And it was commonplace for eBooks to be priced at higher prices than the ‘regular’ books that you might buy from Amazon. $37 was a common eBook price. As was $47. And I’ve seen eBooks at $67 and $97.
And I’ve got no problem with these prices – I believe the way books are priced is based on a model that’s no longer relevant in the 21st Century. I think that the price of something should be determined by the value it provides to the buyer – not by an artificial model imposed by a tradition bound industry that’s not essentially changed in 50 years or more.
For a few years – say from around 2003 to 2009 – you could create an eBook and set the price yourself. And benefit both from charging for the value that you provided to your buyers AND from actually earning the majority of the price that you set.
The rise of the Kindle has moved the boundaries though.
The Kindle Age
Before we move on I want to tell you that whoever came up with the concept of the Kindle is a genius. And that whoever at Amazon worked out the marketing plan for the Kindle is also a certifiable genius.
And I also believe that the ease of self-publishing to the Kindle is game changing in its potential scope for writers.
But there’s a downside to this – and that downside is that although Amazon now have the clout to move away from the business and pricing models that the Publishing Industry try and impose, they’re still playing the game by these rules.
So if you self publish to the Kindle, you earn the highest royalty rate if you price your book in the $2.99 to $9.99 range. The author royalty in this range is 70% – which is staggering by the way. If you published a book through traditional channels the figures I’ve seen quoted are that you’d receive around $0.50 to $0.75 per copy IF – and for most writers this is a big IF – you sell enough copies to earn the advance back.
Now that the Kindle has quietly established itself as a mainstream player the majority of the Kindle books are being priced in this $2.99 to $9.99 range.
The problem with this price range is that Kindle books are effectively eBooks – and the prices being charged for them make the ‘traditional’ eBook pricing models look expensive and potentially deter purchasers.
So how do you price your eBook? Can you still charge $37 for an eBook or more? Let’s look at 3 ways you can use to determine what price you are going to charge.
How To Price An eBook 1 – The Kindle Price Model
The path of least resistance pricing model is this one. Amazon.com are starting to flex their muscles – mostly in a good way – and it’s entirely possible that Amazon will drive the future of the Publishing Industry.
(Paul’s Note – to see one of the ways this is already playing out, go check out Steven Pressfield’s post on The Domino Project – What I Love About Seth Godin)
To price your eBook using this model you literally go to the Kindle store, compare what comparable books are selling for, and use that as your price point.
Advantages: Potential buyers won’t balk on the basis of price. You’ll be charging what’s perceived as the ‘market rate’ for your eBook.
Disadvantages: You’re pricing your eBook at the lowest price point. If your eBook offers great value or great information – and EVERY eBook you write should offer great value – then you’re not getting the return that’s warranted from the writing of your eBook.
How To Price An eBook 2 – The ‘Bit More Than Kindle’ Price Model
This model reflects the reality that Kindle is the driving force in the eBook market for most potential buyers. There are a lot of buyers who’ve NEVER bought an eBook in PDF form from Click Bank or from your website – and it’s a big step for them to be presented with an eBook for $37 or $47.
But adding a few dollars to the $9.99 price range is NOT such a big step. A price point of $14 or $17 is more expensive than a Kindle book – but not THAT much more expensive. If the information in your eBook solves a pressing problem, there’s a good chance that potential buyers will not be concerned with the differential between these price points and typical Kindle book prices.
Advantages: Using this model you generate greater revenues than the previous model – and the additional cost probably won’t deter the majority of prospective customers. Especially if you’ve built an audience via your website or blog and you’re primarily selling your eBook to that audience.
Disadvantages: Using this model you’re still not generating the full revenue that a valuable eBook deserves. Pricing should be based on the value you’re offering to customers, not on the archaic publishing model that Amazon has incorporated into Kindle pricing.
How To Price An eBook 3 – The Stacking Value Price Model
This is the pricing model I prefer. Done right, you not only get to price your eBook based on the value it’s delivering – but potential customers also don’t feel that they are paying over the odds and are getting value for money.
This ‘model’ is based on how companies like Warner Bros and Sony ‘justified’ the greater cost of DVDs back in the day when few people had DVD players and most of us used VHS.
If memory serves, a VHS of a film used to be about £10 and the corresponding DVD would be around £18. To justify the differential in price, the DVDs would contain bonuses.
These bonuses would be additional features like commentaries, deleted scenes, alternate endings, production drawings, interviews with the technical team, stunt analysis, etc etc.
Now, these features are standard on DVDs – but notice even now that you can often buy Single Disc versions of a film or versions with an additional disc and extra features for a slightly higher price – but back in the day they were revolutionary.
