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He has made more money overall by lowering the price for a short period. He lowered the price to get more visibility, and kept some of the increased traffic after raising it again. He is making significantly more per day from that book than before lowering the price.
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Well , yeah. The point,is, as our good friend anamardoll missed completely, is that temporarily lowering price of the book as a promotion, worked to boost sales and therefore income
once he brought the price up back up to 2.99 .
However, lowering price to 0.99 did not result in the kind of increased volume that made it a better deal for him to permanently lower the price to 0.99. He was clear about THAT.
To be honest, it's not really news that having a sale can increase traffic, buzz, etc. Merchants have doing that, probably since the dawn of markets.
THe whole point of agency pricing was that is an attempt by publishers and other booksellers to stop Amazon from making a play for monopolization of the ebook market by discounting the price of ebook bestsellers below cost.
Now many Mobilereaders thought that Amazon was in fact correctly pricing those ebooks because well, let's face it, consumers like cheap. Thus megabytes of bandwidth was expended on explaining how Amazon's prices were"right" because "the Internet changed everything" ,"ebooks could be distributed for free" , " if you cut prices you ALWAYS made it up in volume, "etc, etc.
Since then, its become clear that :
1.Amazon WAS in fact, heavily discounting bestellers below market price.
2. Fears that agency pricing would choke off the growth of the nascent ebook market were unfounded. The Ebook market has expanded dramatically DESPITE higher prices for bestsellers
OTOH,
1. Publishers have been clumsy about pricing ebooks, because (a) they are not as close to the consumer (b) they understandably want to defend the major source of their profit-HC bestsellers. They ARE learning , though. THe last big sales by Amazon and BN included some agency priced books. We can expect more of that.
2. Indie publishers and authors have taken advantage of publisher leadfootedness about prices to gain some mindshare and sales by through offering books at lower prices, either through promo sales for 0.99 or by permanently lowering the price of their ebooks to 0.99. Of couse, not every author that offers a book for 0.99 is making money. You still have to be good. But at a few are, and that's encouraging. It ain't the beginning of a a new world, though.