Home » Ebooks, Pricing » A 25 Cent Book in 1950 Would Be $2.44 Today

A 25 Cent Book in 1950 Would Be $2.44 Today

10 April 2014

From author Scott William Carter:

Amazon lists most of their genre fiction ebooks at $4.99, with backlist often at $3.99.  Is this the correct price?  Four years after publication, Simon and Schuster still sells the ebook edition of my first novel for $11.76, a price I think is insane, but who knows, perhaps they’re onto something.  My sharp friends Kristine Kathryn Rusch and Dean Wesley Smith generally advocate pricing a little higher than most indie authors, andthey have valid reasoning behind their approach, especially when you consider they have started a traditional publishing company, albeit one that’s smartly taking advantage of all the new technologies.  And of course there are loads of writers, like Joe Konrath, who happily price at $2.99 or $3.99 and are doing very well.  Who’s correct?

No one, at least as far as I’m concerned.  Or everyone. With ebooks, price can’t primarily be about supply and demand, because supply is infinite, but it is affected by not only what consumers are willing to pay, but also by your goals as a publisher. There is no correct price for all ebooks.

Now, that said, where do I come down? I think Amazon is probably onto something, but even they, with their mountains of proprietary data on their own customer’s buying habits, which you would think would give them an enormous advantage, currently only have five out of the top twenty books on their own Kindle bestseller list.  A twenty-five percent hit rate is pretty good, but that’s their own bestseller list on their own site for a product they created!  (And look at how prices are all over the map on that list; that alone should tell you something.) Still, I think ebooks are closer in parallel to movie rentals, and no one says that a .99 movie rental at your local Redbox is somehow devaluing the movie.  Louis CK now sells his comedy specials direct to his fans for $4.99, and he’s made millions doing so.  It’s a pretty safe bet that his fans don’t think he’s devaluing his work, but instead think they’re getting a good deal.  That’s what I think, anyway, and I’m one of them.

. . . .

When the paperback novel was released in Britain, and here in America, it was just as much a gamechanger as the ebook.  That’s why the arguments about cheap book prices devaluing literature sound so familiar.  We’re just rehashing the same argument that was had about paperbacks.  “My books are certainly worth more than a Big Mac at McDonalds!” the writer claims.  Well, that certainly may be true to that writer, but who cares?  The average price of a Big Mac in America in January 2014 was $4.64, which is pretty close to where Amazon prices their genre ebooks, and most writers would be happy to move as many ebooks as McDonalds moves Big Macs. Pocket Books priced paperbacks in the forties and early fifties at 25 cents and sold millions — a price that would be the equivalent of just under $3 today.  Boy, did some folks howl about how books priced so low couldn’t be “real books,” just as the reincarnated literati, like zombies who eat books instead of brains, say the same thing today.

What’s wrong with giving people a good deal?

Link to the rest at Scott William Carter

Ebooks, Pricing

31 Comments to “A 25 Cent Book in 1950 Would Be $2.44 Today”

  1. Totally agreed. I used to believe that pricing my books too low would devalue them, and they struggled as a result. I’m selling a lot more now that they’re priced at $.99, $2.99, and $3.99, and they’re generally getting better reviews too. You really can’t know what the right price for your books is until you’ve experimented with them. Holding to a particular dogma without the data to back it is just going to hurt you in the long run.

  2. “What’s wrong with giving people a good deal?” Nothing, if they think they get a good deal, rather than cheap, low quality stuff.

  3. While I acknowledge that my understanding of economics is rudimentary at best, this made a lot more sense to me than other arguments I’ve heard on both sides. Products are usually more successful when more people can afford it, and anyway, writers are somewhat more focused on reaching quantities of people than material goods are. Dyson can try to speak to a cultural elite, but I think writers take a much bigger risk doing that.

  4. Pricing for e-books is one of the (very) few areas I disagree with Kris and Dean. When adjusted for inflation, the first adult MMPB I bought for $0.75 in 1975 would be $4.17 today. To me, I can’t justify more than $5 for what is a license to use an electronic file. It’s not even a physical item my reader can trade, borrow, or sell.