And often persuaded people not just to buy the DVD, but to take the plunge and buy a DVD player too.
You can do this with your eBook as well – and stack value onto your eBook so that you can charge $37. Or $47. Or even more.
Here’s how you do it:
(i) Record the eBook in Audio Format
The first way to add value is to create an MP3 version that people can put onto their iPods, iPads or iPhones. Or whatever MP3 player they use.
Or they can burn the MP3 files to a CD and play it in their car.
Professional quality microphones are relatively cheap these days ($250 or so) – and so is the recording software that you need to record and edit your sound files.
The learning curve to record and edit your own material isn’t steep – so adding audio is a great way to add perceived value to your eBook package. Plus there may be people who buy your package purely because of the audio element.
(ii) Add A ‘Work Book’ or ‘Action Plan’ To Your eBook
One of the biggest faults with most commercial books is that they’re heavy on ideas, but short on systems. Whatever topic you’re teaching/talking about in your eBook, another easy way to add perceived value is to create a step-by-step system to actually implement the information you’re providing.
Workbooks are often just a few pages long, but can greatly enhance the customer experience of your eBook. As an additional bonus, a workbook makes implementation of your material that much easier for customers – if that implementation delivers the results that you’ve promised to customers then their opinion of you as an ‘expert’ in your field will raise. And it will be that much easier to get them to buy your next eBook.
(iii) Add Check Lists
Check Lists again are simple to put together and provide more value for the customer. These check lists – in conjunction with the workbooks – really help the customer’s implementation of your information.
(iv) Add Related Reports
Short reports on related topics are another great way of stacking value to your eBook package. For example, if you had written an eBook on how to build an audience via video marketing, you could stack value to that eBook by adding a report on how to correctly set up a YouTube channel page.
Another example, I wrote a book of bass exercises called Bass Hanon. There were 240 exercises in that book (20 exercises in 12 keys) and I stacked value to that package with a report called Hanon Variations – which showed 30 ways to vary each and every one of those 240 exercises.
Add a short report with detailed resources that relate to your eBook. In the video marketing example above, a detailed list of Video Aggregator sites with a brief description of each would make a great Resources Report.
(vi) Expert Interviews
If there’s a known player in the subject area of your eBook, and you can get that known player to agree to an interview, then this is another great way of stacking value. Especially as you can include the interview in audio format AND get it transcribed and present it in PDF format.
Advantages: The obvious advantage of this pricing model is that you can charge higher prices for your eBook package. As the majority of the price is profit, this obviously generates higher revenues for your business.
Disadvantages: The obvious disadvantage is that creating the extra value requires the investment of extra time and energy. Often writing an eBook is hard enough – adding these Value Stackers on top increases the effort required.
There will still be people who balk at paying $37 or $47 for an eBook – despite the amount of additionally value that you’re providing.
There is a way of getting them onboard though:
Getting The Best of Both Worlds – Kindle Pricing Combined With An UpSell
If you’ve chosen to use Model 3 and stack value to your eBook package so that you can charge $37 or $47 or more, my advice is that you should also publish just the eBook to Kindle and use Kindle pricing. But then in the introduction to the book you should make the purchasers aware that of the extra value you’re providing with reports, interviews etc.
And give them the option of contacting you with their Amazon purchase number to get an upsell offer to purchase the items that you used to stack value to your package.
Not every Kindle purchaser will take up your upsell offer – but if you’ve provided great additional value some will. As these are people who’ve probably found you via Amazon rather than via your website, then this is a win-win scenario for both of you (You generate extra revenue, they get extra value).
Back in the day you could create an eBook and charge $37, $47 or more for it. And people would buy.
But along came Kindle – and the majority of Kindle eBooks are priced below $10. That makes an eBook priced at $37 look expensive.
Your pricing options are:
- (i) Sell at Kindle prices
- (ii) Sell at just above Kindle prices
- (iii) Sell at ‘traditional’ eBook prices – but ‘justify’ this price point by stacking value.
My advice is to stack value to allow you charge higher prices – AND publish just the eBook to Kindle at normal Kindle prices, and upsell the rest of your value package in the Kindle eBook itself.
eBooks are still a great way to create leverage for your online business. If you’re unsure about how to get started with writing an eBook, then I suggest you subscribe to my newsletter. As a bonus for subscribing you’ll get a free, 10 Module course delivered weekly to your inbox which will take you from idea to publishing.
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So what are your thoughts on eBook pricing? I’m aware that some people think that $37 or $47 is to high a price for an eBook. Do you agree? If so, why? Or do you think that price should be related to value? And if so, how do you demonstrate that to your potential customers?