Tuesday, January 24, 2012
The Fire Sale is Over... kind of.
When Kindle publishing first started, Amazon set forth the rules: If you sell your e-books for $2.99 or more, we'll pay you 70% of the cover price. Charge less than $2.99, and we'll take 70%. Oh, and no giving books away for free. Only big publishers can do that... The answer was obvious. Price everything at $2.99, and only go lower if you want a loss leader. Sacrifice profits on a title or two in order to make a decent income off the rest. And for a few months, that seemed to be working. Then Amazon changed the rules.
Early last summer, Amazon began marking down titles at random to $0.99 in order to entice more readers to buy more books (and more Kindles, no doubt). To their credit, they paid the authors the full amount. But unfortunately, hundreds (or even thousands) of us no-name authors were suddenly left hanging with most of our titles priced at $2.99 while Kindle buyers were suddenly jumping on $0.99 deals. I, like a great majority of Indie authors, lowered my prices. It was the only way to compete. I sacrificed a huge amount of profit in order to compete with Amazon's fire-sales.
My sales increased and I got my titles into the hands of literally thousands of readers. In a way, I exchanged profit for a large base of readers, and hopefully a growing brand.At the time, it worked. But now, the game has changed again. I alluded to price increases recently, and you've probably noticed them by now. This is the full, boring explanation:
In December, Amazon began a new program. They gave new Kindle owners a free month of Amazon Prime, which gave them a few perks such as access to Amazon's Kindle Library. This gave new Kindle owners access to tens of thousands of titles for free. Great for Amazon. Great for Kindle sales. Not so great for those of us trying to sell books. For the first time in a year, my sales flatlined in January. I didn't take a major hit, I just lost all growth and on some days, saw less than average sales compared with the previous month. Obviously I had to do something. So what do you do, when Amazon gives books away for free? How do you compete? Answer: Raise Prices!
Okay, you're laughing. That doesn't make sense, right? Sure it does, because things have changed. There's no point at all in trying to compete with free. I'm trying to make a living here. I'm trying to build a career. And if I really want to give my books away for free, I can join the program. I just have to pull my titles from every other e-book retailer. Yeah, did I forget to mention that part? Once again, The Bix Six don't have to do that, but I do. Ah well, who am I to complain. Clearly I'm just a pawn in this chess game. All I can do at this point is hope that my books are good enough that some people will still be willing to pay for them, even when they can download other books for free. A week ago I changed the price on Tinkerer to $3.99. I immediately lost about thirty percent of my sales. And my profits multiplied by ten.
All that being said, I am considering joining Amazon's library. I don't like the exclusivity. I don't think it's fair. But then again, it's Amazon who sells my books. Smashwords distributes my books to sellers who more or less ignore them. Barnes & Noble treat Indie publishers like an embarrassment to be hidden in the back room. Amazon puts my book on the same shelf as everyone else. They promote my book through sales and ads, and when they drop the price of my books, I still get paid my full share. So my objections to this program are clearly based more on principle than anything else. And as much as I'd like to stay on my high horse, I've got a business to run. I can't sell books if nobody knows about them, and only Amazon seems interested in helping me to do that.