The New World of Publishing: Pricing Indie Books…Some 2012 Thoughts

Normally I hate talking about pricing of ebooks by indie publishers because there are no right answers and I always end up making people mad. But that said, things are changing so fast that my last post about pricing (besides pointing to other people’s posts) was way back. You can read it here.

So leaving the thousands of details I could talk about behind, let me cut right to the chase and keep this short.

With one reminder: I am not talking about writers here. I am talking about the average reader buying books.

That said, my observations and studies of readers’ buying habits have lead me to believe that ebook pricing is going up and books are being accepted and bought regularly at higher prices.

And on the flip side, the 99 cent area is becoming an area that many regular readers are avoiding or buying when books they know are “on sale” from a much higher price. (Discount readers will always buy at that price.)

Of course, this is not 100% of the time, and everyone here will have an experience of finding a book they loved at 99 cents that they would not have bought. Please spare us all that story.

Remember, one data point does not a study or trend make. I’ve been following hundreds and hundreds of data points and studies from here and in Britain, mostly, I must admit, studies done by traditional publishing. Their conclusion now is that electronic book prices are trending upward. (No matter what indie writers seem to believe.)

And I think that’s a great thing.

It gives us all a ton more room to move around and do sales and such. But before you can do a sale, you have to price your book out of the sales bin to start with. And that’s what I am going to talk about here:

Setting prices that give indie publishers flexibility in doing sales, just as traditional publishers have.

And also setting prices that allow a book to have a value to a reader and make the writer some money at the same time.

Traditional Publishers: Some Facts

Traditional publishers are settled in around in the range of $5.99 to $7.99 for ebooks that are also released in mass market paperbacks.

Traditional publishers are setting the prices much higher for ebooks also released in hardback, often matching the price of the hardback, but usually keeping the price of the electronic book around the $17.99 range for a time after the hardback release.

This varies from company to company, but no traditional publisher releases a hardback and also a $7.99-$9.99 electronic at the same time. However, this happens all the time with trade paper releases. A publisher will release a $16.99 trade paper and put out a $9.99-$12.99 ebook, then lower the price after six months on the electronic book down to the $7.99-$9.99 range.

Traditional publishers are using the “sale” aspects of lower ebook prices for very-short-time events, sometimes only a day, often a week. They drop the price anywhere from free to $2.99. This almost never happens with only a first book, and never with hardback releases.

Usually the author has to have three or more books with the publisher before the publisher puts an early title on sale. And then only when the book is in mass market or trade paper editions.

Hardback pricing has “reduction” sales, meaning prices are lowered from $27.99 to $22.99 or lower. (And, of course, hardbacks are high-discounted into box stores like Costco, which means authors make no money on those copies for the most part under most contracts. Indie publishers seldom get to those box stores at this point.)

As readers, we’ve been at this new phase of electronic reading now for going on two years, with regular readers now in the play instead of only early adaptors. This new trend of traditional publishing pricing is setting the price bar pretty firmly above $5.00 general level.

The lower prices are either because of length of the work and if a novel, an extreme lower price will often make readers more weary and cause the novel to jump through more hoops before bought. (Again, talking about regular book buyers, not writers or discount buyers.)

— There was (for a time) downward pressure on prices in electronic books in 2010-2011, but this trend has pretty well faded and now reversed (except at the high levels of pricing, meaning books above $15.99 still find a ton of resistance). A very vocal group of indie booksellers are keeping the pricing lower for some indie publishers. They confuse “sales” and “discounting” with original Suggested Retail Pricing.

But traditional publishers are holding the prices high and most readers (not all) are accepting that, when the price for the ebook is in a reasonable range. (Note: I said “reasonable range.” Very few ebook readers will pay above $15.99 for an ebook without the early-purchase premium on the book, meaning it’s just released from a favorite author. Studies have show that there is a very strong resistance above $12.95 price point.)

— All this is for what I call “normal readers.” A reader who would ONLY buy a book from a discount bin or cheaply at a used bookstore will disagree, of course, and love the 99 cent novel trend. But normal readers, the masses that are now starting to enter the electronic reading world are fine with paying a fair price. And if the price is reasonable, won’t even notice the price for the most part.

My Suggestions for Pricing in 2012

These ebook prices are slightly different than my earlier suggestions. And for ease of stating, I am using word count as markers. This is not always the case. Word count in some genres, such as young adult and early readers or fat fantasy, can vary. So these are only guidelines.

And only my opinion.

EBOOKS

Short Fiction (Under 3,000 words) $1.49

Short Fiction (3,000-6000 words) $1.99

Fiction (6,000-9,000 words) $2.99

Fiction (9,000 to 15,000 words) $3.49

Fiction (15,000 to 20,000 words) $3.99

Fiction (20,000 to 30,000 words) $4.99

Fiction (30,000 to 50,000 words) $5.99

Fiction (above 50,000 words if backlist) $6.99

Fiction (above 50,000 words if brand new) $7.99-$8.99 (maybe higher for a short time if attached to a paper book release.)

Those are my pricing suggestions here in early 2012 for ebooks. I think they would have been slightly off a year ago, slightly too high for the market back then. But now, as electronic reading goes into this new phase, out of the early adaptor phase, I think the above pricing is fair and following trends in publishing in general.

