Tuesday, June 21, 2011

Sunshine Deals and Amazon Million Club

As you all can see I'm extremely busy at the moment, and hence not posting. But one of the things I've been doing is analyzing data from the Sunshine Deals (600+ low priced books that ran during the first half of this month. I'll be posting a full analysis at some point but here are some quick notes:
  • The promotion was a huge success for the participating publishers - 24 titles went from relative obscurity to breaking the top 100

  • The Sunshine Deals completely changed the make up of the Top 100 as a whole. Usually there are a number of slots occupied by games and periodicals but during the promotion 98% were books. The ratio restored directly after the promotion ended.

  • Indie staples were displaced. John Locke typically had 6 -8 titles in the top 100 but all were displaced during the promotion as readers flocked to buy the newly reduced books. The promotion kicked all 10 of John Locke's titles out of the top 100 and none of them have returned (though his new "how I sold 1 million copies is #3 on the Movers and Shakers list (was 18,039 yesterday and is 51 today) Amanda Hocking's books were pretty much "out of" the top 100 when the promotion hit and is showing similar rankings as Locke (around 105 - 500)

  • The number of Sunshine titles on the list since the promotion (25, 21, 8, 7, 6, 6)

  • The ratio of Sunshine by price was: 10 - $0.99, 7-$1.99, 7- $2.99 (42%, 29%, 29%)

  • Directly after the promotion all books restored to their original price: 2 - under $5, 10 - $5.01 - $8.99, 12 - $9.00-$9.99 (8%, 42%, 50%)

  • 5 days after the end of the promotion 33% of titles reduced their price (1 - $0.99, 3-$1.99, 1-$2.99, 3- $7.69-$9.34)
I'll be doing a more complete accounting later - but this gives you some data to mull over in the meantime.

It was announced today that John Locke became the first indie to reach the 1,000,000 sales mark. He's only the 9th author to do this. I'm going to be reading his book on the subject and blogging about it here - But the secret isn't that hard - write a ton of good books and price them all at $0.99 ;-) Personally I think he left a ton of money on the table and should have raised the price on some of his books but that's just my opinion.

Authors in the 1,000,000+ club:
  • Stieg Larsson
  • James Patterson
  • Nora Roberts
  • Charlaine Harris
  • Lee Child
  • Suzanne Collins
  • Michael Connelly
  • John Locke

Well that's all for now - as I said I'm very busy at the moment but I wanted to get out a quick post.

22 comments:

rdlecoeur said...

In the end, Robin, you have to take your hat off to John Locke as a master marketeer. He is a man with a plan and the plan has worked for him.
Having published all of his novels for $0.99 he now publishes 'how I sold 1m copies of my book' for $4.95. Apparently its only 60 pages. You can read it in less than an hour. It has a ready made audience -every kindle self published author, so that means he'll make loads of money from aspiring authors & wannabe's. It's a ripe market for plucking as history has shown us. The entire market will be deluged with people copying his plan thus dooming them to probable failure. Early adopters of anything are usually the only winners in these scenarios.
I will be eager to read your take on it.

Robin Sullivan said...

I do indeed take my hat off to John - he's done remarkably well.His $4.95 "how to" will do very well - no doubt. I myself bought it and last I checked it was deep into the top 100 in just the first day it was released. He'll make a bundle there. But I still contend that the money lost on the table pales by comparison to what he COULD have had.

I don't think he planned for the single $4.95 how to book to be the big cash cow. I think he is capitalizing on a chip that he has and I'm glad to see he didn't price that at $0.99 as well.

I am a bit concerned that if many follow the $0.99 model it could have significant impact on "making a living wage". As only those that are selling extremely well can make money at $0.34 each.

Robert Bruce Thompson said...

As only those that are selling extremely well can make money at $0.34 each.

What no one seems to take into account is that these $0.99 books earn the author $0.35 on each sale. There are no used ebook sales. You don't find ebooks on the sale table at the library or at used bookstores. If someone wants to read the book, the author earns $0.35, again and again.

There's no pass-along, either. I have many friends that I've traded large numbers of paperbacks with over the years. That doesn't happen any more, because all of us read fiction almost exclusively as ebooks. (The exception being books we check out from the library, which I and most of my friends are doing a lot less than we used to.)

I've bought hundreds of ebooks since I bought my Kindle six months ago, and zero fiction in paper. When I recommend an ebook to my friends or vice versa, we go out and buy the ebook. And the author gets paid every time. Instead of one or two paperback copies of a book circulating among us, we as a group might buy a dozen copies of the ebook.

