Sunday, April 3, 2011

Kindle: The Results

I recently posted about an experiment I did with my books listed on Kindle. You may recall that I lowered my Kindle books to .99 cents each for one month. Well that month is over now and I have some interesting conclusions regarding the whole experiment.

In that previous post, I told you I had my books regularly listed at up to $4.99 and was selling about 20 books a month (some of my titles were actually only listed at $2.99). The experiment was to see if it would be better to list the books at .99 and sell more copies than at the higher price and sell less. So here’s what happened…

One noticeable conclusion came immediately when I saw the sales count for the month-long experiment. I sold 90 copies at .99; again, the previous month was only 20.

At $4.99 a book (actually, any price over $2.99), Kindle offers the author/publisher a 70 percent royalty. But if you lower your list price to under $2.99, they only give you a 30 percent royalty. So whereas I previously made an average of 2.44 a copy in royalties (all my titles with combined pricing), at the .99 listing price I was only making .30 per copy. So my profit before the experiment selling 20 books was $48.80, and during the month-long experiment I sold 90 copies at .99 each and profited only $27.00. But hold on, there’s more to know…

During the experimental period, I did not actively promote my books. So I sold 90 Kindle copies without effort. And… more than 40 of those were sold in the very last week of the experiment—why? I believe that happened because with more sales on record, my books ratings went up. The more you sell, the more popular the book becomes in “Amazons” eyes.

Even more interesting to this experiment was that my paperback copy sales increased as well and made up for the difference in profits for the Kindle version. Why did this happen? Likely because of the increased ratings. The more sales you have with Amazon, the higher they list your book in its category. So there just might be a real benefit to selling cheaper Kindle books, particularly if you have another format listed with them, i.e., paperback.

The conclusion:
Here’s my conclusion. I’m satisfied that a lower list price may generate more sales. But more so, I believe the lower price attracted a few additional readers, who may not have otherwise purchased the Kindle book at the previously listed price of $4.99, and because they did, the books ratings went up, and because they went up, more people saw the book and purchased it. Therefore, I fully intend to continue this experiment for at least one more full month to see if sales continue to climb at a faster rate. What do I think I’ll confirm with extending the experiment? Higher ratings sell more books with Amazon.com. This might be old news, but the question may have always been, “How do I get my book listed higher in search results with Amazon.com if I haven’t sold any copies?” The answer may be Kindle bargains. I will keep you updated!

11 comments:

Project Savior said...

The real important thing is that your volume increased, that means more readers, which means more followers.
Since you probably aren't planning on retiring to your private island with the $50 a month in book sales its better to take the cut in profit to build up readership, then when you release another book you'll have a larger audience that might pay the $4.99 and you'll make more than the $50 per month on that book alone.

Joylene Butler said...

This is great to know, Carol. I'm showing your results to everyone. Proves what I already believed. Just the other day someone said no way were they selling their hard work for $1.99. I'll pass your post along to show them just how wrong they are. Deals make readers happy, and why not. More happy readers, more sales.

Thanks!

Rahma Krambo said...

Thanks for posting your results. I think your conclusions are pretty right on. I just recently downloaded both Kindle and Nook aps on my iPhone and PC to test them out. I'm reading my first book on Kindle which was a free offer from the author. I really like the book and her writing, so yeah, I'll be very interested in her other books and I will pay for them.
This e-book thing is a whole new game and we, as writers and publishers, have to try different things to see what works!
Good luck with your publishing.

Sun Singer said...

Very interesting experiment. A lot of authors these days are not only lowering the price of their "standard length" novels, but are also offering a lot of short stories and "mini-novels" via Kindle. It's kind of fun watching the action.

Malcolm

Cozy in Texas said...

Great post. I dropped my prices on Kindle to $2.99 for this month for three of my books and my sales have increased too, but I'm also doing a book blog tour so it's probably a combination of the two. I think we have to just keep trying different avenues to see what works. Interesting about the higher ratings I hadn't thought about that. I had a comment from a lady in England who said she had wanted to buy my book for a while but it had been too expensive with value added tax.
I'm speaking about self-publishing at our local writing group in a couple of weeks and I'll pass out a link to your blog. I think the members will find it interesting.
Ann

Toyin O. said...

Very informative, thanks for sharing:)

Helen said...

Very interesting. The world of ebooks seems to be a new unmapped world and it's paying off for the writers brave enough to explore it. Thank you for sharing not just your experiment, but the results and insight you gained.

J.M.Cornwell said...

In sales parlance (something I learned in previous incarnations), this is called a loss leader. You sell something at a loss to get interest in something more expensive. What I find interesting is that the people who are buying the 99 cent Kindle bargain and still coming back and buying the print book. Or maybe not. It could just be the higher placement. It could be both. I've just started selling my book on Kindle, and a few short stories, and it seems to be working for me, slowly but surely. I keep my fingers crossed. It's earl days yet.

Kathi Oram Peterson said...

How interesting! I'll be interested to see what happens this next month. Keep us posted. :)

Anonymous said...

Question: Why are you only receiving 30%?

The choice at Amazon is between 70% for titles priced $2.99 to $9.99, and 35% for those priced less than $2.99 or over $9.99.

It's not a huge difference per sale, just a nickel, but for 90 sales, it would be $31.50 instead of $27.

And 70% of $4.99 is $3.49 per copy, so 20 sales would be $69.80.

Anonymous said...

Ah, I see you mentioned average sales, at two different price levels. My mistake on that second half.

But it is 35% for under $2.99 or over $9.99.