Amazon Demands Authors Do the Impossible – Control the Prices of Print Books Sold by Third-Party Sellers

From The Digital Reader:

As I am sure you know, Amazon requires competitive prices for ebooks sold through its site. The ToS for KDP specify that authors can’t price their ebooks at lower prices on other sites, and if Amazon finds a lower price, it reserves the right to price match.

This policy has caused all sorts of problems when Amazon has mistakenly identified a lower-priced ebook, and it causes even bigger headaches when Amazon applies to print books.

Author Rosanne Bowman forwarded an email she got from Amazon yesterday. It seems Amazon is upset that Walmart is taking a loss on a couple of Bowman’s books, so Amazon has decided to take it out on Bowman.

Amazon is committed to providing customers with a great shopping experience. We measure this in a number of ways, including high-quality content, accurate listing information, and competitive prices. We reserve the right not to offer books that don’t meet these customer expectations.

We have recently observed that the print list price you provided Amazon for the book(s) identified below is not competitive with the list price(s) of other print edition(s) of the book(s) on another sales channel:

Hook’s Daughter: The Untold Tale of a Pirate Princess (The Pirate Princess Chronicles) (ASIN: 578412454) is listed on Amazon.com at $ 9.99 and at $ 4.92 on https://www.walmart.com/ip/Hook-s-Daughter-The-Untold-Tale-of-a-Pirate-Princess/951175999

In order to maintain a great customer experience for Amazon shoppers, we ask that you please reduce the KDP list price for the above titles and review your KDP catalog within the next 5 business days to ensure your book(s) are competitively priced.  As always, we reserve the right to stop selling titles that are uncompetitive with offerings at other stores, and we may remove the book(s) from sale on Amazon if we cannot provide a competitive customer experience.

BTW, Amazon may not have noticed yet but Walmart also marked down another of Bowman’s books.

Walmart gets the books through Ingram, and therein lies the problem. While Bowman can set the list price at Ingram, she can’t control the price set by Walmart or any other retailer any more than she can control the price through the resale market.

Link to the rest at The Digital Reader and thanks to P. for the tip.

PG was not particularly surprised about the contents of the OP.

To the best of his recollection, the provisions of KDP giving Amazon the right to price-match have been around pretty much in their current format since PG first reviewed the KDP Terms & Conditions not long after Amazon launched the program. Ditto for the Digital Pricing and Print Pricing pages.

Amazon pays royalties at a much higher rate than traditional publishers do and Amazon provides access to a worldwide market, but one of the trade-offs for an author to gain those higher royalty rates is Amazon’s price-matching policy. As a general proposition, it won’t be underpriced by anyone who sells online.

As an ancient adage says, you buy the ticket, you take the ride.

Per Nate’s thoughts in the OP, it is true that the author, Ms. Bowman, has no control over Wal-Mart’s pricing of her book, but she does have control over the pricing of her Amazon book.

PG read four posts on the ALLI blog suggesting that indie authors use both KDP Print and IngramSpark together for the best sales results (the latest is here), but PG didn’t see any warnings about the potential Price-Matching issue mentioned in the OP.

Here’s what the IngramSpark website says about using IngramSpark and KDP together:

Using IngramSpark and KDP Together

I would also be remiss if I did not note that you can use both IngramSpark and KDP at the same time if you own your ISBN. Note that if you are making your title available in both self-publishing systems, you can’t choose KDP’s Expanded Distribution because that makes the title available to Ingram and will cause a conflict with the ISBN when you upload into IngramSpark.

Once your title is available, IngramSpark will fulfill orders to places such as Barnes & Noble, independent bookstores, and libraries, and KDP will fulfill Amazon orders. Of course, if you’re looking for a one-stop for all of your content, IngramSpark provides the broadest distribution from one self-publishing platform. This is a good choice if you only want to go to one platform to upload and update your content when there are changes to be made versus having to update in both IngramSpark and Amazon KDP.

If your book is already in KDP’s Expanded Distribution and you would like to use IngramSpark, don’t fret! First you need to remove your book from KDP’s Expanded Distribution program. Then you will need to set up an IngramSpark account, if you haven’t done so already. Last but not least, call or email our customer service team and ask them to transfer your title from Expanded Distribution to your IngramSpark account. Filling out a form is required but once that is submitted, your title will appear in your IngramSpark account in a few weeks.