As I keep saying, and few other than Locke seem to realize, far from being bad for authors, the $0.99 price point is great for authors, including mid-list authors. The "natural" price of an ebook is $0.99, which is about half the price of a used paperback. That's what the story itself is worth, and that's why so many people do the two-for-one thing at used bookstores.

When someone buys a new paperback, the author might earn a $0.70 royalty. Any sane author would happily trade that $0.70 one-time royalty for a $0.35 royalty every time someone reads the book.

Rob Cornell said...

Robert, I'm sorry. But my story is worth more than 99 cents. I have nothing against putting books on sale for 99 cents, but John Locke only made $350,000 on 1 million sales. That's horrible. He could have made over a million and probably closer to 2 million if he'd price higher. At $2.99, which is still an impulse buy price, he would have cleared 2 mil for sure. And there are writers like Joe Konrath who have made more money with less sales. 99 cents is good for short stories. But for novels, you're ripping yourself off. And you're training readers to think the stories that you work hard to write are nearly worthless.

I want to make a living at this game. I'm not going to short myself the money my work is worth.

Robert Bruce Thompson said...

Robert, I'm sorry. But my story is worth more than 99 cents.

But you don't get to decide how much your story is worth. The market decides that. Potential readers, including me, decide that when we notice your book and choose not to buy it because you have it priced too high for us to take the chance.

The $0.99 price is fair for a full-length novel, but $2.99 is outrageously high, particularly for shorter works, and particularly those by unknown authors.

We'll disagree about Locke. I think if he'd priced his books at $2.99 no one would ever have heard of him. And you assume he'd have sold the same number of books at $2.99 as at $0.99, which is demonstrably wrong. Locke earned $350,000 in six months by selling a million $0.99 books. If his books were priced at $2.99, he'd probably have sold 1% or less that number of copies and earned maybe $20,000.

You mention Joe Konrath. Recall when he did his price experiment. He dropped the price of one of his books from $2.99 to $0.99. He was concerned that he'd have to sell six times as many copies to make the same money. He ended up selling 40+ times as many copies and making about eight times as much money.

Kate Madison, YA author said...

4.95 is still insanely cheap for a how to book. And I finished reading it yesterday--he spends very little time on the 99c thing.

The first third of the book is about how insane traditional publishing is in that they have managed to create an entire stigma around those who try to do it themselves. Locke asks if any other industry has such a stigma.

But the rest of the book is geared towards his blog/twitter/email marketing strategy that clearly worked for him.

I think it's easy to say his success is due to the 99c price point but I don't think that's entirely accurate. There's countless 99c and free novels out there that are languishing. No. He made a concerted effort to get people to click the buy button.

He also writes in the book about being worried that his methods might not work anymore. But I don't think he has to worry about that since they are, in fact, very time consuming--even by the most rabid marketing standards. So the bar will still be high to achieve what he has.

Also, regarding his rankings, he is said to be about to have an 8th Donovan Creed novel out in a couple of weeks. That should help lift most of them up a bit.

As far as marketing methods go, feeding the machine seems to be pretty effective. Again, another high bar as many writers don't have the time and/or inclination to be mass producers like Locke, Hocking, Patterson, Roberts.

Speaking of feeding the machine-I'm off to finish my first one.

Kate Madison

Robin Sullivan said...

@Robert - I know many are believers in the $0.99 but my main goal is for a writer to make a "living wage" not just supplementing their day job. What a living wage is depends on where in the country you live. For my husband and I where we live that is $120,000 a year with our regular expenses that would mean selling 353,000 books a year which is 29,411 a month. Victorine Lieskie was selling 1,000 books a day when at #50 on Amazon so to make that kind of money there are only about 20 - 100 slots. Now in other parts of the country $60,000 would be more reasonable and so that expands greatly but still only a "few select" can make a living at that.

At $4.95 (The standard price for Ridan author when I'm not doing any discounting...It takes 34,600 books to make that living or 2,881 books per month. To be selling at that range you can be in the 800 - 1200 rankings so if 35% of those are indies that opens up several hundred "slots".

At $0.99 there will only be 3 - 10 kindle authors making six-figure incomes. If that becomes the "standard" price as you mention it will make significantly fewer authors making a living wage...at least that is how my number crunching sees it.

Robin Sullivan said...

@Rob - I agree totally with what you say. Use $0.99 for a promotion but don't make it your "standard" price.

Robin Sullivan said...