Every writer is different.

Every publisher is different.

You must decide what kind of publisher you want to be.

Remember, my opinions are based on my desire to be a long-term publisher, selling in all markets all over the world. Short term gains are nice, but not something I would spend much time chasing.

We shall see how these prices work over the next few years. I might be doing another pricing update a year from now. But I don’t think so.

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Copyright © 2012 Dean Wesley Smith

Cover art copyright Philcold/Dreamstime
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120 Responses to The New World of Publishing: Pricing Indie Books…Some 2012 Thoughts

  1. Cyn Bagley says:

    Dean,
    I am taking a deep breath and taking the plunge. When I first saw your pricing, I was a little skeptical, but I did it anyway. I seem to be selling about the same amount that I did when I was a discounter – so, few books sold, but more money in my pocket.

    I have several short stories, three collections, two auto-biographies, two poetry chapbooks, and three novels. I am at the point of having my last novel read by a couple of beta readers (I love these guys). I have been pricing my novels at 3.99 because I am considered a new author also even though I have been writing for years.

    Anyway, I am sure that the new novel is good enough, but I am not sure that I would be able to sell it at 5.99. What are your thoughts?

    I am getting squirrelly. Sorry.

    Cyn

  2. Hal T. says:

    Dean, thanks for a fun post. I hope you’re right but, as 2012 begins, my own numbers are different.

    My wife and I have three novels and a racy novella available (all at $4.99). According to Amazon’s January sales numbers, our 10,000 word collection of three science fiction stories ($.99) outsells everything else at a ratio of 25-to-1.

    No special promotions, no giveaways, nothing special going on as far as we know. We’re not dropping the price of our other work but we’re not missing with that 99-cent price point, either.

  3. J.Anne says:

    Dean,

    Great post about pricing and the last bit about piracy as well. I too have noticed that the prices of e-books have gone up and I don’t mind paying up to $12 for an e-book, but if the book sucks and I feel it wasn’t worth the price (due to poor editing or just simply poor writing sometimes), I will write a review and tell others how I feel it wasn’t worth that amount. So authors, if you want to charge high prices, write a book that will satisfy readers or you’ll get dumped on in the reviews.

    As far as piracy goes, I sell a lot on non-fiction and you’re so right. The first year or so I worried about how to make my downloads secure, how to prevent people from cheating me etc. but now that I have 150+ of these thing selling I don’t have time to worry about money I *might* be losing. If they want to cheat me, they’ll always find a way. I’ve learned to move on and get the next product out.

    In general I feel most people are honest and want to pay for the things I provide. This may not be true, but I believe it anyway. :)

  4. J.Anne says:

    And just to add, so people don’t think I’m out to get authors with high price tags, if I feel the book WAS worth the high publisher price, I say that in my reviews as well. I did that recently for several books, Ready Player One comes to mind. I paid $12+ for that e-book (because it is still in hardcover), but it was a great book and I left a blurb about how it was well worth the price in the review I wrote. :) (In addition, I bought the hardcover for my son, as well as the audiobook because he likes to read and listen.)

  5. Carradee says:

    I haven’t toyed with my prices much, but every time I’ve increased them, sales have increased, too.

    It’s something I remind myself whenever I consider how I’ll price something I’m working on. In fact, I have a side penname I’m planning on letting loose this year. I might try following your pricing scheme for it. :)

  6. Donna, that Amazon discounting is a GOOD THING, imo. The readers sees that your title is discounted down from the higher price, PLUS you still get paid the full amount based on the non-discounted price. Why is this bothering you?

  7. allynh says:

    “Laura Resnick on 26 Feb 2012 at 11:32 am – For example, I am a slow reader. So if -I- can read a book in one sitting (which is the case with a number of my old Silhouette romances, which were often 60,000 words or less; the original cover price for these books in print, back in the day, ranged $2.25-$3.25), I figure that most readers can also read it in one sitting–and I think a book that I sit down with, finish in one sitting, and may well never read again… merits a low cover price.”

    When you say that you are a slow reader, 60k in one sitting is fast to me. I read 10k an hour, so 60k would take me six hours.

    – One thing to note in the discussion so far, with people pricing “older” books lower. Remember, that what is “old” to you will always be “new” to somebody else, so I would not change the price. Books don’t spoil. I just spent premium prices for the Clark Ashton Smith collections, and those stories are not just “old” they are “ancient”. HA!

    I’m basing my e-book prices on the totally arbitrary concept of $1.00 charged per 25k. Ignore the 99 cents added to each(These are not the droids you’re looking for. HA!).

    Best Range for me*
    words – 100k | 125k 150k 175k 200k 225K |
    price – $4.99 | $5.99 $6.99 $7.99 $8.99 $9.99 |
    inches – 0.50 | 0.625 0.75 0.875 1.00 1.125 |

    * (Book 6×9 at 500 words per page, with cream paper(0.0025 inches per page).)

