How to Price an E-book

17 replies
Already back in 2014, a major milestone was reached in the online book publishing industry: indie authors took home the bulk of all author earnings on Amazon's group of sites. They surpassed the earnings taken home by "The Big Five" trade publishers--Penguin Random House, HarperCollins, Hachette, Macmillan and Simon & Schuster--combined. (Source: January 2015 Author Earnings Report – Author Earnings)

Clearly, there has never been more opportunity for individuals to self-publish books as there is in this day and age. But more opportunity equates to more competition. So, how can indie authors stand out from the millions of other books being published every year all over the world? How can they maximize each book project so it brings them commercial sales success?

Specifically: What is an appropriate (and effective) retail price point for an e-book?

Some people will jump to this conclusion right away: Price it cheap! Price it at $9.99 USD or lower! I'm willing to bet these individuals have been indoctrinated by a certain e-commerce site that shall remain nameless because this post is about educating people rather than pointing a critical finger at any one company. That said, there's a lot more to pricing any type of book than simply trying to undercut the competition. There is much more to consider.

First and foremost, you need to understand your audience and what motivates them to buy. For the people who desire a low price ahead of all else and automatically assume that everyone views it the same way you do, think again. There are all kinds of different people in this world with all kinds of different reasons for buying e-books. You need to speak to them in their marketing language if you want them to buy from you.

Yes, some people buy things based on price. The marketing language you will use with this group might sound like this: Have what you want for less. Nobody will ever undercut our price! The affordable solution for thrifty consumers.

Other people buy things based on value. The marketing language you will use with this group might sound more like this: Sophistication and classical style for discerning women. Crafted with care for the distinguished gentleman.

Does that make sense? Although price is the most important thing for some people in some situations, other customers will buy depending on the perceived value of something ahead of the price. If that weren't the case then we wouldn't see any BMWs on the road, would we? Nor would we see so many people walking around with a Venti Latte from Starbucks in their hands when they could just as easily pick up a cheap coffee from Dunkin Donuts. The same principle can be applied to books as can be applied to cars and coffee--and everything else you're trying to sell.

Don't think about your book as a simple commodity. Think of it as valuable information. It's the content your customers are buying--not the format of the book. How can that content help them to improve their lives? If they believe that content will significantly improve their lives, they'll pay more for it. But you must provide them with value that is commensurate with the price you're charging. Otherwise, you'll lose the sale to your competitor. Likewise, if you tell someone your content is valuable but then you price it cheap, you're sending them a mixed message which will probably make them shop elsewhere.
#ebook #marketing language #price #price-based selling #value-based selling
  • Profile picture of the author Steve B
    Originally Posted by Best Seller View Post

    Specifically: What is an appropriate (and effective) retail price point for an e-book?

    I had hoped that you would answer the question you posed above, specifically. But you didn't. You said the obvious: some buy based on price, others buy based on value.

    So what is a cheap price for an ebook? What is a high price?

    What would you pay for 3 pages of value? How about 200 pages of value?


    Originally Posted by Best Seller View Post

    But you must provide them with value that is commensurate with the price you're charging.
    So how does one who is trying to price an ebook determine what a customer thinks your value to him is worth? Isn't that really the question here? Please explain how you go about determining that and pricing your ebook accordingly.

    Steve
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    • Profile picture of the author Best Seller
      Originally Posted by Steve B View Post

      I had hoped that you would answer the question you posed above, specifically. But you didn't. You said the obvious: some buy based on price, others buy based on value.

      So what is a cheap price for an ebook? What is a high price?

      What would you pay for 3 pages of value? How about 200 pages of value?




      So how does one who is trying to price an ebook determine what a customer thinks your value to him is worth? Isn't that really the question here? Please explain how you go about determining that and pricing your ebook accordingly.

      Steve
      Hi Steve, that's a fair question. I answer it in detail in one of my books, so I don't want to give away the farm on a forum. But I will tell you this much...

      Whenever my company produces books for any authors (myself included), we start with either a paperback or a hardcover (their choice) and then convert those digital files to an e-book after that fact. That way, these authors have a larger net to catch more fish because they are appealing to the readers who still prefer to hold a hard copy in their hands as well as the ones who prefer to read soft copies.

      So, all our pricing starts out with the hard copy ... which factors in many things including production costs (e.g. editing, proofreading, indexing, printing), the cut the retailers/wholesalers are going to take by selling the product on their sites, marketing and publicity costs, things like that. Once we have those costs figured out, we can determine our lowest possible retail price that will still earn us a profit. Then we figure out how much we want to earn based on goals, based on what our research tells us our readers want, and based on where we're selling those books.

