Is Kindle KDP Select Right for You?

Video transcript with bonus content

 

 

 

What are the Pros and Cons of KDP Select? No writer can ignore that question since there is money at stake. In fact, if you are using Amazon KDP to publish, it’s an essential decision you must make.

Amazon KDP, the self-publishing division of Amazon, is the brainchild of Amazon founder Jeff Bezos. He is a genius in my opinion. And I’m not alone. He brought together ebook technology in a unique way that revolutionized the way people buy and read books.

However, Bezos is in the business of making money.  He spent hundreds of millions of dollars building a pipeline to sell ebooks which starts on Amazon.com, delivers ebooks wirelessly through Whispernet, and ends up on a Kindle ebook reader.

Authors need to realize that it’s in Bezos’ interest to keep that pipeline filled. That is the purpose and function of Amazon KDP. He does that by offering cheap ebooks to readers. The only way he can do that is by “manipulating” publishers and authors into accepting the lowest possible price for their ebook.

One of the things Bezos has done to drive prices down, and pay authors as little as possible, is a program called KDP Select or Kindle Select. It comes disguised as a bundle of author benefits, but it can have a dramatic negative effect on your income.

A Good Idea Gone Wrong

Is KDP Select a sucker punch to the chin from Amazon?

That may be a little harsh. Yet, KDP Select has some serious flaws for authors, and in my view, they should never automatically sign up for it. It is too important to success to leave to an impulsive decision.

Yes, back in the day, KDP Select worked. It’s doesn’t work very well today in many cases. Even Amazon recognizes that, and that’s why their big push is to get authors to buy AMS ads.

KDP Select has been with us since 2011. It was a simple plan in the beginning. If you gave Amazon sales exclusivity for 90 days, they would enroll your book in the Kindle Owners Lending Library (KOLL), and pay you out of a fund they established.

Authors received a share of the fund based on the number of their books that were borrowed, compared to the total number of books borrowed.

Another component allowed authors to give away their book for 5 days out of each 90-day period.

The idea was that thousands of people would download your book, and you could expect a huge number of reviews and the buzz would skyrocket paid sales. It worked, but not for long. It still works, but for very few.

What killed the free promotions?

  • Almost everyone started giving away ebooks. The market was flooded in every genre.
  • A proliferation of new web sites started promoting free ebooks. That eliminated the uniqueness of the free offer, and ebooks became a commodity.
  • Most free downloaders became freeloaders. They did not write reviews or create buzz. It seems like there are a huge number of ebook hoarders who get them when they are free. but never read them.

I discuss the giveaway problem in another video.

The Kindle Select Vortex – The Pros and Cons

If you decide to give away a free ebook, don’t get caught in the KDP Select vortex.  You don’t want to give Amazon the 90-day exclusivity KDP Select requires.  Especially when your book will not receive the visibility in Amazon’s own rankings as free ebooks once did.

Amazon has put real teeth into their exclusivity expectations. They have banned books and authors who violated the pact, even innocently. Amazon constantly searches the internet to make sure your book is not being sold elsewhere. If they find it for sale on another site, even your own site, they will punish you.

Amazon is the biggest book marketplace in the world, but you want to” go wide” as they say, and sell everywhere, like Draft2Digital.com and Smashbooks.com.

While KDP Select had some worthwhile benefits at one point, things have changed. For example, free books no longer appear in the “Also Bought” listings, so you no longer get leverage with that.

To get a 70% royalty, you are already forced to join in the Kindle Lending Library, but when you sign up for Kindle Select, you are forced into their Kindle Unlimited plan. That means that you’ll get less than 1/2 of one cent per page read. Look at it this way — if your book is 200 pages and you sell it for $3.99, you get 70% of that which is $2.79 minus the small Whispernet delivery fee.

How much do you get under the Kindle Unlimited plan for that same book? About 90 cents. When it comes to pros and cons, this is a big con.

I think that’s pretty outrageous. Of course, others will have different views. Some authors make a pile of money each month off the Kindle Unlimited plan. Others have a more passive view that 90 cents is better than nothing.

But any way you look at it, the person in this scenario is losing $1.89 per book by signing up for KDP Select.

That’s a huge price to pay Amazon instead of doing a proper job of marketing your book in the first place and getting what it’s worth.

Amazon KDP Turns Greedy?

Amazon has done several things to complicate KDP Select. They consider them improvements, but authors should challenge that claim. The changes included:

Limiting the 70 percent royalty to 30 percent in some countries unless you join KDP Select. For example, I sell mostly to English-speaking countries, so I don’t care if I get only 30 percent from books sold in Mexico or Japan.

If I publish a book I think will do well in one of the “35 percent” countries (notably India), I simply check the exchange rate and increase the price of the book, so I get the equivalent of 70 percent at the 30 percent rate. KDP allows you to change the sales price—you are not required to use the default US (or any) equivalent price. I have a separate video about how to do this.

By the way, even when you sign up for 70%, KDP Select or not, you are still forced to offer your book in the Kindle Owner’s Lending Library (KOLL). Your book becomes a candidate for Amazon Prime members to get a free ride at your expense.

The only out is choose to sell your book at the 35% royalty level instead of the 70% level.

Free Ebooks Have Lost Their Sales Power

Amazon recognizes that offering ebooks free as a promotional gimmick for authors is pretty much dead.

