• Optimizing Author Earnings

Part 1- Market Segmentation

I just wrote my first two novels (Severance Lost and Shadow Cursed) and am sorting through the self-publishing pricing problem, namely that I can assign any sales price to my book on amazon and I have no idea what the correct number should be when I simultaneously publish them.  Besides that, a host of other decisions will all play a role in how well my book sells and eventually how much money I earn (if any).

Should I get an ISBN number?  Do I put in the effort to push pre-sales? Should I sign up for Kindle Unlimited? Will any of it actually help me be a self-sustaining author? I only get one chance to do this right, so I decided to find as many of the answers as I could. Hopefully my efforts help you as well.

pricing-infographic_sfwaA thorough search of blog pages led to a whole heap of anecdotal evidence with few numbers. All of them agree about the difficulty in getting information on the subject, but the arguments for or against a certain price are usually reduced to testimonials.

One group preaches, “I want people to read my book, so I should lower my p
rice!” from their blog pulpits while the other camp r
ationalizes “I put too much effort into writing (Insert name of your great American novel here) to just give it away!” After many late nights writing my own novel, I can understand the sentiment, but I have enough business savvy to know the market sets the price for a product.

If I’m selling J. Lloren Quill’s secret sauce at the grocery store, it better be a competitive price with the sauces surrounding it on the shelves. If I look around the virtual amazon shelves I can at least estimate a price range to be competitive with the other books, but to stand out on the shelves, I’ll need something more. To truly understand the market, I needed some data.

Enter the May 2016 Author Earnings Report.

This comprehensive report by Hugh Howey and the Data Guy sends a spider crawling through amazon’s bookshelves and pulling back a ton of information.  I won’t go into all of the methodology they used, but I will describe how I used their raw data. After downloading their free, anonymized spreadsheet, I started to segment their population data to fit me.

I filtered the data to only include information from independent authors publishing in the science fiction genre. If science fiction/fantasy wasn’t the primary category of book chosen, I excluded it. Then, I excluded all entries that didn’t have daily sales information or daily earnings.  In the end, I was left with 2047 samples from the original million+ in the Author Earnings Report – a more manageable number that was much more pertinent to my own publishing efforts.

In the Optimizing Author Earnings blog series, I’ll take a deep dive into this data set ().

First, we’ll look at some descriptive statistics of the scifi/fantasy genre and be able to tackle some basic questions like:

  1. How much does a book earn on a daily basis?
  2. How long does a book continue to bring in money?
  3. What do the daily sales numbers look like?
  4. How long does it take to ramp up sales?
  5. Do authors that sign up for Kindle Unlimited make more money than their non-KU counterparts?
  6. How many independent authors use a pre-order period to market their books?
  7. Does anybody use an ISBN number anymore?

After that, the real fun will start. Can we optimize the amount of money a book brings in? I’ll share the results of a statistical optimization of daily author earnings that I performed that used all the meta-tags from the amazon sales data as independent factors. This data will show which factors correlated the strongest with the top selling (or bottom selling) books by independent authors in the scifi/fantasy space.

Why am I doing this analysis? Before you call me a money-grubbing Trump-lover, that isn’t my motivation. I’m doing this analysis because I put a ton of work into my books, and if I’m going to publish them with my own money, I want to give them the best chance to succeed. I also think this is an area that a lot of authors wished they had information but lacked the background or interest to do the analysis. I have a doctorate in engineering and this stuff is easy for me. If it helps me succeed, that’s great. If it helps someone else succeed, all the better…we’re all in this together. Best of luck everyone!

6 comment on “Part 1- Market Segmentation

  • I’m looking forward to seeing the results of the analysis. A couple of comments from a fellow enginerd:

    1 – Can you make the infographic a link to a larger sized version of it? I can’t read the small print on the axis.

    2 – You are using each meta-tag as an independent factor. Will some of the factors actually be dependent or be analyzed as dependent?

    3 – Good luck with the books!

    • Thanks Rick! It’s always good to hear from someone in the enginerding community. We’re a tight group. I’ll change up the graphic (I want to change the bottom graph anyway) and your comments about independent and dependent factors are spot on. I’ll talk about that as I get further into the blog series and also talk about areas that are definitely not covered by the meta-tags in the data.

  • Good Evening! I LOVE this post. LOVE LOVE LOVE. You have yourself a new subscriber! 🙂

    I am a sci-fi/fantasy writer at night and I work in scientific publishing (corrosion engineering, more specifically) for my “day job.” My specific role in my company is called “audience development manager,” and I have got to tell you….what you have posted is EXACTLY the kind of research we ADM folks do to expand our publications’ footprint in the marketplace!

    Because I have worked in publishing so long (I was a technical editor for 10 years prior to my current role in audience development…and my company also has me serving as our copyright/intellectual property officer) — I have become very particular about publishers and am strongly attracted to the indie route. I’ve written a lot and have only recently drummed up the courage to step into the marketplace…I have a story being published in Everyday Fiction next week and a few more I’m fine-tuning for submission in various sci-fi/fantasy/horror journals that I have vetted very carefully (I look at monthly web traffic [which can usually be found in the “advertise” part of their websites], whether they are paid/free publications, what their copyright policy is, and finally, the general “vibe” of how they treat their authors).

    Anyway — among all that I have been working on a fantasy novel for about 3 years, with the help of a developmental editor. I’m fairly close to completion (maybe another year, honestly) and it just kills me to think about surrendering the rights to my work to a publisher after having put so much work into it. So I am doing a LOT of research into indie publishing. The reason I accepted my position in audience development at my company is so that I could learn the industry “tricks of the trade” to promote my book when I am finally done writing it.

    I’d like to share with you one thing I’ve discovered through my work:

    There’s been a huge, recent push in the library community to help indie authors gain more recognition in publishing? This year was the inaugural launch of Indie Author Day (http://indieauthorday.com/). Librarians are saying there is a positive correlation between those books that get checked out at the library vs. actual sales. They are making some serious efforts to help indies with book discovery. Worth looking into. 🙂

    I’m looking forward to continuing to read your blog!

  • Sorry – typo…

    “Did you know — there’s been a huge, recent push in the library community….”

  • Thanks Daniela and I wish you the best with your publishing efforts! I love the tip about the library community – I’m finding that one of the most enjoyable parts of publishing is meeting so many individuals and organizations that are trying to support indie authors. It’s fun to be a part of something where everyone is trying to help out everyone else.

    I really appreciate you checking out my blog and I’ll post the next part of the blog series this weekend.

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