So Why Is Amazon Fooling Around With the Price of My Book?

By now lots of you are familiar with my penchant for Q and As a la Ann Landers. Here is one from a recent issue of my SharingwithWriters newsletter:

 

QUESTION

If I set a price in Amazon, and the book is NOT enrolled in KDP select, how is it that they get to change the price?

How (if at all) does that affect my royalties?

Holly J., writer 

ANSWER
Amazon is huge. Amazon has power! Actually, the real reason they get to change prices any time they want to: Because they are the retailer and setting the retail price is the prerogative of retailers in most cases.

Amazon aims for the lowest price possible which is one of the reasons people buy from stuff from them including books. And that's why we WANT our books on Amazon at the lowest price possible. Make sense? There are lots of other reasons we want our books on Amazon, too. Huge reasons. But that's another day's SharingwithWriters post.

 And, no.  It doesn't affect your royalties.  But here's the thing. Sales are more important than the percentage on any given book. In the retail world of which I was a part of (other than books) for thirty years, it's about quantity of sales rather than large margin per sale. One sale begets recommendations and more sales still (especially with a good book!), so we don't mind discounting to get that. 

 

Of course, there can be limits--and Amazon knows where they are. I don’t see that they’re much interested in loss leaders. Even when books are given away free, there is something in it for them. And most times something in it for the author, too.

 

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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 .

Dan Poynter shares little known danger lurking in Kindle's royalty program

This is a tip from my SharingwithWriters newsletter. It's so important I thought I'd share with those of you who follow my blog, too. If you don't want to miss a single tip or article from my newsletter subscribe using the signup window in the right-upper column of almost every page of my HowToDoItFrugally Web site and get a free e-copy of my little booklet, Great Little Last-Minute Editing Tips for Writers, too.

When I was chatting with Dan Poynter in the green room at the Greater Los Angeles Writers' Conference, he mentioned that authors using KDP Select (a Kindle marketing program) for very fat books or books with many images should carefully select their royalty. It may be that you will get more in royalties choosing 35% than 70% because the latter entails a delivery fee that's calculated on the megabytes of your book. If your has over 40 megs you may end up making nothing at all. The 35% royalty does not deduct delivery fees from your royalty paycheck.

PS. Great Little Last-Minute Editing Tips is available in paperback for gift giving, too.   

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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 . If your followers at Twitter would benefit from this blog post, please use the little Green widget to let them know about this blog:

E-BOOKS Vs. PHYSICAL BOOKS Vs USED BOOKS

Richard Bauman is a Sharing Writer today with an opinion on e-books. Before you hit him hard on buying mostly used books for which the author gets no royalties, please read this through. It may be just what you need to get you onto the e-book and e-reader track. And, shoot.  Leave a comment. Tell him what you think!  I mean, really. SHOOT.  He wants to know. I want to know!



By Richard Bauman



Have you read an ebook lately? Probably you have. Were you happy with the price you paid for that ebook? Chances are not so much. If you thought it was overpriced—it probably was—especially when you consider you probably could have bought a “used” copy of that book for a fraction of the price of either the ebook or a new print version of the book.


I’m an author, and of course I want people to buy my books. New books; freshly printed books, or ebooks. On the other hand, I rarely buy new books. I buy used books, even recently published and popular books, fiction and non-fiction, usually for no more than ten percent of their original selling price, very often a lot less than that. Places like half.com, amazon.com and numerous other websites make it easy to buy used books. But I haven’t yet found a website selling “used” ebooks.
The skyrocketing popularity of ebooks is well documented. There are a gazillion websites where you can gather all the glowing statistics about ebooks sales verses physical books. There’s a lot of flux, though, about the price of ebooks verses physical books. Some say ebooks and physical books should be priced the same, others (like me) believe ebooks should be lower priced since production costs, including shipping and handling, are lower for ebooks than traditional books.
In any discussion about ebooks pricing verses pricing for physical books, one part of the book market that seems to have been ignored by publishers, authors and even readers is used books. That is a mistake. By pricing ebooks at or near the price of physical books publishers/authors are losing sales. Because many book buyers will purchase used books rather than new books, regardless of format, and thus authors and publishers make zero dollars from the books (the used ones) we buy.
The author of a traditionally published book might get 20% of the book’s selling price in royalties. Often royalties are based on the book’s wholesale price, not its retail price. And bookstore shelf life of a new book is short. If it doesn’t sell quickly and sell well, it will probably be a remainder book in less than a year. Remainders and returns don’t put money in the author’s pocket.


