The Fashion of Hating Amazon

It’s become quite fashionable throughout the publishing industry to publicly bash Amazon. They’re destroying independent bookstores! They’re running roughshod over publishers! They’re hurting indie authors by locking them into exclusivity!

I have seen numerous blog posts expounding upon all these claims, and for the most part, I don’t dispute them. Is Amazon destroying independent bookstores? Yes, but in the sense that they have become more efficient at the process of getting books into readers’ hands than those bookstores. Is that Amazon’s fault? Or is it just marketplace competition? I tend to think the latter. Are there things bookstores can do that Amazon cannot? Absolutely. There will always be a place for specialty stores, just like there will always be people like me who prefer to buy their meat from an actual butcher than out of a Wal-Mart refrigerator case.

Is Amazon running roughshod over publishers by trying to dictate terms? Well, yes. As a retailer, they have the option to carry or not carry media produced by a third party. If said third party doesn’t like the terms, there are other venues where they can sell their books. Likewise, if Amazon doesn’t like the terms a third party vendor offers, they can limit exposure or not sell those products. It’s business, plain and simple.

The last one is the one I really want to talk about though. Is Amazon harming indie authors by locking them into exclusivity? The program is called KDP Select, and a requirement to be part of it is that the items enrolled in it cannot be available from competing retailers. In return, Amazon displays KDP Select items higher in search rankings, makes them available to download for free to Amazon Prime customers, and pays a portion per download once a Prime customer has read past ten percent, whether or not they finish the book. But is this harming indie authors?

I decided to try an experiment. I had some books expiring from their three-month commitment to KDP Select, so when the time was up, I removed them from the program. At the time I did so, I was averaging approximately 10 paid sales per say across the board, meaning I was receiving royalties from ten transactions, either as borrows, ten-percent reads, or paid sales. Upon removing them from KDP Select, I placed those items with other, competing retailers as well as leaving them on Amazon.

In the space of two days, my author ranking (where I rank in terms of paid sales compared to other authors on Amazon) dropped from roughly 20k to 60k, and eventually bottomed out at 90k. My average paid sales per day dropped from ten to four. By removing my work from KDP Select, I lost 60% of my sales immediately. Did I recoup any of those sales from the competing retailers?

No. Not one.

I let it ride for a couple of weeks but couldn’t stand the lost revenue. Businesses close over that kind of sales drop, and I am not ready to shutter Local Hero just yet. I re-enrolled. Since then, my author ranking has climbed back to around 30k and my sales per day average is now over five. I expect it may take a month or two to regain my former levels, or at least until I release Champion.

So what happened?

It all comes down to the success of Amazon in the field of ebook delivery. Between the affordable Kindle units and free apps that will run on any platform, they have literally perfected the availability and accessibility of ebooks. I personally am a great example. I don’t own a Kindle. In fact, I have a Nook, but I haven’t used it in ages. I have an Android tablet made for Kobo, which is another ebook retailer. I have the following ebook apps on my tablet: Kindle, Nook, Aldiko. I probably use the Kindle app 80-90% of the time, with Aldiko filling in the balance.

I am not an atypical customer for ebooks. I suspect the great majority of ebook readers are like me, using Amazon because it is easy. And when you throw in the Amazon Prime benefits of free ebook for a monthly subscription rate, they become the primary customer destination. By dropping out of KDP Select, I literally lost sixty percent of my customer base in return for access to a wider variety of retailers whose customers are more likely using Kindles and Kindle apps anyway.

For the foreseeable future, I will keep my novels in KDP Select. Why would I risk losing a huge customer base?

Why would anyone?

Comments

  1. It’s unfortunate that Amazon sinks its hooks so far into writers that they all but ensure the death of competition by limiting their work to a single retailer. That’s how I’ve come to see KDP Select. Yes, it makes things easier. But it’s also limiting as hell. Glad the smell is still on the rose for you, but in the event it wears off and you have all your eggs in one basket, it won’t be pretty.

  2. It’s up to Amazon’s competition to compete. If they can’t or won’t find a way to show writers how green their grass (or money!) is, then writers have no reason to work with them. KDP Select is a great idea for many writers, and when that’s no longer true, poof! The writers leave. What I love about KDP is the short commitment. Three months? That’s nothing for a trial run, and certainly far shorter than traditional contracts.

    Now if more authors would offer drm-free copies… (rubs hands gleefully)

    Thanks, Ian, for mentioning that authors get paid for a Prime borrow if the reader reads more than 10%. Knew it was true for Kindle Unlimited, but not Prime. I sideload all of my books, including Prime borrows, so I’ll need to borrow the hubby’s Kindle to make sure the authors get paid.

  3. Select is short term gains for long term losses, especially with the new Kindle Unlimited subscription model that Select users are forced into. Don’t expect those borrows to stay at $1.80.

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