Amazon Kindle Tiers

Amazon sells books in both print and ebook formats, but, frankly, most indie writers generate the bulk of their revenue from ebooks. Since most indie writers make the majority of their money on Amazon, this means the most indies are generating income from Kindle sales, borrows or page views through Amazon’s Kindle Unlimited subscription service.

Over time, as various authors have compared notes on sales, some general statistics have been developed to indicate what the different Kindle sales rankings actually mean in terms of the number of units sold. I’ve broken those sales rankings into seven distinct tiers, which are described below.

Note that these numbers are approximate, and may vary from day to day. Nevertheless, they provide a useful model for understanding Amazon’s sales and may be useful for planning purposes, as well.

Tier 1: 1 – 10

You’re selling an ungodly number of books and probably making six figures per month from just a single book. You’re also killing it in borrows and page reads from Amazon’s Kindle Unlimited subscription service.

Sales: More than 60K books per month.

Tier 2: 11 – 100

You’re selling ten thousand or more books and probably making mid to high five figures per month for an individual title. Again, borrows and page reads will kick in additional revenue. The highest charting indies may move into this territory briefly, but generally won’t be there for long.

Sales: More than 16K books per month.

Tier 3: 101 – 1000

You’re selling thousands of books per month. At best, you’re doing low five figures. Even at the high end of the ranking, you’re still making a few thousand per month. Best-selling indies who end up in this territory for even a relatively short period may end up making more money than most traditionally published writers ever see. Borrows and page reads are a significant revenue stream.

Sales: More than 3K books per month.

Tier 4: 1001 – 10,000

You’re a real writer making real money, selling hundreds to low thousands of books per month. Borrows and page reads are still a significant revenue stream. This is where best-selling indies tend to hang out, especially if they have a large portfolio of books for sale.

Sales: More than 400 books per month.

Tier 5: 10,001 – 100,000

You’re selling 1 to 10 books per day, which adds up over time. At the lower rankings, you may be getting some revenue from borrows and page reads, but most of that will have dried up at the higher rankings. A lot of indie books settle into this tier and steadily earn money for writers. This is probably the bread and butter tier for most indies. Once again, having multiple products is the key to success when books are in this tier.

Sales: More than 35 books per month.

Tier 6: 100,001 – 1,000,000

You’re making a few sales per month. Don’t quit your day job.The settling place for indies that need to learn more about marketing.

Sales: About 2 sales per month.

Tier 7: 1,000,000+

You’re basically not really selling at all. This is not a good place for a book to be. Ever.

Sales: A sale every once in a while, maybe.

Why are tiers important?

During an intense marketing effort, such as a launch, an ebook tends to naturally reach a particular tier in terms of sales. Amazon’s own internal algorithms even take into account different factors, such as honoring slowly rising sales more than temporary spikes, and try to optimize where the book should be in the sales rankings.

After a time, generally at the 30, 60 and 90 day marks, an ebook ages enough that sales generally fade a bit and it drops to a lower tier. What you’d really like is a book that, even on auto-pilot, settles into a high-enough tier that it continues to bring in significant revenue with little or no ongoing marketing.

Best-selling author Hugh Howey’s book, “Wool,” after five+ years in publication, has settled in at the high-end of Tier 3. This means that he makes money month after month with little to no advertising. The books also leads readers in to the next two books in the trilogy, which means that the sell-through makes him even more money.

If you’re marketing your ebook, what you really want to do is to create a campaign of some sort that generates slowly rising sales rather than a sudden spike. Likewise, you want your ebook to reach the highest level possible so that 1) you make a boatload of money, and 2) your ebook eventually settles at a lower tier in terms of sales, but continues to generate real revenue.

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Book Purchases in 2013

Where have the bookstores gone?

Where have all the brick-and-mortar bookstores gone?

OK, I’m a numbers guy. It’s an inescapable part of my training from my day job, where I’m a detail-oriented information technology (IT) specialist. I kept track of (most) of my book purchases in 2014. I missed only on recording a couple of purchases at conventions and two purchases at McKay Used Books, my awesome, semi-local used bookstore. Still, it’s interesting analyzing the data for trends.