    I’ve done some price experimenting. All I know for sure in my case is that $1.99 or anything above $5.99 is more of a price ghetto than free or $0.99.

    Do I think my method should work for every writer? No. YMMV

    • Well, the thing is they have pre-established brands.
      They already have their thousand true fans a few times over.

      • Not arguing with your statement, Felix. When I started studying this pricing thing a little over three years though, even established writers, who were switching over to indie, were all over the place in self-publishing price points. There was no consensus, which in some ways was a good thing. Otherwise, we’d be in lock-step just like the Big 5, which I think would work against writers in the long run.

        In comparison to KR and DWS, I have a teeny, tiny handful of true fans. But even if I had the thousands that other writers have, I don’t think it’s in my long-term economic interest to gouge them. Which is how I feel with the last few of Jim Butcher’s Dresden Files books when I can get the HC (at B&N’s b&m store no less!) cheaper than I can the e-book.

        And yes, I’m aware that bizarre pricing is the publisher’s fault, not Jim’s. I don’t simply want to make the same mistakes the trad publishers are making and drive my dedicated readers away.

        • There is a sweet spot between too low and too high. Too low devalues the work in the eyes of the buyer. Too high is, well, too high.

          This is what I was taught in economics, and I don’t think it’s been refuted.

          Talent generally devalue their work. It’s common among freelance writers who work with businesses to be reluctant to raise their prices. For them, the best advice I’ve heard was to raise your rates when you have more than full-time work. Once you’re turning away jobs, raise your rates. If you still have enough work to make you full-time, you set it correctly.

          If nothing else, not offering the lowest price eliminates those people most likely to take advantage of you, like the clowns who want free rewrites and are late paying.

  5. My pricing philosophy is simple: As a reader, given the amount of reading I do (lots) and my budget (not so much), what do I feel comfortable paying? Most of my novels are $3.99, the longest one is $4.99, and I’ve got a couple of short story sets at $0.99 and $2.99 (that one is more of a 2-part novella-length work), and I’m experimenting with launching my new novels at $0.99 for the first few days.

  6. I’m not a fan of the “it was 25 cents in 1950, it would be $2.44 today” method of comparison. It’s a fun fact, but markets and market supply change, and the things we buy don’t stay static with respect to each other. Such comparison is a very blunt tool at best.
    I love value books myself, but I see a lot of the low pricing done in a fairly unconscious way, with little thought to long term strategy or market psychology.

  7. PG, on my comments today I notice that, since I don’t fill in the website space, it is automatically filled in with a book marketing website. I’ve had to go back and edit to delete it out. I’ll leave it in on this comment so you can see what I’m talking about.
    Is this something your site is set up to do intentionally? or is there some kind of hack going on?
    Edit: Now it isn’t doing it anymore.

    • I’m not sure what was going on, Teri. I haven’t seen this.

      If you see it again, please let me know. If you can do a window capture of what’s happening (Alt-PrtScn in Windows), then paste it into an email, that will help me see what the problem is.

      If anyone else has seen the same thing, please let me know.

      • That could be a simple case of autofill in the browser recognizing the URI field name in the form and populating it with the last item used in that browser for a field of the same name.

        • Teri –

          If you used the Google Chrome browser especially, what TLE describes may be the reason (although this implies that a book marketing site was filled in a user form sometime in the past).

          If you used Chrome and you want to check whether the book marketing site might be in one of your autofill entries, go to this Google help site and expand the section for “Edit Autofill entries”:

          https://support.google.com/chrome/answer/142893?hl=en

          • Try this: with the cursor in the URI space, press the down arrow key. You might see a list of websites below the box. Tap the down arrow key until you reach that name (don’t press Return) and hit the delete key. If it disappears, that should solve the problem. (It works in Firefox, YMMV.)

  8. You can order an endotracheal tube from Amazon for less than $4 (USD). Is that worth more or less than a Big Mac? Nobody’s ever needed a Big Mac as bad as some folks have needed an endotracheal tube. The range of hourly rates for legal services and sex work is about the same in most large American cities. Does that mean anything?

    Spoiler alert: Comparing the prices of apples and oranges is like comparing apples and oranges.