@Robert you are right that the buyer decides the "value" not the author but if all they are presented with is $0.99 - guess what they buy. You happen to be a $0.99 buyer - nothing wrong with that there are a lot of you out there. But it is not a model to sustain a writer full time. My readers THANK me for the price of my books at $4.95. They see it as a bargain over the $9.99, $12.99 and $14.95 counterparts.

$0.99 is not "fair" it is less than a pack of gum (that runs me $1.35). With the amount of time it takes to produce a book selling it for under the price of a candy bar that brings me 1 minute of enjoyment doesn't stack with hours of enjoyment of reading a good book.

As for known/unknown it doesn't matter - a good story is a good story and once you find an author and like them most won't baulk at putting $3 or $5 into their pockets. Readers want authors to be compensated for their time and effort.

I do agree that Locke would have had a harder time at $2.99 but I think he would have still found an audience. But the high numbers sold on ALL books told me the same readers were buying more than one. For them to buy 1 or 2 at $0.99 to get them hooked is a good strategy but the otyer 8 - 10 should be bought at a higher price and if they liked the first two they would gladly pay it. Let's say he did 2 at $0.99 and the remaining 8 at $2.99 That's about $25 for 10 BOOKS!! That's an inexpensive lunch for two people or a reasonable dinner for 1. It's not too much to ask.

And yes Locke and Konrath have made $0.99 work for them - but they are outliers - you can't have hundreds or thousands of authors making good money at that price point (IMHO).

Robin Sullivan said...

@Kate - I agree it's not JUST about the $0.99 as you so correctly point out there are many at this price point and free that are doing NOTHING in terms of sales.

His success is due to
a) good writing
b) good marketing
c) an extraordinary price point that once you are "interested" you say - what the heck let's give it a try.

Robert Bruce Thompson said...

Robin,

The flaw in your thinking is your assumption that things are static. They're not, by a long shot.

I don't have figures available, but I'd be willing to bet that the #1,000 ebook on Amazon today is selling more copies than the #100 book was one year ago. Those 100 slots you're worried about have increased by an order of magnitude in one year, and we're still on the early part of the curve.

I don't read the kind of books your husband writes, but if I did I still wouldn't buy his books at $4.99. That's simply much too much for a product that I can't resell or give to a friend. And I strongly suspect that you're leaving money on the table. If you dropped your prices to $2.99, I'll bet you'd much more than make up for the lower revenue per unit with increased units.

No, I'm not a $0.99 buyer. I've bought books from $0.00 to $2.99, and one or two for a buck or two more. But that's my limit and the limit of many people. We simply don't consider $5 to be a bargain. A rip-off, more like. Again, with ebooks we're buying only the story. We can't sell or trade the ebook, or even pass it along to a friend.

I think $2.99 is a workable price for the most recent full-length novel in a series, with backlist titles at $0.99. When you consider that the actual cost to someone to read a backlist title is typically about $0.99 (counting the two-for-one trade on a used paperback) or even free, if the reader gets it at the library, the author is actually making out better at $0.99 than at higher price points.

Of course, that's assuming that the author produces a reasonable number of titles. Attempting to make a living on one or two titles isn't realistic no matter what the price level. Konrath is earning $70,000 or $80,000 a month in self-pub royalties, but he's doing it on something like 30 titles. Realistically, any author who hopes to make a living on self-pubbed fiction needs to have at least half a dozen titles available. That's quite doable for anyone who works at it. Even a slow writer should be able to produce three new full-length novels a year, and faster writers can easily do half a dozen or more. A very lucky one-trick pony author may earn a living after a fashion, but it's a lot easier if you have several or many titles feeding off each other.

J.A. Marlow said...

Okay, I have to laugh. $60k a year? Geez, I could only aspire to that in the day-jobs around here! Try under $30k. Seriously under $30k. (yes, it's depressing, but at least I'm eating).

Okay, a little simple math. I've seen a ton of Indies selling 1000 books a month for $2.99. So many so, that it's not out of the realms of a good writer to hit such a milestone. At that price it they are getting over $2 a book on average.

On that, such a (relatively) small Indie milestone, I could quit my day-job, earn more than I am now, and write full time.

Full time. Write to feed the machine. To write to my heart's content. To tell the stories I really want to tell but don't have time to because by the end of a workday I'm a zombie.

But you know what? I can't do that until I can make enough from my writing. So, here is the math (rounded)for my particular circumstances with a goal to quit my particular day-job:

1000 books sold at $2.99 = $2 in royalties per book = $2000 a month. Writing career, here I come!

1000 books sold at .99 = .35 in royalties per book = $350. Well, this might help pay a few bills, but I better keep that day-job.

