Joe Konrath uploaded an interesting post on his blog a few days ago. He argues that an author should concentrate on developing his fans but not his readers. He reasons that fans are more likely to spend extra because they like the author (that's what separates them from readers). I disagree with him somewhat.
Mr. Konrath thinks that indie authors shouldn't price their ebooks too low because it would leave money on the table. I agree; he's right on this one. Ideally I'd like to see the authors I read get paid enough that they can do this for a living. But then he goes one to suggest that an author should price his books much higher because fans will buy them. I disagree here.
As I see it, the difference between a fan and a reader is that a fan will spend extra (like pay to see you at an event). But a reader will still buy the authors books. I know something about readers and ebooks that he doesn't, and it affects how an author sets prices.
I am a fan of several authors, but I am a _reader_ of a couple dozen. Let me tell you something: when I find a author I like to read, I will often go out and buy the author's complete backlist as ebooks and put them in my TBR pile. But I will _not_ pay fan level prices. If the book has been out for any length of time I will not pay more than $6 or so. It's only anecdotal, but I know several other people who buy their ebooks the same way.
But Mr. Konrath and I are mostly in agreement on prices. I check the Kindle Store, and all of his ebooks are in my price range.
BTW, you generally have 1 chance to get my money. If nothing is available or if it costs too much I will not buy. But the good news is that you have the chance to sell me your entire backlist.