    • The range of hourly rates for legal services and sex work is about the same in most large American cities.

      It means I should have listened to my gut and become a dominatrix instead of going to law school.

      For any good or service, you charge what the market will bear.

    • The range of hourly rates for legal services and sex work is about the same in most large American cities. Does that mean anything?

      Yeah, it means it costs the same to get screwed either way, but one gives you a chance to enjoy the experience. 😉

  9. Not really on-topic, but Amazon is now offering $2-5,000 in severance pay to any warehouse employee who is unhappy with the job.

    http://www.king5.com/news/business/Amazon-paying-workers-5000-to-quit-254796921.html

    Will Melville House follow suit?

  10. How much does Amazon influence prices?

    I have heard that the Big Houses negotiate royalty rates with Amazon. I don’t know, and they ain’t saying.

    As for the little guys like me, the price sweet spot is $2.99 to $9.99. Within that range, Amazon pays a 70% royalty (extraordinary delivery charges excepted). Outside that range, Amazon pays 35%. Anybody know any indie ebook priced above $9.99?

    Me? As a reader? My max ebook price point is $9.99. For writers I know — such as Terry Prachett, David Drake, Jerry Pournelle, Stuart Woods — the purchase decision is almost a reflex: Less than $9.99? Buy it. For new writers I have no experience with — such as Pam Uphoff and Lex Allen — I won’t go more than $4.99. I have been disappointed with quick purchases at $0.99 and $2.99. Now I sample and read reviews.

  11. A basic Kindle costs $69, and a lowest priced book costs 99 cents. So a reader is actually holding a $69.99 book 🙂

    • That’s assuming you only ever buy one ebook. And only ever read it on your kindle. Should I add the cost of my laptop, iPad and phone to the price of every book I buy? And my internet connection, and electricity bill as well?

    • I have hundreds of books on my Kindles and Nook, and I figure the fact that ebooks cost less than the hardcovers and paperbacks I used to get, that pays for the Kindles several times over. And it’s pretty priceless to me that I can carry a library with me wherever I go and just press a button to start reading, and the device remembering for me where I left off. And my middle aged eyes can’t be happier with being able to make EVERY book I own a “giant print” readable book. (You’ve seen the costs of “large print” books, right. Crazy.)

      And with the Kindle app, I can read on my smartphone if I don’t want to carry my Kindle. Or my laptop if my eyes are tired and I want to make the words ginormous.

  12. I follow Dean’s advice, though I may charge very slightly less. Books that aren’t selling well also have their price lowered. In general my e-books are a bit below trad. pubbed e-books. My paperbacks may be slightly more (the price is set by Createspace).

    I will not sell novels under 5.99 unless it’s a short promotion, or sales have slowed drastically. It takes me at least 6 months to write a novel. If I turned out a book every month, I’d consider 99 cents.

  13. The price of an ebook v a Big Mac is bogus. The two are not cross-elastic. That is, a substitute for each other. Big publishers price their ebooks at the same price as their trade paperbacks because they see them as cross-elastic.

    Most of the rest of this conversation misses the point. The real point is what will the market bear? Those who are experimenting with price have the right idea. At what price and number of books bought will I maximize income.

    That’s why gasoline prices vary sometimes from one hour to the next.

    That’s why airline seats are set at different prices.

    Don’t waste time worrying about the Amazon hegemony, write books, sell books, rinse, and repeat.

    Go to Mr. Carter’s website. He sells books for $4.99.

  14. I don’t disagree with the premise of the post, but, boy, someone used a wishful-thinking inflation calculator to come up with 25 cents to $2.44.

    http://www.shadowstats.com/article/no-438-public-comment-on-inflation-measurement

  15. Dusty Greenfield

    I just thought this was funny.

    “Now, that said, where do I come down? I think Amazon is probably onto something, but even they, with their mountains of proprietary data on their own customer’s buying habits, which you would think would give them an enormous advantage, currently only have five out of the top twenty books on their own Kindle bestseller list.”

    One company holds 25% of the range that he mentions against dozens of companies that release product into that specific market. No, that proprietary data isn’t doing them any good at all. I wonder what percentage he thinks they should have?

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