There’s an interesting thought I’ve had bouncing around my head for over a month now, and all the more lately as a result of several other articles and blogs I’ve read that unknowingly touched on the topic in a way, but … how do we value an e-book?
I find that it’s an interesting question with a lot of variety in what I would suppose would be answers … though technically, these are supposed based on what other people online have stated and said about ebooks. But I still find it an interesting thought: what value are we placing on our ebooks?
I ask because as a whole, it appears that to most, the answer is “little.” Most commentary I’ve seen from online, or been the recipient of, is that an ebook is inherently of little value by nature of being an ebook. While a hardcover or a paperback copy of something such as The Wheel of Time is generally seen as holding an intrinsic value, the ebook of the same will often be derided as “overpriced” or “too expensive,” even though the ebook is already slightly cheaper.
Now, I’m not going to get into the whole debate of “But an ebook should be so much cheaper because it’s not physical” because that particular point has been trounced so thoroughly by authors and industry professionals much better than I that it’s no longer a dead horse, but rather a meaty, ground-up paste that was once a dead horse on the floor. There’s no point in discussing that. The majority cost of the physical aspect of a book has not been the actual tangible costs in a long time. It’s time, editing, marketing, etc. Just like a restaurant is not so much the cost of the ingredients as it is the time and preparation skill. So, if you were already planning a comment discussing that, don’t. You might as well be arguing that jet fuel can’t melt steel beams.
Back to the topic at hand, considering the idea that customers aren’t holding an ebook to be of similar value, I find this a fascinating conundrum to consider: Why does the public hold this view? It’s an odd, strange view to take, in light of the rest of society’s embracing of the digital. But in ebooks, there’s this strange idea that an ebook does not have value. In fact a few weeks ago I encountered one poor, confused soul who declared that since ebooks tended to pay an author a higher royalty, the prices of an ebook should be adjusted to compensate, and then volunteered their own numbers (pulled out of a sunless place) to declare that ebooks should cost no more than 10% of the cost of a physical book because that was fair compensation.
Obviously, this is laughable. And I and a few others did have a good laugh about it later at LTUE, because that’s again one of those arguments that doesn’t understand it’s beating a dead horse. But the point remains, and this is what I haven’t stopped wondering about over the last few months … Why? Why is it that a public that seems to have the understanding of “I’m paying for content” with so many other products doesn’t get this with books at all?
Because, let’s face it, in other market areas where space is shared by digital and physical, there’s not a huge assortment of people crying for reduced prices. You don’t see articles from music sites talking about how MP3 downloads are worthless and shouldn’t cost more than ten cents. You don’t see game review sites asking how dare Steam or Origin have a digital game on launch day cost the same as its physical compatriots.
So why in the book industry is this such a problem? Why is it that a person will look at a digital MP3 download from their favorite artist and buy it without a second of remorse, but then look at a digital book from their favorite author and send them an angry message about how that ebook shouldn’t be more than a dollar?
I don’t actually have an answer to this question. All I have are theories based on what I’m reading and hearing from other people around the internet. Maybe you’ll agree with some of these, maybe you won’t. But all of these are things I’ve heard expressed in one way or another.
1- We value the material the book is printed on, its physicality, more than we do the actual book.
Let’s face it, the true content of a book is the words inside of it, but more and more whatever those words are seems to matter less and less to buyers. For whatever reason. I’ve seen posts from people online saying that it’s not about the story, it’s about the stuff it’s printed on.
I find this one curious. Yes, there is a certain tangible luxury to creasing pages in my hand and feeling the spine of a book creak a little when I open it. But … I’m not valuing that experience above the words contained within the pages. As often as I’ve seen this point brought up and made an emphasis, I can only imagine that there’s a whole host of “readers” out there who’re sitting around in a circle passing a book around, each taking turns cracking the spine, ruffling the pages, and taking deep sniffs of that new-book scent with their eyes rolling back. And at that point … well, you might as well buy a cookbook. After all, if the words in the pages aren’t as important as what it’s printed on, who cares what you’re buying, right? Just go to the clearance bin at Barnes & Noble and have a blast.
On a more serious note, however, I think that part of the blame for this movement comes from the book publishers themselves, most of whom have historically not been very enthusiastic about ebooks (mostly because a lot of them were caught completely off-guard and have been on a back foot ever since). A lot of publishers have been very vocal about “the push for real books.” Heck, in the past month I’ve seen multiple “studies” or publicity posts on r/books from big publishing houses discussing how the public is en mass turning away from ebooks and embracing the physical book once more.
Now, I might believe that more if I didn’t see the exact same type of article every few months from them while book sales across the board don’t show any signs of this supposed “development.” That, and the same articles showing up again and again with slightly different wording bears far to much similarity to other industries where the once-leaders are behind the curve and trying to catch up.
But in a way, I can’t help but wonder if it’s working, if, in a manner somewhat akin to the music industry and their newfound love of Vinyl records (they’re hip), these articles are fueling a mentality among readers that “ebooks are not valuable because the story isn’t valuable. Only the printed pages are valuable.” Of course, this is easily reinforced by a sub-observation that …
1A- Physical books have physical difficulties that imply value to their purchasers.
