We are in the midst of a relentless fall in both the value perception of books and in the actual prices of books in the Top 100 Bestsellers List.
It’s easy to get distracted by the Big 5 Publishers’ $13.99 new releases and assume nothing has changed. However, the hard facts indicate a massive upheaval is going on.
Let’s take a quick look at prices of the Top 100 Bestselling books in the two top ebook stores – Kindle Store, Nook.
Kindle Store – 55% of the Top 100 are below $5, 24% are below $2
- Kindle Store Top 20 – 11 books below $5 and 4 books below $2 in the Top 20. That’s 55% below $5 and 20% below $2.
- Kindle Store Top 40 – 24 books below $5 and 11 books below $2 in the Top 40. That’s 48% below $5 and 27.5% below $2.
- Kindle Store Top 100 – 55 books below $5 and 24 books below $2 in the Top 100. That’s 55% below $5 and 24% below $2.
- Kindle Store Summary – 1 out of every 2 books in the Top 100 is $5 or less. 1 out of every 4 books in the top 100 is $2 or less.
- To put that in perspective – In 2008, there were just 2-3 books below $5 in the Top 100. Additionally, at that time there were hardly any free kindle books from indie authors and small publishers.
This is really quite stunning. Keep in mind that Amazon uses weighted algorithms to try and keep cheaper books out of the Top 100. It obviously isn’t working.
Perhaps having 55% of the Top 100 below $5 means that we are, in effect, approaching a world where the best-selling books will be in the $3 to $5 range. Of course, we then look at the fact that 24% of the Top 100 books are below $2 and a scary thought strikes – perhaps the end result will be a world where best-selling books are all in the $1 to $2 range.
Nook Store – 56% of the Top 100 are below $5, 25% are below $2
- Nook Store Top 20 – 11 books below $5 and 8 books below $2 in the Top 20. That’s 55% below $5 and a massive 40% below $2.
- Nook Store Top 40 – 21 books below $5 and 14 books below $2 in the Top 40. That’s 52.5% below $5 and 35% below $2.
- Nook Store Top 100 – 56 books below $5 and 25 books below $2 in the Top 100. That’s 56% below $5 and 25% below $2.
- Nook Store Summary – 1 out of every 2 books in the Top 100 is $5 or less. 1 out of every 4 books in the top 100 is $2 or less.
- I don’t have figures from 2009 for the Nook Store. However, in 2009 and 2010 there used to be just 3-6 books below $2 in the Top 100 in the Nook Store. Now there are 25.
This is even more stunning.
B&N doesn’t have weighing algorithms to hide cheaper books – so you would expect cheap books to have more of a shot. However, most people who want lots of free books flock to Kindle. Amazon has focused on free kindle books for the last few years and it has attracted most of the free-seeking crowd. B&N has always had a less price-sensitive crowd. If you don’t believe me, think about it for yourself – Everyone knows Amazon has cheaper ebook prices. What does that say about people who choose Nook? That they are probably less sensitive to price.
How on Earth are the figures so similar for Kindle Store and Nook Store?
What’s uncanny is how close the figures are –
- Kindle Store has 55 books below $5 in the Top 100 while Nook Store has 56.
- Kindle Store has 24 books below $2 in the Top 100 while Nook Store has 25.
- This might just be a coincidence or it might mean that the two top ebook stores are seeing the exact same trends. That they are evolving in the exact same manner as far as the value perception of books and the price of bestselling books are concerned.
I really don’t know what to say.
It’s quite stunning that 25% of the Top 100 are $2 or below. It’s even more stunning that 55% of the Top 100 are $5 or below.
We’ve talked about how books might settle in the $3 to $7 range in the long-term. Well, the change is already happening. Furthermore, the prices seem to be shifting to two bands – Below $2, between $3 and $5.
Are we going to continue to see ebook prices drop in the Top 100 Lists?
My assumption would be – Yes, definitely.
- There are obviously two price bands that are gaining traction. The first is $2.99 to $5. This is already 25% of the Top 100. The second is $1 to $2. This is also 25% of the Top 100.
- The first possibility is that we reach an equilibrium with both bands present. 30% to 40% of the Top 100 will be books in the $2.99 to $5 range. Another 35% to 45% will be in the $1 to $2 range.