    The only reason I’m shooting for the range 125k to 225k is so that my e-books match my POD, and I don’t want to cross the arbitrary Amazon limit of $9.99 on e-books. I like paper books, and the only way I get a nice spine is if I have more pages. I plan on writing the occasional King Class book, +300k, but will be limited to the max number of pages for cream paper(740), and how small I’m willing to make the font**, plus I will self limit my price to $9.99, so I will “lose money”*** on the doorstop books. HA!

    ** (Tom Clancy’s _Executive Order_ is about 721k. That thing is a huge hardback using mmp size font, glug! They should have gone two-column for readability.)

    I can write any story of any size, but I will bundle small stories into collections like:

    3 x 50k = 150k @ $6.99

    2 x 100k = 200k @ $8.99

    The bundling is totally arbitrary. I just don’t want to have e-books without POD as well. Stephen King would put out “collections” that were really a bundle of what he considered “short novels” to make a volume the same size as his regular books. His idea of a short novel is larger than most “normal” books. The reason I feel good about the price range is that as a reader if I love the work by some author, I will pay any price (and have) to get that book.

    *** (Remember: King made $17m per title, in the Legacy system, with 33m Constant Readers. _Under the Dome_ is priced at $9.99. If that were my book, at the indie price of $9.99, with his 33m Constant Readers, well…, just pull up your calculator and enter $9.99 x 0.7 x 33,000,000 and hit equals. Yikes! So price accordingly. HA!)

  8. This is really interesting. I’m just about to release my first novel (well, the first one I’m willing to release to the world), *Blood for Blood,* and I was planning to list it at $4.99. It’s around 104,000 words, roughly, and now I’m wondering if I shouldn’t price it higher.

    I’m not sure as a newly-self-published author if I’m completely comfortable shooting for the $7.99 level, regardless of word count. Maybe I could start at $5.99?

    This may be a confidence issue, as well.

    I’m certainly glad to hear that ebook prices are trending upward. I was worried the “99 cents only” crowd would drive prices down. Apparently, they don’t, anymore than the availability of old hardcovers at the “Everything’s a Dollar” store drive down the price of hardcovers at Barnes & Noble.

    One of the most face-palming statements I ever read on Amazon’s forums was a request for a review, which ended with “and its 600 pages for 99 cents, so at least it’s a good value.” I couldn’t begin to point out all the ways that was wrong.

  9. Re: Donna’s price-changing issue… you don’t have your work available for cheaper anywhere else, do you? If so, Amazon price-matches and doesn’t pay anything above that. Some retailers are notoriously slow to amend prices (Kobo and Diesel, via Smashwords, apparently). However, I know a few authors who benefit from Amazon slapping a sale price on and still paying the author the full amount.

  10. Kenneth Guthrie says:

    @ Thomas.
    I don’t really do under 2.99 because of the 70% royalty rate situation at Amazon, which is most people’s highest income generator. I would raise my books to 2.99. People will still buy them because you are a good writer (price isn’t as important as good writing because your fan base [short or long term] is the driver for your continued financial success.)

    @ All
    One of the things that needs to be considered when following Dean’s advice is royalty rate. My opinion is that if you are working with Amazon (any of its stores) then under $2.99, unless it is really short, is not viable from a business perspective.

    That said, Smashwords is an exception. I feel comfortable pricing lower (although I don’t due to price matching at Amazon and friends) because I know that I will be getting an 85% rate on a 0.99 story. If you do the math, you are getting 0.35c on a 0.99c story at Amazon, but 0.84c at Smashwords. I won’t add that, if Smashwords were easier to buy from using the Kindle or Nook that it would be in all of our best interests to direct our customers there through internal linking (which is probably a ToS violation in some cases, ex. Smashword links in an Amazon edition of a book, and so on.)

    My overall opinion is that the above post is pretty good as a reflection of the current market and I don’t really think that Dean is suggesting that you price as above, but more follow your own heart and research to find the best price match for your type of fiction and level of skill (hence, the ‘All Writers Are Different’ comment.)

    Also, as a final note, it is important to remember that readers don’t think in word count. Ask anyone who is not an author how long a novel is and most won’t have any idea. The fact is even authors don’t really as we all have such varied opinions what is and what isn’t a certain type of fiction, which inevitably varies between genres. Hence, when you read the above try to think in short story, novella and novel and price those three accordingly for the genre (I would even go so far as to state in my descriptions that it fits into one of these and not give a word count as that might get confusing.) Of course, that’s just my opinion as I write only short stories and novellas and happily price them at 2.99-3.99 then rough everything up into collections priced above that (You’ll note that I don’t price under $2.99 due to royalty rates.)

    Oh yeah, on an aside, if you have Amazon Singles, you get the 70% royalty rate on your 0.99c Amazon Sinlges. That would mean my thoughts on royalty rates for those authors would be incorrect.

  11. @Anthea: “Donna, that Amazon discounting is a GOOD THING, imo. The readers sees that your title is discounted down from the higher price, PLUS you still get paid the full amount based on the non-discounted price.”

    While I agree the price match and perceived sale to the customer is very good, I don’t think the second part is correct (not sure if you meant it that way). Correct me if I’m wrong, but Amazon will only pay the relevant *percentage* when price matching, but not on the *full* price. If I have a $4.99 novel in Amazon and they price match my iBooks price at $2.99, they will only pay me 70% of $2.99. If they paid 70% on $4.99, my royalty would be $3.49, or $.50 more than the selling price.

