think it could be particularly relevant for shorter works of fiction. For releases under, say, 40,000ish, I think the $2.99 is reflective of hard work and a confident eBook pricing that indicates quality. It offers much room for 1.99 and 99c promotions too. I’d like to see a 2.99 standard for novellas emerge, but we will see.

3.99 for novels has been my gut feeling since day one. 2.99 seems too low for an 80,000 word novel, and 4.99 still feels high for a first timer. Maybe I’ll experiment with these price points in the future, but What We Saw will launch at $3.99. Probably. It just feels right. It’s cheap enough for an impulse buy but costly enough that the ‘perceived value’ doesn’t diminish. I look forward to seeing how it goes.

A word on 4.99 for sequels. It makes sense — get the reader to check out your first book for $3.99, then charge an extra $1 for the sequel. I might tie this in with a subsequent deduction in the price of the first book to $2.99 for promotional reasons. We’ll cross that bridge when we come to it.

Other Attractive Pricing Methods

I mentioned Tahlia Newland’s price strategy before, and I am also very fond of this.

Novels -
Over 85,000 words $4.99 – $5.99 ($3.99 for the first in a series)
60,000 to 85,000 words, $3.99

Short Novels  -
30,000 to 60,000 words $2.99

Novellas and short story collections -
15,000 to 30,000 words $1.99

Short stories and novelettes –
under 15,000 words, 99c.

Me and Tahlia basically agree — standard length novels at $3.99, shorter works at $0.99-$2.99. I’d love to see a standard like this implemented.

A word on the UK — I’ve no idea. The UK is at a similar stage to the US, according to David Gaughran — it’s 18 months or so behind, and tends to be somewhat price sensitive. For that reason, I imagine I will launch my novels at £2.99 in the UK for the time-being, although I expect that to change.

Flexibility: The Key to eBook Pricing

I guess the key in all of this is to be flexible. Experiment before deciding on an eBook pricing sweet spot. Okay, okay — I don’t have any novels out yet, but everyone has to start somewhere.

Maybe I’ll change my mind on pricing. Maybe I’ll try higher than 3.99, or maybe I’ll try lower. Whatever happens, I’ll be sure to let you know of the results.

/obligatory pricing post

PS: TWO WEEKS UNTIL THE LAUNCH OF WHAT WE SAW!!!!!

I hope you enjoyed my excitable blog post the other day. Thanks so much for all the kind words and support on Facebook, Twitter, on the blog, etc. I really do appreciate it! Roll on December 6th. I’ll have more on PoD and CreateSpace next week.

Where do you stand on eBook pricing? Do you price high, low, or somewhere in between? 99c — a blessing or a curse for authors?

Image courtesy of 401(K) 2012 via Flickr

11 Comments

  1. Hey there, Ryan! Interesting blog as always — I just have a couple questions. I’m more in the camp with Dean on the higher price points. You said you felt it was hard to justify — but why? After all, when we charge for a book we’re not simply charging for the cover and the printing, but for the hours that went into writing it as well as the quality of said writing. Why should a writer’s time be only marketable at a lower price point? After all, for a book that interests me and is well written, I’m still willing to shell out the $20 for a soft or hard cover regardless if its a new or an established author; I’m just picky. After all, Apple is still charging between $1-3 for single songs from albums — why should we be giving away whole books at the same price?

    Reply
    • Hey, Katherine! How are you doing? I hope all is well with your writing.

      Thanks for the comment. You raise some interesting points that I would like to address individually, if that’s okay?

      “You said you felt it was hard to justify — but why? After all, when we charge for a book we’re not simply charging for the cover and the printing, but for the hours that went into writing it as well as the quality of said writing.”

      I agree and sympathise on this level, however I would argue that eBooks and eFiles for that matter should be priced lower due to their intangible nature. You’re right about iTunes — they charge £7.99 for albums and $1 for single songs, but that is a failing business model in my opinion. The rise of Spotify and other streaming services (£9.99 p/m for all the tracks in the world) changes value perception somewhat. I still feel Apple and the like are trying to impose pre-digital pricing on digital products, and I expect that to change in a few years time.

      I agree on a quality level, too, however I think the way of the business model is that we have to be willing as writers to ‘take a hit’ in order to reach exposure. Like I said, in an ideal world, I’d charge $9.99 for my eBooks, but I don’t think that’s a realistic price point for my first novel. I know I wouldn’t spend $9.99 on an eBook, so I guess I’m picturing myself as the ideal reader, if you will.

