At BookExpo America today, I took the chance to attend a panel given by Mark Lefebvre, Director of Kobo Writing Life, on common digital publishing pitfalls. Lefebvre addressed a number of common mistakes digital publishers make, and how Kobo could help avoid them.

The first such mistake had to do with cover design. Given that e-book cover art is typically viewed in much smaller thumbnail form, fine print isn’t going to work well. he showed examples of covers that had been optimized for mobile, with the author’s name in big letters at the top and the title slightly smaller below. This makes them clearly visible even when the image is thumbnailed.


The second pitfall had to do with pricing. Lefebvre explained that many publishers price their e-books too high, in order to try to protect the windowing of their print prices. Hence, their e-books end up at the same price as or higher than the print version. This doesn’t play well with consumers, who tend to feel that much of the value of the book resides in the dead tree matter, though in actuality much more of it is in the content itself.

On the other hand, many independent publishers make the opposite mistake, and often undervalue their work—pricing it at 99 cents or otherwise too low. This tends to turn off many Kobo customers who’ve gotten burned by bargain-basement books that haven’t been very good—though pricing down to 99 cents on daily deals can be an exception.

One interesting point Lefebvre made regarding price is that, since Kobo is global, it sells in Canada, Australia, New Zealand, the UK, and elsewhere, in addition to the US. And customers in some of those regions—such as Australia and New Zealand—are used to paying more for e-books, so publishers can afford to price their e-books higher there.

This led into the third pitfall Lefebvre mentioned—a failure to think globally. When authors focus only on the US market, they could miss out on benefits from optimizing their price strategy to take global currencies into account, or making changes when currency fluctuations occur.

Lebebvre demonstrated an interesting feature of Kobo’s retail system, which has to do with a built-in currency converter that optimizes prices in the new currency rather than doing a direct conversion. For example, converting a US $5.99 price to Canadian dollars comes out to $7.70, which doesn’t look like a natural price. However, Kobo’s system will automatically round that up to $7.99 Canadian, which looks more like the sort of price we’ve been trained to expect to see on a web store. (UK pounds and Euros round to the nearest .49 or .99 price, given those currencies tend to have higher conversion values.)

The fourth pitfall was about the failure to think long-term. E-books aren’t just about the first 90 days. Once an e-book is available in the store, it’s not going to be rotated out to make room for newer books on a shelf, or shipped back to the publisher for a refund. It will stay in the store for as long as the publisher has the right to sell it. Publishers can have significant backlist opportunities if they only take advantage of them.

And finally, it is important for publishers to leave themselves open to making changes as necessary—adjusting metadata, experimenting with different price strategies, and optimizing for other circumstances. “Price is a verb, not a noun,” Lefebvre said, and recommended examining what other best-selling books in your genre are doing and adjusting your own strategies to be more in line with those of other successful titles.

Lefebvre also recommended using a free “funnel book” if you have other books available to sell—make the first book in a series, or one of your better stand-alone books free, as long as you have other books that customers can buy after reading the first one. He also provided some statistics about the effectiveness of such giveaways.

Say that a free e-book is downloaded 12,000 times. Of that 12,000, only 2,000 will actually open the book, and only 500 of those will actually finish it within six weeks. Those who finish it tend to have a 45 to 55% conversion rate when it comes to buying more books—which amounts to about 1.4% of the total free books given away. But if you have other books to sell, it can work.

One of the audience members asked a question about mining Kobo’s database to get an idea of what’s selling where. Lefebvre replied that Kobo had bestseller lists across 360 categories ranked by sales, and that romance and erotica titles had been found to sell best. There had been a huge growth over the last 6 to 9 months in crime and thrillers, which amounted to the second-most popular category, followed by fantasy and young adult books.

Another interesting note to come out of the talk was that Kobo’s arranged a partnership with fellow Rakuten-owned company Overdrive, to allow self-published authors to opt their Kobo books into Overdrive’s library e-book service. It plans to turn that option on within a few months.


  1. Good advice, athough I would disagree with this remark: “The second pitfall had to do with pricing. Lefebvre explained that many publishers price their e-books too high, in order to try to protect the windowing of their print prices.”

    I’m not the sort who assumes that executives at large publishers are stupid. I think they’re being quite clever when they price ebooks high and that they are not simply protecting their print prices.

    What they’re protecting is a diversity of ways to buy books. Pricing ebooks high makes print books more attractive and thus encourages print sales through physical bookstores. There, Amazon’s advantage is small. Making ebook significantly cheaper would push sales toward digital, a market heavily dominated by Amazon. That would primarily benefit Amazon, hurt bookstores, and weaken the diversity of retail sales. It’s also a smart move to price ebooks up rather than print books down. Print sales mean their usual profit. Ebook sales mean a larger-than-normal profit. That keeps them strong enough to stand up to Amazon’s bullying.

