Pricing your eBook
There are a lot of discussions out there about pricing eBooks and a lot of varying opinions. If you have done any amount of research in this area then you will have read posts by authors who are enjoying success at many different prices. Most of these successful authors are enjoying the ability to price their books at $4.99 to $9.99 and receive 70% royalties for their efforts. They believe that these higher prices reflect the quality of their books.
Now let’s flip the coin and look at the other side for a moment. Hundreds upon hundreds of authors are thrilled with how many books they are selling at much lower prices – usually ranging from $0.99 to $1.99. They get a decent return because so many more people are buying their books.
With so many varying opinions, you are still left right where you began: how much should you charge for your book? If you go online and browse Amazon’s best-selling books, you will notice that the prices vary greatly. However, most are at least $2.99.
Royalties are the biggest factor in determining how much you should charge for your eBook. Amazon pays 70% royalties on all Kindle books that are priced between $2.99 and $9.99. Prices falling out of that range only receive a 35% commission. Let’s crunch the numbers:
1 Book Sold at $2.99 = $2.09
6 Books Sold at $0.99 = $2.10
As you can see, you would have to sell 6 books at $0.99 in order to earn as much as you would selling 1 book priced at $2.99. That’s a huge difference. However, this kind of calculation is only one factor. I mean, that still leads to the linger wonder of why some authors price their book at $0.99 when the math seems to be against that strategy.
Why Authors Price Books at $0.99
It tempts impulse buyers to take the chance and read their book. It’s a strategy used to build a readership base. While $2.99 isn’t exactly a lot of money, look at it from a reader’s perspective. They could buy three $0.99 books for that amount.
Some authors will price one or two of their books at $0.99 to gain new readers, who then have the opportunity to buy their other books. So it’s sort of a promotional pricing strategy. When someone buys your book, they will then see the coveted “Customers Who Bought This Item Also Bought…” list. Readers almost always browse this list to make their next purchase.
Those are two of the strategies that prompt authors to drop their book price. Of course, there is no guarantee that pricing alone will attract hundreds of new readers since there are so many factors that go into determining whether or not readers will buy your eBook.
Now I’m going to let you in on a common misconception that many people get wrong. I see it all of the time when I am browsing through blogs.
Amazon ranks books based on revenue, not the number of copies sold.
I have books priced at all different price ranges and I can tell you that I have several books that have the exact same number of reviews, same stars, and are priced differently. Even though the $0.99 book sells more copies, the books I have priced at $4.99 are much higher ranked.
I recommend that you price your Kindle books between $2.99 and $4.99. Use this as the basis for your standard pricing. Then, promote your books by lowering the price for a limited time. That strategy will gain new readers while ensuring you are getting the biggest payout.