The cost of creation

Natasha McNeely triggered a lengthy tangent in my mind; one I’ve been considering rather in-depth for a long time, and moreso in the last few days as I truly begin to weigh my options in publishing. Natasha talks about e-book prices, and her take on appropriate cost.

Firstly, you all get a disclaimer: this is just my thoughts, from a personally inexperienced perspective, yet with the backing of a whole lot of research and sense of pride in storytelling. There. Now, onto my rambling.

There’s nothing wrong with the $0.99 price point. There are valid reasons for using it, including drawing in new readers, and letting people get a relatively risk-free taste of your work. After all, isn’t it exceptionally easy to justify dropping a dollar on an e-book, just to see if you like the writer’s style? I know I’ve done it.

However, there is a catch. Many, in fact.

As I outlined to my husband when we were setting up his freelance illustrator rates, you need a wide scope for what the client, or consumer, is actually paying for. When you are an artist, whether through images or words, you have years of experience and learning behind you. The buyer is purchasing a quality product because you have a decade or more practice put into your craft. By asking for a fair price, you are giving value to the sheer amount of dedication necessary to perfect your art.

Then there are subtle overheads. The tools required to produce your product. A computer, with peripherals and software; a desk, pens, paper. Electricity, an internet connection, and a workspace. Even if you had all of these things before you started writing, using the home computer in your lounge room, they are still business costs. You could not offer an e-book without paying for those things at some point.

There are also literal costs in producing and marketing a finished e-book. You might get lucky and not have to pay for all of them, or you might go all-out and use most of the following (and more): cover art, editing, formatting, uploading/account fees, advertising including business cards or other little handouts like bookmarks (which require design and printing), a dedicated website, the list goes on.

After all that, the writing itself must have value. It must. You did not spend a year or longer writing this one specific book, to see no returns on your personal effort. Now, that’s not to say value is inherent in money (quite the opposite), but this is an important element to consider when offering your e-book for under a dollar.

I believe an e-book novella deserves to cost up to $5.00, with novel-length works going anything up to $15.00. I’ve been happy to pay $15.00 for an e-book I especially wanted, and will probably do so again. I also believe the lure of a cheap first book should come when you already have a backlog of work available; that way, readers can buy more of your writing while it’s still fresh in their mind. Will they remember to come back in a few months time, even if they liked their $0.99 purchase?

Just as a new author releasing a paperback will not sell their first book for less than its worth, as a book, as a complicated, dedicated creation, independent writers most certainly shouldn’t be expected to sell their e-books at a devaluing rate.



12 thoughts on “The cost of creation

  1. A thoughtful post, as always.

    I will say that I have limits to what I consider acceptable for ebooks. I don’t mind paying up to $10, but I start getting a little iffy around that price. Ebooks are not as permanent as physical books. They’re generally locked into their readers, and there’s always the possibility that if the site you purchased from goes down, there’s no way to pick up the book again. Five to seven dollars for an ebook is a great range, and I wouldn’t mind if some of my favorite authors raised the prices of their books a little!

    Another thing that an old boss of mine has made me think about is the idea of “training.” Selling a novel for $1 sets up a certain expectation, and when the price is raised after sitting at super-cheap for a while, old readers will complain. I’ve heard this from other authors. It works the other way too. Someone on twitter complained a few weeks ago that every self-published book she picks up ends up going free. That made her think that she should just wait for any book she wanted to get because at some point they’d drop the price or make it free.

    1. I suppose I really should’ve mentioned that all prices are in Australian dollars, which instantly means I’m both used to paying more, and am almost universally charged more. Your $10 limit would be the general equivalent to my $15. 🙂

      Those are really great points, and I agree completely about price variations. A clearly listed “introductory price” would be one thing, but people often do feel punished for their purchase if the cost changes later.


    2. I agree with what Nina said about “training.” Even large physical stores have to account for this. For example, if you buy a TV for $500 and the next week it goes on sale for $400, lots of stores will let you bring in your receipt and give you that difference. (They are able to do this because A: It makes people less afraid to make the purchase at risk of missing out on a better deal, and B: Most people will never bother watching the prices and coming back in, so they don’t actually lose much money.) I think readers are used to this treatment in other venues and feel cheated when Ebooks work differently. Based on that concept, it seems that the best thing to do would be to set it the book at the final price you want it at. And if you really want to have a low-sale period, it should be at the release, to boost initial sales, with a very clearly-stated end time for that special price. That’s my vote, anyway. Not that I’ve ever sold an Ebook. =)

      1. Time sensitive discounts are definitely tricky business to juggle. On one hand, people often think, “Oh, it’s on sale, I should get it now”. Of course, as you say, others then feel cheated. I’m with you on deciding a good price and sticking with it. 🙂


  2. When it comes to pricing, you have the advantage of experience. Although the actual values are different, I’m sure the Dragon’s Hoard has helped you develop your instincts in these regards. Which is exactly why I’m going to make darn sure I heed your words when the day comes for me. 🙂

    1. I definitely appreciate the sentiment, Al. 😀

      With The Dragon’s Hoard, I have the advantage of my work and components being easily broken down into base cost and hours applied. The pricing from that point is really simple to calculate, even covering expenditures like web hosting. Writing is some kind of maddening, unaccountable force. How many total hours go into making a book? Thousands? How much can you even think to charge per hour? Impossible to determine. How much per word, then? That would depend on projected sales, so you could split your expected income over copies sold.