Last year, I spent $80.32 on Amazon. I spent $61.25 at bookstores. I spent another $37.80 at science fiction conventions. Money-wise, it was kind of a lean year, so I spent a far less than I usually do. This is also the year that I started reading extensively in electronic formats (chiefly on my smartphone, an Android Razr with a nice-sized screen).

My Amazon purchases are interesting. First, I bought some new, print editions on Amazon that I couldn’t find locally. I bought some used editions from vendors that advertised on Amazon, so Amazon took a percentage of the purchase price. Finally, I bought ebooks from Amazon. The real point here is that I shopped on Amazon because it was the only place that I could find all of the books that I wanted.

My bookstore purchases are probably even more scary for bookstores than the dominance of Amazon.

I live in Loudoun County, Virginia, a suburb of Washington DC. It’s the fastest growing county in the entire country (for, like, 13 of the last 15 years). Loudoun County is also one of the most affluent and one of the most educated counties in the entire country. Which is why it’s shocking that there are no bookstores around here (except one tiny, ill-stocked Books-a-Million in a local mall).

For bookstore purchases, I spent only $61.25. That translated into two books from Wegman’s, a luxury supermarket; two from Books-a-Million, a large, regional bookstore chain; and one from Barnes & Noble. The ones that I bought were bestsellers from writers that I already follow, i.e. – I tend to buy them wherever I first spot them.

This is also the first time that my Amazon purchases have surpassed all of my bookstore purchases. For the few times that I went to a bookstore, none of which were in convenient locations to where I live, I failed to find the books that I was interested in. My bookstore visits were thus 1) dissatisfying, and 2) inevitably resulted in Amazon purchases so that I could get what I’d wanted in the first place.

I attended several conventions during the year, including both Capclave (in the Washington DC area) and Balticon (in the Baltimore, MD area). The Dealer’s Room at just about any reasonably-sized convention offers a far better selection of science fiction than any brick-and-mortar bookstore, including both new and used editions. It also features vendors who are extremely knowledgable about the field, meaning that the “recommendation engine” at a convention can rival Amazon’s recommendation engine.

When you account for the several purchases I forgot to record, It’s very likely that I spent more money at conventions and used bookstores than I did at conventional, brick-and-mortar bookstores. I easily spent more at cons than any individual brick-and-mortar bookstore. Likewise for used bookstores.

Can we draw any conclusions from my experiences? Well, there are clearly dangers associated in extrapolating from a single data point (me) to the industry as a whole. Nevertheless, I suspect that other book buyers are having similar experiences. So, here we go…

First, Amazon is increasingly successful because they, more than any other bookseller, are making it possible for customers to find what they want. More specifically, Amazon wants you to find what you’re looking for, regardless of price, and they don’t care whether what you purchase is a new print edition, a used book, or an ebook.

Second, bookstores suck. There’s no other way to put it. When you go to a store, and then you leave and shop somewhere else (Amazon) because the store didn’t provide what you wanted, that can’t possibly be good for the future of the store. For me, and likely others as well, this is aggravated because an increasing number of the authors that I care about are available mostly in ebook form, so it feels like bookstores are missing an entire dimension that has become important to me.

Third, additional money that I spent in non-traditional venues like conventions and used bookstores probably would have gone to Amazon if those venues had not been available to me. The audience for science fiction conventions is, I suspect, a relatively small percentage of the overall science fiction reading community. For those people who don’t attend conventions, and don’t have access to a quality used bookstore, I suspect that most of their money would have been spent on Amazon, not traditional booksellers.

Fourth, while I understand that 80% of books are still sold in print form, I can only guess that in the future they won’t be sold in brick-and-mortar bookstores. Personally, I’ll be much more likely to buy them from Amazon than Barnes & Noble or Books-a-Million.

These are pretty scary trends for traditional, brick-and-mortar booksellers. Overall, it feels like there’s a vast and intensely interesting conversation going on between readers and authors…and the bookstores are missing out on it.

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