Expert publishing blog opinions are solely those of the blogger and not necessarily endorsed by DBW.
At Digital Book World Conference + Expo next week, I will be on stage with Dan Lubart, senior vice president of sales analytics at HarperCollins and principal at Iobyte Solutions, the data provider for the Digital Book World Ebook Best-Seller list from which the insights below are derived. We’ll be sharing more insights on what’s happening right now with ebook pricing and ebook sales.
The average price of a top-25 ebook best-seller has plummeted in the past several months, dropping from a high of $11.37 in last Oct. to $8.23 this week (see chart below).
Since gaining control of the power to discount titles from some of the largest publishers, Amazon, Barnes & Noble and others have been dropping the prices of best-selling titles from $14.99 and $12.99 to points much lower — sometimes to below $5.
A good example is last week’s No. 1 best-selling ebook, Safe Haven by Nicholas Sparks (Hachette). It was discounted by its retailers to $3.99 on Dec. 20 after several graduated discounts throughout the fall that saw its price decrease from $9.99, the last price its publisher set. It had been priced at $12.99 when it was new in late 2010 and early 2011.
Another good example is the No. 7 best-selling ebook last week, The Forgotten by David Baldacci (Hachette). It was discounted last week to $9.20 after being priced at $11.04 for most of Dec. The last time its publisher set its price it was $12.99.
In the four-and-a-half months since we started tracking ebook best-sellers and their prices, there has been fairly wide fluctuation in the average price of a best-seller — more than $3 between the high and the low over that period. Because our list is only 25 titles long, a $0.99 book hitting the list or a higher-priced title dropping off can have a marked effect on the average. For instance, when the $29.99 Fifty Shades of Grey bundle dropped off the list in early Oct., the average price dropped nearly $1.
Despite the small sample size, the trend is clear: prices for the most popular ebooks are decreasing. And, no wonder, as publishers like Simon & Schuster and Hachette often publish most of the books found on our list and retailers have only recently gained the ability to discount their books. Other publishers were already being discounted by retailers and most self-published titles found on our list are at comparatively low prices. Even Macmillan, which did not settle with the Department of Justice over the matter of ebook price fixing, has signed new contracts with its retailers, allowing limited discounting.
Soon, Penguin and, if their merger is approved and consummated, Random House will join the ranks of publishers subject to ebook discounting, which will likely help lower the average price of an ebook on our list further.
In the next nine months or so, the year for the beginning of ebook discounting for HarperCollins, Hachette and Simon & Schuster will end. At that time, retailers will likely be scrambling to make sure that they haven’t broken the terms of their new agreements with publishers by losing money on their complete book of business with them (read: over-discounting). Which retailers will have the ability to continue discounting books at that time and by how much? Depending on the answer to that question, we may see ebook prices rise temporarily. Until then, it’s hard to predict that ebook prices will rise again any time soon.
At Digital Book World Conference + Expo next week, I will be on stage with Dan Lubart, senior vice president of sales analytics at HarperCollins and principal at Iobyte Solutions, the data provider for the Digital Book World Ebook Best-Seller list from which the insights above are derived. We’ll be sharing more insights on what’s happening right now with ebook pricing and ebook sales.