Yes, this much is true. While the story inside the pages remains the same, the trick with an ebook is that it’s hard to compete with an observation of value when looking at one. A physical book? Well, for one, you can pick it up and feel the weight of it, which, to most people, does imply a value. But you can also flip through it, jostle it, check a few pages, see how long it is.
You know what’s interesting? We can do all these things with an ebook. You can flip through it and read a sample. You can see how many pages there are. You can even check reviews—something you can’t do at a bookstore.
And yet … people don’t value that either. And why? Because it’s easy. It’s fast.
Think about it. To examine a digital book, all you need to do is open its Amazon page. Click. Boom, that’s done. You only need to click once to open a sample and browse through it. You can see the number of pages right there, check reviews … it’s all easy.
And, oddly enough, that’s part of the problem, I think. We equate easy with “low value.” If you buy a book from a bookstore, you have to drive/walk/take transit to the store itself, you have to browse the shelves, you have to pick up the book, carry it to the register … All these things give the book physical weight. A real-world presence that causes you to give it value because you exerted effort in just acquiring it. Even if you order it, there’s a period of shipping and then a tangible thrill when you tear open the box.
Ebooks have none of that. We’ve made it easy, oh so easy, to get your hands on our stories. Ebooks can be bought an downloaded, ready to read, in seconds, from anywhere with a cell signal.
And because of that, people are taking them for granted. Because it’s so easy to acquire, readers think that in turn, it must be just as easy to create … even if it’s the exact same book they’d happily pay $15 for a hard copy of. And so, people are asking that a price represent what they’ve perceived to be a low cost … even though no such low cost exists.
2- There’s a race to the bottom
There’s another thing that’s not helping the image of ebooks that I’ve noticed, and that’s loss-leading.
Basically, the idea behind loss-leading is simple. You have a product that cost X amount of dollars to produce and market, but you sell it for less than X and eat the loss, hoping to make your money back on related products before the losses made by selling X eat you alive. It’s a risky, risky proposition in business, because with each sale of a product you are losing money in the hopes that you’ll make it back in the long run.
Take the Xbox-360 video game console for example. When Microsoft launched the 360, they did so eating heavy losses on each one sold, because the cost of just the parts alone that went into it was far above what the machine actually cost, to say nothing of the millions upon millions of development cost they’d sunk into the machine. Every console they sold, even at launch prices, was done at a loss of, IIRC, around $400 a machine … and that was just in parts.
The goal was, however, to get the public entranced with their machine. The gamble was that if they could sell enough machines, they’d start making money back through game sales and other materials not sold at a loss related to the product, that they would eventually make up for that loss. And eventually, they did. The hardware got cheaper, and after four or five years, Microsoft turned a profit.
Of course, for every company that succeeds at this … there’s a bevy of skeletons left on the road that couldn’t turn a loss lead strategy into an actual lead.
Now, what does this have to do with ebooks? Well, right now, one of the things impacting the price of ebooks is a “race to the bottom,” buoyed by the belief that a loss-lead will at some point turn into a profit. This is why so many ebooks come out at $3.99, $2.99, or even $0.99. There’s a pressure from authors (especially competing ones) that any book over $4.99 isn’t worth the money, that it’s too expensive. Every book has to be below that magic price point. And readers, seeing prices dropping like rocks, are buying into it.
The problem? It’s a loss-leader scenario. Ebook authors drive their prices rock bottom, and in return their profits bottom out. The return becomes minimal, the loss too great. Because despite all the claims to the contrary, real life economics are not a textbook, and the person who says “It’s science that if you halve your price, you’ll sell three times as many books and make more money” most likely still won’t buy your book, and doesn’t realize that a mathematical formula for economics is called an economic theory for a reason.
Right, so ebook prices are being driven down … and then what happens? Authors aren’t getting the return they’d hoped for since prices are so low … so the solution is to cut the amount of work they do. Hence, now we’re seeing ebooks for $2.99, $3.99, and even $4.99 that are below that “magic” price point so many push for … but are also much shorter to compensate. They “cheap” price point is still shouted, but where before authors were trying to write 300-page plus novels … now they’re churning out 100 page and less novellas priced at the “low” price of $3.99 (I’ve even found some selling thirteen page stories for $2.99 and doing pretty well).
But then eventually that whiplashes back to the reader, who comes in to buy an ebook and gets an e-novellete for the same price, and is disappointed. They don’t leave a review (studies suggest that love it or hate it, by percentage around 1 in a 1000 readers leave a review). They just stop buying ebooks as often, or, burned, view them with far more suspicion because so many ebooks are driving for the same price, and yet they don’t seem to be delivering.
The loss-leading with ebooks? If you’re going to write one ebook and want to make back what you spent on it ten years down the line, and aren’t worried at all about the financial risk (ie, your book is not paying bills, it’s just a little bonus here and there), a loss-lead can be a good way to build buzz, but at the current rate and the low prices involved … it can be a long time before you’ve paid off the cost of the book.
