Tag Archives: Amazon

Amazon’s Bookstore

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It’s somewhat ironic that Amazon helped drive many independent bookstores out of business, and now Amazon is starting to open their own bookstores in Seattle, San Diego, and soon Portland. The big difference between an ordinary bookstore and an Amazon bookstore is that an Amazon bookstore is meant more to introduce you to the Amazon ecosystem rather than just to sell you a book.

Walk into a Barnes & Noble and compare it to an Amazon bookstore and you’ll see the difference right away. A Barnes & Noble bookstore overwhelms you with a huge variety of books to give you the most options of finding what you want. Anything from woodworking and gardening to quantum physics and accounting, you can probably find a book about that topic in most ordinary bookstores.

However, step into an Amazon bookstore and you’ll see a much more limited variety. Instead of trying to bombard you with as many book choices as possible, an Amazon bookstore just gives you a limited selection of the most popular books in that particular area, based on Amazon’s data from its online store.

So not only will you get a much more limited selection of books, but you’ll also see short reviews of each book on the shelf. As you can see in the picture above, an Amazon bookstore may have fewer titles available, but they tend to have at least five copies of each title along with a brief review of each book for anyone to browse.

So an ordinary bookstore overwhelms you with choices and it’s up to you to find what you want. An Amazon bookstore offers far fewer books, but provides multiple copies of each along with a short review to help you understand why that particular book is highlighted.

It’s hard to say which approach is better, the traditional bookstore model or the Amazon bookstore model. When a traditional bookstore, you can easily get lost wandering the aisles and finding books you might never have heard about before. With an Amazon bookstore, you’re getting a curated choice of books on different topics, but with far less depth and variety.

Think of an Amazon bookstore as a curated experience where a knowledgeable librarian has selected the most popular books on a given topic that you’re likely to enjoy. From a business point of view, the Amazon bookstore model is superior because it means less inventory to stock and books more likely to sell on any given topic. Despite fewer choices, the Amazon bookstore is better suited for fast browsing vs. the traditional bookstore that’s better suited for in depth research.

Amazon plans to open a bookstore in Portland soon so we can see if Amazon bookstores will start to appear around the rest of the country. You probably can’t spend much time in an Amazon bookstore because of the limited selection, but you still may find something of interest because the store is designed to promote a handful of titles instead of an avalanche of titles.

Curiously, Amazon’s bookstores sells books for retail price, so if you find something you like, it may actually be cheaper to buy it online. If you’re an Amazon Prime member (and pay for that privilege), then you can purchase books at the usual discounted price.

Since traditional bookstores like Barnes & Noble keep struggling with high lease costs and declining book sales, it’s likely that the Amazon bookstore model is the wave of the future. Amazon’s bookstores aren’t meant to sell you products as much as it’s meant to get you to buy something from Amazon, preferably online.

Unlike traditional bookstores, Amazon’s bookstores don’t need to make money selling books if they can drive people to buying books online or through Kindle. Whether you like it or not, the future of bookstores is increasingly looking like Amazon.

Amazon’s Brick and Mortar Stores

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Amazon recently opened a brick and mortar bookstore in Seattle and may even open another brick and mortar bookstore in San Diego. After decimating bookstore chains like Borders Books and Barnes & Noble, you have to wonder why Amazon would want to open their own brick and mortar bookstores.

The main idea is to provide a services that online book selling can’t offer such as offering author events and a place to pick up or return books conveniently. After decades of selling books online, Amazon has a history of which books are most popular in which areas of the country. By opening brick and mortar stores, Amazon can exploit their knowledge of popular books by stocking their brick and mortar stores only with books most likely to sell in that particular region.

In comparison, other bookstores often just cram books on a shelf and hope for the best because they don’t know which books a particular region finds most popular. Since Amazon does know this data, they can theoretically sell only the books people are most likely going to buy. Even better, Amazon’s brick and mortar stores plan to offer prices identical to their online site, which means you can buy books with the convenience of browsing them ahead of time.

In comparison, most people visit a Barnes & Noble, find a book they want, and then buy that book for much less on Amazon. Yet a certain percentage of these people may play to buy the book online from Amazon but fail to do so for any number of reasons. That represents lost sales. So if Amazon’s brick and mortar stores can capture sales immediately, they might be able to sell enough books to pay the expense of a retail store.