      Whatever price we determine for our hard copy (paperbacks, hardcovers) is the same price we give to our soft copy (e-books). Why? Because in marketing, consistency in messaging is KING. If it's the content the client is buying, then they will pay the same price for it no matter what format they're buying it in.

      There's A LOT involved. My point is that there's a formula to figuring this out so that the author still earns a profit from their books rather than just blindly saying, "Okay, I'll price it at $9.99 or less!" That's suicide--pricing a book that low. You'd might as well just give it away for free.
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      • Profile picture of the author Steve B
        Originally Posted by Best Seller View Post

        Whenever my company produces books for any authors (myself included), we start with either a paperback or a hardcover (their choice) and then convert those digital files to an e-book after that fact.

        To be honest, I doubt that very many people on this forum are interested in creating either a hardback or paperback to begin with. They are digital marketers and create e-books first which may later be converted to paper using CreateSpace or some other service. So using a formula like you describe is not going to work for very many people here.

        I think forum members would like to know how to price their creations as a stand alone product, right out of the gate.

        I don't know the answer . . . but in my mind, looking at the specific niche market, the products already selling well in the market, and getting feedback from satisfied readers (maybe you give some copies away in exchange for feedback) as to what they would pay for the book . . . are at least a few things one might do to figure out the initial price point.

        Additionally, I would think testing a range of several different price points would be important once the book is released.

        Just so you'll know, I'm not trying to be critical of your initial post . . . I just didn't see how it would be real helpful to the majority of e-book creators here - myself included.

        Thanks, Steve
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        • Profile picture of the author Best Seller
          Originally Posted by Steve B View Post

          To be honest, I doubt that very many people on this forum are interested in creating either a hardback or paperback to begin with. They are digital marketers and create e-books first which may later be converted to paper using CreateSpace or some other service. So using a formula like you describe is not going to work for very many people here.

          I think forum members would like to know how to price their creations as a stand alone product, right out of the gate.

          I don't know the answer . . . but in my mind, looking at the specific niche market, the products already selling well in the market, and getting feedback from satisfied readers (maybe you give some copies away in exchange for feedback) as to what they would pay for the book . . . are at least a few things one might do to figure out the initial price point.

          Additionally, I would think testing a range of several different price points would be important once the book is released.

          Just so you'll know, I'm not trying to be critical of your initial post . . . I just didn't see how it would be real helpful to the majority of e-book creators here - myself included.

          Thanks, Steve
          These are all valid points, Steve. I don't find them critical of my post. I think we can all learn from each other.

          For my part, as an author and publisher for over twenty years, I see that there are still just as many readers buying paperbacks and hardcovers as there are people buying e-books. So, I tell my authors to consider both audiences when they publish. They're giving up potentially have their readers if they don't offer both hard copy and soft copy to the public..

          Also, there is a sub-section on this forum called "Offline Marketing" so, clearly, someone here realized the need to help the other people who are also still selling the "old fashioned" way.
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  • Profile picture of the author TrickyDick
    If you believe Dan Lok, Sean Mize and others, the value of "information" is rapidly approaching zero....

    The value of helping someone get results... with personalized attention... is rising.
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    • Profile picture of the author Best Seller
      Originally Posted by TrickyDick View Post

      If you believe Dan Lok, Sean Mize and others, the value of "information" is rapidly approaching zero....

      The value of helping someone get results... with personalized attention... is rising.
      Agreed. Which is why I teach authors both value-based selling and price-based selling techniques. Personalize your approach. Show your customers the value you are offering them rather than just slapping together a fast book and then slapping a cheap price on it.
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      • Profile picture of the author TrickyDick
        Originally Posted by Best Seller View Post

        Agreed. Which is why I teach authors both value-based selling and price-based selling techniques. Personalize your approach. Show your customers the value you are offering them rather than just slapping together a fast book and then slapping a cheap price on it.
        The IM concept of "value" doesn't resonate in the real business world.... at all.

        Real business owners don't want to be "entertained" by a 350 page ebook or watch a 70 hour video course. They want results... as in money in their pocket... with as little time invested as possible. This is exactly the opposite of "value" in IM.

        If they want to be entertained, they'll go to a movie, the symphony or a comedy club.
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        • Profile picture of the author Best Seller
          Originally Posted by TrickyDick View Post

          The IM concept of "value" doesn't resonate in the real business world.... at all.