A story for you, a true one: A long time ago, when the BiC pen was first introduced, they floundered. Sales were abyssal. No one wanted their product. And the CEO of the newly-founded BiC just couldn’t get it. They’d done demos, they’d given away samples, they had salesmen pushing their new pen as hard as they could, and despite the fact that they were a far better choice than their competitors (they were marketing, after all, the first real pens against ink-wells) … they weren’t selling at all. So they hired a consultant.
The problem the consultant found? They’d ruined their image by selling the pens at far too low a cost. The CEO of BiC and his sales team had decided to sell low to appeal to customers, but the problem was, the consultant explained, that people do not associate low costs with a desirable, quality product, but with something cheap and undesirable. The solution? BiC raised it’s prices to over five times what they had been asking, and above their competitors.
The result? They crushed their competitors. BiC pens flew off the shelves and became a household product … because the price implied a value.
The rush to the low price point? On my list as hurting ebooks. I’ve seen numerous new authors talking about selling at a loss so that they can entice a reader to buy their book over one from a big publisher. But all that says to a consumer, subconsciously, is “This book is clearly not as good as the one produced by this big publisher, because the seller doesn’t believe it is.”
Do we need to be following BiC and raising our prices above big publishers? Of course not, and a lot of us agree that those prices are, in many cases, too high.
But racing to the bottom, to sell a book of the length and depth of a ten-dollar bestseller for two … that only hurts the public perception of ebooks, and the one selling.
One last note. Regardless of what I’ve written above on this point, there will be those who claim that a book must be cheaper to sell better because of supply and demand curves. The truth is, however, that what all those people seem to be missing (likely because they never took an economics class of any kind) is that those graphs, the real ones, have horizontal lines on them for each product they’re discussing that show the actual point at which that graph stops being applicable. There is a low point and a high point. Dropping a book a dollar does not automatically triple sales. In fact, below or above that line, sales will stay the same or worse, decrease.
Ebooks, it appears, have long since dropped below that bottom line.
3- The entitled reader
There’s one last thing that I’ve noticed quite a bit more in the last few months, though they’ve always been there, that’s driving the value of ebooks down.
The entitled reader.
Authors out there know what one I’m talking about. The reader that believes they have a right to read your material, and that they in turn should need to pay as little as possible for it.
This is, I think, in part driven by the mistaken belief that the physicality of a book is what amounts to 90% of a book’s cost, but the end result is the same: these are people that loudly crow to anyone who’ll listen that books should be as cheap as possible. Three dollars. Two. Ninety-nine cents. Free.
Crud, one such believer outright told me that authors shouldn’t count on being paid, nor should they be writing a book to make money. They should write a story for people to enjoy, and that enjoyment should be all they expect to get from it, and asking to be paid was just rude. I’ve been told this more than one time by different people.
Now, when put out in a spotlight like that, I think most would agree that this is ridiculous. Authors don’t magically acquire cash with which to pay rent and buy food, nor should their form of entertainment be given away for free while others are sold.
But the issue I see here is that the gist of what these “readers” (because let’s be clear, they’re never actually going to buy many books, if any at all) spout reinforces others into thinking “Well hey, maybe six bucks is too much.” And then, without really being sure why, you have a reader that suddenly agrees that three dollars is a far more “fair” value for this book they really loved … even if they happily paid fifteen for it when it came out.
It’s a toxic ideology, that readers have the “right” to read an author’s books and be entertained by them, but an author is a fool to ask for compensation. Yet I run across it at least once or twice a month online, upvoted on Reddit, in blog comments, or just in chat or writing conversations. And I have no doubt it’s hurting the value of ebooks for authors everywhere. And I’m sure it feeds right into ebook piracy, something so massive and profitable for the pirates that even my lesser-known books are pirated less than 24 hours from release.
Do I even need to expound upon this further? If there is insufficient material recompense for writing books, well, guess what. There will be no more books. Authors are not swimming in golden swimming pools or relaxing on a beach with models. Most of us are spending 8-10 hours a day at a keyboard, working, just like everyone else, to try and make rent, food, etc, and maybe work out ways up to a little luxury in life. Most of us are also working extra jobs on top of that because right now … we aren’t making that rent, food, etc.
Ultimately, if you’re looking for an answer to all of this … I don’t have one. I don’t even have a solution. All I see is a problem, one that seems to be growing. We’re not valuing the arts enough, I think we’d agree, but inside that already limited, cracking sphere, ebooks seem to be getting the short end of the stick.
And for something that is likely going to be the next MP3 analogue … that’s not good. I believe we need to change this mindset, to get people to stop placing the value of a book on the paper it’s printed on rather than the story contained in those pages. To find ways to show the value of an ebook. To stop badgering authors to loss-lead and drive their prices lower than is possible or profitable. And to speak up when someone defends their piracy by saying “Well, the author should just be glad I read it, free publicity” or claims that authors should just be writing for “the joy of the audience” rather than expectations that they be paid.
The trick is, of course, actually getting that to happen. But one thing’s for sure, we can’t keep going the way we are and expect things to stay sunny. Everything has a value, and at some point, we need to decide what that value is going to be.
Thoughts? Comments? Ideas? Post ’em below.