Thus, they started offering two other promotional features. One is a “Pre-sales” option. Authors can announce their book and sell copies before it’is released.  KDP Select users can use “Kindle Countdown Deals.”

An author sets a low price, and it increases over time to its normal selling price. This creates an artificial incentive for customers to “buy now” and this can work if a huge number of people are aware that your book is in this program.

But this also means you are doing a huge amount of marketing work. And where are all your customers going? To Amazon and seeing a free KU offer!

Kindle Countdown really only feeds the Amazon dog.

If you have an author website, you want to drive traffic there. You can set your own countdown deal and by changing the price manually. You don’t have to sign up for KDP Select to get this benefit.

But what is the biggest KDP Select problem of all?  What removes money out of your pocket? It’s Kindle Unlimited.

The Kindle Unlimited Problem

Kindle Unlimited or KU is the most disturbing KDP Select element. When you sign up for KDP Select,  you are obligated to be a KU supplier.

Any Amazon customer can pay $9.99 per month to sign up for KU and can download and read as many books as they want. They get to read your book free if you are in KDP Select.

Do you get the full price for an ebook, say $3.99, when a KU reader downloads it? No way. You get paid out of the Amazon Global Fund. When considering pros and cons, this is on the negative side of the ledger once you understand what’s happening,

It used to be that you would get paid based on the number of times your book was downloaded out of all the books in the program. Your payment was based on a percentage of all books downloaded. Amazon killed that fast. Now they only pay by pages actually read.

These days the Global Fund is about $20-25 million per month.

They married technology that is able to measure how many pages a downloader reads no matter where the reader is or when the person reads it. This system is called KENPC – Kindle Edition Normalized Page Count. It differs from your actual page count.

So you no longer get paid your retail price when someone downloads your Kindle book under KOLL, KU or the special curated Amazon Prime readers program.

You only get paid for the pages people actually read. Worse, A KU member must read at least 10 percent of your book before you get any payment at all.

How much do you get in this deal? In recent times its about .0045 cents per page. That’s less than 1/2 of 1 cent per page! That’s all your writing is worth to Amazon KDP.

Tipping the Pro and Con Scale

But wait–there’s more!  Amazon advertises that their fund is about $25 million a month, but they drain well over $1 million of that amount off the top to pay what they call “All-Stars” the bestselling books and authors in the US, UK, and Germany.  In the US, the top 10 Kindle Select sellers each get a $25,000 bonus, and there are lesser amounts for other sales categories.

So, you drive the traffic to Amazon, but they cream the profits.

Say you have a 200-page book that you sell for $3.99. Under KDP Select, if someone reads 100% of your book, you’ll get about 90 cents for it instead of $3.99. Many books are longer, of course, so yield is more than 90 cents, but you get my point. It’s all relative.

As I said, Jeff Bezos is the richest man in the world. At this moment in 2019, Forbes says he is worth $131 billion.

I bet you think he made that in hundred-million-dollar increments. Not so. He made it $2.09 at a time by getting you to sign up for KDP Select rather than you selling it for the $3.99 it’s worth.

By the way, you probably won’t even see the full 90 cents per book because so few people finish reading books they download. This is especially true when they’re paying by the month, not by the book.

You’re probably asking if there is there an upside to any of this?

Is There an Upside to KDP Select?

I have stated the facts about KDP Select fairly well. But you know, a large number of authors LOVE selling their work for less than 1/2 of one cent per page through Kindle Select.

If they get 100,000 page reads a month, that means they earn about $450.

Yet, if the same book was 200-pages long and sold for $3.99, the profit would have been $1,395 at a 70% royalty.

Let me tell you the story of  Mike Omer who was profiled on The Atlantic website. You too might be one in a kajillion like him. Omer wrote a 378-page thrilled called A Killer’s Mind.

It was good enough that Amazon decided to publish it under their own Thomas and Mercer brand. So, for that reason alone, you know Amazon pumped the book in the listings.

According to Omer, he sold 10,000 copies, but the income is a little hard to compute. Even if we average hardback, paperback, Kindle, and audiobook, it would likely be more than $117,000. That’s probably a low estimate.

Omer says the book was also downloaded 10,000 times via Kindle Unlimited. His total income from that at today’s less than 1/2 of 1 cent per page rate. He earned about $17,000.

These numbers don’t seem to change much.

The fact is, some authors are thrilled to get 1/2 of one cent per page for their work. They think they are in heaven. Good on them, I guess. They are the ones who see the benefits of Kindle Select, and no one will change their mind.

If you have a book with a high page count, and a lot of Kindle Unlimited members who love your writing, and who turn pages fast, then KDP Select may be for you. Especially if you don’t mind letting Amazon have all the extra money you could be making if you sold the book rather than renting pages.

The only other conceivable reason for using it today is to get exposure. Just remember, you are paying at least $2.09 per book for a modest-sized book, and that’s a lot to pay for exposure. You’d probably do better buying Amazon’s AMS book ads, but that’s a different topic.

The Pro and Con Choice

Most people sign up for KDP Select because they have no marketing plan.

They think they’ll get exposure by a free giveaway, but they don’t get much exposure that way. There is a glut of free ebooks, and most people don’t even read them. They just hoard them.

My advice? Don’t jump on the KDP Select bandwagon. It has far more bad features than good ones in my view.

The secret is to write a book that people want to read. Make sure they know it exists by promoting it. Get the highest possible price for your work, not the crumbs from Bezos’ KU subscription plan.

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