There are several factors in play that formed a foundation for the psychological price-point barrier. First, of course, was Amazon’s setting of $9.99 as the ideal price point for New York Times bestsellers. Here the interesting phenomenon to me was not that Amazon set a price point but that it became the adopted price point — the psychological barrier against which all other prices would be/are compared — of ebookers, virtually without challenge. Why didn’t ebookers say, for example, ”No, not $9.99. It must be $7.99!” or some other number? Amazon announced it and it became the magic number. Perhaps we ebookers are really part of the herd and not part of the herders. Something to think about for another day.
Second, is the difficulty ebookers have in accepting/believing any claim that ebooks can legitimately be priced higher than the paperback version and certainly, under no circumstance, as high or higher than the hardcover version of the book. eBookers believe with all their heart and soul that ebooks should be priced no higher than the paperback version and preferably lower. No amount of argument will budge most ebookers from that price point or from the belief that the savings reaped by publishers by going digital are “huge,” not “nominal.”
A third factor is the new version of the direct from author-to-reader model of publishing — self-publishing – which is a modification/modernization of the original self-publishing model of just 5 or so years ago.
All of these, and other factors, too, contribute to the psychological price-point barrier that currently barricades eBookville, preventing it from becoming a paradise. Yet, there is another factor that is less prominent in our thinking about the price-point barrier, but is, I think, quite potent: the ephemeral nature of ebooks.
Consider this: I recently purchased two hardcover books without thinking twice about the cost. I saw them on the shelves at my local Barnes & Noble. They stood out not only because of their subject matter but because of their size. The two books are A Lethal Obsession by Robert S. Wistrich (which comes in at 1200 pages and a list price of $40) and Christianity: The First Three Thousand Years by Diarmaid MacCulloch (which comes in at 1161 pages and a list price of $45).
Think of the heft of books that size; the spine widths must be 2 inches and the weights more than 2 pounds. The pricing with discounts at B&N were $28.80 and $32.40, respectively (with Amazon being a couple of dollars cheaper) for the hardcover versions. I bought them without blinking an eye over the price.
But I would have blinked, blinked again, and ultimately not bought either of them as ebooks because of the price (B&N: $32 and $29.99, respectively; Amazon: $23.19 and $29.99, respectively), which is higher than the established psychological price-point barrier. The difference is that with the hardcovers I can subconsciously correlate mass with value, even though I know that with books there really is no such correlation, but with ebooks it is hard to imagine the value of bits and bytes — they are ephemeral. Even DVDs and CDs give you some mass in exchange for the price, so the price-point barrier is less powerful, but ebooks give you nothing — nothing to hold, nothing to see, nothing to weigh, nothing to correlate with value.
And this nothingness is a significant barrier to price acceptance by ebookers, even if only subconsciously.
When I talk to fellow ebookers, we all seem to agree that there is a sliding price comfort scale for ebooks that we do not notice with physical product purchases, even when the physical product is something as little as a DVD or CD in substance terms. We note that we have no hesitation whatsoever with ebooks priced up to $1.99; we give half a blink’s hesitation to books at the $2.99 level; a full blink at $3.99; and things start going downhill rapidly at the $4.99 mark. By the time we get to the $12.99 mark, we are not only doing multiple rapid blinks but we are struggling to find any reason whatsoever to justify making the purchase and almost never do. For several of us, we no longer even consider any ebook priced above $7.99 and will only consider ebooks priced $4.99 to $7.99 on rare occasions.
It appears that Amazon did its job too well when it set the psychological price point at $9.99 and the publishers did their job too poorly combatting it (and ebookers didn’t do their job at all when they acquiesced to Amazon’s price point with hardly a whisper in opposition).
It is hard to overcome that psychological price-point barrier when all I receive is air (bits and bytes) in exchange for money. I understand the advantages to just having air, but that is the rational part of the buyer in me. Unfortunately for the ebook industry, it is the irrational part of me, the part that wants to see some physicality, some sense of ownership, some something in exchange for the price — just air just won’t do.
The questions are this: Will this psychological price-point barrier fade to history as ebooks continue to grow market share or will it become a more signifcant barrier in the future? Will the low-price expectation negatively impact authors and publishers in such a way that quality is sacrificed by the authors and publishers because of the imbalance between cost of production and sales price? Both questions are worth pondering.
reposted with permission from An American Editor