    There’s another factor that may or may not apply. Small publishers and independent authors who release ebooks through the Kindle store are treated badly by Amazon. Price an ebook above $9.99, and Amazon will only pay them 35% royalties rather than the (fake) 70% it pays for ebook priced between $2.99 and $9.99.

    Elsewhere I’ve unloaded on Amazon for what that does to textbook prices. It forces their publishers to essentially double a digital textbook’s price to make up for that pitiful 35% royalty rate. I am not sure if the larger publishers are stuck with those same vile terms, but if they are then, as with textbooks, Amazon’s miserly royalty rate forces them to double the price to get the same per-sale income.

    Take a hot new novel from a popular author. It’s very long and eagerly awaited, so Big Publisher decides to price the hardback at $24.95 to make up for all the books they publish that loose money. The print run will be huge and returns few, so Big Publisher hopes to make $10 profit on each sale before the author royalties.

    It also, quite sensibly, sees no reason to make less per sale on the ebook version. If Amazon paid the same royalties as Apple does, 70% at all retail prices, it could price the ebook at $14.99 and earn:

    $14.99 x 0.7 = $10.49 on each sale, not that different from what it earns for print sales and thus OK.

    But Amazon only pays 35% royalties on any ebook over $9.99, so if Big Publisher prices that ebook at $14.99, the will only earn:

    $14.99 x 0.35 = $5.25. Quite reasonably Big Publisher decides it sees no reason to make about half the profit on an ebook sale it earns on a print sale, and all the more so since an ebook sale at that price means that Amazon banks $9.74, almost twice their profit, for a transaction that costs it pennies.

    So what do the wise executives at big publishing do? They decide to set a retail price for the ebook that earns them about what a print book does, that calculates out to:

    $10/.35 = $28.57. Note that it’s more than the print price to earn the same profit from Amazon sales as their print books do. By rights, the ebook price should actually be higher. If they price it a bit lower, say $22.99, they’re actually doing readers a favor because their profits are actually lower:

    $22.99 x 0.35 = $8.05. Note too what happens were they to price at that level, one math-challenged pundits would sneer at as “too high.” Big publisher is making about $2 less per sale than with its print version while Amazon’s income from that sale is:

    $22.95 x .65 = $14.92 per sale. Contrast that with the perhaps $2 Amazon might make from selling the print version of the print book.

    The real issue is why any savvy publisher would want to price the ebook version of a popular book at any price that’s not the same as or higher than the print version. Not only does pricing an ebook significantly lower than the print version make their per sale profit significantly lower, Amazon is the prime beneficiary. Amazon makes huge profits on ebook sales.

    In the example above, by pricing an ebook just below the print price, Big Publisher is actually being generous. It’s giving up $2 of its profit from a sale. For that, they should be praised by ebook champions not attacked. The company that should be attacked is Amazon, whose vile royalty rate not only forces publisher to keep their ebook prices high, but extracts huge unearned profits from those sales.
    I want to stress another point that flows naturally from what I’d described above. Publishing industry executives are competent and hard-working. That is clear. They’ve made the calculations I have described above and responded accordingly. And what does that say about journalists and industry pundits who’re too math-challenged, too lazy, or two dogmatic in their beliefs (pick one or several) to make those same calculations?

    These pundits sneer, they rant, they pontificate on matters about which they clearly know nothing. Do the math and you can clearly see that it is the economics of publishing, as driven by market-dominant Amazon, that dictate that ebook prices must remain high. Amazon is the bad guy. All you need to do is run the math. It’s not even hard math, roughly the sixth-grade level.

    –Mike Perry

    • Great analysis, Michael. We also recognize that Publishing executives are competent, hard-working and extremely smart. Heck, even though they’re a competitor (and the biggest player in the industry in the US), we also recognize that Amazon exec’s are also savvy and quite shrewd.

      One thing to be aware of though, particularly with agency pricing, which most of the big publishers have with Amazon, that the $9.99 cap doesn’t exist. So big publishers are making more than 35% on higher priced books; and yet, despite this, they still seem to be interested in driving customers to the print version of the books.

      As a former academic bookseller, I know that the margin that bookstores get for print sales of textbooks is 20% — ie, on a book that retails for $100 the bookstore keeps $20 and the publisher gets $80 — so THERE’S even more motivation to keep those sales in a print-based world (and quite supports your theory) — Yes, academic publishers have done their math and know where they can earn the most money and definitely don’t want that to go away, or lose those big dollars to digital sales.

