by Amanda S. Green
You have your short story or novel written. You have it formatted for conversion. Now you’re ready to look at the different outlets where you can put it up for sale. The only problem is, they all have their own contracts or “agreements” and so much boilerplate it’s hard to tell up from down. Don’t worry. We all feel that way and I’ll give you a couple of general guidelines to follow shortly. However, before I do, I have to put in the disclaimer that none of this constitutes legal advice. I repeat, this is not legal advice. It never has been and never will be. Please, read the agreements yourself and make your own decisions.
The basic rule of thumb is that you can’t sell your work on any platform for less than you are selling it on any other platform. In other words, if you have your work for sell through Amazon’s KDP, Barnes & Noble’s PubIt and through Smashwords, you have to price your work at the same price. Otherwise, you are in violation of your contract.
In the past, that meant that if you wanted to take a title for free, you could do so on Smashwords (the only platform for ages that allowed you to do so), and then you had to report the lower prices to the other outlets so they could match it. Whether they did or didn’t was then up to them. The problem is that by initially taking your product free, you were in violation of your agreements with Amazon and B&N. It was a sore spot with a lot of authors who wanted to be able to take titles for free for a limited period of time for promotional purposes.
Smashwords is no longer the only site that allows authors to offer their work for free. Amazon has introduced its KDP Select program. Basically, this means an author who places a title into the Select program can offer that title for free for a total of 5 days every 90 day period the title is in the program. Titles in the program are also available for free “loan” to Amazon Prime members. Titles earn a percentage of the “pot” for every time it is “borrowed”. This month the “pot” is $700,000. Last month, the pot was $500,000 and the average payout, iirc, was over a dollar per time a title was borrowed. Confused yet?
The downside, if you want to call it that, is that you can not offer your title anywhere else for as long as it is in the KDP Select program. I can hear the cries of “foul” now as well as the gnashing of teeth about the loss of potential sales through other outlets. However, if your titles are like mine, the vast majority of sales come from Amazon. So, the possibility of being able to increase those sales is something to consider.
Now, I’m not advocating taking every title into the program. For one thing, I’m not sure how effective the program will be in the long run. For another, you need to find out where your sales come from. I know of folks who sell more through B&N than anywhere else or through Smashwords — and I’m talking Smashwords itself and not their premium catalog that distributes to BN, Diesel, Kobo, Sony and Apple.
There’s also a possible trend I’m following. It seems, at least so far, that the program of taking titles free for a few days works best for novels when it comes to increasing sales afterwards. Not only am I seeing the increase in sales, in one occasion a triple digit percentage increase in sales, for the title that had been free, but also in sales of short stories. The other title has seen increased sales, but in more modest numbers. Part of that is because of the different genres involved. Part may be because of the days the titles were offered for free as well as the number of days they were offered. Both are just part of what I’m tracking to see if I can spot trends.
As I said, I’m not advocating taking everything into this new program. But for promotional purposes, it does seem to be working, at least in the short term.
I’ll talk more about contracts later. I know I promised to do a comprehensive post on them today but I am still going through the updates at Amazon not only to their contract language, but also to their style guide. Let me finish that and then I’ll do a more complete compare and contrast.
Pricing: Generally, what you need to remember is you can’t charge less than 99 cents nor more than $99.99.
Barnes & Noble: You will receive a 40% royalty for all sales where the price is $0.99 – $2.98. You will receive a 65% royalty for sales where the price is $2.99 or higher.
Amazon: You will receive a 35% royalty for all sales where the price is $0.99 – $2.98. You will receive a 70% royalty for sales where the price is $2.99 or higher. There is a minimal transmittal fee for the 70% rate based on the size of the file but it is usually no more than a few cents per transaction.
Smashwords: I’m just going to quote from their FAQ. ” For sales at the Smashwords.com retail store, (Sales price minus transaction fee) multiplied by .85 =proceeds to author/publisher. The earnings-share rate for sales originated by affiliate marketers is 70.5% net. For most retail distribution partners, Smashwords pays the author/publisher 60% of the suggested list price you set for your book. These rates vary by retailer for sales outside the US. Apple, Barnes & Noble and Diesel are 60% of retail price, though for Apple’s UK, France, Germany and Australian bookstores, Apple deducts a Value Added Tax (VAT) from your sales price, so your actual earnings share = 60% of (Retail price – VAT). Kobo is also 60% for books priced between $.99 and $12.99 for US and Canadian dollar-denominated sales. Sales in other currencies at Kobo are at 38% list.” Basic translation — you may get more for short stories but may not for longer works. It just depends on the fees that are taken out when and where in the process.
So, how much to you price your work for? There is no correct answer and if you ask three people, you will get four different answers. All I can tell you is that my thoughts on the matter are changing. For new authors, or authors who haven’t built a following yet, I recommend short stories going up at 99 cents. By this, I mean stories of no more than 7,000 words. anything from 7,000 to 12,500 words, $1.99. If you have something that is 25,000 words or less, price it at $2.99. You might want to even price your first novel at $2.99 and then increase the price with subsequent novels.
The reason I say this for authors who haven’t been out there making a name for themselves is that there is a huge backlash going on right now when it comes to “indies” or self-published authors. This is especially true on Amazon because of the new Select program. What’s happened is that hundreds of titles a day being offered for free. These are titles most folks would never have bought but, because they are free, readers are picking them up, seeing all the errors and posting about it. So, when it comes to buying new e-titles, they are then looking at the price and they won’t pay a lot for a new author. The converse side is they are also not willing to pay 99 cents for a novel because it screams “self-published”. So avoid that by pricing it at $2.99 and give yourself the higher royalty payment at the same time.
The best advice I can tell you is to follow the best seller lists on Amazon and BN. See what the prices are. See what the genres are. See if you can spot a trend.
I’ll be back Tuesday with more on this and more, especially on the agreements with the different outlets. Apologies for not having it all done today, but family obligations have cut dramatically into my time the last week and a half. Fortunately, things are looking better…fingers crossed.
Some good advice here, and spot-on with the realization that there is no magic right anwer… and if you ask three authors you’ll get four answers about it… only time wil tell if we’re all putting our eggs in one Amazon basket…
Armand, you are exactly right. Only time will tell. However, in the short term, I think the eggs are safe. At least I hope so.
I appreciate the information as I really have no experience with digital publishing, yet. I am considering it for works other than my teen novels that have already been published in the traditional manner. Maybe my publisher will consider e-publishing once all the hard copies have been sold.
Does your publisher hold the digital rights to your teen novels? If not, you might want to consider going ahead and putting them out in electronic format.