July has been a big month for Wearing the Cape, made more interesting by my decision to move from the original $.99 ebook price to $2.99; the decision immediately slashed my sales numbers. Why did I do it? Well, I’d gotten some good reviews, my numbers were rising, and I have a problem with Amazon’s royalty system.
You see, for anything priced less than $2.99 they will only pay you 35% per sale, meaning they’re pocketing most of the money for selling a book that really “costs” next to nothing to cache on a server somewhere.
Think about this for a moment. At $.99 I was earning only $.35 per book, so on my best week, with 77 sales, I earned a whopping $27. This while being #2 in my Amazon category!
Now there are arguments for keeping the price that low–the main one being it makes impulse-buying incredibly easy. After all, if a new book sounds interesting but you don’t know the author, for $.99 it’s easy to take a chance. If you don’t like it, you’re out less than the cost of a cup of coffee. McDonalds coffee.
But as I watched my category, I found Wearing the Cape competing with two other self-published books: Confessions of A D-List Supervillain and In Hero Years…I’m Dead. Both books cost significantly more than $.99. Confessions cost $2.99 and In Hero Years cost $5.99, and both were doing well. This made me think about my audience.
Comic-book readers are used to paying $2.99 or more for a single comic, often picking up two, three, a dozen titles a month–in other words they’re used to making an investment in their reading entertainment. 
For trying something new, there is little difference between paying $1 and $3. Then there is the value proposition; if $3 is the standard cost of a professionally done comic, then charging $3 for the book makes a value-claim of its own.
So I decided to give $2.99 a shot. After all, with a 70% commission rate, even if it cut sales in half I’d still make three times as much (70% of $2.99 is roughly $2–more than 6 times what I was getting). So beginning the second week of July, I bumped the price by $2. And sure enough, sales dropped. But not by half. And they’ve come back (see nifty chart below) so that I am experiencing a rate of growth close to what it was before.
Of course six weeks is only a snapshot that doesn’t answer all the what-ifs. But one thing is certain: to make the money I earned last week, at the old price I would have had to sell 450 books. In one week. Would I have had that kind of growth? Doubtful.
But here’s the fun bit.
After spending nearly a year seeking an agent, I self-published on April 25th, three months ago. Assuming that I had found an agent, who then immediately found me a publisher (an insanely optimistic assumption, since agented writers often go for years before closing a book deal), I would likely have earned a $7,000 advance–the industry standard for newbie writers–then had to wait for at least a year for the publishing company to actually publish my book. They might have printed 7,000-15,000 copies, not all of which would have sold, and I would probably have never seen more than my initial advance.
So. After spending a year writing Wearing the Cape and another year finding an agent/publisher for it, I would likely have made no more than $7,000. But what is happening now?
This month I sold nearly 300 copies of WtC, more than 200 at the new price, and cleared $400. Assuming growth in sales remains steady, adding around $100 more a month, in half a year I’ll be getting $1,000/month from my first book (and assuming sales of 500/month is not being wildly optimistic). Taking that out to one year, I will have made more than what would have been my author’s advance on a book doing no more than moderately well by self-publishing standards!
So in the great debate now raging between those advocating self-publishing for first-time authors and those recommending still finding an agent/publisher, I have to go with the first camp. Especially in today’s worsening publishing market, the chances of a first-time author finding a publisher for his book are very small indeed. But more than one self-published author I know has been discovered by the reading public, climbed the charts on Amazon, and then been offered representation or a publishing contract. They put their work out there, put a price on it, and readers saw the value of it. And this is the ultimate validation for any writer.
It’s been a good month.
April 2012 Addendum:
It turns out I wasn’t optimistic enough–I sold over 900/month last December, and although numbers are now down from that peak, with Villains Inc. out and both books priced at $4.99, I am making between $2,500 and $3,000 a month on my writing. I passed the publisher-advance milestone quite awhile back.
Marion G. Harmon, A Writer in Vegas. 
I like your logic about comic book readers. Maybe this month I’ll try Power Down at $2.99–royalties and so on aren’t so much an issue for me right now, but for the long game it’d be interesting to see how it does.
