E-book pricing continues to be a tricky issue for publishers, with both publishers and e-tailers experimenting with different price points for different kinds of works. To help provide some answers, Vook has written a white paper on the key factors creators and sellers need to consider when pricing digital content. Based on an analysis developed during creation of the Vook pricing engine, the multimedia publisher has come up with 10 rules for maximizing digital sales of e-books, enhanced e-books, and Apps.

To develop those 10 rules, Vook examined what it calls the four successful factors for e-book pricing: categorization, discoverability, marketplaces, and the importance of libraries. Correctly categorizing a title will affect the number of views it gets. Vook notes that a book on Microsoft Office, for example, could be categorized under productivity or reference, but will do better in the more trafficked category of business, where it will draw more views and can be priced higher. According to Greg Bateman, Vook's head of operations and finance, buyers are willing to pay more for e-books in certain categories.

Proper categorization helps books get discovered and in turn contributes to what Vook calls "lift effects." Lift effects are things that raise them to prominent shelf positions and keep titles there with high purchase rates. According to Bateman, to help titles gain traction, publishers should keep the launch price as low as possible for a period ranging from three days to two weeks before raising the price to a more appropriate level.

Just as different publishing segments have higher prices, so too do different marketplaces. Stores specializing in e-books have higher prices compared to App stores. Sales also benefit when publishers merchandise the entire library of authors. "The rising tide of a popular catalogue lifts all e-book boats as retailers' platforms automatically cross-sell for you," the Vook paper notes.

A final part of creating the digital pricing rules was experimenting with different prices of 40 e-books and 20 apps over a three-month period to find a title's sweet spot. In the case of Sherrilyn Kenyon's DarkHunter e-book, for example, the most effective price was $5.30. Testing different prices also reinforced the fact that pricing will vary title by title, Bateman stressed, and that in the digital world publishers need to check prices daily to see what impact it is having on the sale of e-books.


Vook's 10 Rules of Pricing

1 Zero variable cost means it's okay to significantly lower prices to maximize revenue.

2 Optimal pricing is highly content specific.

3 Certain pricing thresholds trigger psychological "automatic" purchases.

4 Categorization plays a large role in optimal pricing and discoverability.

5 Merchandising whole catalogues is more effective than single titles: "a rising tide lifts all boats."

6 Containers are critical to driving upsell in app environment.

7 Lift effects through savvy launch promotions have a profound impact on sales.

8 In general, apps cannot support as high price points as e-books.

9 Real-time sales tracking is necessary to adjust pricing in a dynamic e-book world.

10 For each retailer there are distinct best practices to maximize discoverability and revenues.