[KarolGajda]

Coming from a marketing background I know how important testing is when it comes to selling anything. From the start I knew I'd be playing around with pricing. The most important aspect of any test is that for it to be statistically accurate you need 100 actions. In this case, sales. If your book sells 10 copies one month and then you change the price (or anything else) and it sells 20 the next month you can't truthfully say it had anything to do with what you changed. There just isn't enough solid data to go on and anything could have been the cause of your doubling in sales. Something to keep in mind.

Note: All sales figures are for the US store only.

I currently have one book, non-fiction, in the Kindle store.

May sales at $0.99: 401
June sales at $2.99: 324 (326 - 2 refunds)

So my sales dropped by 19% month-to-month. You'd think I'd be upset with this. (Especially with the 2 refunds!) In actuality, I'm thrilled.

My overall goals with publishing to Kindle are to gain new readers, new rabid fans, and to spread my message. Notice I didn't mention anything about profit. Profit is secondary. More than anything I want everybody who plunks down the cash to buy my book to actually read it. I could care less about making the sale if it's just going to sit dormant on the buyer's device.

I had a theory going in that at 99 cents I'd make a decent amount of sales, but probably not a lot of them would read.

During the 99 cent month of May I didn't get any e-mails about my book and didn't get a refund. After 401 sales you'd think one of those things would happen.

When I raised the price to $2.99 things changed. Even though I made 19% less sales in June I actually got fan e-mails! Really positive "thank you for writing this!" e-mails. In addition, I got 2 refunds, which means buyers were actually reading! And this is why refunds are good. Sure a refund might mess up your sales (after the first refund my sales died for 2 days), but it lets you know people are paying attention. If you care about your work you want people to pay attention to it, right? You want to polarize. If everybody hates your work that's no good. But if everybody loves it then you're probably only sharing it with your Mom.

Fun aside: In May I made ~$150 from the book. In June ~$600. Actual readers, fan e-mails, and significantly more money? Yes, please.

I've now raised the price to $4.99 for July. It's a holiday weekend so I expect sales to be a little slower, but yesterday I made 9 sales. That's pretty good. We'll see what happens by the end of the month. Depending on how it goes I will either lower the price to $3.99 or raise it yet again.

###

Thoughts, criticisms, and your own price tests are all welcome.

 

[jimbronyaur]

What a great test and great post here.  Thanks for sharing.  We view price in our own way as the writer when in reality we are trying to figure out what the hell a reader wants. 

Right now, in my mind, my perfect world that exists... I am going with two prices:

(1) $4.99 for novels and (2) $0.99 for anything else I write.

That way I can take care of everyone!  If you don't like paying $5 for an ebook, no worries, I have plenty of stuff for $0.99.  And my hopes are that when someone reads my $0.99 work, they'll go and pay for the novels.

-jb

 

[LucieSimone]

What a great test and great post here. Thanks for sharing. We view price in our own way as the writer when in reality we are trying to figure out what the hell a reader wants.
Right now, in my mind, my perfect world that exists... I am going with two prices:

(1) $4.99 for novels and (2) $0.99 for anything else I write.

That way I can take care of everyone! If you don't like paying $5 for an ebook, no worries, I have plenty of stuff for $0.99. And my hopes are that when someone reads my $0.99 work, they'll go and pay for the novels.
-jb

This is my philosophy, too. I have a novel priced at $4.99 and a short priced at 99 cents. I do sell more shorts, but not that much more. And really, when is $5 too much to pay for a book? I never base my decision to buy a book on it's price. If I like the cover, I'll click on it. If I like the blurb, I'll sample it. If I like the sample, I'll buy the book - even if it's $10.

 

[Erica Sloane]

Interesting post. Thanks for sharing it.

I had my first refund today. Well, first on Amazon. I had two on Smashwords about a month ago, both at the same time, so I figure it was from the same person. Did they read and return and consider it a "free read"? I don't know, but that's all in the past.

The first one on Amazon occurred earlier today. That "1" in the refunds column really stands out with the other numbers for my other works. I guess part of the reason it stands out so much is that it's there by itself. I hope it stays that way. 

 

[Maria Romana]

I had a theory going in that at 99 cents I'd make a decent amount of sales, but probably not a lot of them would read.

This is a really important point that I've been thinking about a lot lately, and I think is often missed in all the low-price discussions. No doubt, lower price almost always equals more sales, but as you point out, does it really mean more readers? $.99 is a low enough price that a lot of people will buy without being sure they'll like it. If it looks half-way like something they might want to read someday, they'll snatch it up. And then they may or may not ever read it. If it's $3 or $5 or $7, they're not going to shell out the money unless they've sampled, read the reviews, and are quite convinced they'll enjoy it.

One of my biggest concerns with the rock-bottom price (or free book), is that you'll get people buying impulsively and then leaving you bad reviews, because the book's not really "their thing". Higher prices require greater patience on the part of the author, but as Joe Konrath says, "It's a marathon, not a sprint!"

