A Quick Look at Amazon’s July ‘Big Deal’ promotion

Amazon just wrapped up their second big eBook promotion of the year, this time including a number of titles from the agency publishers.  This is a quick summary before the weekend of what we saw.

First let’s take a look at the movement of the average daily price (unweighted) of the entire Kindle Bestseller list for the past three weeks:

It’s pretty clear when the promotion began and notice that within three days, the average price of the top-100 dropped from just above $9 to just above $6.  Taking a deeper look at how the quantities of books in our price bands changed shows us no real surprises:

 

The number of sub-$3 titles was gently declining from 30 to 25 going into the promotion and immediately jumped up to the 40s, peaking at 49 on July 25.  For one day, half of the list was priced below $3.  This increase came proportionately from books in the two higher price bands (above $8). 

So where is the ‘interesting’ data this time?  It has to do with WHICH publishers benefited from this promotion.  All six of the agency publishers presumably were invited to submit titles to this promotion.  Let’s look at the counts of titles under $4 on the list for each of the agency publishers:

 

It looks like HarperCollins was clearly the big winner, getting as many as nine titles into the top-100 under the promotional pricing compared to a maximum of two for any of the other publishers.  Looking at the chart for all titles (not just under $4) shows us that Harper was the only agency publisher to gain list share:

This is just one example of the ‘new rules of publishing’ that everyone needs to figure out pretty quickly.  'Share of list' is one of the new digital equivalents of premium retail space in the front of the store, and quickly becoming as or more important.   Since it’s not something publishers can directly pay for, they are faced with the challenge of understanding how to get it in other ways.  For this latest week, it looks like Harper won the set.

Dan Lubart can be reached at dan@iobyte.com.
You can follow him on Twitter at @ebook_mktview  

How Much Do eBooks Profit From Being on Bestseller Lists

One of the bits of ‘conventional wisdom’ around books is that making the bestseller list (any of the growing number of lists, really) is important for discoverability.  The natural question that arises from this is whether position on the list tends to be self-sustaining.  In other words, do books that make it onto the bestseller list gain real benefit from the additional exposure? Does that exposure help them increase sales and thus maintain their high ranking?

We found that there is a significant benefit to making these lists, and that benefit is far stronger for eBooks than it is for print, where titles rise and fall in sales rank far more frequently.  In fact, eBooks that rise high on the bestseller list can normally look forward to a far longer time on the list than an equivalent print book.

Let’s start with a basic assumption – some number of customers are looking at, and making purchase decisions off of, the bestseller lists.  This could include the Kindle Bestsellers, which show 20 at a time up to the top 100, or Nook Bestsellers, which can show from 10 to 100 at a time and go as deep as you care to go.  In the world of online search, the data strongly suggests that being on the first page of results is far better than being farther back.  So I set out to test the data in a few different ways:

• Comparison between retailers
• Comparison between formats (eBook vs. print)
• Comparison between position on the list

Let’s start by looking at the “churn” on the Top 20 list for Kindle, Nook, and Print bestsellers on bn.com for the past 60 days.  I define “churn” as the number of titles that appear on each day that were not on the list the previous day.  To be clear, these titles may have been on the list previously, but there was at least one day since its last appearance. 

Chart 1 – Daily Churn – Top 20 for Kindle, Nook and B&N Print

Although it is hard to see, the average daily churn for Kindle and Nook are close, Kindle at 8.8% and Nook at 11.8%, while the B&N Print is much higher, at just over 24%. In other words, the turnover of titles on the Kindle and Nook bestseller lists are about comparable, and those lists are considerably less chaotic than the B&N Print bestseller list.

Expanding the scope to the top 100 titles, rather than the top 20, the differences between print and digital are even more noticeable.

Chart 2 – Daily Churn – Top-100 for Kindle, Nook and BN-Print

Now the similarity between Kindle and Nook is more obvious (8.1% vs. 8.6%), and the gap between eBooks and print is even wider (BN Print at 27.9%).  What we see is that there is substantially less churn on the eBook lists than on the BN.com print list and that the top-100 eBooks are about as stable as the top-20.  This also confirms that the ‘self-sustaining’ effect is far more prominent for eBooks than it is for print, indicating that eBook purchases are more influenced by bestseller lists than print. 

Lastly, we want to test if the churn is indeed lower on the bestseller list than it is deeper down.  In order to do this, we looked at the Nook list in five groups of 100 titles each.  What we found was a very strong basis for the assumption that bestseller lists support book sales.

Chart 3 – Average Daily Churn for Nook Bestsellers

Rank range      Average Daily Churn

==========================
1-100               8.6%
101-200           25.1%
201-300           35.3%
301-400           54.7%
401-500           66.7%

Now there is one factor that could be greatly affecting these numbers and that is that BN.com may be imposing any number of arbitrary rules that affect the repositioning of sales rank.  In fact, we previously noted here that there is one such rule that at least temporarily restricted the highest rank a book priced below $4 could achieve (no higher than rank 126).  Yet while these rules may be impacting the free repositioning of sales rank between titles, it actually doesn’t really matter since the titles in the top-100 are clearly tending to stay there as compared to titles lower down.