Most likely Amazon is testing the retail market to see if stocking stores with high selling books will be profitable. If so, then they’ll simply move into neighborhoods armed with data on which books will likely sell best while other bookstores simply guess. Even with their lower prices, Amazon might be able to pay the expenses of retail they can sell books fast enough.

It’s still an experiment so don’t expect Amazon to open a bookstore near you any time soon. In the meantime, watch Barnes & Noble stock their shelves with more toys and games, vinyl records, and gifts to make up for the fact that they can’t sell enough books. Then watch their book shelfs offer fewer and fewer books of any given category because Barnes & Noble has no idea which books might sell best.

While Amazon is testing the market for brick and mortar bookstores using statistics to guide them, Barnes & Noble is still clinging to their old model of stuffing shelves with books and hoping for the best.

Good luck to both of them. Given the odds, it’s likely only one brick and mortar store will survive and its name won’t be Barnes & Noble.

To read more about Amazon’s experiment with brick and mortar stores, click here.

 

Following the Leader with Amazon

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If you’re going to self-publish your books whether they’re fiction or nonfiction, you need to be where the people are. Right now, that means the two most important places to self-publish your work is through Amazon’s Kindle and Amazon’s print-on-demand service called CreateSpace.

Both services are absolutely free to use since Amazon only makes money by taking a cut each time you make a sale. If you never make a sale, you’ll never pay Amazon a cent. Since Amazon has roughly 110 million users, there’s a huge chance someone will find your self-published book and buy it.

Of course, just throwing your book on Amazon’s Kindle or CreateSpace isn’t enough. Because so many people use Amazon, it’s easy for your self-published book to get completely lost in the crowd. For that reason, some people think there’s an advantage in pursuing other markets like Nook and Kobo as well.

The huge problem with the Nook is that it’s dying. Nook tablet sales are declining and Barnes & Noble (the people behind the Nook) are struggling. That means fewer people are even looking at Nook e-books, which means fewer chances someone will buy your book.

Because Barnes & Noble runs Nook, there are almost as many books on Nook as there are on Kindle, which means you’re still lost in the crowd with your one or two self-published books, but now you’re competing in a much smaller market. So you get all of the disadvantages of Amazon with none of the advantages.

That doesn’t mean ignore the Nook completely. Just be aware that the Nook has little future so make sure you put your self-published books on Amazon’s Kindle and CreateSpace first. Only after you have targeted the largest market should you even consider the Nook. Putting your book on the Nook won’t hurt since it’s also free, but don’t expect to make a huge amount of money from Nooks ales compared to Kindle or CreateSpace sales.

Kobo is even worse. Kobo attracts an even smaller number of people while still containing nearly as many books as Amazon and Nook. So you’re facing fewer people while competing against all the other existing books on the market. The advantage of less competition on the Nook and Kobo rarely translates into greater sales.

So if you’re going to self-publish your books, start with Kindle and CreateSpace. If you stop there, you’ll probably make 99% of your income right there.

Only after you have gotten your books on Kindle and CreateSpace should you even bother with Nook and Kobo. Both are relatively easy to set up, and once you’ve formatted your book for Kindle, you can use that exact same file to submit it to Nook and Kobo. Just don’t expect much from Nook or Kobo. The money and the market is in Amazon’s Kindle and CreateSpace.

Focus on Kindle and CreateSpace. Then make sure you promote your books because just tossing them on Amazon is no guarantee that anyone will see them. It’s possible to write the best books in the world and have them get lost on Amazon if nobody knows they exist.

Putting your books on Kindle and CreateSpace is just the first step. The second step is to keep promoting your books through blogs, social networks, and anything else you can think of. Your books won’t sell themselves. You have to sell them whether they’re on Kindle, Nook, or Kobo.

The real secret isn’t finding the biggest market (it’s Amazon) and hoping for the beset. The real secret is putting your books on Amazon and then making that extra and continuous effort to keep promoting them day after day for the rest of your life.

The key is putting your book where most people can find them (Amazon) and then marketing them like crazy all by yourself. Skip this second step and your books will likely sink into obscurity. Focus on marketing and your books will sell whether they’re on Kindle, Nook, or Kobo.

