I used to work for a locksmith company that prided itself on being the cheapest in town. My boss would routinely call other companies and ask for quotes, and then price his own service calls less than the competition.
I realized something important about business while I was working for him.
“If you buy cheap, you get cheap” applies to customers. People who want the lowest price are a terrible customer base. Why? Because it’s a terrible basis for a relationship. Customers who want to save money, first and foremost aren’t loyal to you as a vendor, they are loyal to your prices. Someone else offers them a lower service call, or a lower hourly rate, or a steeper discount on parts, and poof, they’re gone.
There are a lot of philosophies regarding pricing of e-books. One writer, who I admire quite a bit, believes strongly in offering his work for free. I think I understand his reasoning, I just don’t happen to agree with it. (I do, however, appreciate the benefit for me personally–free books!)
What I would caution against is what I would term reactive pricing. I price Catskinner’s Book at $2.99 for an e-book and $9.99 for a trade paperback. I think that is reasonable.
I have run a number of promotions where I gave away the e-book. I have given away a number of paperbacks. However, I still believe that the book is worth what I have priced it at. In my mind, I wasn’t lowering the value of the book by promoting it via KDP free download days, I was giving away something of value as an advertising expense.
That distinction may not seem significant to many, but it is to me. I don’t want to compete with other authors on price. I don’t think that’s productive. I want to build a readership that has a relationship with me as a writer. I believe that my novel isn’t perfect, but is worth at least the price of a Banana-Pepper Jack-Half-Decaf-Frappuccino at Starbucks. I want readers who feel the same way.
To be honest, I will probably launch Cannibal Hearts at $4.99. Right now it looks like it’s going to be longer, and I honestly believe that I have gotten better as a writer. I’m not going to release the book until I feel that it’s worth five bucks.
Am I limiting my readership? I certainly hope so. I want to limit my readership to people who enjoy reading my stories as much as I enjoy telling them. Will I be doing free promotions for my next book? Sure, that’s part of the business. I’ll enroll Cannibal Hearts in KDP, I’ll be offering it on StoryCartel. Heck, if someone writes me and tells me that she or he really wants to read my book and can’t afford it, I’ll probably comp them a copy. It’s not all about money.
It is about value, though. I am an honest tradesman, and I believe in offering a fair product for a fair price. I’m not going to keep raising my prices, even if demand increases, above what I feel is reasonable. For a self-published e-book, I can’t see going above the $4.99 price.
I can’t control how many people want my work or how much they want it. I can, however, control the value that I put into it. If I offer my work for less than I feel it is worth, then I am doing a disservice to it. I can’t be true to my art and not believe that it is worth paying for. Nor can I be true to my art and accept more than I think it is worth.
My own thoughts.