Once a book’s been read, it might get donated to a thrift store or library sale, or put up for sale on half.com or Amazon.com. The book might be given to a friend or relative. No matter where it goes, on the book’s second and subsequent change of hands the author and publisher get zilch. For authors and publishers of traditional books it’s a one copy, one sale, one money making opportunity.

Now, if publishers and authors produce ebook versions of physical books, there’s the potential for bigger sales, and more income for them, provided they sell the books in price range that entices frugal book buyers to shun secondhand books in favor of the ebook version.

Here’s an example of how wise pricing can mean more sales and more income for publisher and author. Gordon Kirkland is a humor writer. He’s a great wit, and I’ve read several of his books. As I’m writing this the print version of his book, I Think I’m Having one of Those Decades is for sale on Amazon.com for $17.95. Even though I really enjoy Kirkland’s sense of humor that’s way more than I’m willing to pay for his book. I checked half.com, and I can buy it used for 78-cents. A no-brainer, I’ll buy the used copy. But wait. On amazon.com there’s also the ebook version of the book—for just 99-cents. Only twenty one cents more for the ebook than for the used book. I’ll take it. Hold on, it gets even better. That seventy-eight cent book will actually cost me $4.27 thanks to $3.49 for shipping and handling. And I’ll have to wait a week or so for it to arrive in the mail. What should I do? Spend more than $4 for the used paperback, or 99-cents for the new ebook I can download and start reading instantly? Talk about a no-brainer.

If I buy either a new or used print version of the book I get a physical book that I can keep or give away, donate to thrift store or library sale, or even sell on Amazon or Half.com. I’ll take the 99-cent deal. The thrift store and friends lose out, but I make out, and so does Kirkland.

I can hear publishers and authors crying tears as big as light bulbs that they’ll make less money if they lower the price on ebooks into to the used book range. Will they?
I deliberately used Gordon Kirkland as an example, because he recently lowered the price of many of his ebooks on Amazon.com to 99-cents. According to his posting on his Facebook page, he’s not only making more sales, he’s making more money at 99-cents than he did when the ebooks were priced higher.


An example of a pricing strategy, in my opinion, that works against the author and publisher is for the book The Glass Castle by Jeannette Walls. It’s a terrific memoir, one of the best I’ve read. Today, on the Barnes & Noble website, you can buy the new paperback version for $9.36 plus $3.99 shipping (total 13.35). The ebook version is $9.99. On the other hand, at half.com I can buy a used copy for $1, plus $3.49 shipping. If the ebook version was priced in the $4-$5 range, I believe the author and publisher could sell more ebooks, and make more money, and at the same time see fewer sales going to the used book marketers.


Ebooks are hot products right now. They aren’t a fad, and no doubt will be a major form of book sales going forward. The enthusiasm for them will be lessened, however, if publishers and authors don’t pay attention to the used books market and its impact on the sales of new books. When people like me, with a wide streak of frugality, see they can still buy used books cheaper than they can a new e-book, that’s what we will buy. On the other hand, if publishers and authors will price their e-books into the price range of used books and their inherent shipping costs, they probably can sell a lot more e-books to people like me.

~Writing opinion today is Richard J. Bauman. Author, Awe-Full Moments: Spirituality in the Commonplace, http://www.richardjbauman.com/

---- 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 Frugal Book Promoter: How To Do What Your Publisher Won't; 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 . If your followers at Twitter would benefit from this blog post, please use the little Green widget to let them know about this blog:

Amazon Kindle Lets Book Buyers Lend Books!

Based in past experience, I can hear some of my subscribers virtually groaning. Many will see this as a way to sidestep their chance to collect more royalties!

Stop it! Right now!

This is a program designed to help you sell more books, not fewer! Amazon is letting your readers recommend your book—easily! By keeping the loan period short,  Amazon has actually rigged the program for authors so that many who get a book loaned to them will go back and buy it for themselves . I mean, Kindle editions aren’t expensive, right? And we all know that word-of-mouth sells books. Now, if a reader of your Kindle edition lends your book, you’ll have two mouths out there working for you.


Here’s the announcement directly from Amazon:

“We are excited to announce Kindle book lending (http://www.amazon.com/kindle-lending). The Kindle Book Lending feature allows users to lend digital books they have purchased through the Kindle Store to their friends and family. Each book may be lent once for a duration of 14 days and will not be readable by the lender during the loan period.

“All DTP titles are enrolled in lending by default. For titles in the 35% royalty option, you may choose to opt out of lending by deselecting the checkbox under "Kindle Book Lending," in the "Rights and Pricing" section of the title upload/edit process. You may not choose to opt out a title if it is included in the lending program of another sales or distribution channel. For more details, see section 5.2.2 of the Term and Conditions.