    If they did pay on the full amount, that’s a massive loophole they’d lose a boatload of money on. Just like a $.99 novel matched to free – they don’t pay anything, they won’t continue to pay 35% of $.99.

    ~Steve

  12. Thanks, Dean, this is very timely! I had a feeling the days of the 99 cents bash were coming to a close. Too much junk at that price so if you price your books at 99 cents you’re just not going to end up like John Locke, with one million copies sold in 5 months (aren’t we all salivating…)

    I think there are other things that might be coming to a close too, like trilogies. I had a YA trilogy up last year and now with hindsight, I realize that was a mistake. Yet I had done (I thought) everything “right”, first book (60,000 words) priced at 99 cents, the following two at $2.99 (they were shorter in the the 45,000 words range). Plus the “right” categorization: the “hot” genre of YA.

    Why the mistake? Because (1) it wasn’t really a YA classic (too literary, too much historical/exotic stuff to appeal to 14-18 years old); (2) each book came out at 3 months interval, losing my readers in the waiting (I’m not a Big Name writer!); (3) the 99 cents price allowed me to participate in marketing events that turned out however to be a total waste of time (and money); and (4) worse of all: the book is not really a trilogy in the sense that each book is a stand-alone. No, it requires reading all 3, and in the right order, to get a sense of the story arc.

    So it’s not just a matter of pricing but also of packaging. Some books may be internally divided in 3 parts but that doesn’t mean they’re trilogies. The marketing pitfalls are really multiple: wrong price, wrong packaging…I’d love to have your views on packaging and in particular on trilogies (not the same as series, in my opinion, where each book concerns the same character(s) but each stands on its own – a trilogy does not)

  13. Anthea,
    Maybe it’s my ignorance about Amazon’s policies. I didn’t know they would honor my set price. I hadn’t had it changed long enough to get a remittance so I was really just experimenting. Are you saying if I price my book at $3.99 and AMZ discounts it to $2.99, I’ll still be paid for the $3.99?

    Since I signed Enemy up for the Select program, it’s exclusive to AMZ so there is no price matching obstacle.

  14. Josh says:

    So, Dean, most of your short stories are priced at $0.99. Any intention of raising your prices to match your pricing criteria?

    • dwsmith says:

      Josh, within three months you won’t see a book or story of mine under $2.99. Many short stories will just be taken down and swept into collections and so on. So the answer to your question is Yes. (grin) But it’s going to take a little time.

      This workshop, where we just did a section on pricing with 27 professional writers, was a stunner and a real eye-opener for me on a lot of fronts. Let me put it this way, I came away from this wonderful experience of this workshop knowing for a fact that this pricing blog did not go nearly far enough. But I will let it stand for now because it’s a guideline that’s better than my old one. I might talk about this new thinking in a year or so, after I test it and others test it. Now off to open the workshop for today’s session.

  15. @Donna: “Are you saying if I price my book at $3.99 and AMZ discounts it to $2.99, I’ll still be paid for the $3.99?”

    I’m almost 100% sure that’s not the case (again because they could easily lose money – and Amazon won’t do that). I just checked my KDP reports to confirm. There are two columns – average List price and average Offer price. I’ve got two books currently being matched to iBooks lower rates (because Smashwords is sloooowww getting new prices out) from $4.99 to $3.99. I see $4.99 in List price, $3.99 in Offer price, and my royalty is 70% of $3.99, NOT $4.99.

    ~Steve

  16. I am an admitted dilettante when it comes to e-books. Last year I only put up five novelettes, and I kept them all at the 99-cent US price point. Sales crept and crawled. Now, granted, this was all genre work — science fiction and fantasy — not romance or other “fast” genres that tend to move a lot of merchandise in the aggregate. But I am thinking about revamping my pricing model, because it’s been suggested to me that my current pricing is “ghetto” and that it’s hurting me far more than it’s helping me.

    One thing I can say for certain: of the five novelettes I had up last year, the one that outsold its siblings was the one that had previously been published in a major print market, and won a readers’ choice award. I am not sure if that extra “quality branding” made a difference in readers’ minds, but based on the data I have from 2011 I suspect it did. So I am less motivated to post original fiction in this regard, and more motivated to put up more fiction that’s been similarly “quality branded,” to see if it bears out.

    Now, $2.99 for a novelette… I’m going to have to think about that. My gut tells me that’s a bit steep for such a short length. But on the other hand, if I am “ghetto pricing” at 99¢ I am clearly not keeping up with the trends in the business. I don’t want to be consigning my stuff to the bargain basement out of ignorance, or stubborn unwillingness to change my tier to fit the emerging market. So, the raised prices will take a little getting used to, on my part.

    It would be fascinating if, after adjusting prices across all product come April 1, the rest of 2012 showed more sales rather than less.

  17. @Donna, and Steve

    That is correct, if Amazon is NOT price-matching, but they decide to discount your title (which actually happens a fair amount with non-agency titles, whether indie or self-pub), then you still get the full royalty on the cover price *you* set.