Why You Want to Read E-Books

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Book lovers can never get enough books. Yet the cost of printed books keeps going up so rather than buy expensive books, many people visit their local library instead. For those who want to read books inexpensively or even free, the best option is to use a service like BookBub.

The basic idea behind BookBub is that you give them your email and specify which types of books you like such as horror, romance, or mysteries, and BookBub send you an email periodically notifying you of e-books on sale through Amazon, Nook, iBooks, or Kobo that match your criteria and have lowered their prices temporarily even down to free. Then you can purchase or download the lower priced books on to your smartphone, tablet, or computer.

By using BookBub and e-books, you can stock up on a lifetime of books inexpensively or even absolutely free. You just have to get used to reading books on a computer screen of some kind, but that’s a small trade off for getting as many books as you want on a variety of topics that interest you.

Authors lower prices of their e-books temporarily just to promote them. Novelists with several books often discount or give away one of their books to grab readers who will likely buy the other books in the series. Book lovers can simply take advantage of these deals and fill up their computers with as many e-books as they wish.

Now if you load a smartphone or tablet with e-books, you’ll never be at a loss for reading material wherever you go. Best of all, it won’t cost you much or anything at all to do this. If you’re a true book lover, e-books give you a way to read inexpensively for the rest of your life.

To learn more about BookBub, click here.

The Dying Computer Book Market

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At one time I used to make most of my income through printed books. Back then, companies like Microsoft updated their software every few years, which meant you could write a book on Microsoft Office 2000 and have it sell for several years before you’d need to update it for another version. For authors who wrote about Windows XP, they had several years before they needed to update their books. In the meantime, they collected royalties each year.

Nowadays software gets updated rapidly, often yearly in the case of OS X and iOS. Books on Windows 8 were obsolete about a year later and needed to be updated for Windows 8.1. In the meantime, sales of Windows 8 books were dismal because the world no longer needs to rely exclusively on Windows. Even worse for computer books, in the old days people needed books to find information about software problems. Today, you can just search for answers to common software problems using Google or your favorite search engine. That means computer books are not only obsolete, but they often don’t sell enough before they need to be updated once more.

That ultimately means computer books, in printed form, are a dying breed because they can’t adapt fast enough and their shelf life is too short to make much of a profit. Ultimately, computer books are more successful as web pages and video tutorials than printed instructions that go out of date so rapidly. Just browse through any library shelf to look at computer books covering topics like Office 2000 or Turbo Pascal. Most likely few people will bother checking out such obsolete computer books, yet they take up valuable shelf space.

If computer books are dying, what’s next? Harlequin romance novels sell mostly in e-book form because romance novels are throwaway books that people read once and never bother reading again. So there’s no need to waste paper printing them. That’s why Harlequin romance novels are selling in better as e-books because it’s profitable for the publisher and convenient for the reader. Readers can also comfortable read e-books on their smartphones or tablets without advertising what they’re reading from the lurid romance covers that depict muscle bound men without their shirts on clinging to beautiful women.

If you look at all types of books, you’ll see that very few have a reason to appear in printed form. People still appreciate printed copies of books, but there’s less and less of a reason for most books to appear on paper any more. People want printed books out of convenience, not necessity.

Bookstores are still popular but Borders Books is gone for good and Barnes & Nobles is never going to do anything more than struggle to stay alive. There’s no growth in the book retailing business, even though Amazon recently plans to open a bookstore in Seattle.

Books will always remain popular just as horses are still popular. It’s just that horses aren’t used for everyday travel any more and tomorrow, printed books won’t be used for everyday reading either. Printed books aren’t going away completely, but they will fade away into irrelevance, and the trend will only continue to increase over time.

What Killed Traditional Publishers

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A long time ago in the good old days, publishers served two purposes. One, publishers offered editing services to turn rough manuscripts into polished books. Two, publishers offered a distribution network that could get a book into bookstores all over the world.

Unfortunately, both purposes are no longer the monopoly of traditional publishers any more. To cut costs, many publishers have laid off editors, who now work on a freelance basis. That means you can hire some of the best editors to polish your manuscript without going through a traditional publisher.

