Wednesday, November 23, 2011

99 is the magic number

Sandra Parshall

Why would a writer offer the product of a year’s work for a mere 99 cents?

Some people are appalled to see authors “giving away” their work, but many who have self-published their new and out-of-print novels as e-books are tapping into the magical allure of the 99 cent price tag. 
 
Savvy marketers know they can sell almost anything for that
price. To the buyer, it’s a bargain, whatever “it” is, because it costs mere pennies. Move the price up to $1 and the sale will become harder to make. Sure, it’s all in our heads, a perceived difference rather than a real one, but moving the price down from dollars to cents is guaranteed to increase sales.

Steve Jobs, never a slouch in business matters, recognized the attraction of the 99 cent price. When Apple launched the iTunes Store in 2003 (following the crackdown on internet music piracy), Jobs decreed that each single music track sold would cost 99 cents. Even consumers who had grown used to getting music for free (illegally) were willing to pay mere pennies for songs. The prices have since gone up – new singles are now $1.29 – but the phenomenal success of iTunes was built on the 99 cent price tag.

Even when a product costs considerably more than pennies, merchants still draw on the attraction of the 99 cent price by attaching it to the dollar amount. A new refrigerator won’t be advertised for $900. It will be sold for $899.99, which somehow seems like a lot less. A variation, 95 cents, is used in the prices of printed books, clothing, and a few other types of merchandise. We seldom see a tag bearing a rounded-off dollar amount.

E-book authors know what they’re doing when they offer new work or have a limited-time special sale of older work for 99 cents. Readers will buy a lot of books at that price. It’s such a small amount of money that the buyer won’t feel cheated if she doesn’t like a book and deletes it from her reader without finishing it. If she loves it, she’ll be back for more by that writer – at higher prices. (Those higher prices, too, will usually be a dollar amount with .99 at the end.) Writers like C.J. Lyons, J.A. Konrath, and Debbi Mack have quickly built large e-book readerships by using one of the oldest marketing tactics known to American commerce.

Everybody loves a bargain, even when it’s something intangible like a chunk of text that exists only in electronic form. Which proves, once again, that the more things change, the more they remain the same.

16 comments:

Julia Buckley said...

An interesting study of human psychology--and a compelling argument!

Sandra Parshall said...

Anything that worked well for Steve Jobs is worth trying. :-)

Patg said...

The psychology of consumerism should be a mandatory study for anyone who wants to sell something. But like doctors needing to study bedside manner, the writing community seems to want to shy away.
The latest I've seen if you have a series, is to offer the first book free.
Patg

Sandra Parshall said...

I wonder if I could talk my publisher into having a sale on my e-books...

Allene said...

Great post, Sandra. 99 is certainly a magic number for people on fixed income and struggling to find work. They can afford to try a new author, or find an old favorite. Takes some of the weariness out of their life, living vicariously through a skilled author's words.

Earl Staggs said...

Sandra, you've convinced me to rethink. When I published a collection containing 16 of my short stories, I set the price at $2.99 and said I would leave it at that. Now, I'm 99% decided to reduce it to 99 cents. I hope my mind never becomes so closed I can't change it. A born and bred U.S flag waver, I used to say I'd never drive a foreign car. Now my wife and I both drive Hyundais.

JJM said...

Loss-leader pricing like 99-cent book and the free first volume of a series is why I now have some 400 books on my Kindle. [sigh] You bet it works, even when you understand full well the psychology behind it. At least, as you say, the loss isn't so great if you find the book isn't worth even the $0.00 you paid for it, though.

And then there are crafty writers who have the savvy to be friendly to potential readers via social media / e-mail. (As it happens, I have yet to be sorry about buying any book as a result.) But that's another story; my only point being that it's a whole new world for authors out there, and the $.99 book is only one part of it.

Excellent article, Sandra, thank you.

Writer Lady said...

It's true. I will take a chance on any book that sounds interesting at 99 cents, but let the price go higher and I have to think about it.

Still, I'll pay more ($X.99) if it's an author I enjoy reading. Almost any ebook is cheaper than paperback these days.

Pat said...

As a reader and buyer, I'm not sure if I agree with the 99cent deal. I'd rather pay $2.99 and get a book a better book.

JJM said...

"I'd rather pay $2.99 and get a book a better book."

Except that the extra two bucks does not guarantee the book truly is better. For that matter, I've ended up buying a Kindle book for $9.99 on the strength of an earlier work by that author, and regretted the expenditure.

I think the point of Sandy's article is that there is a psychology behind the $x.99 pricing; she then asks the question: is there a possibility that books sold at loss-leader prices will have more people taking a chance on them -- is the $.99 book, in other words, a sound marketing strategy? I'd say yes, just based on my own experience.

--Mario

Sandra Parshall said...

The 99 cent price is most successful at introducing readers to writers they have read before. It's a cheap way to get a taste of the author's work. Some writers have short-term offers of free books. If the writer produces good work, chances are those readers will be back to buy more at a higher price. Without the free or 99 cent intro, a lot of readers might never try the writer at all.

It's much the same as getting the first book from the library before buying any of an author's work.

With so many books on offer, both in print and e-book form, lesser-known and new writers have to find ways to hook readers. A low-priced introductory book is already a proven success in the world of e-book marketing.

Lynn M said...

I know that I strive for free or very cheap books when stocking my e-reader and I myself have bought books at more expensive level after reading a 99 cent book. It is great marketing.

Dru said...

I've discovered many new-to-me authors when I took that chance and purchased their 99 cent book. I have no qualms buying their higher price books if I enjoyed what I read.

Lori L. Lake said...

Hi, Sandy - I understand your argument, but the comparison to music does not hold up. We pay 99 cents for a single music track, not for the *entire* album. The only way the analaogy would work for books is if the author sold CHAPTERS for 99 cents each. I think the amount of time most authors spend on developing and creating a top-notch book approaches (or exceeds) the amount of hours musicians work to create studio albums, so a single musical track doesn't equal an entire book.

In order for the 99 cent book price point to be effective, the author has to: 1) have a kick-ass cover; 2) have a kick-ass description and blurbs that draw a reader in; and 3) have kick-ass content that is well-written and engaging. In particular, the first 50 pages or so better be sky-rocketing fireworks in quality because that's how much the reader can preview on sites like Amazon.

A lot of the 99 cent books I've sampled do not meet those three criteria. At all. And if readers get someone's name in mind as a "bad" writer, that's not very helpful.

Thanks for blogging about this VERY interesting controversy, Sandy. The debate goes on...
Lori

Beth Anderson said...

Krill has priced all of our mysteries at .99 cents for the holiday season. Once they did that, Raven Talks Back went straight to the bestseller list, as it has several times before but now it's staying there, so far anyway. Something about that 99 cent bargain...

Jean Henry Mead said...

It's an intriguing concept and I'm trying it with some reprint books that were recently orphaned when my publisher died. The numbers have gone up although the royalties are miniscule. Only time will tell.