    However, if you have a cheaper price for the title on another site, then Amazon will match to that and you will NOT get anything extra above royalties on the lower price – they are well aware of that loophole, Steve. :)

    Two different scenarios about Amazon dropping your list price. One is them using their retail discounting abilities, which does not affect your royalties. The other is you messing around with prices elsewhere and them adjusting to match. Make sense?

  18. Josh says:

    That’s very interesting. I take it that you believe professional-caliber writers can then charge a lot more for ebooks than even your criteria suggest? I guess this would be seen to bear out considering the number of publishing houses that are putting ebooks up at hardback prices.

    Or can the granularity of your criteria be changed quite a bit depending on genre, etc.

    I hope you’ll share soon.

  19. Jeff Ambrose says:

    “Let me put it this way, I came away from this wonderful experience of this workshop knowing for a fact that this pricing blog did not go nearly far enough. But I will let it stand for now….”

    No! You can’t! You can say something like that and then leave us hanging for a year! Let us test it with you. Or at least give us a peak inside the test. Please. Pretty please. :)

  20. J.A. Marlow says:

    Ugh, you’re leaving us dangling now? I’m jumping up and down here, wanting to know what new experiment you are going to try! :P

    It sounds like not publishing the individual stories may be part of it. Is this part of an effort to get completely away from anything priced at .99 or is there another part to the decision?

    • dwsmith says:

      J.A. and Jeff, oh, I will be doing individual stories, just longer ones standing alone. The shorter short stories will be grouped with other stories in different ways. I’m going to even start linking and redesign this web site some. Yeah, I know, shocking. (grin) Just watch as it goes along and things slowly change. And I will talk about some changes as they happen, some I won’t. But unless I am doing a “sale” nothing will be under $2.99 and much will be higher. And honestly, I won’t be doing many sales. I’m in for the long term, not short term gains.

  21. If a book is going for $0.99 you can’t lower the price. By going to $2.99, I can put a book on sale again at a later date for $0.99. This changes the price-point, and it pops up in a different price category on a given day. Different customers have different price points. While giving a book away for free is a way of reaching a lot of readers in the shortest possible time, obviously we must have a long term perspective on pricing. The thing is, by raising prices and selling fewer books, we make more money. Should we really chase rankings by offering cheaper books? Why not, when just starting off? Learn the business. Get some data. By the end of the year, I will know more and adjust prices accordingly. By giving away a free book in the horror category, I got one up to #7 in its category. Stephen King had a book going for $17.99 at a slightly lower rank in the paid horror category. This is a game of patience, and my plan will work. It takes time. Just by way of perspective, Wal-Mart changes prices almost at whim–but they have something on sale every day at prices that beat the competition by two cents…does it work for them?

  22. I remember when I first saw you mention selling a short story (under 5K) for 99 cents and thought that was too high, but then I started reading authors notes about sales going up when they raised the prices. My novel was having abysmal sales at 2.99, but when I raised it to 3.99 my sales went up (significantly), and then I raised it to 4.99 last week and had my best week ever. Will I get rich at that bracket? Not off of this one book, but I have several others in the pipeline coming out this year, and my novella is selling decently (compared to what I expected), and I have a couple of short stories making me a few bucks per month and I see this light at the end of the tunnel. I could conceivably quit my job by the end of the year if it keep posting new content. I don’t need amazing sales to accomplish this, just a nice steady stream of new products available for readers. Talk about an epiphany!

  23. Louis,

    Walmart doesn’t really price change on a whim. They empower the employee who is charged with maintaining the stock in each section of the story to place items on sale or not. So the person who makes the going-on-sale decision is the person who most directly sees which items are moving and which are not. Also, if memory serves they put incentive schemes in place to reward successful sales/marketing schemes those employees come up with. It’s a good system that obviously works well.

  24. I write fantasy and science fiction. I suspect that the Baen readers are the very ones who I hope will also become my readers!

    So I’m going to try this pricing structure:

    100,000 words = $6.99

    I’m totally a noob, so I’m still experimenting and figuring this whole indie pubbing thing out. It’s fun! And I’m ever so grateful to Dean for sharing his experience and insight. Thank you, Dean!

    (I tend to write long, so I don’t yet *have* anything less than 7,500. )

  25. Hmmm. The middle part of my comment seems to have disappeared. Let me try that again. Looks like my “less than” and “greater than” symbols got interpreted as HTML marks. Oooops!

    less than 7,500 words = $1.99
    7,500 – 17,499 = $2.99
    17,500 – 39,999 = $3.99
    40,000 – 59,999 = $4.99
    60,000 – 99,999 = $5.99
    greater than 100,000 = $6.99

    — Jaenii

  26. Kenneth Guthrie says:

    Interesting, Dean. I’m planning to do a bit of an experiment with a series of 10,000 word stories published at $3.99 each with the collection being 12 stories (120,000 words). I might try the $7.99-$9.99 price point for the total work with my mind sort of set on trying $9.99 for the first 3 months or so and adjusting downward to $7.99, with that being my ‘abandon and move on’ point. My feeling is that it will probably sell ok at $7.99, but could $9.99 be possible? No one really can say as a lot of it will be based on the quality of the stories and how I pitch the work to my readers (cover, description, internal marketing). I definitely plan to do a deluxe job on it and I’m sort of eager to see if it works out well (which, by the way, might totally change my business model if the data showed that it was worthwhile.) I might even go trade paper if I see enough success to pay for that expense.

