How to Make Money as a Writer Part Three: Profit Margins and Frequency of Purchase
Back in Part One, I teased you by saying that there were four factors involved in making money as a writer - leads, customers, profit margins and frequency of purchase - and that the writer was, simply by being a writer, already engaged in two of them. And that’s true - and in this article I hope to show you how the second two factors - profit margins and frequency of purchase - are much more directly under a writer’s control, but that, if managed well, they also have a positive effect on the first two.
Writers’ expectations generally, we have seen, are along the lines of expecting that a book will sell, and sell well, as soon as it appears. Most writers - by far the majority - are thus disappointed when months later they have not experienced the tsunami of sales that they were expecting. We have outlined that that is partly because books initially must be placed where they will be seen by those most interested in buying them - the audience for a particular book, whom we could call ‘leads’. If presented properly, with powerful covers, impactful blurbs, correct placements and good social proof, many of the leads will convert into customers.
But when it comes to profit margins, we need to look at things slightly differently. The market for books dictates to a large degree what a reader will pay for a book: a writer can’t expect to exceed that, either offline or online, and in these days of online self-publishing, some writers give work away for free or at very low prices in order to attract more readers. These have proven to be workable strategies, because of course they lower any resistance a reader might have to purchasing a book. (Note that the reader must still be of the interested variety - even free books will not be downloaded by the wrong public.) But if we are talking about profit margins, that takes us in a different direction.
For a reader - any reader - to be prompted into paying more for a particular book, rather than acquiring it as some kind of discounted or giveaway item, then that reader has to feel that that book is going to be worth it. That sounds almost like a tautology, but it bears closer scrutiny: there has to be something about a book, some quality or set of qualities in a story, which mean that a reader will reach for his or her money and hand it over. There has to be a greater commitment on the part of the reader to pay top dollar.