Book Price Drops and their Effect on Sales
Anybody who sells books (or anything else, for that matter) is always interested in evidence regarding what factors drive sales. One of the first and most important factors in sales, of course, is price. As we all know from elementary micro-economics (whether we studied the subject or not), demand for a product is almost always sensitive to price, and almost always in one direction – a lower price will result in greater demand, all else being equal. One counter to that truism is when lowering the price results in a reduction in perceived quality, thus lowering demand i.e. if the price is cheap, people might think the product can’t be any good. Recently, I had the chance to make some observations in this matter, on some books on Amazon that I have been following for a while. They are all Amazon imprint books, and were all published at the same time, so it is interesting to follow this little “book cohort” and observe how they do over time.Graph 1 – Sales Rank by Day
The first graph shows sales rank for these books over 3 weeks or so in mid-late December 2016 to early-mid January 2017 (19 days to be precise). This covers the Christmas period and immediate Christmas period, which are always of interest. It also covers a period before and after a price drop, for two of the books, which occurred on December 30, as noted in the graph text box.
The second graph shows the same data, but uses a logarithmic scale, as the difference in sales rank between the four books tends to over-emphasize the less well-selling books. As we can see from the graph, Christmas sales trends were mixed, and not very clear. Generally speaking, sales improved somewhat or remained stable, as Christmas approached, then fell off afterwards.
Graph 2 – Sales Rank by Day, Logarithmic Scale
The exception to that trend is the book “Trail of Broken Wings”, a fairly “literary” book that sold very well in the past and also ranked highly in a Goodreads competition. That books sales improved quite substantially, after the price was dropped on December 30. In fact, its sales rank went from about 1500 before the price drop, to about 200 near the end of the graph. That can be a little hard to see, due to the scale of the x-axis in the first graph, and the use of a logarithmic scale for the second graph. Therefore, I broke out a third graph for that book, shown below. The significant impact of the price drop is very clear in that graph.
Graph 3 – Sales Rank by Day, Trail of Broken Wings
Another book had a price drop on the same day, but the effect was very different. In that case, sales rank dropped after the price drop. Perhaps this is an example of the “perceived lower quality” effect, whereby a price drop actually hurts sales. As the fourth graph shows, its sales rank went from about 10,000 before the price drop, to about 25,000 afterwards.
Graph 4 – Sales Rank by Day, The Alter Girl
So, the effect of a price drop on sales rank seemed to work on way for the book that was already highly ranked (positively), but the other way for a book that was not highly ranked (negatively). Of course this is a case study of two books, so we can’t say that we established any general result. That would take a lot more data (no doubt large publishers and e-retailers such as Amazon have this data, and do these analyses all the time).
Sales rank is, of course, interesting, but sales and the associated dollars are what really matter. So, in an effort to estimate those effects, I used the Amazon Sales Rank to Sales relationship that was crowd-sourced some time back by Hugh Howie and other Indie writers and publishers. That relationship is a “best guess”, but it does reflect the power law nature of book sales – i.e. the top ranked books have orders of magnitude more sales than the lower ranked books.
The relationship goes something like this (though, mathematically, I convert that to a best-fit power law):
Sales Rank = Sales Per Day
- 1 = 7,000
- 5 = 4,000
- 20 = 3,000
- 35 = 2,000
- 100 = 1,000
- 200 = 500
- 350 = 250
- 500 = 175
- 750 = 120
- 1,500 = 100
- 3,000 = 70
- 5,500 = 25
- 10,000 = 15
- 50,000 = 5
- 100,000 = 1
- 100,001 or more = (less than one)
So, having explained that, let’s look at the estimated sales, and how the price drop effected them. The graph below shows those numbers, as estimated from the power law.
Graph 5 – Estimated Sales in Units, by Day
As you can see, sales in units were a bit higher pre-Christmas, then fell, for the most part. Again, the exception was “Trail of Broken Wings”, which had a big rise in sales after the price drop of Dec 30.
Graph 6 – Estimated Sales Revenue by Day
However, the price drop meant that revenue increased, but not as sharply as unit sales. Revenue went from averaging $300 per day before the price drop, to about $400 to $500 after the price drop. Things were much worse for the book “The Alter Girl”, where the price drop seemed to bring sales down, and certainly hurt revenue. Before the price drop, it was earning a bit under $100 per day, while afterwards it was only making about $15 to $25 per day. So, in terms of revenue, the price move certainly seems to have backfired.
