Articles tagged "pricing models"

Could pay-what-you-want pricing models spell more money for creators?

In the fall of 2007, Radiohead released their seventh studio album In Rainbows as a digital download using a pay-what-you-want model. At the time, the decision blew some minds. Pay what you want? Whatever you want? For a RADIOHEAD ALBUM??

The decision to pursue such an untested marketing move exhibited real guts on the part of the band and, more importantly, a lot of faith in their fans. By reconfiguring the transaction and empowering the customers, Radiohead managed to flip the script. Although fans were given the option of paying nothing for the new album, pre-release sales exceeded total sales from their previous album Hail to the Thief, released via traditional means. 

Then again this summer, the internet was agog about comedian Louis CK’s no-frills sales approach. In December of last year, CK turned heads when he bypassed a corporate release of a comedy special, instead selling it directly to viewers for $5 on his website. Then, in June he pulled a similar move: selling tickets to his upcoming tour directly to fans, rather than through Ticketmaster (which can occasion a 40% service charge). The result of both experiments was stunning: CK made over $1 million dollars in just 10 days from his comedy special and bypassed $4.5 million in ticket sales in two days.

But would this work for books? (So goes the question in my head, always). Perhaps so! According to a story published this week in The Guardian, a pay-what-you-want experiment in eBook bundling is turning heads and making serious cash. Put together by Humble Bundle, Inc., the Humble ebook Bundle is a collection of 13 eBooks sold at a price determined by the purchaser, but of at least 1 cent. Customers who pay more than the average price — currently sitting at around $14 — unlock extra content (more books, in this case). In another interesting twist, customers are given the option of dividing the money they spend between several recipients as they see fit, including the authors, Humble Bundle, and a variety of charities such as Child’s Play Charity, the Electronic Frontier Foundation,  and/or the Science Fiction and Fantasy Writers of America.

And how about the content backing up such a good idea? Surprise, surprise, it’s great stuff! The bundle includes work from contemporary sci-fi greats such as Neil Gaiman, Cory Doctorow, and John Scalzi as well as up-and-comers like Lauren Beukes, Paolo Bacigalupi, John Scalzi and Kelly Link.

Sales of the bundle are astounding. In just two weeks, the bundle has made over $1.1 million dollars, with over 80,000 bundles sold at an average price of $14.18. These sales figures are staggering (Lauren Beukes points out that 80,000 copies is “New York Times bestseller-level sales.”) The response to such a radical sales model is heartening.

Pay-what-you-want and direct sales models spell exciting possibilities for the publishing industry. Could a sales plan like this become more regular? How could bundling young authors and bestsellers benefit both? Let’s hear your thoughts on how this could change the game.

Additional Reading: Would you let readers price your book?