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What Is the Solution to Ebook Pricing?

Ebook Pricing Solution

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What is the solution to ebook pricing, given the downward pricing spiral writers have pushed themselves into?

This is not a new discussion. In fact, it’s so old it almost bores me, but finally, after shouting from rooftops and mostly hearing only my own echoes, it seems like the whole industry is talking about the pricing problem.

Then we saw the beginning of the permafree book, and all the while I and a few other writers with some foresight were shouting on mostly deaf ears that we were devaluing our own industry.

Some ears are still deaf. I have seen it compared to public libraries (only if you have your book in 30,000 public libraries simultaneously) and the music industry (just so you know, free music albums fuels live concert sales—oh wait, writers don’t have concerts—whoops) and then there are the people who just don’t understand the words coming out of our mouths.

But there is also now a conversation starting about readers returning books they read and enjoyed for a refund, readers who won’t buy a book and wait for it to be free, and readers who think $2.99 is too expensive for a book. As I said recently in a debate about piracy, who needs pirates to devalue our work when we’ve already done it to ourselves?

Now I’m lucky, I’ve never heard any of those things pass the lips of any of my readers that I’m aware of, and I am grateful to them for it—but part of the reason may be attributable to my own good work. I have never positioned myself as a cheap and easy read, instead pitching a quality product at an adult (and perhaps slightly intellectual) speculative fiction market. Albeit, that’s a smaller market that some, but I’ve never felt much pressure on my prices.

This is market positioning. This is about identifying what quality of product you are offering, and then pricing it accordingly. If you are offering a poorer quality product to cash-strapped consumers, then you might legitimately price at $0.99.

The problem is, most writers have not been doing any market positioning. They are only competing on price. And when you consistently offer steeper and steeper discounts, all you do is train the consumer’s psyche to expect more and bigger discounts.

Oh wait—did I say some readers think $2.99 is expensive for a book and they wait for it to be free?

Looks like we have already arrived at that point….

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How do we fix it? There is no quick and easy fix. Sorry, there’s not. I’ve seen memes going around now about how much work goes into a book, comparing ebook prices to coffee, and starting petitions for Amazon to change its refund policy. These are all very, very true—but it’s the wrong way to approach the problem.

Consumers, as a whole, any consumers, don’t care much about what goes into a product (unless you have effective market positioning, which most writers don’t). They care about the end result. What does this product mean for me. I’m a consumer, and by and large I don’t want to hear how a product was made. Tell me what it does for me.

This is value. Not price. Value. Say it with me. VALUE.

Stop talking to readers about what it costs you, how you need to feed your kid etc., and start talking to them about what your product gives them.

How many hours does it take to read your book? What does that work out to as cost per hour? What else can a consumer get for that price?

If your book takes readers to exotic destinations, what would it cost them to go there themselves?

What does your book give a consumer that money can’t buy? Star Wars takes us to a galaxy far, far away….

Think creatively about what your book gives the reader and start talking about that.

The second thing you can do is think about market positioning. Who charges a premium on ebooks and can get away with it? Top tier writers, most of whom are published with big publishers. Why? Because they have built a reputable brand for quality (however that is perceived by their readers) and they have positioned themselves to charge top dollar for it. Maybe you can’t do that, and maybe you’ll never be able to do that, but you can start thinking about whether you’re really selling 99c quality books or not.

So there’s your homework:

Lessons for Writers From ‘Pricing for Law Firms’

Funnily enough, pricing is much the same across industries and professions–or should be. At a recent seminar I attended, lawyers were criticised on the basis that “if grocery stores priced like that, they’d soon go out of business”. And funnily enough, the first thing I thought was “Writers are making the same mistakes – only worse!”

So what are those mistakes?

  • Market positioning – this is about where you place yourself in the market. There is a cheap and nasty product, there is the Rolls Royce, and then everything in between. Cheap and nasty mass sells cheap products, while Rolls Royce sells very few, high-priced items. Every market looks like this to some degree. You need to know what you are selling and to who, because this affects what your product is worth and what the buyer is prepared to pay for it. So selling your books at 99c may make perfect sense – provided it is your intention to sell that quality product to that type of reader. If you are selling a higher quality product at 99c then you are doing yourself a disservice because….

  • Price is still a perceived indicator of quality. If there is a mismatch between your price and the product quality then you are trying to sell the wrong product to the wrong people and the people who would be interested in your product at the right price aren’t even looking at it because the price is sending them the wrong message about quality.

  • Heavy and repeated discounting does nothing but train the customer’s psyche to expect more and steeper discounts. We have witnessed this in action in the publishing industry over the last few years as books have dropped to 99c and then, finally, when there was nowhere else to go, to permanently free. Now a loss leader is all very well and good, but many writers are literally giving their books away for nothing.

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We shouldn’t be talking to customers about price. We should be talking to customers about value. You see the example of a cup of coffee for $2.99 used when readers won’t pay $2.99 for a book – primarily comparing the amount of effort and cost of inputs in the coffee to the staggering amount of time and effort that goes into a book. This is all very true – but it’s still the wrong comparison!

So what is the right comparison? How much value does the coffee have? How much pleasure does it give the buyer? It sure is pleasurable to drink, but ten minutes and it’s gone – and most of that you spent waiting for it to cool down enough to drink. And that’s assuming you are a coffee drinker – of course, if you are not, the coffee has zero value – exactly as a book has zero value to a non-reader.

What is the value of a book to a reader? It will vary from reader to reader, but generally speaking the amount of entertainment a reader gets from the book will be a key driver of value. I’m a fast reader but it will still take me 12 hours to read the big fat books I enjoy. That’s a great deal more bang for my buck than the coffee. Of course, it’s not as straight-forward as that, and other subjective factors will include:

  • Preference for short or long books – a book the wrong length will have less value to that reader;
  • Importance of quality – a low quality book will have less value to the discerning reader, while a high quality book may have no additional value over a low quality book to a less picky reader;
  • Brand value – a trusted and enjoyed brand will have higher value than an unknown writer.

There may be others I have not thought of. But ultimately, we have spent too much time having the pricing conversation with readers, offering steep discounts to secure more sales, and have trained readers to expect low prices. While we have been doing that, no one has been talking about the value of books and everyone has forgotten.

After all, if we were talking about value, the debate about steep discounts for ebooks versus paperbacks wouldn’t be raging so fiercely – because we’ d all know that their value is more or less the same because they offer the same experience…