Second, books are no longer distributed exclusively through bookstores. Now you can by printed books over the Internet (mostly through Amazon) or buy e-books over the Internet (again mostly through Amazon).

Without editing services or distribution networks, traditional publishers have pretty much lost their entire reason for existing.

As an author, you can take control of your work and get it published and distributed without a traditional publisher. Just get a freelance editor, sell your book as an e-book or print-on-demand book through Amazon/CreateSpace (owned by Amazon) and you have all the benefits of traditional publishers while keeping the lion’s share of the profits as well (which is not possible with traditional publishers).

This is the reason why traditional publishers are obsolete with nowhere to go but down. Traditional publishers are simply not needed any more. That’s bad news for traditional publishers, but good news for authors since there’s no longer a gatekeeper to pass through to get your work to the public.

For authors, this is liberating and scary. Without a traditional publisher to help you out (and take most of the profits), you have to learn how to market your own books. For some authors, this isn’t a problem, but for many who just want to write, this new world of self-publishing represents more of a hassle. Yet it’s unavoidable.

Even today’s traditional publishers have cut back on their marketing budget so authors still need to promote their own books. If you don’t promote your own books, nobody else (not even a traditional publisher) will do it for you unless you’re a famous author like Stephen King or J.K. Rowling. For the majority of authors, self-marketing is the new way of publishing whether you like it or not.

So embrace the freedom of today’s world of self-publishing. It’s scary, it’s more work, but in exchange it gives you more freedom and flexibility. If you’re interested in writing a book, there’s nothing stopping you from doing it. Now you have no more excuses, and that could be the scariest thought of all.

The Book is Out of Its Cover

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The Financial Times recently published an article about the future of books. The article initially focuses on Amazon’s latest decision to pay authors per page someone reads of their books in a book subscription service. That way the more pages someone reads of a book, the more you get paid. That will encourage people to write more page turners and likely shorter fiction as well.

What’s more interesting is how the article says that the book has escaped its covers, which means books will no longer be limited by the physical constraints of paper. Instead, tomorrow’s books will include audio, video, interactivity, and changing text. Once you remove the linear, physical restriction of a printed book, tomorrow’s books will be free to incorporate practically anything. The real question is how?

Just as novelists learned that readers liked to read long manuscripts divided into chapters, so will tomorrow’s authors eventually learn how readers want to accept audio, video, and interactivity in tomorrow’s books. Most likely no one will want useless audio, video, and interactivity cluttering up a book, but how they will want this extra media added remains to be seen. The real question isn’t whether this will happen but when. For authors, this also means experimenting with multimedia today to get experience putting it into your books for tomorrow.

The multimedia book of tomorrow won’t resemble today’s printed books any more than a Maserati resembles a horse and buggy. The future of tomorrow’s books remains exciting and different, but it will still be a way for authors to impart information to readers. Non-fiction will likely adopt audio, video, and interactivity, but fiction may find these unnecessary in much the same way that adult books don’t need the added touch and play factors of children’s books that let children touch items in a book or slide items around to watch them move or pop out of the pages.

The book is definitely out of the cover. The only question is how will you take advantage of the inevitable?

The Strategy of E-Book Pricing

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With most e-book distributors like Amazon, Nook, and iBookstore, you get 65% – 70% of the profits if you price your e-book within a certain range such as 99 cents up to $9.99. At a higher price than $9.99, you get much less royalties such as only 35%. That means you either need to price your e-book at $9.99 (to earn a 70% royalty rate through Amazon and earn roughly $7) or price it near $24 to make the same amount ($7 with a 30% royalty rate). Obviously if you price your e-book at $24, you’ll see fewer sales than if you price it at $9.99. That’s Amazon’s way of keeping e-book prices fairly low.

Most people immediately assume if they sell their e-book at 99 cents (instead of at a higher price), they’ll make more money. Wrong. You have to consider people’s mindset about prices and the type of e-books you’re selling.

With fiction, most people have no idea who you are or what type of novel you’re selling as an e-book. As a result, fiction e-books tend to succeed far more at a lower price point such s $1.99 or 99 cents. This makes a fiction e-book a disposable item. If someone buys it and doesn’t like it, they didn’t lose much. That increases the odds someone will actually buy your novel as an e-book.

