Amazon VP at Digital Book World

[wallcraft]

Dianna Dilworth reported on Russ Grandinetti's presentation at Digital Book World today. From Ken Follett’s Kindle Sales Dropped 48% After $2 Price Increase On Book:

the week the publisher switched from the $7.99 Amazon price on the title to the $9.99 publisher determined price, Kindle sales of the book dropped by 48%.

This would be more convincing if longer term sales trends were used.

Kindle owners buy 3.3x as many books in the year after purchasing a Kindle than in the year prior

This is presumably only purchases at Amazon. It certainly demonstrates that ebooks are good business for Amazon.

The full report isn't very long, and it is worth reading.

[EricLandes]

Originally Posted by wallcraft

This would be more convincing if longer term sales trends were used.

A rep from Kobo (also at DBW) said they have a real-time stat ticker on display in their office all the time. They're noticing they cannot do longer-term sales projections because the market character is significantly changing every few weeks.

They emphasized the market fundamentally shifted this past Christmas.

[fjtorres]

Originally Posted by EricLandes

They emphasized the market fundamentally shifted this past Christmas.

Fundamental market shift? Yes.
Christmas? Probably a bit earlier--say, august--though.
Nonetheless, I expect they are referring to the fact that the market has changed from one dominated by hobbyists and avid readers to a balanced market that more closely resembles the greater book-buying population.

As for the sales report on Mr Follett's book, while the actual number has some news value, the actual report is more of a "dog bites man" nature. Most people already understand the inverse relationship between the price of commodities and their sales volume. (Maybe even inside the BPHs.) By now every ebook retailer afflicted with the so-called Agency Pricing scheme (except Apple) probably has similar anecdotes to tell.

2010 was notable for two things above all:
1- ebooks became mainstream commodities in North America
2- the non-competitive pricing scheme instituted by the Price-Fix Five

2011 will likely see the same two development spread to other, less developed markets, including some that will likely welcome price-fixing. So we'll see more reports along the lines of both those sources.

Barring another reader price reset, we will also see a shift in North America from an ebook market dominated by new reader buyers stocking up to one dominated by the installed base and their long-term *buying* habits. And I suspect that both the reader market and the ebook market will start showing seasonality, much as other content markets do.

Expect a new wave of drop-out vendors, either way.

[ProfCrash]

It is an impressive drop but I wonder if it is all due to the price increase. People who really wanted to read the book probably bought it as soon as it was available. Which means that people who were less interested in the book might have been chased off by the $2 price increase but I think there would have been a drop in sales anyway. I am sure that there is a way to compare the drop off to past books and figure out what the real drop in sales was.

[leebase]

Let's explore the Ken Follet price increase sales drop.

1. Yes, we don't know what the long term trend was.

2. Proves the publishers can't set prices too high. Higher pricing correlating to sales dropping is SUPPOSED to happen.

3. What did the low ebook price do to sales of the hard cover? We can not assume that revenues went down just because the ebook portion did.

4. What was the value to the publisher of having ebooks in general at $9.99 verses $7.99. Perhaps sacrificing revenue on that one book was worth it to the publisher.

5. You think the publisher was unaware of what happened to sales of it's books and that such knowledge won't be affecting their decisions going forward?

6. With agency pricing, the publisher can respond quickly to price/demand fluctuations like never before.

7. Was the low price due to an Amazon subsidy? Curious minds want to know.

8. At what part of the sales curve were we in? Books sell less over time.

Lee

[Lemurion]

Publishers have been trying to get beyond the $7.99 price point that's been dominating paperbacks for almost 20 years for a while now. It's not just ebooks, it's also those new taller paperbacks that sell for $9.99 that have been replacing standard paperbacks for many best selling authors over the last few years.

Personally, I hate the damn things and I think I've only ever bought one of them (and that was at an airport so my choices were insanely limited).

Many publishers just want $9.99 to become the new entry price, regardless of format.

[Blue Tyson]

20 years? paperbacks like that were 6.99 only a few years ago...

[Lemurion]

I've been seeing $7.99 paperbacks for almost two decades now - not all books have been that price, but it's been common enough, and more to my point, it's served as a ceiling.