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Named to "Writer's Digest 101 Best Websites," this #SharingwithWriters blog is a way to connect with my readers and fellow writers, a way to give the teaching genes that populate my DNA free rein. Please feel free to add to the conversation using the very tiny "comment" link. For those interested in editing and grammar, go to http://thefrugaleditor.blogspot.com.

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Friday, August 22, 2014

More Authors Need to Understand "Elastic Pricing"


Amazon sent me a letter about the brouhaha surround their disagreement with the publisher Hatchette. I am reprinting this quote from that letter because I think this elastic pricing concept is one many authors miss and understanding it might make them feel more comfortable with many kinds of book promotion and marketing that I cover in my multi award-winning Frugal Book Promoter:

 " . . .e-books pricing is highly elastic. This means that when the price goes down, customers buy much more. We've quantified the price elasticity of e-books from repeated measurements across many titles. For every copy an e-book would sell at $14.99, it would sell 1.74 copies if priced at $9.99. So, for example, if customers would buy 100,000 copies of a particular e-book at $14.99, then customers would buy 174,000 copies of that same e-book at $9.99. Total revenue at $14.99 would be $1,499,000. Total revenue at $9.99 is $1,738,000. The important thing to note here is that the lower price is good for all parties involved: the customer is paying 33% less and the author is getting a royalty check 16% larger and being read by an audience that’s 74% larger. The pie is simply bigger."


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Carolyn Howard-Johnson, author of This Is the Place; Harkening: A Collection of Stories Remembered; Tracings, a chapbook of poetry; and how to books for writers including the award-winning second edition of, The Frugal Book Promoter: How to get nearly free publicity on your own or by partnering with your publisher; The Frugal Editor: Put Your Best Book Forward to Avoid Humiliation and Ensure Success; and Great Little Last Minute Editing Tips for Writers . The Great First Impression Book Proposal is her newest booklet for writers. She has three FRUGAL books for retailers including A Retailer’s Guide to Frugal In-Store Promotions: How To Increase Profits and Spit in the Eyes of Economic Downturns with Thrifty Events and Sales Techniques. Some of her other blogs are TheNewBookReview.blogspot.com, a blog where authors can recycle their favorite reviews. She also blogs at all things editing, grammar, formatting and more at The Frugal, Smart and Tuned-In Editor .