The trick with e-books is that you probably won’t make money on a single e-book. Instead, you’ll make money selling a series of related e-books. For non-fiction, that means selling multiple e-books on the same subject such as improving your golf swing, finding the best golf courses to visit, and stories about unusual and humorous golf stories. Even though each e-book might be different, they all appeal to someone who likes golf.

What happens if you sell e-books that have no relation to each other? You might sell a golf swing improvement book, a gardening book, and a build your own computer book. How many people interested in golf will also be interested in gardening and building a computer? Close to none, which means you can’t sell those other e-books to people who already like your first e-book.

That secret of writing related e-books also works with fiction as well. John Locke, the author of “How I Sold 1 Million eBooks in 5 Months” outlines his strategy of writing a series of related books with recurring characters. Now if someone likes one of his novels, they’ll be likely to want and buy the other novels in the series. Each book in the series acts like a wider net to attract new customers. Some people will likely read one of his books and not like it, but many others will like one of his novels so they’ll be more inclined to buy his other ones.

That’s basically how he sold 1 million e-books in five months.  That simple strategy of selling a series of related e-books is the whole secret. Of course you still need to write good books whether you’re writing fiction or non-fiction, but the content quality alone is far less important than being just average and having a series of related e-books that happy customers can buy.

Remember, the hardest part about selling e-books is making that first sale because customers have no idea who you are or what you can offer them.; The moment they like one of your e-books, that barrier disappears and they’ll be far more likely to buy your other e-books.

So with fiction, you want your prices low enough to make it easy for people to experiment and take a chance buying your e-book. With non-fiction, the quality of your writing is less important. What’s more important is the quality of your topic.

Write a weight loss e-book and anyone interested in losing weight will be a potential customer for your e-book. Since non-fiction already tells the potential customer what the e-book contains, there’s not the same level of risk when buying an unknown author’s novels.

Surprisingly with non-fiction, a price too low is a warning that the information inside may not be any good. That’s why non-fiction e-books can typically charge more than fiction e-books, such as $4.99 and up. Try starting at $9.99 and experiment with dropping your prices temporarily to see if sales increase. Remember, each time you drop the price, you must make up for the price drop with increased sales. If a lower price doesn’t translate into increased sales, you’re better off keeping the price up.

With non-fiction, higher prices indicate quality whether that’s true or not. You don’t want to price your non-fiction e-book too low, but you also don’t want to price yourself out of the market. That’s why for non-fiction e-books, $9.99 is a good starting point and then you can experiment with lower prices later to see if it attracts more sales. Surprisingly, lower prices often do not attract more sales, so you’ll be better off keeping the price at $9.99 or slightly less to get the maximum royalty rate and earn the most amount in royalties in return.

Pricing e-books is less about making a killing on one e-book and more about getting people to buy it in the first place. For fiction, low prices lower the risk to the customer. For non-fiction, higher prices are more attractive since it hints at higher quality. Since every author and topic is different, experiment, but keep these general guidelines in mind. for fiction, keep prices low. For non-fiction, keep prices high.

Israeli Law to Boost Book Sales Kills Them Instead

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To give authors a living wage, Israel recently passed a law preventing book stores from discounting new books. The idea was to keep new book prices artificially high so authors could earn higher royalties. As usual, what the government tries to do, they tend to screw things up and that’s exactly what happened to book sales in Israel. Instead of giving authors more money, the higher price of books simply drove people away from buying books at all. That means lower book sales and less income for authors.

This backwards law that boomeranged on authors is just one more clue that authors can’t rely on making money the old fashion way of selling books through traditional publishers any more. The real money comes from self-publishing because now you can experiment with different prices until you find the right price range for your particular types of books.

Some people think that 99 cents is the magic price range, but that’s not always true. Offer too low of a price and you may see sales fall because people think 99 cents means the book is cheap. Yet if you raise your price too high, you’ll eventually drive away price-conscious buyers.

For fiction, cheap prices are good because it encourages people to experiment with new authors and essentially dispose of books after they’re done reading them. For reference and non-fiction books, a higher price is usually justified to convince customers that the information is valuable so it’s worth paying for.