    Anyway, I’m looking forward to watching you and Kris at work. Please make it as climatic and exciting as possible. Throw me a cliffhanger or two if there’s a chance and I’ll be looking forward to your HEA at the end!

  27. Kenneth Guthrie says:

    Oh, just to clarify, I do think that the short story market and novella market is one of the most violate right now. Short stories (I’ve heard) lost popularity with traditional publishers, but thanks to the changes that e-publishing has brought, my opinion is that this market will become [even more] ripe for the picking (not in a huge way, but definitely ripe). The above $9.99 statement is sort of a dig at the fact that the short stories market is not so well understood right now, although what market really is, right? That said, the more work one has up, the greater the risks one can take. One bomb means nothing to someone who has dozens of pieces of the pie for sale. In fact, and Dean might be able to confirm from his perspective, bombs (meaning low sellers or no-sellers) are all part of the game for the long-term players in this industry and are just a part of a writer’s life.

    • dwsmith says:

      Kenneth said, “In fact, and Dean might be able to confirm from his perspective, bombs (meaning low sellers or no-sellers) are all part of the game for the long-term players in this industry and are just a part of a writer’s life.”

      I confirm completely. That’s normal and has nothing much to do with anything that I can figure, or others can figure. Often we think it’s our best book that bites it the hardest. Often we try something that just doesn’t fit for us and we fail that way. More times than not, a traditional publisher screws up the publishing in some spectacular way or another (never the same from one book to the other) and the book fails horribly. If you can’t adapt and keep going, your career will be very, very short. In fact, due to a mistake I made, do you folks realize that in 1991 I couldn’t sell another book. I hadn’t followed quickly my first book and my numbers on that first book sucked so bad, no publisher would touch another book by me under this name. Career totally dead. Luckily I didn’t accept that and just stop. By 1993 I had sold five more books and in 1997 I sold 14 novels and wrote 11. Mostly under this name. Not all, but mostly.

      So Kenneth, good observation. A writer is a person who just writes. What happens to the books after they go out into the world is of minor importance, actually, and impossible to control. It’s the writing that matters. The writing is in my control. How readers buy books and publishers treat books is out of my control, so I don’t sweat it past what I can control in contracts and check steps along the way. Failure of books is normal.

  28. Kenneth Guthrie says:

    @ Piracy
    This is going to sound crazy, but why not upload any story that you plan to keep free permanently to Napster, or whatever people use these days? I know pirates *might* not buy stuff (I don’t really follow the news on piracy – except the occasional amusing freak out on the KDP forum), but it would be quite interesting if someone got like 1,000,000 pirated downloads and then saw a huge increase in e-store sales and became Stephen King or something overnight.

    Note: You can do something similar by uploading a free story to Scribd.com, which is a PDF hosting site. This is not in any way illegal by the way. The website will distribute your file to whoever wants it for no cost to you. I have a few things up and I’ve heard it is a good way to reach the European community. I also have no idea if it actual works, but its better than Facebook marketing or whatever people do in that people actually read the content you want to sell. (I have -2000 reads on several excerpts and free stories there.)

    On an aside, you can also have the Scribd.com document viewer in your posts – see their website for information [embed doc next to viewer]. People can read it just like they would with adobe reader, but with a few interesting features, on your website (you can block copy and paste). It’s the same as posting an embedded Youtube video to your blog. Goodreads will do a similar thing if you upload your book for free or sale via an author account, but the reader can only see it on Goodreads.com

  29. David Barron says:

    Re-design the website? THE HORROR!

  30. Just a short update regarding the prices of ebooks.

    Yesterday I realeased my first novel ever to the german market. It is a 60 000 word fiction book for which I set the price at Euro 4.99 which is about 6-7$.
    And well, the very first day I already had a sale. Its not much of course but it shows that people are willing to pay this price even for authors with no previous track record.

    Have fun writing :-)

    I’m off to write book no 2

  31. Diane Castle says:

    Thanks for this post–it confirms what I’ve been suspecting–that the 99 cent bubble has burst. I do think readers are catching on to the fact that it’s going to be hard to find quality work at that price.

    I second you on your opinion of the high-end e-book prices. I once paid $12.99 for an e-book, but you better believe I sampled it first, and thought three or four times before actually purchasing it.

    If it’s a book I really want to read from an established author, I think $9.99 is reasonable, and I have no problem hitting the one-click buy button. If the book is in paperback, I get really angry if the e-book version is priced over $7.

    While I think the average reader doesn’t know enough about publishing to check the imprint, I always do. If it’s a no-name press or an indie-author, I’m generally hesitant to pay more than $4.99. Is that fair? Maybe not. But it’s a bias I have.

