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Russ Grandinetti: Consumers Spend More on eBooks After Joining Kindle Unlimited

Russ-Photo[1]The highlight of the second day of the DBW conference would have to be Russ Grandinetti, the Amazon VP of Kindle Content.

Grandinetti didn’t share a lot of solid details during the half hour interview, but he did speculate that Amazon might consider different pricing models for different types of ebooks (fiction vs nonfiction, for example). He also dropped a few nuggets which raise serious questions about the accuracy and validity of recent news about Kindle Unlimited and its impact on ebook sales.

According to my notes, Grandinetti said that it is still too early to draw any conclusions about Kindle Unlimited, but that Amazon had noticed a few trends.

So far, it has been a net positive on ebook sales. Far from buying fewer ebooks after joining (as some had feared), new KU subscribers devoted around 30% to 40% more time reading after joining KU and spent 25% more on ebooks in the first 60 days after joining (compared to the 60 days prior to joining).

He noted that sales of titles in KDP Select were also up. (In the opinion of this blogger, that is probably due to KU loans giving a boost to sales rankings.) Retention rate for KDP Select was around 95% for the past 5 months, and that the combined earnings (loans plus sales) of titles in KDP Select in the last 5 months of 2014 were "double, more than double" what they were in the same period in 2013.

And FYI: I bumped into Len Edgerley of The Kindle Chronicles in the press room, and he lent me his audio recording so I could confirm the details above.

I may have been one of the first to suggest that possibility a month and a half ago, but as I pointed out the following week there was also a chance that the reports of declining revenues were simply market fluctuations or possibly a sign of cyclical behavior repeating on an annual cycle.

It is frankly too early to say.

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Juli Monroe January 14, 2015 um 3:10 pm

Although I was blaming KU for my sales decline last year, when I stepped back and thought about it logically, I realized there had to be another reason. My sales dropped in all countries, including the UK and DE before KU had debuted in those countries. Obviously KU hadn’t been a factor in those drops.

Something else was happening late last summer and fall, and it coincided with the rollout of KU.

anothername January 14, 2015 um 3:37 pm

Consumers spend more money using KU, but who gets what proportion of the money?

Rob Siders January 14, 2015 um 5:07 pm

Would seem dependent on the terms under which the publisher and Amazon have agreed, yes?

Daniel Vian January 14, 2015 um 6:24 pm

Considering only KU self-published books (KDP), an ebook selling at $5.99 has been producing an author royalty of more than 23 percent from KU borrows and 70 percent from sales in KDP outside KU. If an ebook sells at $2.99, the author KU royalty per borrow is 47 percent. For non-KDP ebooks, the payout to authors is determined by the author/publisher contract and the publisher/Amazon contract and is usually about 30 percent or less of the retail price of the book. Authors who think Amazon is squeezing authors dry are wrong.

Felipe Adan Lerma January 15, 2015 um 8:13 am

Nice reporting, Nate, thanks! Interesting details (even if general) coming out from the conference it seems. I myself, am definitely doing better since my 3rd mth in KU (December.)

Nate Hoffelder January 15, 2015 um 9:05 am


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