Hello,

We noticed you're browsing in private or incognito mode.

To continue reading this article, please exit incognito mode or log in.

Not an Insider? Subscribe now for unlimited access to online articles.

Christopher Mims

A View from Christopher Mims

The Second-Best-Selling Book in America Costs $0.99

Ebook sales now determine whether a title cracks the bestseller list. With a pricing model pioneered by apps.

  • February 25, 2011

The second best-selling book in America, a thriller by Lisa Gardner called Alone, was first published in hardback in 2005, when it cost $25. Now you can pick it up for just $0.99–but only as an ebook. And its ebook sales are the sole reason it is now topping bestseller lists.

Ebook sales now have the power to drive a title to the top of the bestseller list all by themselves

There are a few things going on here that are notable:

1. Lisa Gardner’s latest thriller hits shelves on March 8, so it’s clear that her publisher decided to release this older title at a steep discount in order to generate buzz around this author.

2. Books, like other media, are suddenly being priced like apps. This has far-reaching implications for how all media will be priced in the future, and could indicate a race to the bottom as consumers become increasingly unwilling to pay a premium for new titles when classics come cheap.

Anyone who pays attention to Apple’s App store has seen this tactic before: game developers regularly discount older titles to $0.99 in hopes of climbing the charts – the idea is that they make up on volume what they lose on each sale, because a buck is the magic price point at which impulse buys occur. Plus, getting onto the most-downloaded list, whether you’re selling an app or a book, generates enormous amounts of additional sales.

According to Pamela Paul (mp3 - podcast), the newly-installed children’s book editor at the New York Times Book Review, the average fiction bestseller nets between 50 and 60 percent of its sales in ebook form. Nonfiction readers are a little less progressive in their tastes, and sales of nonfiction bestsellers are usually 30-40% from ebooks.

Compare the pricing of Alone to Donald Rumsfeld’s memoir, currently #1 on the non-fiction bestseller list, and you begin to get an idea of how surreal the pricing of Alone (or perhaps of Known and Unknown) really is: The ebook version of door-stopper book costs $19.99, which is actually more than the discounted version of the hardback.

What this points out are three themes that will be increasingly important to how books and other media are sold: the first is that publishers are going to start selling more and more back-list titles at discounted prices in order to capture a market that is otherwise unavailable to them – think of it as the market currently occupied by the used books that will cease to exist once the world is full of ebooks with their DRM.

The second theme is that bestseller lists and the frictionless purchasing experience of ebook readers will encourage publishers to game bestseller lists just as app developers game their equivalent on the app store. Maybe you’ve heard about how that’s working out for game devs: by most accounts it’s led to a deflationary price spiral and a race to the bottom.

The final thing worth noting is that the current pricing scheme for ephemeral media–ebooks, iPad magazines, etc.–is due for a correction. With successes like this, even major publishers are going to find it too tempting to juice sales by discounting titles. As consumers seek out more affordable media, prices will go down.

We can expect this process to be repeated again and again for anything sold in this fashion. But perhaps that’s irrelevant: aside from books, I can’t think of anything else that is still priced the way it was before the advent of the Internet.

Follow Mims on Twitter or contact him via email.

Couldn't make it to EmTech Next to meet experts in AI, Robotics and the Economy?

Go behind the scenes and check out our video
Want more award-winning journalism? Subscribe to Insider Plus.
  • Insider Plus {! insider.prices.plus !}*

    {! insider.display.menuOptionsLabel !}

    Everything included in Insider Basic, plus the digital magazine, extensive archive, ad-free web experience, and discounts to partner offerings and MIT Technology Review events.

    See details+

    Print + Digital Magazine (6 bi-monthly issues)

    Unlimited online access including all articles, multimedia, and more

    The Download newsletter with top tech stories delivered daily to your inbox

    Technology Review PDF magazine archive, including articles, images, and covers dating back to 1899

    10% Discount to MIT Technology Review events and MIT Press

    Ad-free website experience

/3
You've read of three free articles this month. for unlimited online access. You've read of three free articles this month. for unlimited online access. This is your last free article this month. for unlimited online access. You've read all your free articles this month. for unlimited online access. You've read of three free articles this month. for more, or for unlimited online access. for two more free articles, or for unlimited online access.