Why the 99 Cent Price Point is a Problem:
People love 99 cent ebooks. They’re extremely cheap entertainment. John Locke makes huge sums of money selling full-length novels for 99 cents. There’re entire sites devoted to promoting 99 cents ebooks. Heck, my three novellas were 99 cents.
Here’s the thing, 99 cents may be great for the reader; they’re cheap and they can buy tons of books for 99 cents. For authors, though, 99 cents will lose them money, especially if they sell on Amazon. 99 cents only pays 35% royalties, so I only get 35 cents back for every one book sold. In order to break even on my expenses, I have to write a blockbuster book.
Here’s a math problem for you, if I incur $100 in expenses, how many books do I have to sell to make my money back if I were to sell at 99 cents exclusively on amazon? The answer is 100/.35= 271.71, so 272 books. Smashwords and other distribution services pay 65%, but that still means I have to sell 150 books at 65% royalties to break even. The average number of eBooks sold varies. I’ve heard estimates from 100 to 264, but I’m going to venture it’s closer to 100 since the outliers (like John Locke) push the average up.
Unless your expenses are near zero, you will be losing money at the 99 cent level, period. If you want to make money, you have to spend money. Editing, cover art and advertising all cost money. Sure, you can get your book edited for free, but trust me when I say that’s not a good idea. I now have a permanent editor who will even edit my blog posts going forward. He’s good, he’s a fan, he’s not too expensive but he adds up quick.
A decently drawn cover, depending on the artist, can cost upwards of $300. I happened to luck out with my artist wh0 did my covers for $100-125, but her rates are slowly going up as her name gets out thanks in part to me (Florence Wong: vivadawolf at gmail dot com. Tell her I sent you!) If you’re taking your ebook to print, open your wallet, because the price will be doubled because of the back cover. That’s not even including other artwork – the snazzy hominia map cost me $150. There hasn’t been much other artwork, like New Delta cityscapes and creature drawings I’d like to have, because those will cost an arm and a leg.
There’re plenty of free advertising options but effectiveness is limited due to those options being flooded with other authors. I’ve taken to paying for Facebook advertisements to boost my Facebook page. The impressions to page likes to sales conversion rate is extremely low, but it’s getting my name out there. So far, my ads are being shown to over 300,000 potential customers, the largest audience yet.
Many authors have the pricing strategy of starting at 99 cents then raising prices of future books. Initially I used this strategy; however, I’ve realized that it only works if the next book outsells the first, because the second book has to not only bear the costs of its own production, but also the previous one as well. I’m not starting at 99 cents anymore.
K23 Detectives Pricing
I have and will cntinue to work my ass off getting the word out, but doing that costs money and K23 Detectives, even if it gathers a decent cult following, will always be in the red as long as my books are sold at 99 cents. Note, however, that profit-wise I’m not as bad as I could be, due to the K23 Detectives Three Pack with Bonus Novels, now known as the K23 Detectives Collection. It cost me nothing to put it out. The original cover was just a mash up of the original three and any editing costs were incurred for the individual novella editions. The money I spent editing the two Cybermagic novels were sunk costs as they were edited when they were written. Therefore, at 2.99, which has an amazon royalty rate of 70%, it was 2 dollars of pure profit I put into help defraying costs. Also, The Three Pack’s existence guaranteed that the two sequels got sold.
However, when I decided to rename the Three Pack and put out the Collection, I did have expenses (the cover, the map, etc.) But in this cases the profit is split between print and ebook versions. Now the print price is $21.99, not cheap, but that wasn’t my choice, it was Createspace’s. The eBook Collection is currently $2.99, set because originally it was the price of three novellas put together. Today the ebook price is going up to $4.99 and the reason is Sandworm Rodeo.
Sandworm Rodeo and all future eBooks will be $2.99. As long as the Collection is the same price as smaller works, future books are going to be a tough sell even if someone absolutely loved the Collection. I don’t expect anyone to pay the same price for less. But there’s still the issue that the three original books are .99 cents. They’re going up to 1.99. I believe in A Clear and Feathered Danger, What Lies Within and The Impending Darkness. I believe that while they aren’t perfect (no book is) they are groundbreaking. I’ve done what most fantasy authors strive and fail to do. I’ve created an original, working and compelling mythos. While one could say my ego’s inflated, I would’ve quit by now if I didn’t think I had something. Besides, its pretty self-evident that I’ve created an entire mythos. 99 cents is selling myself short; devaluing what I believe to be the future of fantasy. $1.99 isn’t too much to pay to experience something new. After that, if you like what you’ve read and decide you want more, one more dollar isn’t too much to ask.
So the new eBook pricing model is:
First three novellas individually: $1.99
Sandworm Rodeo and all future single work releases: $2.99
The K23 Detectives Collection: $4.99
I think this is a fair system that allows me a better chance of recovering costs while not being too expensive.
99 Cents and You:
While time will tell how this pans out, I do think 99 cents is not a price point for authors serious about building a following. 99 cents may be enticing to some readers but it also says an author doesn’t have faith in their own work. They say you get what you pay for, a book at a rock bottom price means rock bottom quality to many. It’s also a money losing proposition regardless of how one does the math.
So indie authors, if you want to rise above, raise your prices.