So there is no magic price range for everyone. You have to experiment with different prices until you find what works best for you. Remember, selling 10 books at 99 cents is pointless ($7 profit) if you could sell just one book at $9.99 (also a $7 profit). Lowering prices doesn’t always mean people will flock to buy your book. Likewise, raising prices doesn’t mean people will buy it either.

What definitely won’t work is to put your fate (and income) int he hands of traditional publishers who are reacting to the whims of the market place that they no longer have any control over. At one time the huge advantage of traditional publishers was their massive distribution network. Nowadays, that distribution network is basically Amazon, and anyone can sell books though Amazon as a self-published author, so where’s the advantage of traditional publishers any more?

Beyond the name recognition and the ego boost of seeing a printed book in a store, authors aren’t seeing much cash from traditional publishing book deals and they likely won’t see more in the future. As traditional publishers cut costs to stay afloat, self-publishing is becoming more viable from both a practical and financial point of view. The old world of traditional publishers is gone for good. You probably won’t make much money selling books through traditional publishers so you might as well try self-publishing. You may find you can reach more people than ever before faster and more profitably than going through a traditional publisher.

Three Cases for Self-Publishing

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There’s a comprehensive essay about self-publishing called The 7k Report. This report tries to track the e-book and self-publishing markets and contains lots of information, but some of the most useful tidbits are that mysteries/thrillers, science fiction/fantasy, and romance are three of the hot fiction genres for e-book/self-publishing. In general, genre fiction will be easier to market because there’s already a built-in market for those types of stories. Anyone interested in spy novels will automatically be interested in your spy novel. However, if you just write a story about a boy or girl growing up and coming of age, that may be a little tougher to market initially. You could have the best coming of age novel, but it’s still harder to attract an audience.

Perhaps the most important bit of information from the 7k Report is its conclusions about self-publishing. Generally if you’re a writer, your manuscript probably falls into one of three categories:

  • Awful
  • Average
  • Excellent

If you have an awful book, no traditional publisher will want to publish it so you’re better off self-publishing. Whether you make any money or not is irrelevant because you most likely won’t get a traditional book contract anyway, so you might as well self-publish and get the joy of seeing your work on the market, whether anyone buys it or not.

If your book is average, then there’s a chance no traditional publisher will print it. Even if they do, there’s a large chance that it won’t make money and will go out of print. Once a book goes out of print, it’s essentially gone forever. However, if you self-publish it, then you can continue selling your book forever. You may only make a little money, but at least your book will still be available and you can publish (or self-publish) additional books on the same topic and built up a library of similar books you can sell to the public. Now each additional book on the same topic or genre helps sell the other books and you’ll gradually increase your income. Once again, self-publishing is preferable for average books because you’ll make more money in the long run and have control of your manuscript.

If your book is excellent, you may still be better off self-publishing because you can get the lion’s share of the profits and most publishers won’t do much promoting of your book anyway until it proves profitable for them. So even if your book is excellent, you’ll still need to promote it yourself so you might as well get most of the profits. Traditional publishers pay 10% of the profits while self-publishing earns you 70% of the profits.

Theoretically, traditional publishers should earn you more because of their greater distribution, but with bookstores dying and Amazon basically being the biggest book distributor in the world that’s available to publishers and self-publishers alike, the distribution advantage of traditional publishers is gone.

If your book is excellent, you’ll attract a large following through self-publishing and then traditional publishers will come calling because they want to market a proven winner. Now that your self-published book has proven to be a winner, you’ll be in a much stronger bargaining position with traditional publishers. “Fifty Shades of Grey” and “Still Alice” were both self-published books that were later snapped up by traditional publishers. You can be certain that the authors got a much better deal with the traditional publisher after they self-published first.

So no matter what the quality of your book, self-publishing offers more advantages than going with a traditional publishers. Eventually you may wonder why bother with traditional publishers, and that’s exactly why so many of them are in trouble.

Unless your book contract says otherwise, a traditional publisher gets all the rights to your book and if it goes out of print, you won’t have control of it any more. Self-publishing gives you many advantages over traditional publishers. While it might be flattering to your ego to get a traditional publishing contract, it might not be financially best for you, so consider self-publishing. It’s pretty much the future of publishing so you might as well go with the future instead of sticking to the past.

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