--Maria

 

[KarolGajda]

This is a really important point that I've been thinking about a lot lately, and I think is often missed in all the low-price discussions. No doubt, lower price almost always equals more sales, but as you point out, does it really mean more readers? $.99 is a low enough price that a lot of people will buy without being sure they'll like it. If it looks half-way like something they might want to read someday, they'll snatch it up. And then they may or may not ever read it. If it's $3 or $5 or $7, they're not going to shell out the money unless they've sampled, read the reviews, and are quite convinced they'll enjoy it.

One of my biggest concerns with the rock-bottom price (or free book), is that you'll get people buying impulsively and then leaving you bad reviews, because the book's not really "their thing". Higher prices require greater patience on the part of the author, but as Joe Konrath says, "It's a marathon, not a sprint!"

--Maria

It really depends on a lot of factors. Some buyers of 99 cent books are intensely rabid readers and do read everything. In the non-fiction market I'm not sure that's the case. But that's really all speculation. Based on experience with information products off Kindle over the past 10 years I know price vs value is perceived differently in non-fiction. And on Kindle I know that the $2.99 price point is more beneficial in all aspects than the $0.99 price point for my particular book.

Jim & Lucie: While I appreciate your thinking, it's not scientifically sound. Unless your $4.99 books are selling like gangbusters at that price I would do price testing until you find the real sweet spot. Let the numbers speak for themselves. They don't lie.

 

[Cheryl Bolen]

What an extremely interesting post. Thanks for sharing. I do believe the non-fiction book buyer is vastly different than a fiction buyer. For one reason, non-fiction books are often keepers for the information they give. You'll want to reread or look up something. Fiction readers want, for the most part, to be entertained. Once I've read a novel, I remember it. I rarely reread a novel.

 

[41352]

Really interesting post, thanks for sharing! I wonder if the conclusions apply to fiction writing or if it has to do with niches in the market... 

 

[Susanne O]

Very thought provoking post, thank you.

In my own experience, one of my books (I have seven) has never been discounted and I've kept it at $2.99 since it was published. It is my best selling ever book, Fresh Powder, which was in the top 100 in the UK for over a month and has sold 10000 copies since Christmas. Still selling at a rate of 50 or more a day.

So that would prove your point that a slightly higher price does not put off someone who really wants to read a book.

That said, I think a free promotion does gain new readers. Virtual Strangers has been downloaded nearly 14000 times in the US and 6000 + in the UK since it went free earlier this week. I'm sure many of those will result in readers discovering my other books. It also creates a bit of a buzz around that particular title.

 

[sportourer1s]

Do you really think people who have read your book then pubicise it for you? I am not convinced to be honest. I think that most $.99 books are probably never read. I asked one customer how he had enjoyed my book and he said it was 65th on his list to read. Madness!

 

[jimbronyaur]

This is my philosophy, too. I have a novel priced at $4.99 and a short priced at 99 cents. I do sell more shorts, but not that much more. And really, when is $5 too much to pay for a book? I never base my decision to buy a book on it's price. If I like the cover, I'll click on it. If I like the blurb, I'll sample it. If I like the sample, I'll buy the book - even if it's $10.

Hey Lucie!

The key here is confidence and work. You have to believe in yourself and charge what is fair. And then you need to get out there and work to sell the book while writing the next book.

-jb

 

[Scott Daniel]

I will be coming out with a novella - 18-19K words and have been debating what to list it at. I would like to go $2.99 for this length work and $3.99 for novel length. Thoughts?

 

[Zelah Meyer]

That's a very good point about people actually reading it at the higher price.

I download lots of books when they're listed for free.  Mainly non-fiction books on all kinds of topics that might, some day, prove useful for research or information purposes.  With fiction I only download the ones that look like they might be the kind of book I'd read based on the title, cover & blurb but I don't bother sampling, which I would do if I were actually going to spend money on them.  I may or may not get around to reading the ones I've downloaded and you're right, if I'd paid $2.99 for one then I would definitely read it! 

Mind you, personally speaking, if I'd paid $0.99 for it then I would definitely read it - but then, I am an avid re-reader so very rarely buy new fiction (thus freebies are a way to tempt me to try out a new author) if a book looked good to me and I was willing to buy it then I would pay anywhere between $0.99 or $6.99, price wouldn't be the deciding factor, how much it looked like my kind of book would be.

My current plan is to price according to length but I intend to keep an eye on the markets between now and when I finally publish (probably a couple of years) and see what is working.

Good luck with your experiments (and your sales in general!) 

 

[KarolGajda]

Very thought provoking post, thank you.

In my own experience, one of my books (I have seven) has never been discounted and I've kept it at $2.99 since it was published. It is my best selling ever book, Fresh Powder, which was in the top 100 in the UK for over a month and has sold 10000 copies since Christmas. Still selling at a rate of 50 or more a day.

