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Canadian Ebook Pricing 2014

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The Canadian ebook marketplace is a few years old, so just how are publishers approaching the question of pricing? In many different ways, it turns out. Instead of best practices, publishers are …

The Canadian ebook marketplace is a few years old, so just how are publishers approaching the question of pricing? In many different ways, it turns out. Instead of best practices, publishers are learning to adapt their pricing strategies to channels and markets.

In this presentation, you'll learn about price differences between the retail and library channels, emerging business models and their effect on prices, and how Canadian-owned publishers are pricing their ebooks.

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  • 1. Ebook Pricing
  • 2. Some Context
  • 3. United States • ebooks accounted for 30% of all book sales in the first half of 2013 (Bowker) • In the US, adult fiction and non-fiction eBook sales increased by 13.6% in 2013 (AAP) • Sales of children’s ebooks decreased by 30.1% (AAP) • In 2012, ebooks outsold mass market (BISG) • Overall, the US ebook market grew by 5% in 2013 (AAP)
  • 4. Canada • 58% of people who had read at least one book last year had read a book in ebook format (BookNet 2014) • 20% of book-buyers bought one or more ebooks in 2013, up from 18% in 2012 (Canadian Book Consumer 2014) • In 2012, ebooks accounted for 17% of book purchases in Canada (BookNet, 2014)
  • 5. BookNet: The State of Digital Publishing in Canada 2014 Ebook Sales Channels
  • 6. BookNet: The State of Digital Publishing in Canada 2014 Ebook Revenue
  • 7. Pricing
  • 8. No Standard • There is no ‘standard’ or ‘best practice’ • 49% of Canadian publishers are using a Direct Pricing model and 28% are using an Agency model (Booknet 2014)
  • 9. United States New York Times Bestsellers Lists 14-Apr-14 Fiction Suggested list price Print price Kindle price The King J.R.Ward 32.95 16.47 hc 15.99 I've Got You Under My Skin Mary Higgins Clark 32.50 19.50 hc 16.99 The Fixed Trilogy Laurelin Page 0.99 Shadow Spell Nora Roberts 33.04 9.50 pb 10.99 Missing You Harlan Coben 32.95 16.47 hc 15.99 Non-Fiction Print price Kindle price Flash Boys Michael Lewis 32.95 19.00 hc 12.90 Heaven is for Real Todd Burpo 18.99 13.68 pb 8.74 Upstairs at the White House J.B. West & Mary Lynn Kotz 1.99 10% Happier Dan Harris 31.99 20.05 hc 16.99 Thrive Arianna Huffington 31.00 15.50 hc 14.99
  • 10. “At the end of January, the average price of a best-selling ebook was $5.36, just $0.99 off an all-time low, recorded in December 2013. Since then, it’s been steadily ticking up.… In just two months, the average price has increased more than $2.00, or a 40% rise. After weeks of slowly ticking up, … the average price of a best-selling ebook jumped this week to $7.49.” DBW Daily, March 12, 2014
  • 11. Globe & Mail Bestseller Lists 12-Apr-14 Suggested list price Print price Kindle price Kobo price Flash Boys Michael Lewis 32.95 19.00 hc 12.90 16.99 An Astronaut's Guide to Life on Earth Chris Hadfield 32.00 16.00 hc 14.99 14.99 Shadow Spell Nora Roberts 19.00 9.50 pb 10.99 10.99 I've Got You Under My Skin Mary Higgins Clark 32.50 19.50 hc 16.99 16.99 The Orenda Joseph Boyden 32.00 16.00 hc 14.99 14.99 Canada
  • 12. 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% All formats Paperback Hardcover Ebook Format $0 $1-5 $6-10 $11-15 $16-20 $21-25 $26-30 $31-35 $36+ BookNet Canada, 2014 Price Paid by Format in 2013
  • 13. 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% Q1 Q2 Q3 Q4 $0 $1-5 $6-10 $11-15 $16-20 $21-25 $26-30 $31-35 $36+ BookNet Canada, 2014 Ebook Purchase Price Distribution
  • 14. BookNet Canada, 2014 Average Ebook Prices Ebooks 2012 2013 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Average Price Paid (including $0 books) 8.02 6.85 6.69 6.30 6.36 6.27 6.86 8.29 Average Price Paid (excluding $0 books) 12.60 10.66 11.38 11.77 11.69 11.32 11.59 12.72
  • 15. An Age of Experimen ts
  • 16. Different Retail Models • Direct-to-Consumer (D2C) • Bundling • Subscription • (Series, Author cards, BitLit)
  • 17. Direct to Consumer • Verso just launched a D2C site a with a goal of £200,000 in sales by year end. • To “juice” sales, they offered a 50% discount on titles. • After 1 week of going public, they had achieved £80,000 in sales. DBW Daily, April 14, 2014
  • 18. Bundling • Only 15% of Canadian publishers offer e & print bundles for a fee • 20% of buyers would chose a bundled book if it was available • 12% would pay more for it Canadian Book Consumer Study 2012, BookNet
  • 19. Subscription
  • 20. Series, Author Cards, etc. • Return of serials • Offering the first title in a series for free or greatly reduced price to attract readers • Author cards • Value adds
  • 21. Libraries & Ebooks
  • 22. BookNet: The State of Digital Publishing in Canada 2014 Library Distribution
  • 23. Harper Collins 26 checkouts per copy purchased Instituted February 2011 Print retail: $34.99 Print library: $20.29 Ebook retail: $16.98 Ebook library: $28.84 Average price = $14.08
  • 24. Random House 1 copy / 1 user in perpetuity but triple retail Instituted March 2012 Print retail: $32.00 Print library: $19.84 Ebook retail: $14.99 Ebook library: $85.00 Average price = $60.23
  • 25. Hachette 1 copy / 1 user in perpetuity mark-up varies, but some triple retail pulled July 2010, back with new pricing May 2013 Print retail: $28.00 Print library: $16.24 Ebook retail: $11.99 Ebook library: $77.29 Average price = $40.42
  • 26. Macmillan Backlist 52 checkouts over 2 years prices close to quadruple retail 1 imprint August 2013, more October 2013 Print retail: $16.99 Print library: $10.19 Ebook retail: $10.99 Ebook library: $40.00 Average price = $40.42
  • 27. Cuyahoga County Library System acquired “some 300 ebook copies of Fifty Shades of Grey for nearly $24,000 last year.” DBW Daily, April 15, 2014.
  • 28. Quebec Model • Library prices for ebooks are the same as retail • 55 checkouts per copy purchased • Libraries purchase ebooks through bookstores and the bookstores take a percentage on every sale as does the distributor
  • 29. eBOUND Publishers • Of 67 eBOUND publishers, 46 have set a “library” price in CoreSource • Of those 46 publishers,19 set a hgher price for libraries

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