KDP Select is a new option that features a $6 million annual fund dedicated to independent authors and publishers. If you choose to make a book exclusive to the Kindle Store for at least 90 days, the book is eligible to be included in the Kindle Owners’ Lending Library and you can earn a share of the fund based on how frequently the book is borrowed.
Before you get excited about the value of the payout dangled in front of your nose when you next sign in to your Kindle dashboard ($500k for December 2012) consider that you only earn a % of all ebook unit sales in the month, across all titles and genres. I have no idea what the total is, but I’d estimate at least 2.5 million ebooks are sold in a month through Amazon, in which case your titles will earn $0.20 per loan. Who knows how far out my estimate is? It’s not going to be a lot of library-loan royalty you’ll earn. You’ll get a bit more exposure, balanced by a few lost sales (see below).
The main benefit is: “In addition, by choosing KDP Select, you will have access to a new set of promotional tools, starting with the option to offer enrolled books free to readers for up to 5 days every 90 days.”
Presently, setting the zero price point is awkward, relying on Amazons bots to price-match your free book on Smashwords, but this is impossible to coordinate as the Smashwords system has random delays, and Amazons price-matching is not immediate or limited to one day. Being able to run a dated promotion is useful, if you’re into that kind of promotion. I suspect there are more ‘promotional tools’ coming. Amazon is good at selling.
What Amazon demands in return: EXCLUSIVITY.
Ewww. How can this be a good thing for a digital product?
For me, it’s not such a big deal. My experience is the sales via Smashwords (Apple, Barnes and Noble, Kobo, Sony) account for less than 6% of the market. I hate limiting the availability of my book, but doing so focuses the retail attention in one place, which helps my Amazon sales rank a little, which in turn helps sales. It also simplifies the process, because I don’t have to deal with different formats, uploading platforms, tracking sales and reports. Every outlet has a management cost and introduces its own complexity.
Because most of the big publishers won’t join this program at first, it offers participants increased visibility in the Library, if only for a few months. I expect the royalty from loans will offset the few lost sales. Those who can move fast will be in the Kindle Lending Library first. I foresee a flood of indie authors and small publishers trying to remove titles from Amazon’s competitors’ catalogues, just as the peak retail weeks hit…
The odd effect this might have is that all those who don’t sell much on the other platforms will shift to be exclusively on Amazon. It’s the slush rush. The traditional published books will remain on B&N.
I’d like to test out the ‘promotional tools’, so I just ‘opted out’ of all etailer channels on Smashwords. They update their feeds today (being a Thursday). Who knows how long it takes for every etailer to pull the title off their digital shelves? Until all of them have updated, I’m in limbo … I don’t yet have the advantages of being on KDP Select. Yeah I could click on ‘enrol’ without waiting for all competing sales channels to be eliminated, but Amazon’s bots are pretty active and the gorilla sounds pretty serious about the penalties, the worst one being ‘removal from the KDP program’. That would be a death knell for any indie author, although I doubt Amazon would ever use that on a title that is selling and making them money.
It remains to be seen if this is worth the sacrifice. It feels creepy to agree to anything ‘exclusive’ in the digital age. But I’m telling myself it’s only for 90 days, and if it doesn’t work I’ll pull the plug without having lost much. I suspect Amazon will provide (just) enough candy to keep me at the party. With digital publishing, it’s important to catch the new wave, and I want to maximise my Amazon presence because it drives 94% of my digital sales.
It’s a clever move by the market leader that will no doubt have blogs boiling around the world.
Will it help indies shift more books? I’ll let you know.
[edited on 12 January 2012]
Yes. It works!
Got a pleasant surprise from Amazon this morning … I’d enrolled my books in the Amazon Select (Library) scheme, thinking it would make a few pennies. Well it’s more than that. Amazon’s author’s fund ($500,000 per month) is divided by all the library loans (295,000 in December). I had 100 loans, so got $170. Neat hey?
My calculations were ten times too small because I’d estimated the payout based on all ebook sales instead of only the books in the Select scheme. I expect the amount I receive will halve every month as more authors sign on.
Yes, the catch was I had to make the book available exclusively on Amazon. But the lost net sales from the other outlets was far less than that for the month.
I guess that some of the loans might have been potential sales, so in a way you’re cannibalising your own market and accepting a slightly lower royalty, but I would presume that most of the loans are people that see the book on the library shelf, or only try it because there’s zero price friction, rather than buyers who tried to save money by loaning titles they wanted to buy (they only get one a month).
Amazon have been clever at introducing the free promo days tool. Free days definitely boost sales, but the only way to force the price to zero on Amazon in the past was to sign up to Smashwords as well, and set the price to $0.00. When Amazon’s bots discovered this they price-matched your Kindle book. Although this was technically breaking the terms of your sales contract (you promise not to make it available anywhere else cheaper) because this could be out of your control (etailer discounting) it had to be allowed. So Amazon’s restrictive policy of a minimum $0.99 price was causing authors to distribute their ebooks elsewhere. Now, the incentive to go elsewhere is limited because you can achieve most of what you want using only Amazon.
Sure there are pros and cons, but overall, joining the KDP Select program has been a success for me. If you’re an author, I’d recommend you join the program or get your publisher to do so. If you’re a reader with an Amazon Prime account, check out what you can loan, for free, while still supporting your favourite authors.