      “Why should a writer’s time be only marketable at a lower price point?”

      I agree with this too, and am against 99c novels. I think even 2.99 is too low, really. But 3.99 feels just about right for a new author’s eBook. It’s within the impulse buy range, more so than the 4.99 standard that I would eventually like to move towards.

      I think the key with pricing is flexibility. I’ve spoken to several authors — Stuart Meczes, David Gaughran — who each have a debut novel out and have experimented with pricing above 4.99. Both of them told me they experienced a massive drop off in not only sales, but profits. 2.99, 3.99 and 4.99 on the other hand were somewhat similar.

      We’re in an interesting age because this whole idea of ‘value’ is being banded about, but really, nobody knows how much an eBook is worth. In my eyes, 3.99 is a reasonable price (with royalties around the 2.79 mark, much higher than publishers royalties, I must say) for both the newer author and reader.

      Dean Wesley Smith himself states that it isn’t even worth thinking about marketing until an author has around 20 books out. For that reason, I’ll price at what I think is a reasonable 3.99-4.99 range. Twenty books down the line? I’m sure the standards will have changed a thousand times since then.

      Wow, I think I’ve written a whole blog in itself here! Cheers for the thought-provoking questions!

      Ryan

      Reply
  2. Since launching my novels in late 2008, I’ve experimented with different prices from time to time and used various promotions. $2.99 seems right for my adult novels, and $1.99 seems to work well for my children’s books. I may experiment more with the children’s books when my new versions with illustrations come out next year. I try to keep my prices low because I don’t want to discourage anyone from trying a new author. Even my paperback versions I keep under ten bucks. I know I’m not going to get rich from my writing, so my strategy is more exposure. That said, I’ve had mixed success with free promotions and haven’t really seen any spikes in sales resulting from them, so I think I’m finished with that. The great thing about ebooks is having the ability to actually try different strategies until you find what works. And what works for me as an author may be completely different from what works for you.

    Reply
    • I agree, Will, and thanks for the insight. You hit the nail on the head when you say that what works for you may be completely different for everyone else. If there was a proven formula for success, people would be agreed on a price-point!

      That said, 2.99-4.99 does seem to be emerging as a standard for novels. Will that change? Probably. Should we worry about it changing? Definitely not. Might as well make the most of the present! We live in exciting times.

      Reply
  3. Hi Ryan
    I have priced my debut novel A Construct of Angels at $2.99 for the simple reason that I want to attract some attention and get my name out there. I agree that the second book ought to be a little higher and was considering $3.99.

    Well-established authors don’t have to price low – their fans will buy at whatever price (within reason) because the demand is so high.

    I completely agree on the 99C price for short stories, though.
    BTW, my book is priced at £1.99 in the UK – an impulse buy price for all the reasons above. The sequel will retail for around £2.50.

    Reply
    • Thanks for the comment, Andy. I like the $2.99 price point, like I said, and it’s one I’ve considered myself. I imagine I’ll experiment with that for my novels at some stage. None of these are set in stone — I might only make a sale in week one and be forced to change, so we’ll see!

      I like your UK price plan. £1.99 is a price I’ve considered and am still considering, too. I might give £2.99 a shot and see how that goes.

      Your plan on pricing sequels higher is a good one.

      Hmm, pricing. This is why I both love and hate the issue — my mind is wavering already. Don’t be surprised if I completely go against this come launch day, haha.

      Reply
  4. The thing that frustrates me most about eBooks is that “traditionally published” authors price their eBooks the same or very little less than the hardcover. I have a hard time justifying paying $20 for a novel I’m going to read once–I usually don’t buy fiction (in a physical book) until I’ve already read it more than twice. My library is filled with mostly non-fiction books, because I continually refer to them in research, and that justifies the cost.
    eBooks are similar. I could possibly justify a higher price tag for non-fiction eBooks, because I know I’ll go back to them. But unless a fiction book is inexpensive, I’ll look for it at the library.

