Amazon have unveiled a new tool for indie authors. KDP Pricing Support seeks to compare your ebook to similar offerings in the Amazon store and use that comparison to find the best price point for your book. The purpose behind KDP Pricing Support is to maximise author earnings, something most authors will appreciate. But I think it’s almost useless.
Let’s look at Amazon’s suggestions for my short story You Are Just A Guest, which comes in at just over 5,000 words. It’s priced at $0.99, which I think is pretty reasonable; (what I hope is) a solid and entertaining piece of writing costs the same as a single chocolate bar. But KDP Pricing Support thinks I should charge $2.99 for a short story.
Amazon isn’t alone in that opinion; Dean Wesley Smith concurs. And if we think about it, selling a 5,000 word story for $2.99 means I make $0.06 a word. Consider that, at the low end, Analog pays $0.07 a word and Asimov’s $0.08 a word and I’m doing pretty well for a new author! And the way Amazon’s royalty structure works, I’d have to sell six copies at $0.99 to make the same as just one copy at $2.99.
So this is a done deal, right? Time to hike the price! But hang on a moment. Don’t we need to consider what the reader is willing to pay?
Let’s consider Analog and Asimov magazines, which sell for circa $3.50 a copy and contain a lot more than a single story. Let’s consider that the best selling paperback on Amazon is just shy of $7.80. Let’s consider that, while you make $0.06 a word on a $2.99 sale price, most short stories tend to sell to a magazine just once. It is not reasonable to ask a reader to fork out $2.99 for a single short story.
But KDP Pricing Support can’t tell you that, because the best earning point is $2.99, where the sales and royalties are high enough to earn more than at $0.99. From a data perspective, it’s the best idea for my short story.
But I doubt readers would agree.