      If you were looking to make $0.02 per word (a very low generalised payment for writing articles for magazines), on a 60,000 word book, that’s $1,200 for the total story. You would then want 400 sales for a $3 book, ONLY to account for writing itself, and none of the other overheads mentioned. That’s doable. That’s a decent range to look at. That’s why a $0.99 book is undervaluing the work.

      I guess, if nothing else, I’ve got a good starting point for the business side of self-pub. XD


  3. Wow, great post, Ashlee. You put aside all the hipe and took a really good, cool-headed look at cost/profits.

    I don’t own an e-reader, and won’t buy any ebooks, however they are priced. But I know many who do own one, and someday I may get one, when the price drops to $25 or so. (But then I will probably just use it to download classics, and other free books.)

    Many ebooks have sample chapters, and after reading them I didn’t want to buy the book. I would have a difficult time finding books by authors I haven’t heard of already that I wished to actually buy. It’s exhausting looking through them all! And I would have a REALLY hard time pricing the book I’ve been sweating over for 2.5 years for only 99 cents.

    One of the costs you mentioned (bookmarks) would only be used by someone who was self publishing in printed form, wouldn’t it? I adore bookmarks and love to get them ‘free’ with a purchased book. But it’s not really a cost consideration for an author publishing an ebook, is it? Or would you still use them promotionally?

    I think your price of around $3 or $4 is more realistic, for a good e-book, in terms of allowing the author to make a living from sales. It’s interesting to watch what’s happening with publishing. I wonder where it will all end?

    Really good post.

    1. Thanks, Cynthia!

      Until I got my e-reader, I basically never bought e-books. I can’t read them on my computer without getting hugely distracted, so if I hadn’t already planned on getting one, I would be in the same position as you! Luckily, various e-readers will be coming down in price as the market continues to expand (including new manufacturers bringing in budget lines), so you will get a chance to delve in. 🙂

      I agree, and it’s something I haven’t touched on at all – self-publishing, as a rule, allows books to be released before they are as good as they could be. That means a LOT of writing which doesn’t meet the standards we are used to from traditional publishing houses. Sample chapters are essential (we all flip through physical books before we buy a new author), but they also prove where the story is in terms of true completion.

      Yes, I would still use bookmarks or similar printed material to market an e-book, because I like them and think it’s better to have something larger than just a business card, and bookmarks are still associated with reading novels (heaven help us the day that changes!). It needs to be more than just an advertisement, though. A bookmark should be attractive and memorable for its own sake (makes people want to keep it, you know?). But I need to note, I would also never sell solely e-books; I think the cost of printing is worth it for the millions of potential readers who are still reading on paper.

      On one hand, an established author can afford to charge more per book, but on the other hand, why not keep it low enough that you’re still making money on each sale and remain in the impulse-buy range? 😀


  4. Great post and subsequent comments! There’s enough information laid out to keep my head spinning on this topic for weeks. I really like the point you ended on in response to Cynthia above: why not keep the cost of an e-book low enough for impulse purchases but not too low that you don’t make money on each sale.

    I’ve had my Kindle for over a year now, and I still don’t view the books at .99 as worthy of an impulse buy (most look really cheesy [I never realized I was such a cover snob]), but—go figure—somehow, the 2.99-4.99 range leads me to believe they will be better quality. Am I a sucker for marketing, or what? Anything higher than 9.99 for best sellers is too expensive for me. I prefer reading hard copy books, so even if it’s my favorite author, I won’t buy their e-book b/c I’d rather put the money towards a hard copy.

    It’s *very* interesting to read your breakdown of the cost that actually goes into e-books. You’ve opened my mind a little bit, so thanks. 🙂 Unfortunately, my comment is a bunch of mumbled thought tangents, but I appreciate your entire post. You’ve given me much to ponder.

    1. Thanks, Barb!

      There’s a great deal of psychology about pricing, and how that impacts our impression of a product. Most people will be influenced on the perceived quality based around paying more or less (even for the exact same item). In that regard, if you buy one e-book for $0.99, and another e-book for $2.99, you are more likely to read the three dollar book because you have already received the impress that it’s more valuable and more worth your time to read it. Whereas the dollar book can be relegated to the “read later” pile, and sometimes even put off indefinitely. Because you didn’t invest as much money in it, you don’t perceive not reading it as a significant waste – certain activities, even ones we love, are often spurred by a guilt complex (“I better read it, I spent money on it”).

      I’m really pleased you’ve gotten something out of this post and discussion! I’ve noticed that a lot of self-publishers don’t go into detail about their own production costs; fair enough, no one likes talking personal money. But maybe they don’t view the whole as clearly, either. It’s probably a subject which needs more discussion. 🙂


  5. Ashlee–I’m a fairly new blog visitor, so forgive me if I’ve missed this info somewhere. But is your book already self-published? And, if so, only in an e-version?

    I hesitate on commenting more until I know that.


    1. Nope, the only writing work I have published are magazine articles and my short story in an upcoming anthology, Sherry. All other fiction to this point is unreleased. Hence my disclaimer that I’m pretty inexperienced, since I haven’t put any of this theory into practice yet. This is all just my impression based on general business logic and years of research and peripheral involvement in the publishing industry.

      Of course, the biggest problem is in this kind of venture, no one theory will work universally, and there’s no surefire way to tell what will succeed for each individual!


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