    Diane Castle, Author of Black Oil, Red Blood

  32. maria grace says:

    One of the thing that really upsets me about the 99 cents price trend is the expectation it sets with readers. Recently I got a lousy review on Amazon because my 32K word novella was priced at $3.99. She thought it was too much to pay for a work of that size. Apparently she had bought one too many 99 cent book and felt like everything should be priced that way. Personally, I will be very glad if the 99 cent bubble has finally burst.

    • dwsmith says:

      Maria, yup, you’re going to get idiots like that. Or more likely, your writing was so good, the reader didn’t realize how much she had read and wanted more and then complained there wasn’t more. You get that all the time as well. Ignore them, stop reading reviews. (grin) Now back to writing.

  33. Dean,

    I don’t recall if you’ve addressed this in your earlier pricing posts: do you price by word processor count, or publisher’s word count? (Is that the right name? I forget.) One of K.D.’s critiques for my WotF Semi-Finalist was it was too long. (If only that were the only critique…) Her word count estimate was roughly 10% higher than the word processor’s.

    • dwsmith says:

      Martin, almost everyone has gone to word processor count. I fought this battle a great deal early on, trying to keep word count at publisher word count (meaning how much space does it fill in a magazine) but alas, I lost. KD is old school as well and sticking to her guns. Why I fought against computer word count is because we often get paid by the word, and writers, being so damn stupid and lazy, just used their computer word count, which means they got paid 10% less. Sigh, I lost that battle as well and once again we all took a pay cut.

      Between this and writers just allowing publishers on electronic rights to go from 50% of cover price to 25% of net on electronic publishing, It’s clear that writers just love taking pay cuts. Either that or as a group writers are uncannily accurate at shooting themselves in the foot.

  34. Jason says:

    Dean, You are an extremely accomplished writer, so I can easily see your recommendations applying to your work. However, what about a rookie writer about to publish his first short? I am concentrating on short fantasy fiction this year, ranging anywhere from 3,000 to 10,000 words thus far, and plan on publishing a bunch of individual shorts and a collection or two. Would you recommend modifying your price structure downward for a new writer trying to break into indie publishing, or do you feel it doesn’t matter? I appreciate your perspective and time.

    • dwsmith says:

      Jason, the wonderful thing about writing is that it is a level playing field. If you don’t value your own work, no reader will either. So I wouldn’t change my suggestions on pricing if I was talking with James Patterson, Lawrence Block, or a brand new writer. Get the prices out of the 99 cent ghetto unless your desire is to be a discount writer. (Trust me, I wrote a lot of stories and such for Barnes and Noble Publishing (yes, they published books before everyone got upset about Amazon doing it) and they were a discount publisher completely. The only place you could find my work was on the discount tables at the front of a Barnes and Noble store.

      New writers just always give too much to the fact that names matter, when in reality, it is quality fiction that matters. You write a great story and readers will find it.

      And do you know my two mystery/thriller names? Those two names started as brand new names. And guess what, the reason they grew is because I have millions of words under my fingers. And I study how to write and how to tell great stories. Those hidden names didn’t get any help at all except for my skill at telling a story.

      Focus on learning on how to tell great stories and forget the name crap. The name will grow in time if your writing gets better in time.

  35. Jason says:

    Dean, I can’t thank you enough for such a thoughtful response. It was very helpful. I have one last question. I am a Learner at heart, always looking to improve and research. To your point about focusing on learning how to tell great stories, can you recommend courses, books, or something else that teaches the craft of writing? Other than reading King’s On Writing, Sol Stein’s books about writing, and thinking about going for a second Master’s degree, this time in English, I wasn’t sure where else to look. I have access to a Creative Writing program at a local college as well. Would you suggest writing conferences, workshops, etc? What else can a writer do to learn and study the craft of writing on their own, other than reading?

    I was going to private message you but figured your response would be helpful to others here as well. Thanks!

    • dwsmith says:

      Jason, stay away from Creative Writing courses at any college. They might help you with a grammar issue, but they won’t teach you to be a creative writer. They are not designed for that.

      As to how to learn? Stop looking for one overall program and make learning something about writing something you do every day. And I mean every day. Study other writers. Study what they do after you have read their books for pleasure. Buy every how-to-write book you can find and look for the nuggets in each that make sense to you as a writer and ignore all the rest. Study the history of publishing and realize that will come around. Go to workshops taught by professional writers many books farther ahead of you. Spend that money for education. Go to conferences and conventions and sit and listen to other writers and ignore everything that doesn’t work for you. Just take out the nuggets that hit you with some impact and make sense to you as a writer.

      Make learning how to write better stories the most important thing you do every day, and the second most important is learning business.

      To start, read Lester Dent’s plot structure (Google Lester Dent and it comes up.) And then go learn who Lester Dent was and how he wrote. That’s a starting point since so many bestsellers these days just use clear Lester Dent plot structure in their novels. And his books are still for sale on newsstands.

      And don’t forget to have fun.

      • Lindsay says:

        Yes, creative writing programs DO help improve your writing, especially at the MFA level (as he mentioned he’s going for another Masters). You work one-on-one with a professional, published author in drafting poetry, short fiction, and novels, and see a collection or a novel through to its completion for your thesis. The feedback of other MFA students is completely invaluable, and getting industry insight from the professors helps you actually make informed decisions about the process. It’s foolish of you to wave them all away in one fell swoop because for many of us, they’re a vital part of our professional career.

