Suw Charman-Anderson, Forbes Contributor
In this, the third part of my interview with Smashwords founder Mark Coker, we talk about how ebook price and word count affect sales.
Back in June, author Edward Robertson became curious about changes he saw in Amazon’s ‘most popular’ and ‘bestseller’ lists, with previously high-ranking books dropping rapidly into obscurity. After a bit of digging, Robertsonconcluded that Amazon had changed its algorithm, demoting cheap ebooks. I asked Mark Coker if he had any insights into Amazon’s new algorithm and how price affects sales.
We did a study looking at what impact price has on sales, using approximately six months of Smashwords sales data for a collection of over 50,000 books, across all of our retailers, including Apple, Barnes & Noble, Sony, Kobo, Diesel, and also the Smashwords store.
First, we wanted to understand at what price authors move the most units and it’s not a surprise: that price is free. At the Apple iBook store, for example, free books are downloaded about 100 times more than paid books. The lesson for authors who want to rapidly build their platform is that free books are a very powerful tool.
We then looked at the other prices: 99¢, of course, moved more copies than $1.99, which moved more than $2,99. As price increased there were fewer sales. But what price yields the greatest income? And that was really interesting: We found that the $2.99 to $5.99 price band appears to be the sweet spot for indie authors, those prices over-performed the average in terms of income for the author. But 99¢ and $1.99 under-performed. CLICK HERE to read the full story.