- The second possibility is that we keep seeing a drop in prices and stabilize only in the $1 to $2 range. Imagine that – a world where 80% of the books in the Top 100 are $1 or $2. For $100 to $200 you could buy all 100 books in the Top 100 Bestsellers List.
- The third possibility is that the stores try extreme measures. B&N has tried to hide prices of Books in the Top 100 in the past (this is on the Top 100 List). Amazon does algorithm manipulations and handicaps cheap books. I doubt these will work – you can take a horse to the water but it might just kick you if you try to force it to drink.
- 55% of books below $5 means a lot of the change has already happened. This isn’t a blip or a temporary thing. It’s obvious that something big is going on. Something so big the stores are powerless to stop it (trust me, they have tried and are still trying).
The more you think about it, the more it seems that an irreversible change is taking place.
An unstoppable wave driving ebook prices to $1 and $2?
Everything I have seen and read over the past 5 and a half years is screaming to me that the end point is going to be a world where 80% of the books in the Top 100 are at $1 or $2.
Because there is infinite competition.
The world we’ve been sold is a world manufactured by Publishers and Booksellers. That there are a select few authors who are worth reading and their books are worth $10 to $25. After that there is a massive and steep fall. All the other authors aren’t even worth reading. So say Publishers.
- What if instead of a cliff there is a slope? What if the Authors who just missed the cut with Publishers are only 5% worse? What if there are thousands of such authors – good enough to be read and willing to sell their books for $1 and $2?
- What if instead of a cliff there is a slope rising upwards? What if Publishers are terrible at picking winners and the Authors who missed the cut completely are actually better? What if there are tens of thousands of such authors – better than Published Authors and willing to sell their books for $1 or even give them away for free?
- What if there are an infinite number of authors and the separation between them is miniscule? What if Publishers are picking up only a fraction of the best ones?
My assertion would be that all three of these lines of thinking are true. Publishers are missing most of the best authors, the separation between authors is miniscule, and there are a very large number of authors who are good enough to be read. Far larger than what Publishers or Published Authors would have us believe.
The second myth is the polish and magic and fairy dust that Publishers supply.
- What if giving an author artistic freedom is worth more than Publisher spit and polish?
- What if authors writing what is in their hearts is worth more than what Publishers think will sell?
- What if Publishers are just chasing profits and not publishing the best books?
Publishers fail more than they succeed. Publishers often miss absolutely great authors. Publishers often make a hash of things.
It’s a crazy assumption that there would not be great books without Publishers. Even if it isn’t crazy, it’s still an assumption.
If the only people making this assertion are Publishers, their stable of Published Authors, and their partner stores and distributors – then we have to wonder what the truth is.
Free Market + Infinite Competition = Prices Fall to Zero or the Lowest Amount Possible
With the walls between authors and readers down to imaginary ‘Stores’ run by Amazon and B&N. With readers able to buy ebooks from anywhere. With anyone able to distribute and sell ebooks. We are rapidly moving towards a world of Books that is a Free Market.
Authors can sell to any Reader. Readers can buy from anywhere.
That’s the first part of the equation – A Free Market.
The second part is the ever-increasing number of books and authors that are worth reading.
With a near infinite supply of authors. With an ever-increasing number of good indie authors. With ever more carelessly published Publisher ebooks. With ever larger number of published authors going solo. We are rapidly approaching a world where there are a very large number of good authors – with very little to separate them.
That’s the second part of the equation – Infinite Competition.
If Author A is 93/100 and Author B is 94/100, guess who wins? The one who goes from $9.99 to $7.99. Except these are ebooks – Author B cuts prices, then Author A cuts prices more. Then this continues until they both hit $1.
Note: If Author A and Author B strike up a chat and agree to stick with $7.99, then Author C and D cut prices and steal sales.
Prices keep getting cut until we reach $1 and $2 and just can’t go any lower. Of course, some authors will go for free too. The vampire hunger to be read is not to be underestimated.
Free Market + Infinite Competition = Prices Fall to $1 and $2 (or worse, they fall to $0).
That’s the thought I’ll leave you with. 55% of the Top 100 Bestselling Books being below $5 and 25% of the Top 100 Books being below $2 are a sign of things to come. This isn’t equilibrium – this is the beginning of a wave. The end point is a world where either $1 and $2 books rule, or where $0 books rule.