          Real business owners don't want to be "entertained" by a 350 page ebook or watch a 70 hour video course. They want results... as in money in their pocket... with as little time invested as possible. This is exactly the opposite of "value" in IM.

          If they want to be entertained, they'll go to a movie, the symphony or a comedy club.
          If that is your audience, then you need to write your book (and the marketing copy to go with it) to speak to that audience. Your copy might read: "Save time. Get results NOW. Put money in your pocket today with these 10 efficient steps."

          Again, it comes back to what I said earlier. There's more to selling a book than just slapping together some content and slapping a cheap price onto it. Understand your audience and write for them, speak to them, price for them, sell the way they buy.
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  • Profile picture of the author quadagon
    There are a number of variables to consider when pricing including the purpose of the book and even the author.

    Putting these to one side and just looking at kdp I'd research the books in my niche.

    What categories are these books in and what are the best sellers price point. Making a list of the best sellers in 2 or 3 related categories will help you understand your market.

    I'd take note of price, no of pages, categories listed, sales rank.

    With this information you will be able to see the top and bottom of the market and also see which price point is most popular (and how this effects rank).

    With it being kdp you then have to work out how much you will earn from this price point and see which would be most profitable for you.

    Despite what some 'gurus' teach I've never found 2.99 to be the best price point and would often mean I was leaving a lot of money on the table.

    After you've launched test your price and see how it effects sales and profit.

    Counter intuitive as it may be you may be better to increase your price I'd you are not selling.

    If you have a physical book you can also take advantage of decoy pricing to drive sales to either your digital or physical book.
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    • Profile picture of the author mosbah77
      I think that this depends on the value that this ebook provideand how the book is written and the organization of the book subject and contents and solutions that are offered by that ebook plus how easy it is to find what you need in the ebook
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  • Profile picture of the author grandstar
    Many experts suggest that it ends in 7. Examples are $7, $37, $47 and $97.

    The the last 3 are probably the most popular price points on Clickbank.

    Even the mega offer have a knack of ending in 7 such as $997 or $9997.

    I like $9997 best. That's if I can close a sale every day. LOL!
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    • Profile picture of the author Best Seller
      Originally Posted by grandstar View Post

      Many experts suggest that it ends in 7. Examples are $7, $37, $47 and $97.

      The the last 3 are probably the most popular price points on Clickbank.

      Even the mega offer have a knack of ending in 7 such as $997 or $9997.

      I like $9997 best. That's if I can close a sale every day. LOL!
      A long time ago (and maybe I'm dating myself by saying this), it used to be, "It has to end in a 9 ... $6.59 ... $7.79 ... $9.99."

      They used to say the psychology behind ending it with a 9 was that $9.99 looks/sounds like less money than $10 in our minds. I wonder why it changed from a 9 to a 7. What's the new psychology there? Any idea?
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      • Profile picture of the author DABK
        Somebody, a few years back, did a test. 7 as last digit outperformed all other digits. All odd numbers outperformed even numbers (when dealing with inexpensive stuff: 3.99 was perceived to be cheaper than 4).

        Don't remember who did it, just that I read the summary.

        Never figured out the almost-converse: if you price a cheap thing so that the last digit is a 0 (or some other even number), do people think it's more valuable, though still cheap?

        As in, does a pair of sandals priced at $20 make a lot of people think they're paying $20 for a pair of sandals that's got to be worth at least $50?

        Some interesting articles about pricing:

        Marketing Research: Psychological pricing., significant digits, scanner data

        https://blog.kissmetrics.com/5-psychological-studies/

        ADDED later: https://www.theatlantic.com/business...d-1167/384993/

        Originally Posted by Best Seller View Post

        A long time ago (and maybe I'm dating myself by saying this), it used to be, "It has to end in a 9 ... $6.59 ... $7.79 ... $9.99."

        They used to say the psychology behind ending it with a 9 was that $9.99 looks/sounds like less money than $10 in our minds. I wonder why it changed from a 9 to a 7. What's the new psychology there? Any idea?
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  • Profile picture of the author jbsmith
    One factor that many new digital product creators miss is having a product strategy.

    Yes, your e-book and physical book may be your initial offering, but you really should have a vision for where you want to take your business next.

    Reason being, most e-books and books are simply a gateway to obtaining a customer which you then serve through multiple back-end offers.

    The back-end could be a video course, seminars, coaching programs (1:1 or group), membership programs, software, etc...

    Why does this matter?

