[Ed.: Commenters have noted how hard it can be to get a handle on the current state of ebook sales from the shifting and volatile information available to us. Beginning today, Digital Book World will offer weekly reports from Dan Lubart’s eBook MarketView, which aim to help us see what stories the actual data has to tell. Using a proprietary market analysis tool, Dan pairs publicly available data from multiple ebook retailer bestseller lists with analysis and visual presentation to help publishers identify and understand emerging patterns.]
The publishing industry has been debating the value of ebooks and how ebook prices affect sales for quite some time, but much of this debate is framed using anecdotal evidence from a limited pool of high-profile authors. Looking at actual price points of bestsellers at the largest ebook retailer since the start of 2011, we can glean that very low cost ebooks are gaining market share – but so are the highest priced ebooks.
Over the past five months, the Kindle bestseller list showed a significant shift toward the highest and lowest prices—premium titles (over $10) and super-discounted titles (under $3). As seen in the graph below, this was intensified by Random House’s March 1st move to the agency model and its subsequent re-pricing of titles to $12.99 from $9.99. In theory, the super-discounted titles draw the price-sensitive buyer in high numbers, while the remaining segment (those for whom sub-$3 ebooks are not a consideration) are gravitating to the other end, picking up the premium-priced books without a problem. Not much left for the middle ground, in other words.
But this past week has seen a bit of a reversal. Premium titles are still strong, but those super-discounted titles are weakening overall from a late-March peak. The number of titles under $3 on the Kindle Bestseller list is down from a high of more than 40 to around 30 over the past 30 days. This is still up from an observed low of 17 titles on December 26. Some of the movement was into the discount price band ($3 to $7.99), but the big loser continues to be the once-strong value band of $8 to $9.99. The next few weeks may see the high and low price bands battling it out, but there seems to be little place left at the top of the bestseller lists for $9.99 – once considered the gold standard in ebook pricing.
Dan Lubart is the principal at Iobyte Solutions, an IT strategy firm with a specialty in publishing and entertainment media. Iobyte’s eBook MarketView tool enables publishers, authors, agents and others to study the dynamics of the ebook retail marketplace in various ways. Dan blogs at eBook Market View.