The other posts in this discussion are about buying an ereader before you start selling ebooks (especially if you’re going to give some out for free) and calculating how much you invested in your ebook. If you want to know where I’m getting the figures for how much your book costs, look at the second. Last time: Picking a price based on what it’ll take for you to break even.
One of my previous jobs was working for a bank branch that did home equity loans, so I have seen probably tens of thousands of appraisals. (That doesn’t make me a competent appraiser; I was just auditing to make sure the information had been reasonably used to make judgments.) Comparable sales (comps) are very important, when you’re judging the value of a house, because the market shifts so much. The value of the actual house is usually less than the value of the land (of location). The workmanship is only one aspect of the value of the house; often, the number of bathrooms is more important.
Similarly, the value of a book can be determined more by its location (genre) than by the book’s intrinsic “quality,” which is hard to measure anyway. So when you’re looking at comps for your book, the quality of your book is only a minor factor–a feature of your “house,” if you will.
Now, if this were a purely logical society, the way to pick comparable sales would go like this:
- Find the top-selling books in your genre that appeal to the same market, as specifically as possible.
- Find the average price of the top-selling books in your genre.
- Determine a list of features of the 3-5 books closest to yours: average rating, word length, additional material or features (if any), quality of editing, any awards/records by the authors on these or previous books, how many other books the authors have published, how many books the authors have sold (estimated), plus the actual quality of the book (“Look at the beautiful view from the kitchen!”).
- Determine how your book’s features compare to the other books.
- Adjust your price up or down from the average price based on your features (there’s a whole system to it when you’re doing house appraisals, of course, but I couldn’t find anything about it for books).
However, when it comes to ebooks right now, we’re a very emotional rather than rational society: authors who will sell their souls for an Amazon ranking, publishers who will price the ebook high in order to sell more paper books, ranks that are affected by hidden and mysterious sales ranking as books pass from the free list to the selling list and back again.
In general, there are three theories on pricing ebooks as non-free that you should keep in mind when picking comparables:
- Pricing books to sell a lot of ebooks ($.99ish).
- Pricing books to sell a reasonable number of ebooks ($4.99ish).
- Pricing books to reduce the number of ebooks vs. print books sold ($14.99ish).
If you have determined that what you want to do is sell a lot of ebooks, just price them at $.99–that’s as low as you can reasonably go without them being free, so that’s pretty much the price that people are selling them at, the end, don’t bother with looking at comparable sales. This doesn’t mean that you will sell a lot of copies, just that this is the price that people wanting to sell a lot of ebooks price their ebooks at. Your comparables.
If you have determined that you want to reduce the number of ebooks vs. print books that you sell (big publishers), then pick your sales from books priced from $9.99 and up–I’d say somewhere between $12.99 and $14.99 is where you’ll end up.
If you want to sell a reasonable number of ebooks, then throw out the $.99 and $14.99 books before you start making averages.
At this time, while Amazon is usually selling more ebooks for indie authors than any other site (not always; adjust as necessary if you find this is different for you), go to the Amazon Kindle eBooks store, find your genre and subgenre subset as far down as you can go, and click on the first non-free book you find. Scroll down to the Amazon Best Sellers Rank, and click your subgenre under the Kindle Store link (you don’t want to confuse the issue at this point by looking at print and ebooks). You’ll see a list of the top 100 paid and top 100 free ebooks. I’d comb through the top 100 paid list, remove all the $.99 and $14.99-level books, then average the rest, although probably 3-5 books that were as comparable as possible to your own in featues would suffice.
Again, I’m no pro on how to price ebooks–I just keep getting questions. I’m using Alien Blue as my guinea pig for this. So far: pricing AB to reflect my expenses in writing it ($7.99) did squat for sales. Lowering the price to fit a quick eyeball guesstimage of comparable sales ($5.99) (combined with a Kindle Direct Select promotion) boosted sales for a time. They’ve lowered again, but not to the level of the $7.99 sales. (Next time I do this, I’ll test the pricing with near-zero marketing first.) This weekend, I’ll run the numbers as I’ve listed above and adjust the pricing accordingly.
(Psst – take a look at Alien Blue. It’s available via Amazon for now but will come out on non-Amazon formats May 20.)