    Pricing for your lead-in product can leave some profit on the table (or even all of the profit) if your goal is to drive revenue and profit from your back-end offerings.

    Having a $9, high quality e-book or even video program can work if you then convert a decent % into a $199 membership program or a $699 training program or a $497 software product for example.

    I suggest to anyone I work with that they create a product strategy that does not look at just your first product or just an e-book when there are so many back-end opportunities for you to sell into your market.

    In our case, we have Amazon Kindle, Udemy, and many free courses as well as e-books designed mainly to break-even or earn thing margins on their own, but work very well at brining new customers into our funnel where they will buy upsells, future offers where all of the profit margin exists.

    J
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  • Profile picture of the author EPoltrack77
    Id say based on what others are priced at in your marketplace as well as the value it delivers.
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  • Profile picture of the author amuro
    Originally Posted by Best Seller View Post

    Already back in 2014, a major milestone was reached in the online book publishing industry: indie authors took home the bulk of all author earnings on Amazon's group of sites.

    They surpassed the earnings taken home by "The Big Five" trade publishers--Penguin Random House, HarperCollins, Hachette, Macmillan and Simon & Schuster--combined. (Source: January 2015 Author Earnings Report Author Earnings)

    Clearly, there has never been more opportunity for individuals to self-publish books as there is in this day and age. But more opportunity equates to more competition.

    So, how can indie authors stand out from the millions of other books being published every year all over the world? How can they maximize each book project so it brings them commercial sales success?

    Specifically: What is an appropriate (and effective) retail price point for an e-book?

    Some people will jump to this conclusion right away: Price it cheap! Price it at $9.99 USD or lower! I'm willing to bet these individuals have been indoctrinated by a certain e-commerce site that shall remain nameless because this post is about educating people rather than pointing a critical finger at any one company.

    That said, there's a lot more to pricing any type of book than simply trying to undercut the competition. There is much more to consider.

    First and foremost, you need to understand your audience and what motivates them to buy.

    For the people who desire a low price ahead of all else and automatically assume that everyone views it the same way you do, think again.

    There are all kinds of different people in this world with all kinds of different reasons for buying e-books. You need to speak to them in their marketing language if you want them to buy from you.

    Yes, some people buy things based on price. The marketing language you will use with this group might sound like this: Have what you want for less. Nobody will ever undercut our price! The affordable solution for thrifty consumers.

    Other people buy things based on value. The marketing language you will use with this group might sound more like this: Sophistication and classical style for discerning women. Crafted with care for the distinguished gentleman.

    Does that make sense? Although price is the most important thing for some people in some situations, other customers will buy depending on the perceived value of something ahead of the price. If that weren't the case then we wouldn't see any BMWs on the road, would we? Nor would we see so many people walking around with a Venti Latte from Starbucks in their hands when they could just as easily pick up a cheap coffee from Dunkin Donuts. The same principle can be applied to books as can be applied to cars and coffee--and everything else you're trying to sell.

    Don't think about your book as a simple commodity. Think of it as valuable information. It's the content your customers are buying--not the format of the book.

    How can that content help them to improve their lives?

    If they believe that content will significantly improve their lives, they'll pay more for it.

    But you must provide them with value that is commensurate with the price you're charging.

    Otherwise, you'll lose the sale to your competitor.

    Likewise, if you tell someone your content is valuable but then you price it cheap, you're sending them a mixed message which will probably make them shop elsewhere.
    I will say price your book at $5 or even $7 for a start if you are marketing in online marketplaces like Clickbank or JVZoo.

    Or lower if you intend to publish as Kindle on Amazon.

    But it still boils down to each individual writer's choice and preference.

    Matt Lloyd recently priced his e-book Wifi-Millionaire at just $3 in his recent email to me as his subscriber and MOBE customer.
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    • Profile picture of the author DABK
      Why? What's wrong with 5.77, 7.95? What's wrong with $22? What's wrong with 48.97? (Just to name a few of the numbers that want you to explain yourself... Because, otherwise, what you say doesn't help much.)

      Originally Posted by amuro View Post



      I will say price your book at $5 or even $7 for a start if you are marketing in online marketplaces like Clickbank or JVZoo.

      Or lower if you intend to publish as Kindle on Amazon.

      But it still boils down to each individual writer's choice and preference.

      Matt Lloyd recently priced his e-book Wifi-Millionaire at just $3 in his recent email to me as his subscriber and MOBE customer.
      {{ DiscussionBoard.errors[11020764].message }}

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