Could I sell more than 1000 books a month using the .99-cent price point? Possible, but I write in a bad genre for that (only 1 main genre sells less the last time I looked at stats). The likelihood is there, but very remote that I could manage 6000 sales or more a month.

(By the way, I would love to build up to having so much stuff up that I could reach 6000 by selling only a little bit of many books, but that takes time. Meanwhile, the economy in my area is tanking and I'll be lucky to have a day-job in a month)

Just a comment, as a reader. I prefer my favorite authors to have writing as their only career. It means I have more great books to read. If they are working a day-job, then the releases are far apart. That stinks.

Which is why I don't begrudge anything under $5 to an author of a good book (above that I have to stop and think, but realize my ball-park income I mentioned above). It means I'm supporting the author and make it more likely they will produce faster.

Win-win.

That said, I do realize there are people who want books to be like out of a .99-cent store. No matter the size, they want it under a buck.

To me, a good book is a good book. I'll pay at least the amount of a used book for a good ebook (with the added advantage of saving space in my very small house).

And as I want to make a career out of my writing, I'm not that kind of writer, either. To each their own. There are plenty of free and .99-cent books out there for those who prefer it.

clairewriteswords said...

I find this very interesting, especially as those who were in the top 100 and were outed during promotion didn't return.

I think this promotion has allowed people to see what else it out there and sample it and perhaps whet their appetites. Also, I think it's opened the door for many writers who didn't get the recognition before.

Also, in terms of pricing, I have to say that while I agree with @Robert Bruce Thompson that the market and the reader dictates the price, I also have to agree with @Rob Cornell in what he says about the story's worth.

I do feel that a lot of authors, particularly those who self publish, underprice their work and sell themselves short.

In regard to John Locke - he's clearly done really really well in this industry, and he has to be respected for that. But I'd like to know what is included in this book that he hasn't already made available elsewhere on the net for free.

David Gaughran said...

One thing on the 99c debate - I note from the book itself that his philosophy has shifted slightly. In two previous interviews he claimed that he would never shift from the 99c price point for novels. In the book he said probably at some point.

One other thing, someone said above that the market isn't static. Well, even if we conservatively peg the e-book market at 20%, then the most it can realistically grow to is five times that. Still not a lot of writers earning a living.

The right price for a book depends on your goals. That could be maximizing revenue, maximizing readers, any combination of the two, or something else altogether.

If your goal is to maximize revenue, then 99c is not necessarily the best price point. The best price point is the one that sells the most books multiplied by the royalty.

And as Robin and many others have shown, by both cutting prices to 99c or raising them from 99c, that price is not necessarily 99c. It could easily be $2.99. It could easily be $4.99.

In any event, I don't think we should get too carried away with predictions about what the best future price point is. This is still essentially a very young market.

As a completely different demographic with different reading habits begins to transition to e-books, those ideal price points could all change.

On a completely separate note - Robin, have you heard anything about the APP figures? By my reckoning they are 1-2 weeks late.

Also, any news on that more detailed AAP that was promised for BEA?

Rob Cornell said...

But that's my limit and the limit of many people. We simply don't consider $5 to be a bargain. A rip-off, more like. Again, with ebooks we're buying only the story. We can't sell or trade the ebook, or even pass it along to a friend.

I think you're in the minority of readers on this point. A quick look at what is selling will show you that most of those ebooks are priced well above 99 cents. $2.99 is not at all high for the cost of "just a story." After all, many people are willing to spend three times that to see a movie in the theater, and they don't walk away with anything to sell or trade to friends.

Your analogy to used books is like comparing apples to engine parts. Ebooks have changed everything. They are a different kind of media. Part of that that means is cheaper prices. Another large part is convenience. I don't have to go to a used book store to get an inexpensive story. I can download one in an instant on my Kindle at home. (And not worry that the book I want will be at the store in the first place.) I don't have to worry about it taking up space on shelves or lugging them along every time I move. But all of my books are available to me at any time simply by pressing a button.

You get more than "just a story." You have an ebook. Your logic on price might work if you only got to read it once. But you don't. You own that electronic copy.

And 5 bucks for a good story that will entertain me for a number of hours is a grand bargain.

One final point--the idea that you have to price at 99 cents or no one will "try" you is shaky at best. The great thing about ebooks is sampling. You can download a good chunk of the story and read it at your convenience. There's plenty there to help a reader make the decision to buy or not. Let's be honest. Most readers decide after the first page or two at most whether they are going to want to read a book.

Robin Sullivan said...

