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Old 12-17-2009, 01:27 PM   #15
charleski
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Quote:
Originally Posted by Slite View Post
Ok, so the bussiness-model is based on the fact that you sell paperbacks at a loss because you have already "brought home the bacon" with hardbacks?
No, paperbacks are still sold at a profit, though it's a smaller one than hardbacks. As I've explained elsewhere, this is what's called market stratification. Some people are willing to pay more for a product than others, and this is a way to extract extra profit from those who are more wealthy while still being able to offer it (a year later) to those who can't or won't pay as much.

If publishers are moved to a flat-pricing model, the end result for those who buy paperbacks is that the price rises. Do you want that? I don't.

Let's say a publisher makes $3 profit on 1000 hardbacks, then $0.5 profit on 10000 paperbacks over a few years (imaginary numbers, of course). The total profit over time on the paperbacks is higher, but if the publisher only sold paperbacks it would be missing out of the large chunk of profit coming at the book's release (which is also important for cash-flow reasons). In this scenario the total profit is $8000 from selling 11000 books. If those were all paperbacks at the same price, then the publisher would have to take in $0.72 from each of them, which would get magnified through the distribution and retail chain to mean a hefty price-rise on the paperbacks.

Quote:
Originally Posted by JSWolf View Post
These critics do not understand. I won't buy the hardcover. And if I buy the paperback, it would have a lit price of $7.99 and then I would use a discount coupon to get it.
Why should they be worrying about your particular buying habits? Some people are willing to pay more, some are willing to pay less, that's the whole point of market-stratification.
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