Quote:
Originally Posted by Barcey
I have no question about Amazon's data on this:
1) There isn't a benefit for them to lie.
2) They're in the best position to have this data across all ebooks and publishers.
3) Their entire business (beyond ebooks) is built on knowing this type of data.
The publishers should have this data as well but only for their own books. They have enough popular authors that write generic books and have a relatively stable fan base that they can compare how many units sold at $9.99 versus when the tried jacking up the prices.
What Amazon isn't saying is that this is looking at ebooks in isolation. The publishers are arguing that they're trying to protect their higher margins on hard cover editions. The heavy discounting (actual competition) on hard covers means that Amazon is probably making a lot less then 30%. They also have to inventory, manage and ship it so I suspect they make more money selling the ebook at $9.99. Like any smart business man will say though, your profit margin is my opportunity. Amazon is in the business of giving the customer what the customer wants. The publishers are in the business of giving the customer what the publishers want. We'll see who wins.  |
We have seen in the past that one can make the numbers come out any way one wants by cherry picking data. Without the supporting data, it's simply an unsupported assertion. I'm sure that Amazon knows the data, but that doesn't mean that the actual data supports their assertion. What Amazon is basically saying is that you can sell more generic product at X than you can at 2X. That's a basic economic truism.
What they don't say is what is the proper price point to maximize profit, and how that price point changes based on specific authors, genres and subject matter. From the publisher's point of view, if they can sell X number of copies of a book at $15 and 1.2 X copies of a book at $10, then they are leaving money on the table. That money is important to publishers because unlike Amazon, they actually have expenses for each and every book in their catalog and the majority of books don't ever earn out that expense.