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Friday, February 22, 2013

The End of Free Kindle e-book Promotions?

This morning Amazon announced significant changes to the operating agreement governing their associates program that will go into effect starting in March.  The changes are aimed directly at sites/bloggers/commentators who primarily promote free e-books.  In short, Amazon will not pay the associate commission for a given month if 1) 80% of the e-books bought after following the associate's links are free and 2) over 20,000 free e-books are downloaded after following the associate's links. 

Why do associates promote free books in the first place?  Because by getting a customer to Amazon the associate earns commission on other items that the customer purchases while they are there.  Most people just grab the free e-book and go on their way, but a small percentage will buy something else.  This strategy works for associates when they send people to Amazon in high enough volume, and it works for Amazon because people buy things there that they might not have otherwise.

The impact of this change is potentially far reaching.  The big sites that primarily promote free e-books are either going to have to shut down or completely revamp their business plan.  MRM is small potatoes compared to those sites, but we will feel the impact as well.  KDP select authors are going to have a much harder time promoting their books when they have a freebie promotion, and subsequently are less likely to get the sales boost for paid books that usually comes along with the promotion.  That in turn will make it less attractive for an author to join KDP select.

What does this mean for Must Read Mysteries?  I am not quite sure yet.  Amazon has not provided statistics to associates on how many free books are downloaded (they say they will start to in March), so it is impossible to gauge just how close we are to the thresholds.  My guess is that we are over the 80% threshold, but somewhat below the 20,000 books per month.  I will watch the statistics for the first week or so of March and then decide just how radical the changes are going to need to be.  Free e-books are certainly going to be a significantly smaller part of the books that we feature, and it is possible that we may need to eliminate them altogether.  Even that may not be enough, though, because if people load up on freebies after following a regular e-book link that would still count against us.

This change is certain to cause some short term pain for book promoters and indie authors, but the long term impact is less clear.  The glut of free Kindle books is starting to eat into the sales of regular e-books and books, as some people have hundreds of e-books on their Kindle waiting to be read and are not willing to pay for content.  This may be a way of combating that.  It is going to be an interesting next couple of months.

18 comments:

  1. You're right about hundreds of books on my kindle. I will keep buying favorite authors but am less likely to buy unfamiliar authors. I trust reviews on Amazon less and less.
    Keep on keeping on MRM. I appreciateyour tips.

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  2. Thank you bj, we will try to roll with the changes.

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  3. Thanks for explaining the gobbltygook I received in my inbox in easy to understand terms. This is a huge change.

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  4. It took me some time to digest it, with the help of the folks over at the associates forum. It is a big change, and one has to wonder about the (presumably) unintended consequences for indie authors in particular.

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  5. Whatever happens thank you for the work you've done.

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    1. Thank you Nancy, we will do our best to adapt. It is difficult to know just how until we get to see some freebie download stats. Amazon says we will see them by March 1, but I am not holding my breath.

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  6. It's about time Amazon did something to slow down the proliferation of free books. Now I wish they would end those free days altogether. You guessed it -- I'm an author. Free books are really hurting authors who try to make a couple bucks. Too many people no longer buy books, even 99 cent books. Why should they if so many titles are free.

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    1. Have you tried offering free books yourself Richard? Most authors that have see a significant bump up in their earnings (though it is less than it used to be). So on an individual basis it can work. Looking more globally though, you are right that it is ultimately depressing the market. I think ideally we should be seeing lost of 99 cent to $2.99 e-books. That way it is still easy to try new authors and authors can still make some many (especially at the 70% royalties amazon gives on books priced $2.99 and up).

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    2. I have gotten many free books by an author unknown to me. If I like the book, I will go buy the rest of their books. That is a sale they wouldn't have gotten before. I have paid for some books by unknown to me authors and been very disappointed! That author will not get any more sales from me. So to me, it's an advantage to offer a free book. I have read #3 in a series for free and if I enjoy it, I go buy the rest of the series.

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    3. I can see that for offering 1 free book in a series. However, there are many series where people have learned that if you wait long enough you can get them all free. People are getting conditioned to not paying.

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    4. This would be a terrible mistake. I've ready many books and recommended them to others because of these free give aways.

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  7. I would buy more Kindle books if they weren't so darn expensive. There's no need for a kindle book to cost upwards of 12 dollars.

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    1. Agreed April, it is ridiculous when the Kindle book is priced higher than the hardcover. Tim Baer did a nice post on the blog about e-book pricing. I was thrilled to see that a bunch of old John D MacDonald books were coming back in print on the Kindle until I saw they would be priced at $11.99. That just makes no sense for old back list titles.

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  8. Why pay 20.00-30.00$ for a brand new book when you will be very lucky to get 10.00 back in re selling it? I cannot afford to buy new books whenever I feel like it and you usually have to sign a waiting list at the library or pay 4.00$ on top of the 50.00$ fee for the out of state library card. I am 10 miles from the library but it is across the state line so I have to pay a yearly out of state fee. I am really not to sympathetic toward authors these days nor their publishers or promoters. Ebooks should be inexpensive. If I like an author I will buy all of their books.

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    1. I concur. Unless I am thrilled with an author, I won't pay more than $9.99 for an ebook.

      So far all of mine have been priced at $1.99 or $.99. I *might* put my first full length novel (the rest are anthologies) as high as $4.99. It depends on what kind of groans, er, feedback I get from my alpha readers.

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  9. I really don't think this means that e-books are not going to be inexpensive. Indie titles are going to continue to be very affordable and hopefully some of the big publishers (and Amazon) will start to see the light with lower prices. Free books are likely to become less frequent, but I don't think anyone is going to make the argument that it is the job of authors and their publishers to supply folks with all the free books they need. There will continue to be plenty of good 99 cents to $2.99 books and we will continue to do our best to point them out.

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  10. Thanks for the tip concerning blogging titles. I will absolutely look into them free books.
    Really E-book is very nice

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