Amazon Availability

We recently reviewed Amazon availability messaging across all IngramSpark titles and found that 92% had good availability messaging on the Amazon site. The ones that didn’t were mostly newly set up titles or were in/out of revision cycles. Availability messaging tends to change over time as the book develops a sales history.

One of the best things a new author can do as soon as their title goes live is to order their own book through Amazon to help spur good availability messaging. The other thing is to make sure the title is finished before it is uploaded into any system that feeds data to Amazon to keep the title from rapidly moving in and out of revision cycles, which can negatively impact availability messaging. But know that IngramSpark continues to work collaboratively and closely with Amazon to improve availability messaging on their site.

Some of the differences between IngramSpark and KDP come down to hardcovers, print options, discounts, broad book distribution, and convenience. IngramSpark also does not require exclusivity or pricing guidelines as some parts of KDP offer, so that’s something else to keep in mind as you are evaluating which self-publishing company to choose. I hope this post has helped shed some light on IngramSpark vs KDP, but what’s most important to your ultimate decision is what’s right for you and your book.

And here’s a bit more from the IngramSpark blog:

Don’t Limit Your Book Distribution: KDP Select and ACX

Thursday, February 14, 2019

by Amy Collins (@NewShelvesBooks)

More and more, Amazon and Amazon companies are encouraging or requiring authors and publishers to use them exclusively. Kindle Direct Publishing (KDP) offers free ISBNs, KDP Select allows for extra marketing options, and ACX will allow budget-restricted publishers/authors a chance to get an audiobook created and produced for free in exchange for 50% of the profits. All of these options give authors opportunities that they would otherwise have to work harder for, but in exchange, they require that you agree to work with them exclusively. Let’s take a look at them one by one:

Kindle Direct Publishing (KDP): Free ISBNs, But With a Cost

This enticing offer “gives” a free ISBN to an author wanting to publish. But when you read the fine-print on the KDP site, you will see the following statements: “This free ISBN can only be used on KDP for distribution to Amazon and its distribution partners. It cannot be used with another publisher or self-publishing service.” 

What a lot of self-publishing authors don’t realize is that by using an Amazon/KDP provided ISBN, your book will be tagged with an ISBN that belongs to Amazon. Even though the book and imprint will be registered at Bowker, Amazon owns that ISBN and you cannot take the book to another service or make it available for distribution outside of the Amazon platform. You do not have the distribution rights. Amazon owns those.

. . . .

Amazon Exclusive Options Mean Limited Book Distribution

ACX Audiobooks and Audible

ACX audiobooks produced by ACX in exchange for a higher profit share are not offered outside of the Amazon properties. That means that yes, your audiobook is available at Audible, but NOT available through any Apple properties and NOT available to the library or bookstore markets.  Libraries spend almost 24% of their budgets on audiobooks and the numbers are increasing.

KDP Select

KDP Select is a program where the publisher or author that uploads a book to KDP agrees to NOT make the ebook available anywhere else for at least 90 days. This 90-day exclusivity deal means that your ebook is not available at libraries either, or at Barnes and Noble (B&N), or on Kobo (the largest overseas ebook distribution and sales platform).

. . . .

Amazon Nonexclusive Options

ACX and KDP do offer publishers/authors nonexclusive options. KDP can be used simply as a printer/POD option with an ISBN properly purchased from Bowker or another legitimate ISBN provider. ACX will allow outside produced files a more profitable share and not require exclusivity. (But producing an audiobook is not inexpensive…) KDP suggests, but does not require, signing up for KDP Select which requires a 90-day exclusivity contract.

In both cases, the benefits of agreeing to exclusivity are attractive. They save you money and give you a higher level of exposure. Amazon seems to be everywhere…so why wouldn’t you just save the trouble and go for it? 

Wellllllll…..

Changes in the Publishing Industry

It was not that long ago that the entire publishing industry was bowing before the altar of B&N and Borders. Amazon was a new idea that could have gone either way. In hindsight, it is easy to see Amazon’s potential, but at the time? We really had no idea how far Amazon would go. 

The publishing companies that adore Amazon’s money today were falling all over themselves to give the bookstore chains everything they asked for. Just a few years later, those same publishers were lamenting as Borders declared bankruptcy and B&N cut their purchases by over 50%.

A few years ago, Bookbub would consider promoting ebooks that were exclusive on Amazon. No longer. Do you really want to miss out on the opportunity to get into the biggest ebook promotion venue? Because you cannot get accepted by Bookbub until you are available across a number of platforms.

