Here at Written Word Media we like to put the “pro” in price promotion. Every month we help thousands of authors get their books in front of readers, so we get to see what works and what doesn’t. One of the most important elements of any promotion is the price at which you promote your book. Below we outline some common ebook pricing strategies. We ran this report back in 2017 and 2015, and we’ll be comparing this year’s data to our findings back then, as well as talking about some factors that lead to particularly successful promotions.
This year we looked at Amazon sales data from March, April, May of 2018. Please note that this analysis is based purely on data we have collected from the promotions we ran to our audience. These pricing best practices are not necessarily true for all audiences or promotional sites. They are true for books on Amazon and reflect the behavior of Written Word Media readers on Amazon.
When running a promotion most authors have one of two goals: 1) Sell lots of copies or 2) Make lots of money. Ideally, you’d be able to achieve both, however that can be tricky because of the royalty structure on Kindle ebooks. The price you choose for your promotion will be a major factor in determining your results.
Goal 1: Sell Lots of Copies
How to price your book for maximum copies sold.
For many authors, especially those in the early to middle stages of their career, getting their books into as many reader’s hands as possible is the primary goal. The more sales you get, the smarter Amazon becomes on who is likely to purchase your book and the higher you will rise in the Amazon charts, both of which have drastic effects on discoverability. Additionally, the more readers who read your book, the more reviews you will get, the more email signups you will receive, and the more fans you will attract.
If you’re lookings to sell the maximum number of copies, pricing your book at $0.99 has always been, and is still your best bet. On average, authors sell at least twice as many copies at $0.99 as they do at any other price point.
Goal 2: Make lots of money
How to price your book for maximum earnings.
If your goal is to maximize your royalties, you are likely to see positive returns from a price promotion where your book is priced a higher. The price that maximizes author royalties is the same this year as it was last year, $3.99.The caveat here is that your book needs to be well packaged and well reviewed to get the results you are looking for. Readers are more discerning at higher price points and are unwilling to spend $3.99 on titles with poor book covers or no or few reviews. If you’re going to run a promotion at $3.99 make sure you have the goods. If not, run a promo at $0.99 to build your reviews and get feedback on your book cover.
Remember that the royalty structure on most major retailers is dependent on price. We are looking at sales that came through Amazon, and on Amazon authors receive 70% of every sale they make when their book is priced between $2.99 and $9.99, and 35% of the sale when their book is priced below $2.99. This means that you need to sell a LOT more copies at $0.99 or $1.99 than you do at a higher price point in order to make the same amount of money. For examples of how much you’ll earn at different price points, refer to last year’s article.
Most newsletters, like Bargain Booksy, which promote your book during a price promotion, are promising their readers “good deals”. In our experience, readers consider books priced at $3.99 or below a good deal. Book priced at $4.99 or above could be a good full price option for your title; however, we don’t see many authors running successful promotions at price point above $3.99. If your book is normally priced $4.99 or above, we recommend dropping it during your promotion. For an interesting case study on how to decide the full price of your book, check out David Gaughran’s post on pricing.
Can you Have your Cake and Eat it Too?
The analysis thus far indicates that as an author you have to choose between selling lots of books or making lots of money. As we can see in our graph, you can price your book at $0.99 and sell lots of copies, or you can price your book at $3.99 and make lots of money. Is there a way to achieve both?
The Role of Kindle Unlimited in Author Earnings
To enroll in KDP Select or to not enroll in KDP Select? This is the existential question that plagues the modern author. Enrolling in KDP Select necessitates that you are exclusive to Amazon, which means that you don’t have access to sales through Nook, Apple, Kobo, Google Play, and any other retailers at which you’d otherwise like to sell your book. We refer to books that are not in KDP Select and are thus published across all retailers as “wide books”. In exchange for this exclusivity, KDP Select gives you access to marketing tools (Kindle Countdown Deals and Free Book Promotion Days) and the KDP global fund (a shared pool or author royalties that totaled $26.2 million in June 2018).
