Loss Leaders For Profit

As a new author, I'm exploring many different strategies to increase sales and exposure of my books.  During a recent online Webinar, I was introduced to the concept of "Loss Leaders".

I've heard the term before in marketing, but I never thought about it in terms of self publishing.

Here's what a loss leader is:

You create 2-3 books. The first one is your lost leader, which means that you price it lower than your other published books. In my example, I priced my first book at only $0.99, with my follow up books priced at $2.99.

A Loss Leader is designed to attract attention and recruit new customers by giving them a lower priced version of your book. In other words, you're providing a sample of your written work at a low cost, minimizing your buyers risk. If you've done your job at producing high quality content, it's likely that your buyer will purchase additional books from you, all of which are priced higher.

This works exceptionally well if you are creating a series, where you price Book #1 at only $0.99 and all follow up books in the series at a higher rate, but it can work just as well if you have individual books that are focused on the same genre but are not part of a series.

It's important to play with price points when selling books online, because you want to split test different prices to determine the level of resistance in your market. Don't just price your books at the same rate that all other authors are pricing theirs at - be active in testing out different pricing strategies to determine what works best for your audience.