Summary: In this episode, we are going to talk about how to price your eBook. <br> Show Notes<br> Introduction:<br> One of those episodes we can’t believe we’ve never done, because it’s a question everyone seems to always be asking.<br> What should you price your ebook? We have a short answer and a long answer.<br> The Short Answer: All eBook pricing is an ongoing/never ending experiment<br> The Long Answer:<br> We’ll give you broad strokes, and then specific brush strokes that will help you make an informed decision.<br> How pricing works in economics. <br> <br> * In general, prices are driven by supply and demand.<br> * Elastic Prices (Genre Fiction)<br> * Non-Elastic Prices (Textbooks)<br> * How do you become less elastic? Build a strong brand!<br> <br> * Example: Brandon Sanderson-Thomas will pay the going price!<br> <br> <br> <br> <br> The Pricing Graph<br> <br> * Higher Prices > Lower Unit Sales<br> * Lower Prices < Higher Unit Sales<br> * Sweet spot, where you have maximum profit. Also known as the point of equilibrium.<br> <br> <br> <br> What is Your Objective? The goal for all authors is not necessarily to maximize profits. Sell Lots of Books? Or … Make Lots of Money?<br> <br> Sell Lots of Books<br> <br> <br> * When you’re in the start to middle of your career- books in as many hands as possible. (Pirating again.)<br> * More sales makes Amazon smarter- they know who will buy your book<br> * You’ll rise higher on the charts. More reviews. More email subscribers.<br> * Price? $0.99 On average, authors sell at least twice as many copies at $0.99 as they do at any other price point.<br> <br> * The downside of $0.99 is that Amazon penalizes you by reducing your profits.<br> <br> <br> * Impulse buy.<br> * Success drives success.<br> <br> <br> Make Lots of Money<br> <br> * The sweet spot has been $3.99<br> <br> * This is a fluid number …<br> <br> <br> * The royalty structure on most major retailers is dependent on price.<br> * Amazon: 70% of every sale they make when their book is priced between $2.99 and $9.99, and 35% of the sale when their book is priced below $2.99.<br> * However, this only works IF:<br> <br> <br> * Great cover<br> * Great (and lots of) reviews<br> <br> <br> <br> * What if you don’t have those two things?<br> <br> * Run a $.99 promo and garner reviews, then come back.<br> <br> <br> <br> <br> Apparel Pricing as an Example<br> $20 for a t-shirt … sits on the rack, now on sale for $5! Wow, great savings! Wrong. You have $5 less, but that anchoring works!<br> <br> Establish a Brand<br> <br> * High prices can establish a luxury brand. <br> * The problem with a race to the bottom is that you just might win.<br> * You never want to be the second cheapest option.<br> <br> <br> What if You Want High Sales and High Profit?<br> <br> * Consider KDP Select- exclusive to Amazon<br> <br> * Kindle Countdown Deals and …<br> * KENP Payouts. Authors running a promotion at $0.99 earn a 70% royalty effectively doubling the royalty on each of their sales.<br> * Pages read: authors enrolled in KDP Select see an increase in the number of pages read when they run a promotion.<br> <br> * On average, authors see a 1300 bump in KENP reads the day of the promotion, with reads increasing into the weeks after the promotion. With the current payout per page amount averaging $0.0045, that’s an additional $5.85 in earnings per day that an author earns off the promotion.<br> <br> <br> <br> <br> <br> <br> What Price Should You Choose? <br> <br> <br> * You can price a book based on a combination of any of these factors:<br> <br> <br> <br> <br> * Length<br> * Genre<br> * Marketing reasons<br> * What other similar authors charge<br>