There are many successful authors who have chosen not to enroll in KDP Select and there are many successful authors who are enrolled in KDP Select. We are not advocates for or against the program. What we see when it comes to running price promotions is that authors enrolled in KDP Select are more likely to be able to achieve both goals simultaneously. This is due to two factors: 1) Kindle Countdown Deals and 2) KENP Payouts. Authors running a promotion at $0.99 earn a 70% royalty effectively doubling the royalty on each of their sales.
When it comes to pages read, authors enrolled in KDP Select see an increase in the numbers of pages read when they run a promotion. On average, authors see a 1300 bump in KENP reads the day of the promotion, with reads increasing into the weeks after the promotion. With the current payout per page amount averaging $0.0045, that’s an additional $5.85 in earnings per day that an author earns off the promotion. We have had many authors report that they doubled the earnings they made from direct sales with the payout they received through the KDP global fund. In the graph below we are conservative and assume a KENP bump for only four additional days following the promo.
When comparing a wide book to a KDP select book, the sales from other retailers (Apple, Nook, Kobo) generally do not match the additional earnings a KDP Select author is making from the higher royalty rate and the KENP payout. KDP Select books that are priced at $0.99 through a Kindle Countdown Deal have the highest potential for author earnings, particularly when promoting to the Bargain Booksy audience. This scenario is a way to optimize for both copies sold and author earnings.
The analysis above is based on averages. We also took a good long look at the outliers to see if there were hidden data gems we may have missed.
Outlier factor #1: Psychological thrillers are still all the rage. Many of the best performing books at higher price points ($3.99 and $4.99) were psychological thrillers. Apparently, the genre fad that reemerged with Gone Girl continues to be popular. If you’re an author that likes getting into your reader’s heads and rummaging around, congratulations, you’re writing to market!
Outlier factor #2: Short-term discounts on boxed sets sell the highest volume of books. This is not a new finding but it was nice to be reminded that brief promotions on normally high priced boxed sets is a great way to generate a high volume of sales. Many of the promotions that saw the highest volume of sales were for boxed sets that were discounted to $0.99 from $4.99 or above. If you have a series, we recommend bundling it into a boxed set to open up this promotional option for you. Make sure to adhere to Amazon’s box sets guidelines.
Outlier factor #3: Books with poor book covers saw significantly fewer sales. Many industry professionals talk about the importance of a good cover and for good reason. Your cover is the face of your title, and what readers build their first impression off of. Your book’s cover also featured prominently in your Bargain Booksy promotion, so it makes sense that cover quality played a large role in promotion success. If you’re looking for a new designer to work with, we recommend looking at Reedsy’s listings.
Outlier factor #4: Reviews and backlist help readers make purchasing decisions. Also on the lower end of the sales spectrum were the books with few to no reviews. We all know that it’s quantity over quality when it’s comes to Amazon reviews. However, one way around this trend is by having a backlist. Even if your new release isn’t rich in reviews, your promotion will be more successful if you have a backlist that is well-reviewed.
If you’re just starting out and don’t have a highly professional cover or a lot of reviews yet, that’s a-ok. Bargain Booksy is happy to promote authors no matter where they are on their author journey. However, it’s good to walk into a promotion knowing that you’ll be on the lower end of the expected sales if that’s the case. If you’re looking to gain reviews for your book, we recommend running a Freebooksy promotion first, then circling back and running a Bargain Booksy promotion after you have your first few reviews.
What Does it All Mean?
If you’ve made it this far (or just scrolled to the bottom) congratulations! Here is what we learned:
- If you are looking to sell a lot of books in order to build an audience, price your book at $0.99.
- If you are looking to make money off of a promotion (and your books are highly professional with good reviews) price your book at $3.99. But note that readers are less likely to take a chance on a book with no reviews or with a poor cover at the $3.99 price point.
- Books that are priced at $0.99 through a Kindle Countdown Deal and available through KU have the best chance of building audience AND making you money.
- Psychological thrillers and boxed sets tend to yield the highest author earnings,
- Books with poor cover design and books with no reviews will result in sales and earnings at the lower end of the range.
What have your experiments with pricing shown you? Let us know in the comments below!