@Robert - No I'm taking into account that the rankings = sales equation is constantly changing. My data of 1,000 a day if from a few month ago and while it may be 1,100 a day or so its not far off. Nathan Lowell was recently at 112 so I know what the sales per hour at that rate.

I did extensive pricing experiments with Michael's books - when I lowered to $2.99 I actually sold LESS COPIES - not just less revenue but had less physical sales - I've tried this a few times now and each time had the same result. Bottom line - for HIS book and audience $4.95 sells the best.

I don't doubt there is a large segment of the population who maxes out at $3.99. But there are also plenty of people who don't blink at $4.95.

I do agree that you need multiple titles - but we'll just have to agree to diagree on the $0.99 and $2.99 being the only viable pricing for ebooks.

Robin Sullivan said...

J.A - You are fortunate to live in a part of the country where the cost of living is reasonable. I agree with you that the number of authors selling 1,000 books a month at $2.99 is very encouraging. Many can make a very nice income at this level.

Robin Sullivan said...

I've not seen any new AAP numbers - but I don't watch the dates they are released - just that they come out.

AAP and BISG did a HUGE study but it was not ready by BEA. They are now saying they'll release it in July. The only "teaser" they gave is 2009 was up from 2008 (overall) and 2010 was up from 2009 (overall). They said print continues to decline and ebooks continue to grow. So nothing too shocking in any of that.

SlingWords aka Joan Reeves said...

Hi, Robin, I finally got over my strep throat so feel like diving into this discussion.

Of course, I learned about the business of writing in the hard-knock school of legacy publishing so maybe my viewpoint is different because of that.

I want to believe that a good ebook can easily sell at $2.99. However, I have not priced mine at that though I eventually hope to.

There is much that goes into how a writer values a book and how a reader evaluates the book in light of its selling price.

There are many people who might have to think twice about paying $2.99 for a book, especially if they are voracious readers. However, at $.99, even those on strict budgets will yield to an impulse purchase.

A book is only worth what a reader is willing to pay for it. It doesn't matter what I as the writer think it's worth. I'm not buying it. I'm selling it.

I studied ebook sales extensively and wrote a business plan before I entered the frey, and that plan calls for $.99 initially.

Even though I'm previously print published, I was a midlist author who is relatively unknown. I want to give readers every reason to buy my books and no reason not to.

In 5 days, my first ebook Just One Look will be 3 months old. In that time, I've also published 3 others and will be publishing one tomorrow too which will be my first nonfiction, Written Wisdom (compilation from my long-running blog).

By the time I reach the 3 month mark, I will have sold 40,000 ebooks! At least, I'm pretty sure I will have because I'm only 1800 away right now, and I'm selling over a thousand a day.

Of course, I value my books and think they are "worth much more" than .99, but that's not the issue. I don't think I'd have sold that many and hit the Top 100 paid if I hadn't priced low to introduce me and my writing to ebook readers.

All my books are on Kindle Contemp. Rom. bestsellers lists. 1 has been on Top 100 Paid for 35 days, and another may hit the Top 100 paid early next week if it keeps selling like it is.

I do plan to charge more for a book I'm bringing out in July (book 2 of a series) so it will be interesting to see if it sells as well as these 4 are.

I think too many people attach emotion and ego to pricing rather than looking at it as just another marketing tool which is how I see it.

Robin Sullivan said...

@Slingwords - glad you are feelign better...that took a long time. Congrats on the 40,000 books that's a huge accomplishment.

Several people have now said that the author doesn't determine the price - the reader does. That's not really true.

If all you offer to them is $0.99 then of course they buy at that price and you setup an expectation in their minds.

Sometimes you just have to trust your own skill as a writer. If you think you've written something of value - I say price it that way. Then market it. If the sales don't come then yeah you might have to adjust price - just make sure you track the results carefully and analyze the data.

David Gaughran said...

This should give the e-book market a shot in the arm in October.

JK Rowling is self-publishing the Harry Potter books and selling them exclusively through her own website.

While her announcement says that she is "publishing in partnership" with her international publishers, a closer look at the details suggests that she is just giving them a percentage in exchange for "marketing and promotion support".

JK Rowling To Self-Publish Harry Potter eBooks

Robin Sullivan said...

@David - Yeah I made a post on this incredible announcement - which I saw first on your fine site - way to break the news!

I think the sharing may have something to do with getting the rights. I suspect that the reason ebooks for HP didn't exist was because while Scholastic didn't buy them, Rowlings might have been prevented from using them due to a non-compete. Giving the publishers a cut may have been necessary to remove a clause that put the rights in limbo - just my opinion.