And the lesson we can all take from this?

Limit or Avoid Exclusive Deals

Don’t put any part of your business into an exclusive deal. Putting your eggs into the Amazon basket may make sense today, after all, Kindle is over 90% of the ebook market. Audible has a huge market share of the audiobooks. Why not save time and give Amazon your business?

Because Kindle, Amazon, and Audible are NOT the whole marketplace. Libraries, bookstores, gift shops, Big Box chains, Apple…do you really want to ignore every other retail option? What about the international market? The US is only a small part of the world; there are ebook, audio, and POD options all over the globe.

Whether or not you believe that Amazon will always be the monolith that it is today, there are still plenty of reasons to distribute your books to all the venues available. IngramSpark provides the broadest book distribution that includes Amazon, chain bookstores, indie bookstores, and libraries. You never know what opportunities might change your life. Don’t turn your back on potential book sales.

So, what’s the bottom line for Ms. Bowman and her Walmart pricing problem? (Note: PG doesn’t know any details other than those included in Nate’s blog, so there may be reasons why some alternatives don’t work.)

  1. As Amazon has suggested, Ms. Bowman can drop the price on her Amazon books so Amazon’s sales price will be lower than Walmart’s. One of the benefits of working with Amazon is control over sales pricing, unlike going through a distributor like Ingram where Walmart ultimately chooses the price.
  2. Ms. Bowman can unpublish either the Amazon or the Ingram version of her book. (PG hasn’t read Ingram’s Terms of Service in detail, although he didn’t see anything about pricing when he searched for that, so he doesn’t know whether unpublishing there can happen quickly or not.) Or, Ms. Bowman can unpublish both books, take a deep breath and launch her book again.
  3. Mrs. Bowman can increase the cost of her Ingram books (although PG doesn’t know how long it might take to work a price increase through the pipeline to Walmart) to, hopefully, push up the Walmart price or incent Walmart to stop selling her book.

Neither Amazon nor Ingram is a charitable organization. There is nothing evil about them setting reasonable terms for those authors or other suppliers who want to sell through their online or offline systems. If any visitors to TPV had misconceptions about Amazon always focusing on lower prices and never wanting to be underpriced on books or anything else, those misconceptions are likely corrected by now.

Walmart has a similar corporate strategy to sell for lower prices than its competitors but Amazon has executed its strategy more effectively than Walmart and has captured a huge part of Walmart’s sales and an even larger portion of Walmart’s profits over the last ten years.

Likely without intending to do so, Ms. Bowman violated one of KDP’s written rules. The portions of the emails from Amazon Nate included in his posts include specific suggestions from Amazon about what Ms. Bowman can do immediately to resolve the problem.

Yes, Ms. Bowman’s KDP royalty payments may be lower than they would be if she could price her books higher than Walmart’s prices, but, from what Nate has written, this is not, in PG’s immoderately humble opinion, evidence of evil Amazon mistreating an author.

4 thoughts on “Amazon Demands Authors Do the Impossible – Control the Prices of Print Books Sold by Third-Party Sellers”

  1. I think a subset of authors forgets they are Amazon’s suppliers, not Amazon’s customers. If they don’t like what Amazon offers, they don’t have to deal with Amazon. Other authors will jump at the opportunity, and Amazon’s customers won’t notice anything.

    • Exactly. That should be a tattoo…

      The other thing that all too many authors do not understand is Return On Investment. At least until it bites them. I know several who loudly proclaimed that they were leaving Select, never to darken its door again – and were back within the year, after realizing that “going wide” gained them very little, cost much more money, and lost them a lot at Amazon. Not everyone’s experience, of course, but fairly common.

      Oh, and always remember that “I” includes time. You invest a certain amount of time, when you are not producing salable copy, to set up at Amazon. You then invest approximately the same amount of time for each and every other distributor. Alas, the IRS won’t let me tax book my time at $15 an hour, but I still use that figure internally (which gives me a net loss, although far fewer ulcers than when I was grossing $50 an hour in a Dilbert cubicle).

  2. In this case, I think Amazon is in the wrong.

    the writer should NOT have the ability to set the retail price of their product. They can set the wholesale price of their product, but once it’s sold to the retail store, the retail store should be able to sell it for whatever price they want (and can get)

    And to PG, if Wallmart is already selling the book at a price below what the author has as the suggested price, raising that suggested price isn’t going to cause Wallmart to raise their price.

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