“For more info on how Kindle Book Lending works, see our FAQ here: http://forums.digitaltextplatform.com/dtpforums/entry.jspa?externalID=581

Sincerely,
Amazon Digital Text Platform”



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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 Frugal Book Promoter: How To Do What Your Publisher Won't; 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 . If your followers at Twitter would benefit from this blog post, please use the little Green widget to let them know about this blog:

In The News: Amazon to Up Authors' Royalties--Drastically

Amazon is in the news. The thing is, though the major media is covering the story, they aren’t covering it from an author’s viewpoint. So here goes. My take for authors. In the smallest nutshell I could fit it into:

The LA Times business page headlines, “Amazon Ups the Ante for E-books.” Then comes a deck (fancy newspaper talk for a sort of subtitle) that says, “Juicy digital royalties could tempt authors to bypass traditional publishers altogether.”

So far they have it right.

As a quick review, the VP of Amazon says, “Today, authors receive royalties in the range of 7% to 15% of the list price that publishers set for their physical books . . . . “ Amazon just announced that they would pay a whopping 70% royalty to authors who publish their book(s) on Kindle.

Here are the advantages and disadvantages. You decide which, though you’ll usually be able to tell which side I’m on!

~Authors set their own price for the Kindle digital version of their book but it must be between $2.99 and $9.99. Sure Amazon is trying to maintain a low retail on all their Kindle books. Low prices attract buyers.

~The price the author sets must be at least 20% lower than the same book in its print edition.

~Authors are free to place their books with other readers or in other formats (like B&N’s Nook and Sony’s Reader), but they must set the Kindle price lower than or the same as the price they ask for in other digital formats.

~Authors must sign over some rights to Amazon including the ability to turn the book into speech and to allow Kindle to use the book on future iterations of the Kindle reader. This applies only to digital copies. not print.


From there most all the news outlets are focusing on the timing of Amazon’s announcement: That it coincides with an expected announcement that Apple will be making an e-reader of its own.

Or they’re focusing on the fact that this offer is not going to make traditional publishers happy. Well, duhhhh. They’re not happy about any of Amazon’s strong competitive stances on the pricing of books (and other perks). In the past several of the real big publishers started delaying the release of digital editions until long after hardcovers and paperbacks were released. That’s been sort of standard for publishers. They’ve also delayed the release of paperbacks some time after hardcovers. That policy only makes sense.

Articles in the business media are focusing on the influence Amazon has on the publishing world in terms of pricing. And about Amazon’s brute commercial power.

So, how will this specifically affect authors?

~It won’t mean much to those who are traditionally published other than that they might want to press for better royalties on Kindle sales when they sign their contracts. And, of course, the long term effect this move may have on publishing in general.

~To indie authors--self published or subsidy published--it means that having their books offered digitally will be more important than ever. It won’t just be about making their books available to readers the way they want to read them at a good price, it will be about making their books available at the only price some may feel they can afford. The price differential can make a difference but so will the rush by authors to have their books available on Kindle and the more books, the more choice, the more reading folks are going to like that.

~If more people are buying books because they’re cheaper, that broadens an author’s audience. The more people who read a good book, the better a book sells. Remember when Clinton said “It’s the economy, stupid!” Well, it’s the word-of-mouth, stupid.

~I like this last reason best (though there may be other I haven’t thought of). Here it is. Amazon, once again, is giving more power to the author. Even the new author, the emerging author. Treating us as if our pocketbooks are important. That’s a move in the right direction. With their clout, they may start a trend.

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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 two how to books for writers, The Frugal Book Promoter: How To Do What Your Publisher Won't and The Frugal Editor: Put Your Best Book Forward to Avoid Humiliation and Ensure Success. Her FRUGAL book for retailers is 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. She is also the author of the Amazon Short, "The Great First Impression Book Proposal". 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 blog.

If your followers at Twitter would benefit from this blog post, please use the little Green widge to let them know about it:

How Does Indiana Jones Compare with Publish America?

It's amazing but it appears that alternative publishing models have influenced other industries.

On April 21 the front page of the business section of the LA Times noted that Harrison Ford, George Lucas and Steven Spielberg will take their money on the backend of the new Indiana Jones sequel, rather than the front.

That's like an author not taking an advance but putting it off in favor of profits to be made later. In fact their model reminds me of that pioneered by Publish America years ago. PA takes on all the expenses of production (just like Paramount will in this contract that protects them from giving out huge salaries/advances).