The last item to look at is number of reviews. More sales, and a better bargain might drive reviews, which ought to help future sales, based on the “social proof” theory. Note that I have used a five day moving average, in order to smooth out the data, which is a pretty standard way of showing a trend like this.
I should also note that the period being followed is not going to catch all of the reviews from the any increase in sales caused by the price drop – it would take a month or two for most of them to trickle in. But, some effect should be visible, and that’s what the last graph seems to show.
Graph 7 – Number of Reviews, by Day
Reviews per day went up fairly considerably for “Trail of Broken Wings”. The other books showed no such effect. I might also note the number of reviews over the time period versus the estimated number of books sold:
- Trail of Broken Wings: 3168 books, 29 reviews, or about 1 review per 109 books.
- The Alter Girl: 283 books, 5 reviews, or about 1 review per 57 books.
- Boundary Crossed: 971 books, 4 reviews, or about 1 review per 242 books.
- This Thing Called Love: 879 books, 4 reviews, or about 1 review per 220 books.
- Four Books: 5301 books, 42 reviews, or about 1 review per 126 books.
About 1 review per 100 books sold seems to be a pretty consistent result.
As for our own publishing venture (Dodechahedron Books), I have found that price drops, via Kindle Countdown, still move books, though you do take a hit in revenue. However, if you are in the “brand building” stage (i.e. which is probably true of most writers), that's not such a bad trade-off. That has been particularly true when we have put several books in a series on Kindle Countdown over the same period of time, as we have recently for the series below, to good effect.
--------------------------------------------------------------------------------------------------------------
The
Witches' Stones, Book 1 - Rescue from the Planet of the Amartos
Young
Earth woman and spaceship mechanic, Sarah Mackenzie, has unwittingly triggered
a vast source of energy, the Witches' Stones, via her psychic abilities, of
which she was unaware. She becomes the focal point of a desperate contest
between the authoritarian galactic power, known as The Organization, and the
democratic Earth-based galactic power, known as The Terran Confederation. The
Organization wants to capture her, and utilize her powers to create a
super-weapon; the Terra Confederation wants to prevent that at all costs. The
mysterious psychic aliens, the Witches of Kordea also become involved, as they
see her as a possible threat, or a possible ally, for the safety of their own
world.
A small but fast scout-ship, with its pilot and an agent of the Terra Confederation, Coryn Leigh, are sent to rescue her from a distant planet at the very edge of the galaxy, near space claimed by The Organization. Battles, physical and mental, whirl around the young woman, as the agent and pilot strive at all costs to keep her from the clutches of the Organization.
The
Witches' Stones, Book 2 - Love and Intrigue, Under the Seven Moons of Kordea
Sarah
has taken refuge on the planet of Kordea, where she is also learning how to
control her psychic abilities, through the tutelage of the Witches of
Kordea. Coryn Leigh has now taken up the position of Confederation
diplomat to the Kordeans, but he is also charged with keeping the Mackenzie
girl safe at all costs. During their time on the planet, an attraction
between them grows, though they try to deny it, to themselves and each other.
But
The Organization has plans of its own, including threatening the destruction of
the planet Kordea, via destabalizing the orbit of Lina, one of its many
moons. The Organization proves that its threats are in deadly earnest,
so, ultimately Sarah, Coryn and the Witches of Kordea must take the fight to
the enemy. Thus is borne a dangerous mission, to a planet where
their foe has based the weapon that threatens Kordea, and ultimately, the
balance of power throughout the galaxy. Sarah and Coryn agree that the
machine must be destroyed, even at the possible cost of their own lives and
growing love.
The
Witches' Stones, Book 3 - Revenge of the Catspaw
Sarah
and Coryn have become married, under the traditions of the Witches of
Kordea. But the marriage is performed by the Eldest of the most important
coven, a rare honour, that comes with a blessing and a curse. The slow
working out of this blessing and curse forms the backdrop to the story.
Having come so close to their goal of enhancing their weaponry via Witches' Stone power, The Organization will not give up. In order to lure Sarah into their trap, and thus have her become their Catspaw (someone who is forced into helping another, against their will) they need bait, and Coryn becomes the bait. He also comes under the domination of a particularly nasty Elite of The Organization, one "Evil Evilla" Copoz.
Sarah, and a picked group of companions, must re-enter The Organization space, this time to the very heart of the empire, to rescue her husband, as he has done for her in the past. They do so at great peril, but nothing can stop the terrible Revenge of the Catspaw.
No comments:
Post a Comment