So that would prove your point that a slightly higher price does not put off someone who really wants to read a book.

That said, I think a free promotion does gain new readers. Virtual Strangers has been downloaded nearly 14000 times in the US and 6000 + in the UK since it went free earlier this week. I'm sure many of those will result in readers discovering my other books. It also creates a bit of a buzz around that particular title.

Congrats on your success Susanne! 10,000 sales since xmas is killer!

As for a free promo gaining new readers: I don't doubt it. Depending on your situation (# of books available, quality of the free book, size of your audience, among many other things) a free promo could work very well.

 

[KarolGajda]

I will be coming out with a novella - 18-19K words and have been debating what to list it at. I would like to go $2.99 for this length work and $3.99 for novel length. Thoughts?

I think you shouldn't be afraid to test prices. A hard and fast rule about your pricing does you no good. Maybe you'll sell 15 times as many at $2.99 than $3.99. Maybe you'll sell 4 times as many at $3.99 than $0.99. Only one way to know what will happen.

 

[nomesque]

Do you really think people who have read your book then pubicise it for you?

Only if they enjoyed it enough to want to share. But yes, speaking from personal experience and observation, it does happen. More since Amazon added social networking functionality to the K3.

I am not convinced to be honest. I think that most $.99 books are probably never read. I asked one customer how he had enjoyed my book and he said it was 65th on his list to read. Madness!

How is 65th on a TBR list 'madness'? That would typically take me 3-4 months to get to, which doesn't seem too bad to me.

 

[nomesque]

While I'd agree that a higher price = higher percentage of short-term reads from sales, I don't agree that this is necessarily a good thing, nor is it a direct relationship. I don't think you get more eyes-on-ebook if your price is higher, just a greater percentage per sale.

I have been known to spend up to $20 on an ebook. I really wanted that ebook. And yes, I read it straight away. But was there a direct relationship between cost and reading? No. The relationship was between desire and price, and desire and start-speed.

I think that this is generally true, too - people paying a higher price for an ebook have a higher average desire-level than those paying a lower price for an ebook.

One key point of marketing is to increase a potential customer's desire-level for the product. Does higher price cause a higher desire level? I don't think so. However, a customer with a lower desire-level who buys a book because it's cheap, gets around to reading it a month later and loves it - their desire-level for the next book is increased.

I'm not saying that a high price point won't work for some writers, or that it isn't a valid marketing strategy. However, it should be noted that if you're aiming for bestseller status for a book, deliberately limiting its marketing to a niche audience will not get it there. TO reach bestseller levels, its audience MUST be widened to people who might hate it with a passion.

 

[Cheryl Bolen]

I will be coming out with a novella - 18-19K words and have been debating what to list it at. I would like to go $2.99 for this length work and $3.99 for novel length. Thoughts?

Not to offend, by I wouldn't pay $2.99 for a single novella. On the other hand, I've seen many single novellas zoom to Number 1 selling status if they're priced at 99 cents.

 

[andrewwrites]

I just wanted to add that the thing about "you need 100 actions" for a test to be accurate is a bit misleading: It depends so much on what you are testing or measuring, a lot of times you need a sample size of thousands or tens of thousands or more for any data to really be accurate. But 100 does seem like a decent baseline for this kind of thing, and it gives people the basic idea.

So this actual test, your sales didn't drop very much at all going to 2.99, far less than I would expect (based on a lot of things I have read), and I have a feeling that if you had left it at 0.99 you would have sold a lot more than the previous month because your book is taking off (congrats!). I'd love to see tons of people try this experiment and see what the results tend to be, especially with books that have statistically significant but very steady sales figures month-to-month (these probably aren't that common though and the authors probably wouldn't want to risk messing up a good thing if they're selling well).

KarolGajda, you also have the right attitude to readers, and how people actually reading your books are the important metric (although at least people who download and don't read still help move your book up the charts). I had one question, you said sales slowed down after you got refunds, is this common? Do Amazon alter your ranking or discoverability or something in line with refunds? I'm new to all this, so I don't know what's up with that.

Anyway, thanks for posting this, very cool experiment, I love when people share this kind of info!

Oh, and I also just want to say Nomesque's post 2 above mine is very, very good.

 

[andrewwrites]

Hey, one thing I just thought to add:

I was pretty involved in iPhone app creation/marketing for a while, and the Apple App Store has a ton of similarities with the Kindle Store, and people were constantly discussing/debating selling apps for 99 cents vs. higher prices.

One thing that happened almost universally in the App Store was that games that cost 0.99 always got lower reviews than apps costing more. More people would impulse-buy a game just because it was cheap, play it for 5 minutes without really trying to learn it properly, and then delete it and give it a 1-star review.

I don't actually know if this applies to ebooks, I have a hunch that people don't generally review books unless they have read a large amount of the book, but I could be totally wrong. I'd love to see some data on how price affects the avg. rating for a given book that has switched prices. This would be so tough to get a sample size for though.