Can a 99cent ebook make you rich? Maybe… Maybe not!
The price range for eBooks is wide from free eBooks to $9.99 or even higher. So when it comes time for you to assign a value to your novel, how do you decide? There's no easy formula, but you can learn some lessons by evaluating the pricing of other eBooks.
In a recent Wall Street Journal article, successful self-publisher John Locke gave the following rationale behind his price point, "When I saw that highly successful authors were charging $9.99 for an e-book, I thought that if I can make a profit at 99 cents, I no longer have to prove I'm as good as them. Rather, they have to prove they are ten times better than me." You might not think you can make money at that price, but Locke made over $100,000 in March selling on just the Kindle. Being cheaper is a huge advantage.
On the other end of the spectrum is Ken Follett's Fall of Giants, which currently has an eBook version for $19.99 on Penguin. Would it be selling better at only 99 cents? Probably, but the hardcover is currently selling for $36, so an extremely low price for the eBook might cannibalize sales of the hardcover.
Most of us, of course, aren't so lucky to have Mr. Follet's "problem," and would drastically improve our sales the lower our price goes. Still, that doesn't mean you should rush to lower all your prices to 99 cents. Think it through, do what's best for you – and know the facts. Like how Amazon pays a 35% royalty for books under $2.99, but a whopping 70% for books between $2.99 and $9.99. There's a huge financial advantage to bumping that price up a little. By pricing the eBook at just $2.99 (still a third cheaper than those bestsellers,) John Locke would be bringing in $2.10 for every book instead of just 35 cents.
But again, think about what's right for you. At this point, Locke has built himself a sizable fanbase and could probably raise his prices if he wanted to do so. Are you at that level, or is selling a higher number of copies better for your career right now than having a better profit margin? There are no easy answers, and it's clear that the major publishers and self-publishing authors are still testing the waters on this. You should do the same. Research, test the waters, and adjust accordingly. Let's review what lessons you can apply to your own pricing decision:
Having a lower price point than competitors can be a huge advantage.
Research the royalty percentage you will receive from each delivery system.
Consider how the price of your eBook might affect the sale of print copies.
Compare apples to apples and oranges to oranges. Find out the price of eBooks in your genre from major publishers as well as self-published authors.
