Despite a class action lawsuit, PublishAmerica continues to send out and publish on their website some very questionable letters.
June 13, 2012
Good morning!
Thank you for the many reactions I received after I gave you some background about shipping and fulfillment fees yesterday. As I expected, some of you asked me, why don't you charge one all-in price for a product, and ignore the shipping fee altogether?
The answer is as simple as it is baffling: because having the fee there generates more sales.
Have you ever wondered why gas prices always end with a 9? It's because your mind thinks that it's cheaper than 0. Shipping fees have a similar effect.
More after this book review, An Alien’s Cross by Larry Lindstrom (wyochipshot@yahoo.com):
Larry brings everything to the table in his action-packed novel. There’s not a moment to spare in this ride through all kinds of daring escapades out west. Lou Elliot rushes to the aid of his old Apache friend Juaquin, who claims he’s been contacted by aliens. Lou becomes a busy guy, rescuing hostages from Mexican drug cartel members and saving whole families from abduction. Mysterious black helicopters appear, taking Juaquin’s family members and coming back to look for him and his grandson. Lou reunites with an old friend and FBI agent, and they team up for another chance at ridding the country of miscreants.
There is much more than meets the eye in An Alien’s Cross, a suspense novel that caters to the needs of thrill-seekers who are looking for a quick escape into a world of kidnapping, drugs, hostage negotiations, and FBI agents. From New Mexico to North Dakota, Larry Lindstrom (nice Swedish-sounding name; they pretty much invented the crime genre in Sweden) zips readers back and forth between daring rescues with a breath-taking ending.
Find An Alien’s Cross here:www.publishamerica.net/product47507.html.
My local gas station charges $3.24.9 for regular. Not 3.25.0. Even though $3.25 is really what you pay, instead of the 3.24 youthink you pay. It has been like this for as long as you can remember, and the only reason is that gas station owners are business people, and they want you to believe that you are cheaper off than you are. They're right. You do believe that.
Sixty percent of all prices in America end with a 9. Except at Walmart where they rightfully claim to always have the lowest prices, so they go oftentimes for an 8. It makes customers' brains think, subconsciously, that they're a full dollar cheaper off. 1.99 looks better, and somehow much cheaper, than 2.00. Especially when you leave the $ sign off.
Playing with shipping fees generates a similar effect. Online shoe giant Zappos is a good example. They charge no shipping at all. Of course, borrowing a phrase from yesterday's message, the lower the shipping fee, the higher the product price. If it says "free shipping", something else has become more expensive. Zappos' shoes are markedly pricier than what you pay elsewhere. But their 24 million customers don't care. They go for the free shipping and ignore that they pay for the difference anyway.
But you, our PublishAmerica authors, are our best example. We change our shipping/fulfillment fees constantly, and each time we do, we also change the sales price of our books. The lower our shipping fee, the higher the book sales price. As I have explained before, we need to generate roughly between $9 and $10 for a book to stay profitable, and we don't really care how we arrive at that total amount.
You, however, do care. Roughly 60 pct of you are keen on lower sales prices. They barely mind how much they pay for shipping/fulfillment, as long as they can get the product for the lowest possible sales price. So when we offer your book for $2.99, we usually charge $5.99 for shipping, totaling $8.98 per book. But when we go one dollar lower, and sell the book for $1.99, the shipping fee goes one dollar up to $6.99, also totaling $8.98. It never fails: we receive significantly more orders for the $1.99 book than we do when the sales price is $2.99.Yet the total amount you pay is exactly the same.
Meanwhile, there's 40 pct of you who simply refuse to pay that much for shipping/fulfillment. Those are the ones who want to send me letters of complaint about how predatory much we charge for something they know the post office can do much cheaper. Until they see our next sales offer that says Free shipping! That's the one they have been waiting for, and if they happen to want a few more copies of their book on hand that day, they jump into action.
Yesterday was a fascinating example. That's the day that I wrote to all of you about the background of shipping fees. The title of my message was Why you never pay enough for shipping, and in it I wrote what I quoted above,If it says "free shipping", something else has become more expensive. One minute later,one minute, we issued a sales offer under the title Free shipping at PublishAmerica today. It charged no shipping/fulfillment fee, but it asked a sales price of $9.61 for your book. That's 7 pct more than what a book cost you on Monday when shipping was a whopping $6.99, but the book sales price was only $1.99.Yesterday we sold almost twice as many books as we did on Monday. It was the day free shipping afficionados had been waiting for. At any price!
Selling a product is all about offering incentives. No or low shipping is the perfect incentive for one group of people, low product sales prices is the ideal incentive for a totally different group. Without alternating the incentives regularly, incentives stop being recognized as incentives, and sales take a dive.
That's why we keep the shipping/fulfillment fee as a factor of our book pricing for authors. Because it works like a charm.
I invite you to talk back to me. I don't guarantee a response, but I do guarantee that we listen. You can reach me by email at ceoletter@publishamerica.com. In the subject line write Attn. Willem.
Have a wonderful day!
--Willem Meiners
If you want to rent space on Willem's future Letters-from-the-CEO, go to www.publishamerica.net/service/Willem.html
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