With support from the data, we can see that titles that make it to the bestseller list continue their bestselling habit.  What I would take away from this as an author, agent or publisher is that getting my eBooks into the top-100 on both Amazon and BN.com is highly beneficial – not just for the status but for the actual sustained impact on additional sales it may provide.

Dan Lubart can be reached at dan@iobyte.com.
You can follow him on Twitter at @ebook_mktview  

Update on the Kindle Bestseller List 6/24

I've had a number of requests to keep updating this chart for now, so here goes.

Kindle Bestsellers Top 100 - Average Daily Price

The uplift from the 2nd bounce - when the Sunshine Deals promotion ended - held on well for over a week afterward.  Average price of the list on 6/23 was $8.38 - still well north of the $7.75 number early June 1 as the program was just starting but ultimately came down to $7.81 on 6/24, possibly signaling the return to 'normalcy'.

Speculation time...if there really are two distinct groups of buyers as I have theorized in the past - one that shops for value and one that shops for brand - then we may have seen a lingering effect of the value buyers still reading through a glut of content purchased at discount during the program.  There are a lot of copies of 'My Horizontal Life' that have to get read before the next group of summer books gets looked at.  This may have created a week-long 'hangover' effect for these books.

On the other hand, since there was no incentive to purchase extra titles at the higher price points, those sales probably continue at a normal pace, which has given them a rankings bump over the presumably depressed discount books.  If this is at least partly true, it may indicate that while the market can be significantly impacted in the short term by these type of promotions, that there is a certain resilience and tendency to revert to normal. 

So that seems like good news for publishers and authors who are trying to sell content at the higher price points.  But there may yet be a dark lining.

What happens if Amazon makes the Sunshine pricing permanent and rotates 100-200 titles through every week (like supermarket shelves)?  They could create a permanent change in the distribution of titles in the top-100 that would be hard to combat.  Since position on that list has 'value', that would be harmful to the publishing community.  Just one more thing to keep on the radar.

Dan Lubart can be reached at dan@iobyte.com.
You can follow him on Twitter at @ebook_mktview

Are Publishers Going to Become Brands Again?

Something a little different on Father's Day as I grab a brief moment of calm and quiet between coaching soccer games and grilling.  My thoughts keep drifting to the discussion of 'discoverability'.  How will a new author get discovered?  If they price their book above the waterline of $2.99, they feel they can't compete with the mass of self-published books.  Observed buying patterns suggest there is some truth to that.  Yet if they drop down below that point, they are now competing against tens of thousands of titles for the same dollar or three, and how is anyone to find their book?

It's a real dilemna that I think we have just begun to explore.  And when I turn around and look at my bookshelf, that contains many hundreds of books dating back to my childhood, an answer starts to pop up.  First a little history on me - timely on Father's Day.  My dad was a voracious reader and I got that gene, maybe even a super-mutated form of it.  He used to bring me to a used book store called Ben's Books (I think....I was very young) about once per month to peruse shelf after shelf of dusty used books, from which I could pick up a few each visit.  We also did occasional trips to the original Barens & Noble and the Strand.  As a result, I have some gems - including a 1914 printing of 'Tarzan of the Apes' and full harcover or paperback sets of much classic sci-fi / fantasy series such as Tarzan, Doc Savage and Tom Swift, plus many other paperbacks.  Thanks, Dad...and I mean that from my heart.

Now back to the present.  As I look over the spines of the paperbacks, I see the same names: Tor, Doubleday, Del Ray, Ballantine, Ace.  Today, as I understand it, most if not all of these imprints are either gone or gobbled up.  But they were names I knew and cared about and trusted back then.  I bought many books by authors I didn't know because they were 'Del Ray' books.  And then if I liked it, I bought more by that author.

Today, it seems to me the author is the brand as it always has been, but the imprint has a lot less meaning.  But maybe that pendulum will swing back.  I think the component there is too little of in the new eBook marketplace is curation.  I need someone reliable to tell me what to read.  Friends?  Sure, in this era of social graphing, that can and does work, but sometimes I'm looking for a book now, and my friends haven't posted a recent review.  So we have bestseller lists, and we know those work, but they can be gamed and manipulated and I'm not always sure I trust them either.  Personalized recommendations from Amazon are sometimes useful, but lots of new content will never find their way into those.

But now there are a whole slew of new e-publishers springing up that remind me of the old imprints like Del Ray.  Many should be and probably are looking for and signing authors that meet their criteria both for quality and sellability.  And some of those might be genre-focused, trying to develop a sense of trust with readers to the point that when they say they have a great new novel, it gets a hard look.  Me?  I'd be much happier to pay a premium for a book recommended that way than taking a $.99 risk on something pulled up from the sea-bottom (apologies to hard-working, self-published authors, but there is a lot of muck down there too).  Now I just need to discover those publishers and the rest will hopefully take care of itself.  It seems that should be a lot easier than finding the individual books.

Happy Fathers' Day to all the dads out there. 