In other words, in both cases the artists/authors are sharing some of the risks. That encourages everyone to give the project their all in terms of marketing. The difference, as I see it, and it IS a big difference, is that on the backend, these powerhouse names will reap even larger percentages that they would have doing it the old way.

You say, "Yes, but these are big names and most of the PA authors are pretty much unknown." Still, if PA upped the discount they give to authors on their books (after they'd made back their expenses), they'd be looking like leaders in not only the publishing industry but others as well. They already do offer a slightly larger royalty after so many books are sold. (Of course, that is nothing new. Publishers have done that for eons.)

And about that marketing? Do Hollywood names need a nudge to partner as marketers? Sure they do. It's probably not an occasional scenario that big stars take their money and then try to duck out of the talk show tours, which--we all know--are lots of work.
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Carolyn Howard-Johnson, author THIS IS THE PLACE; HARKENING: A COLLECTION OF STORIES REMEMBERED; TRACINGS, a chapbook of poetry; and two how to books, THE FRUGAL BOOK PROMOTER: HOW TO DO WHAT YOUR PUBLISHER WON'T; and THE FRUGAL EDITOR: PUT YOUR BEST BOOK FORWARD TO AVOID HUMILIATION AND ENSURE SUCCESS.
Her other blogs include TheNewBookReview.blogspot.com and AuthorsCoalition.blogspot.com, a blog that helps writers and publishers turn a ho-hum book fair booth into a sizzler.

How Novelists Can Avoid Getting the Shaft with a Movie Deal..Well, OK. How They Can Try

People keep asking me about the writers' strike. That's because I live in LA and wrote a never-produced screenplay. Wowee! Such Qualifications!

So, I couldn't add much that wasn't in all the papers in every city in the nation during the strike. But here's a story that you may not have heard and, yes, I think it will inform many of you, just in case you should ever get lucky enough (we know we're talented enough, right?) to get an offer from a studio to make our book into a movie.

In Column One of the LA Times on Wednesday, Feb. 13, Times Staff Writer Josh Getlin reported on Deborah Gregory's experience. She's the novelist who came out of nowhere to write the Cheetah Girl novels. Disney saw the potential and now—with Disney's powerhouse promotion behind it—her characters are in films, CDs, toys. You name it.

Here's the thing. Aside from the option fees and payment for her title as co-producer of the movies—reportedly at $125,000—she hasn't seen any royalties. The real lesson here isn't that she was given the shaft. The real reason is she was given the shaft because she didn't negotiate properly. And you need to know what she did wrong so you won't do it when your luck is riding high. Here's the dope:

 Studios write contracts so that royalties are paid on net profits.
 Studios know how to cook books so that movies never really make a net profit.
 Even a good agent can't get better contracts from studios because the studios know a) authors are desperate and b) the studios are willing to walk away from a deal that they don't like.

So, what I can tell from this sad little story is that the only things an author can do if he or she is approached by a studio are:

 Don't get too starry eyed. Reality is not likely to be what you think it will be.
 Try to get as much as you can in the upfront money because you will probably never see any tail-end money.
 You can try to negotiate royalties based on gross profits rather than net profits. (Don't plan on that, though--remember, the studios are willing to walk away.)
 Oh, yeah. Get an agent and/or a manager. Preferably one with lots of experience and a background in law.

Now, in case you think that this couldn't happen to you, Getlin reports in a related story that ran the same day (p. A22) that there are many, many authors out there with similar stories. They include Olivia Goldsmith who wrote The First Wives Club; Winston Groom, author of Forrest Gump: Alice Walker who wrote The Color Purple: and Art Buchwald who wrote Coming to America.

Need I remind anyone that Buchwald wasn't a little emerging writer when this happened to him. The movie based on his book grossed $350 million but the studios claimed they didn't make enough money to pay net profits. Buchwald won an undisclosed settlement but, alas, the decision will not apply to your case if you should ever be so lucky (or unlucky) to have to fight for your due. It's a small legality but a big one for those who came after him.
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Carolyn Howard-Johnson, author THIS IS THE PLACE; HARKENING: A COLLECTION OF STORIES REMEMBERED; TRACINGS, a chapbook of poetry; and two how to books, THE FRUGAL BOOK PROMOTER: HOW TO DO WHAT YOUR PUBLISHER WON'T; and THE FRUGAL EDITOR: PUT YOUR BEST BOOK FORWARD TO AVOID HUMILIATION AND ENSURE SUCCESS.
Her other blogs include TheNewBookReview.blogspot.com and AuthorsCoalition.blogspot.com, a blog that helps writers and publishers turn a ho-hum book fair booth into a sizzler.