      FYI, one of the things mentioned in the presentation was that, within Kobo Writing Life (the publishing platform small publishers and authors can use to publish to Kobo) there’s no cap at $9.99, so authors can price higher, and usually do, particularly for boxed sets, earning the full 70%, so they don’t lose money on offering their readers a good deal on getting a full collection of their books for a single value price:



      Mark on behalf of KWL

  2. “One interesting point Lefebvre made regarding price is that, since Kobo is global, it sells in Canada, Australia, New Zealand, the UK, and elsewhere, in addition to the US. And customers in some of those regions—such as Australia and New Zealand—are used to paying more for e-books, so publishers can afford to price their e-books higher there.”

    Yes, we are used to paying more for PRINT books in New Zealand – the UK editions which dominate our market have always been over-priced. Just because we are used to paying more for print books doesn’t mean we don’t shop around for cheaper editions, such as US editions. Being able to buy over the internet means that we aren’t solely relying on NZ bookstores. Before I started buying eBooks I used to buy print books from Amazon – even with the postage from the US to NZ it was much cheaper than purchasing the UK editions from within NZ. Additionally, just because we are used to paying high prices for print books doesn’t mean that we will happily do so for eBooks. I have a set price that I am prepared to pay for the majority of my eBooks, now I very rarely purchase eBooks issued by UK publishers.

    • That’s in line with some of the thoughts I had while I was watching the presentation, too. But it didn’t really seem worth interjecting or bringing it up there, and didn’t fit in with just reporting on it here.

  3. He’s wrong about Aust/NZ consumers being used to pay more for ebooks. We are forced to. We don’t like it to the point where it’s become a political issue. If a cany ebook seller committed to having the same price globally they would get a loyal following in Aust/NZ.

  4. I wanted to confirm a point. I wasn’t suggesting that authors and publishers should rip-off consumers in Canada, Australia and New Zealand, but being aware of the current price conditions that are taking place in the print book market (and via some of the publishers who are over-pricing their eBooks in parallel with their print books), can allow indie authors the ability to set slightly higher prices in CAN, AUS and NZD than the USD price and still offering a VERY competitive and attractive price — ie, especially compared to the over-priced print and ebooks that appear in those markets.

    As a Canadian consumer myself, I’m sympathetic to the angst and frustration of over-priced books based on a legacy of physically shipped goods overseas (or North of the 49th parallel over here), and find great value. Example – a USD $4.99 eBook that is optimized into Canadian dollars at $5.99 or $6.99 in Canada (based on price conversion and rounding up to .99) is still half the price of a print mass market paperback in Canada (ie, to me, that’s good value)


  5. When you compare some of the pricing around you can’t help but feel completely ripped off. For example: Nalini Singh’s Bonds of Justice is available as a paperback for NZD24.99 for the UK trade edition; NZD17.99 for the US mass market edition; on Kindle at USD5.93 (approx NZD8.80) which appears to be the UK edition; and on Kobo at NZD11.99. Another example is Magic Binds by Ilona Andrews. This is listed for pre-order at USD12.50 (approx NZD18.30) for the Kindle eBook and NZD27.79 (supposedly reduced from NZD34.73) for the eBook on Kobo. When I first started buying eBooks, before the Kindle was around, I used to spend approximately USD100.00 per week on eBooks – in the days of Fictionwise, BooksOnBoard etc. This was partly because I would be buying my favourite authors back listed eBooks plus the eBook of any new-to-me author I wanted to try. Pricing was very reasonable and the exchange rate was very much in my favour at the time. The advent of geographical restrictions meant that my eBook buying dramatically reduced and geographical restrictions also meant the introduction of the over-priced UK editions. As a result my purchases of eBooks at Kobo has dramatically reduced and my borrowing of books at my local library has dramatically increased. It’s not even worth waiting for a reduction in price for the UK editions, as there very rarely is one. The eBook for Night Broken by Patricia Briggs was released over 2 years ago, yet it is still listed on Kobo at NZD19.99. I might purchase the US editions of eBooks if they are available and at a reasonable price, or eBooks from indie authors, through Kobo but I won’t be purchasing the eBooks released by UK publishers.

    • I hear you, ShellBell – it’s frustrating how expensive even backlist title eBooks can be from certain publishers, and all based on an un-necessary “shipping of physical goods” mentality in the digital space which shouldn’t affect that different a price than a basic currency conversion.

      In my presentation the pitfall I was calling out was that many publishers are pricing far too high and many indie authors are pricing far too low – both, in my mind, are mistakes they should pay more attention to.

      Indie authors have a significant advantage, because, without having to go with “bargain basement” prices they can still offer customers an amazing deal on a great read that is still far below prices from so many larger publishers. (And why we continue to spotlight them in places like this: — where the prices are all far more affordable, not to mention the great selection of FREE titles from many of those same authors:

      I suppose that might explain why indie author titles are currently selling far more units on a weekly basis than the largest publishers.

      Mark via KWL

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