I miss you Dad.

Alfred Lubart

Dan Lubart can be reached at dan@iobyte.com. 
You can follow him on Twitter at @ebook_mktview

'Sunshine Deals' Ends With a Bang

Just a quick post tonight to show something interesting and unexpected that happened yesterday to the Kindle Bestseller List.


It looks like 'Sunshine Deals' ended twice!  We noted in the last post that the average daily price rebounded pretty much fully during the second week of the promotion as the premium-priced titles returned to the top-100.  Well when the deal ended, the average price shot up again, by a record one-day amout ($1.46), to the highest average price ($8.93) we've seen in seven months of covering the list.

The number of sub-$3 books on the list dropped from 41 to 21, with most of those gains split between the middle bands ($3-$7.99 and $8-$9.99).  In fact, the distribution is now stronger towards the higher-priced books than it was before the promotion started by far.

This is very possibly a short-term rebound and the numbers may very well return to their pre-promotion levels in another day or two.  We'll analyze the numbers and watch how the next few days play out and report back as soon as there's more to tell.

Premium-price eBooks rebound from 'Sunshine' effect

About 10 days ago we spoke about Amazon's 'Sunshine Deals' program and the impact it had on the makeup of the Kindle Bestsellers list (top-100).  Now that the two weeks is just about up, we took another look and  see something interesting.

Books in the two highest price bands - essentially $8 and up - have rebounded nicely in the second week.  At the same time, the sub-$3 books promoted by the deal have retained their gains from the books in the next band, $3-$7.99.

First, let's look at the average daily price chart - revised to June 14...

There is no mistaking rise in the past few days that is almost a mirror image of the drop when the program first started.  The average price of the list is essentially all the way back to where it was on June 1.

Now let's revisit the price band data.  To review, this is how we define our price bands:

Band 1 - Super-discount: $0-$2.99
Band 2 - Discount: $3-$7.99
Band 3 - Value: $8-$9.99
Band 4 - Premium: $10+

Now here is the data, updated from June 1 to June 14, showing the numbers of titles in the Kindle Top-100 that fall into each of these price bands each day:

date               band1  band2  band3  band4
2011-06-01   31       18        15        35
2011-06-02   38       16        12        33
2011-06-03   43       14        11        31
2011-06-04   47       14        10        28
2011-06-05   44       16        10        29
2011-06-06   45       14        12        28
2011-06-07   46       14        10        29
2011-06-08   48       13        11        27
2011-06-09   49       11        12        26
2011-06-10   46       11        14        28
2011-06-11   44       11        13        31
2011-06-12   42       11        14        32
2011-06-13   41       11        14        33
2011-06-14   38       10        14        34

If you don't like tables of numbers, let me point out the highlights.
Premium books ($10+) started at 35, dropped to a low of 26 and rose back to 34.  Value books ($8-$9.99) followed a similar trend, going from 15, down to 10, back to 14.  Note the discount band ($3-$7.99) however, which has steadily declined the entire two weeks, from 18 down to 10. 

So what we appear to be seeing is that the higher-price eBooks - typically the equivalent of new releases and trade paperback from known authors - have rebounded from the initial impact after about a week and regained their prior share of the Bestsellers list.  Discount eBooks - more the equivalent of mass market paperbacks - have not recoverd and continue to be supplanted by Sunshine Deals - many if not most of which were probably in that $3-$7.99 price band before the promotion.

I think that we've seen Amazon flex its marketing muscles in a new way (although they have done this in the MP3 space since they began so it's just new to eBooks) and the market reacted very strongly.  They have the power to move the market, or at least a segment of it, for at least a limited period of time.   Yet the segment buying high-price eBooks, despite lots of outcry against such pricing, has proved resilient and returned to these books after dipping their toes into the less expensive end of the market. 

Certainly we are going to see more of this type of prmotion/experimentation from Amazon.  Maybe we will start to see it from the agency publishers as well.  I would love to get the discussion on this going and see what others think of these results so please do chime in.

Nook Bestseller List has some new rules

So I noticed something odd today.  Yes, I'm going to share.

A few days ago I tweeted that only one book promoted in the Sunshine Deals program on Kindle had cracked the Nook top-100 (Prince of Tides).  I found it slightly odd, but nothing more than that.  Then 'My Horizontal Life' joined it.  All well.  But then I saw something I don't usually see.

'My Horizontal Life' went from rank 1 to rank 127 in a single day.  Possible, but very unusual.  And the 'Prince' was nowhere to be found either.  So I did a little looking and noticed this odd distribution:

# of titles below $3 - ranks 1 - 125: 0
# of titles below $3 - ranks 126 - 200: 65

That means not a single sub-$3 in the top 125 slots, but 65 of the next 75 titles were below $3.

Now some people have called me into question for drawing conclusions from limited data sets so I'm just going to leave that one on the table and step back.

I'm sure B&N isn't the only retailer that has rules to 'manage' their bestseller list, and I completely understand the desire to curate the list to provide the most perceived value to their customers.  I'm just calling what I see.