    Which is where indie writers come in. Since I discovered how many are out there, it’s almost exclusively what I read in terms of fiction now. And that’s simply because they’re less expensive–or even free. I’ve passed over quite a few indie authors who price their books on par with the “traditional” folks. The only exception so far is J. M. Ney-Grimm, whose work is exceptional.
    I don’t think the $7.99 price point for eBooks is tenable, but $3.99-4.99? That’s doable. I do tend to seek the books that are prices closer to $0.99-$1.99 though, even for novels. And if it’s free, I’ll usually pick it up sight unseen just because it’s free, and it exposes me to an author I might not have otherwise tried. Which, in fact, is how I got into Ney-Grimm’s work; she had a free short story, I loved it, and had no trouble buying other work at a higher price.
    In the end, I’m seeing a large rift between self published authors and the traditionally published authors in terms of pricing, with a few indie trying to jump across the gulf. But this is driving me further and further away from traditionally published fiction–I can no longer justify buying a Stephen King book for $14.00 when I can pick up What We Saw for $4. I think, eventually, this trend will continue, and we’ll see traditionally published books drop significantly in price–and that’s when the pricing question will get really interesting.

    Reply
    • Cheers for sharing your thoughts, James. It’s really interesting to see such a mix of opinion. Already, it just goes to show what a hot topic pricing is!

      I agree that $7.99 is rather steep for newer authors. Maybe a few books down the line, it gets more accurate, but then again from my perspective, things will change a few books down the line. Maybe $9.99 will be a standard, maybe $1.99 will be a standard. Who knows?

      That said, I do think we’re edging closer to a $4.99 standard for eBooks. It seems the most logical mid-point. Indie authors will gradually price up, trad pub will gradually price down. Maybe.

      Reply
  5. I guess I’m a little more forgiving. =)

    To me, the ebook is the mass market paperback. It used to be that if I wanted a quick buy (say in an airport or something similar), I picked up a MMPB. They ran around $5, easy to spend if I wanted to kill time for a couple of hours.

    That medium has all but disappeared. Now, mostly you see trade paperbacks and hardcovers. Those are not impulse buys to me. A trade paperback still runs around $12. That’s not an impulse. That’s me buying a book for my 10-year old because I don’t want to hand him a $30 hardback (although with publishers not bringing out paperbacks for almost a year after publication in some cases, I wind up having to buy him a hardback).

    So yeah, if I’m trying out a new author, I’ll think nothing of spending up to $4.99 for an ebook. I’m on Dean Wesley Smith’s side. My book is a valuable commodity and should be priced as such. I had a conversation with Porter Anderson on this topic, and he told me that indie authors should not shy away from the $4.99 price point – or even higher when warranted. Free and 99-cent seems to really only work now as a promotion (e.g., you’ve got five books out, price the first one or two at 99 cents to hook new readers) because so many have been jaded into thinking that free/99-cent books, especially indie ones, are crap.

    My publishing partner brought POWER PLAY out at $2.99. Because of it’s novella-length (20,000 words give or take) and target age (middle grade) that price feels right to me. It’s still right in the “impulse” or “kid-friendly” buy range.

    I’ve got some novelettes (between 12k and 15k) that I may bring out independently soon. I was figuring to price those at $1.99. More than a short story, less than a novella or novel. The price of 99-cents for a short and $3.99 for a debut novel sounds about right to me.

    I will spend more than $4.99 for an ebook, but only from an established author whose previous works I have enjoyed (thriller writer Hank Phillippi Ryan falls into this category, as does Rick Riordan – and I will own all of the Harry Potter books in digital as soon as I can manage).

    But $3.99-$4.99? Easy sale. In fact, I took a chance on just such a book from an unknown author, and now I’ll buy anything she puts out.

    Reply
    • I love your ‘eBooks are the new mass market paperback’ analogy, Mary, and I totally agree. I’ll pick up a paperback these days if I really love the author, or want to buy a gift. Otherwise, it’s eBooks all the way.

      I also agree with yours and Porter Anderson’s conversation. $4.99 displays a confidence in books. Perception of value, and all that.

      I think the price of POWER PLAY is just about right, too. $2.99 seems the perfect price for a novella of that length.

      It does seem that more and more independent authors are agreeing that pricing at 3.99 and above is ‘right’ nowadays. It’s refreshing, after the even wider disagreement of previous years.

      That said, the UK market… 2013 is definitely going to be ‘our 2011′ that’s for sure.

      Reply
      • Yes, it will be interesting to see how things shake out in other countries.

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