Amazon Pricing Guidelines for Kindle Direct Publishing

Price is one of the emotional factors to be overcome in making a sale. I have read many times that humans make purchases based on emotion and then use logic to rationalize the purchase. 

Pricing is an important issue for self-published authors as we struggle to earn a living or pay bills with the extra income derived from our publishing efforts. 

The trick, so to speak, is to price for maximum net profit. This is a careful balance between generating the maximum number of sales and earning the largest TOTAL profit possible.

Some authors want to set as high a list price as possible believing this will generate the greatest amount of total net profit. Other authors set a lower list price to increase sales and use volume to generate the highest possible net profit.

For those who want to see further examples of this math and logic behind this model, I suggest visiting J.A. Konrath's blog, A Newbie's Guide to Publishing and searching his archives as Konrath has written extensively about this topic.

One principle I will share from Konrath's blog is he believes strongly in find the the right price point that will generate the greatest volume of sales and this will result in the largest net profit possible. Konrath as the sales and the data to back this up and he shares it from time to time on his blog.

Amazon allows authors to set their own list price and the share of the sale the author will receive is based on guidelines established by Amazon. Some of these guidelines are shown below and come from Amazon.

If you wish to see the complete set of pricing guidelines for Amazon click on Amazon Pricing Page.

An Experiment With .99 Cent Kindle Book As a Launch Strategy

My latest Kindle book, Goal Setting for Sport: A Concise Guide for Coaches and Athletes was uploaded this morning. It is my hope it will appear on Amazon tomorrow. A post will appear on my website announcing the availability of the .99 version until June 1, 2011, at which time the price will go up to either $1.99 or $2.99. On Tuesday an e-mail will go out to the 1,700+ coaches on my e-mail list.  

The POD version has sold some copies and has already garnered three 5-star reviews. Hopefully Amazon will link the two versions as soon as the Kindle version is posted by Amazon.

I realize most authors who use the .99 price point are selling fiction but I am interested to see if this pricing strategy works for non-fiction as a launch so the book, both Kindle and POD versions, sell quickly enough to drive the title up in the Amazon Search Listings, causing the long tail effect to kick in much sooner.

I will compare my sales of this title against those of my best selling Kindle book in its first month and see if there was a noticeable difference in sales volume (not net profits) using this strategy as a launch for the Kindle book. In early June I will update the readers of this blog on this marketing strategy and report the results, good or bad, and what I have learned.

Paperback or E-book, Which is More Popular? The Results of a Survey and the role of Pricing

On the blog Selling Books there is a post today about a recent CNN survey examining which version of a book is more popular, paperback or an e-book. The survey, an on-line and unscientific study, found people prefer paperbacks to e-books by a margin of 80% to 20%. Yet an earlier report by CNN contained information indicating e-book sales had surpassed paperback sales are were still rising. 

Neither the blog posting or the CNN articles referenced had an explanation for either result, the preference for paperbacks over e-books and the fact e-book sales are out pacing paperback sales. I have an idea of how both results are factual and easily understandable.

I like my Kindle reader. My wife loves her Nook. Yet both of us prefer traditional paper books. I write in mine, make notes, highlight and otherwise mark-up my paper books. I use them as references constantly. I mainly read non-fiction. My wife just likes to hold books while she reads them. She reads fiction.

Why do we both like our e-book readers? Two simple reasons. As a history teacher I can carry hundreds of books around in a small device that weights at most one pound while my wife likes the lack of clutter produced by books laying around the house. Both of us really like the fact e-books stretches our limited budget for new books much further than if we continued to purchase mainly paperback books.

Of the two reasons, price is the overriding factor for both of us. Given the state of the nation's economy and the need to either be entertained for a period of time or the need to find information, the lower cost of an e-book is a major factor, I think, in the rapid rise in e-book sales. I am sure there are other factors, but cost has to be the driving issues.

What does this mean for self-publishing authors? Quite simply, don't abandon your POD service, in my case CreateSpace, and you better be offering e-book versions of your titles as well as paperback. It also means as the publisher and author, careful consideration must be given in how you price both versions of your book.