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Stop Worrying About The Cost Of An eBook – Start Focusing on Lifetime Value

The debate rages on about whether authors should or shouldn’t charge 99 cents for their ebooks.

I kind of feel as though some of the debate is framed in the wrong way. That the price for any product, even a book, does not reflect either:

  • The inherent value in the thing the price represents
  • The depth of the entire business model

Let’s dig into each…

The Value of a Book

If you work countless hours for a year writing a book, spend another year or two working tirelessly to get an agent, get a book deal, and bring that book to publication, does $25 accurately represent the value of your time, or the value of the book itself?

Why is $3 offensive, but $10 okay?

Shouldn’t the price be something like $50,000? You know, for not just your time, but for how powerful your work is? I don’t see many $50,000 books.

The perception is that a book priced at $1 somehow “cheapens” our culture, but a book priced at $9 does not. Really? It only took $8 to do that?

The Business Model Behind a Writing Career

So what about those 99 cent ebooks? Does it somehow lessen the value of all books, putting pressure for the price for every book to go down to zero? Or… is does it reflect a different – and sometimes EFFECTIVE – business model for writing and publishing? Something that should be experimented with, and when success is found – celebrated?

Quick: choose a side.

If a 99 cent or $9 or $15 interaction is the complete extent of your relationship with your customer, then there is something very wrong with your business model. A solid business model looks beyond the cost of one product, beyond a single cash interaction with a customer, it focuses on LIFETIME VALUE of that relationship. Often, for a business, this value is measured in financial terms, but it can easily extend beyond that. Non-profits measure value in other ways, such as hours donated to a cause, and writers can as well. It is a personal decision.

But looking strictly at the financial side of things – consider that the purchase of a 99 cent ebook could lead to a lifelong fan. That over the course of years, you may earn not just $40 worth of sales, but word of mouth recommendations to 10 other people equalling hundreds of dollars in sales. And then those 10 other people recommend you to 10 others, and so on.

There is so much talk about the “discoverability” problem with ebooks, and rightfully so. But there are some very effective discoverability channels already in place: fans telling other people about books. Reader to reader marketing. Word of mouth marketing is incredibly powerful.

Writers shouldn’t have to apologize for charging money for their work. If you have the freedom to choose whether you charge 99 cents or $25, that is your decision. If you choose to do a free giveaway, that too is your decision. It’s your work, after all, and these experiments can help a writer better understand how to develop the business model behind their writing career.

Here is a 1 minute video where Andrew Warner explores the value of charging for content online:

Should you charge for your work? That is up to you. How much should you charge? That is up to you as well. But don’t just have a knee-jerk reaction based on the latest trends on pricing. Consider the long-term business model that supports your writing career. Consider not just the price of a product, but the lifetime value of those you engage with.

For a writer – for anyone who puts creative work into the world – it is part of your job to communicate the value of what you do, and connect it to those who are motivated to engage with it. A price is just one of those decisions. Whichever way you choose doesn’t matter because you learn from experimenting and measuring results – but having the freedom to make those choices does matter.


  • Preaching to the choir here. “A solid business model looks beyond the cost of one product, beyond a single cash interaction with a customer, it focuses on LIFETIME VALUE of that relationship.”  But so wonderfully said. We’re in the “Wild West” phase of ebook publishing. There are no rules,but lots of gunfights.  🙂  

  • Thanks for sharing this post and helping us to understand the long term advantage of having loyal customers.

  • Anonymous

    Dan, for such a young man, you have the wisdom of an elder.

  • The reality is, for fiction certainly, that you stay higher in the charts and shift more books if you have a lower price. So is it better to have more readers, which represents more value in terms of people? Or have lower sales figures, lower rankings and impact fewer people but sell for a higher price? 

    • Joanna,
      As usual: GREAT question! Oddly, I think the answer will differ for individual authors, because their goals may be different, and how they curate their brand may not be the same. EG: there are some who feel that the decision to sell their book for 99 cents is a branding issue. 

      There is also the question of engagement: that the lower your price, the lower potential engagement because their is a lower cost to buy-in. You see this in all kinds of products, so it would be great to get analytics on not just if someone buys a book, but how far into it they READ! And of course, if they can take an additional action.