In any case, congratulations! It looks like WtC is starting to hit its stride, and once you get a sequel or two out I think you’ll really start to build some momentum.
Thank you ! The first “episode” of the first sequel will be out this month.
I have read WtC and both of the sequels and really enjoyed all three. My only complaint is how short they are. I want more. Any particular reason you have broken them up?
I am glad you enjoyed them! All of Villains Inc. is a single book, which will be available in December for $2.99. The episodic release has been an interesting experiment–its main advantage has been to hold my feet to the fire by establishing sequential deadlines. I was also hoping to get reader feedback on the characters/plot as I went (not much has happened in that direction). Whether readers purchase the separate episodes or the complete novel, my royalties are about the same. Actually, due to Amazon’s interesting royalty structure, I receive slightly less in royalties if my readers buy the episodic releases instead of the complete edition–even though my readers are paying a bit more. I’m not sure if I’m going to do it again. The question is, I suppose, would readers rather get an episode a month, or wait four months for the complete story?
Good news all round!
The comparison with comic book prices is an interesting one, as for most genres (and certainly for thriller writers like us) there’s no equivalent marker.
I think for a completely new book with new author then either the 99c or free is still the optimum way forward to get a base of readers who will give good feedback and begin spreading the word. Once the ball is rolling then is the time to try higher pricing.
Chart position is significant. Casual browsers are unlikely to move beyond the first page (top twenty) before making a choice, and getting to that first page, depending on genre, can be the key to success (certainly for us we saw a huge leap in sales when we hit the thriller top ten, and an even bigger leap when we hit the main chart top ten).
At that stage if was so very tempting to up price. With almost 100,000 sales behind us it’s easy to dream about how much we would have made if we’d been on 70% of 2.99 as opposed to 35% of 0.99. But would we have sold anywhere near that quantity at a higher price?
Our next release will also be at 0.99, and we hope to pick up a whole new raft of readers who felt Sugar & Spice, with it’s dark and sinister subject matter, was a step too far.
Beyond that, who knows. The temptation to raise the price is tempered by the appeal of getting those new readers. As our brand builds that will be easier, but if we can make “enough” money selling cheaper then it’s a win-win for both us and our current and future readers.
So we’ll be sticking with cheap and cheerful for now, but clearly the strategy is working for you with this genre, and Ben, the same no doubt will apply with Charlotte Powers. Any news on Charlotte II? (As in volume two of Charlotte I, not the wonderful “Charlotte II” in Charlotte I.) (Though I hope we’ll be seeing more of Charlotte II in Charlotte II!)
Ben is indeed working on Charlotte II, and I’m looking forward to it!
I’m reading a lot of indie writers’ stats recently and most seem to agree that while the really low prices are still working great in the UK, the US market is kind of souring on the “99 cent ebook ghetto.” They’ve read too many unedited not-ready-for-primetime cheap e-books, so they look at the slightly more expensive ones. 3 bucks is still less than a Starbuck Venti, so it can be an impulse buy, but it’s a lot more likely to be good.
Congrats on your success. Your math on the typical advance is mighty convincing.
Thank you. And while my numbers aren’t climbing fast, they are still climbing; as of tonight I’ve sold 99 copies so far this month (an ironic number), bringing my average to 12+ a day. I still believe that $.99 is a great introductory price, however. So I’ll be releasing the sequel, Villains Inc., in four parts (Episodes I, II, III, and IV), one each month, the last episode released simultaneously with the full book. Each episode will cost $.99, but the full book will cost only $2.99.
I thoroughly enjoyed bothe of your books and am eagerly awaiting the 3rd…any word on when it might be published?? BTW…I will definitely pay $4.99 for it!!!:)
Bite Me has a tentative June/July release date so far, although it may get pushed back a bit. Stay tuned to this blog–I will certainly announce it here. If you would like a chance to win the trade paperback editions, look here. I’m holding the drawing open till the end of June, and am glad you are enjoying my stories!