Quote:
Originally Posted by Hrafn
I'd "buy the idea" in a New York minute. Publishers have very little direct contact with end-buyers, so would have very little to go on in estimating price elasticities (the economic term for how price changes affect demand). Amazon on the other hand not only has large-scale direct contact, it is in a perfect position to run direct experiments to calculate these elasticities (changing their prices to book buyers and seeing how that changes demand). It almost certainly knows what its talking about (but will of course only reveal the parts of what it knows that helps its case).
So if Amazon states that books are highly price-elastic, I'd believe them -- particularly when independent data seems to support this claim. |
Publishers may have very little direct contact with specific end-buyers, but they have a whole lot more information than Amazon when it comes to how many books they can sell at what prices for various categories of authors (i.e. well known best sellers, well known mid-tier, etc...). Publishers have been experimenting with various prices points for various types of books for a long time.