        • dwsmith says:

          Lindsey, I have zero issue, and in fact, respect the writers who choose the University track for a career. But remember when reading this blog, I am talking to writers who want to be commercial fiction writers, making their living only off their fiction. And have seen a hundred times at least how writers, to become commercial writers, must unlearn what they were taught in a university program.

          When University programs all start hiring long-time professional fiction writers like myself to teach, then I will change my tune because the focus will be completely different. But right now the focus of 99.9% of all university programs is to teach kids how to be creative writing teachers. Nothing at all wrong with that. Just not the focus of this blog.

  36. Elle Casey says:

    Insightful and interesting. I’m in agreement, although not sure to what extent I think we’d be able to follow that pricing structure and not price ourselves out of the market. It will be interesting to see!

  37. SJ Parkinson says:

    Good Morning and thank you for your insightful post.

    I am approaching publication on two novels (150K unedited + 110K edited as of right now) and this information was greatly appreciated.

    All the best in all future endeavours.

  38. Mark Moore says:

    Hi, Dean. Great post. I’ve been reading your posts since December (when I first started getting serious on self-publishing my own stuff).

    I’ve got my first short story done. I’m just waiting on the cover (yeah, I know, but I’m looking for anime-style art for this series and can’t draw worth beans; fortunately, my artist is charging a decent price).

    In the meantime, I’m going back through my archives of stories that I’ve written since 1996. One series, in particular, seems promising and can be sold after some editing. This would turn out to be a 40-story series.

    I crunched two sets of numbers, the first with bargain-bin prices and the second with your above suggestions (for collections, I used word count instead of number of stories, but I didn’t get to your comment on that until later, haha). For both sets, I assumed a publishing schedule of one story per week (and four weeks in each month) and 25 sales of each story in all channels throughout the world in each month.

    I was curious as to when I would start earning equal to my monthly wages as a retail clerk (I’m not shooting to be a millionaire or anything like that). To my surprise, both sets of numbers have me reaching that goal in the same amount of time – with the extra sales of the POD collection being the deciding factor (the difference being the price of said collection).

    The only product difference is the bargain-bin pricing relies on 5-pack and 10-pack collections, and your suggested pricing relies on only 10-pack collections.

    So I have a few questions:

    1) Are my expectations realistic, or is my logic faulty?

    2) Bargain-bin pricing requires both 5-pack and 10-pack collections. I feel the bargain-bin pricing is more fair for what’s essentially long-unlooked-at, recycled material (although which I’m still fairly confident in), but having 5-pack and 10-pack collections might give the impression that I’m trying to milk this (which, to an extent, I am – but only to the point that it will equal a full-time job that pays a little above minimum wage). Going with your suggested pricing eliminates the need for the 5-pack collections entirely (and opens the door for occasional sales), but I’m not sure if I feel confident charging these prices for these stories (my newer, made-for-e-publishing stories being a different matter). Yes, I know you said these prices are only your opinion. Still, I’m curious as to which way to go here.

    3) For your stories, have you noticed any drop in sales of single stories after collections are released?

  39. LKWatts says:

    Hi Dean,

    Thanks very much for stating your opinions here – they are very interesting. They have also given me confidence that I’ve made the right decision this week by raising the price of my ebook from 99c to $2.99. It’s been something I have wanted to do for a while so now I have finally decided to bite the bullet and just do it.

  40. Victoria says:

    So have I and I don’t regret it.

  41. aimerythomas says:

    This is a very interesting article that I wish I had discovered sooner. Many of the comments have also given me much more to consider in regard to the state of the market.

    E-books seem to be a true test of both demand- and supply-side theories of consumer economics. I think that the market will adopt more centric tendencies and standards for pricing when the number of households consuming / purchasing e-books reach 50%. Consider console video games as an analogy. The cost and price of games increased as value for money and quality improved across the board: a move driven by higher levels of market penetration of the consoles.

    After careful analysis and consideration of what is being sold, by whom, and for how much, I will be releasing my first direct science fiction genre e-book, Primae Noctis, in November with a price of either $7.99 or $8.99 (US). It is more than 200K words and is targeted at the adult market.

    I have observed that young adult science fiction / paranormal romance seems to skew pricing downward on titles crafted for the adult science fiction market. This is unfortunate, but this category also drives device sales into households, which is what will eventually help all aspiring authors to have greater opportunities to sell more volume in the future.

    Cheers,
    Aimery

  42. Stephanie Jackson says:

    I’ve seen several statements about how Smashwords pays 85% royalties compared to 70% royalties from amazon. Nope, that’s not really the case. Amazon pays you 70% of your list price. Smashwords pays you 85% of what’s left over after they deduct all of the fees. If I sell a book on Amazon for $2.99, they pay me $2.04. If I sell a book through smashwords for the same price, Smashwords pays me roughly $1.92. I get paid more through Amazon. Smashwords does advertise an 85% royalty to their authors, but it’s up to you to find out 85% of WHAT.

    • dwsmith says:

      Very true, Stephanie. But Amazon was a bad example since they don’t distribute yet to Amazon except for a very few people. (grin)

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