Loss Leaders and Giveaways

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What are loss leaders?  Can they help you?

In the self-publishing world (and in product sales in general), a loss leader is a product that you put out in front of people at a cheap price – sometimes at a loss to yourself, thus the term “loss” leader – which is meant to entice people into trying out the cheap one in favor of possibly purchasing the other products (in my case, books) that you publish later on.

This article discusses the pro’s and con’s of loss leaders and giveaways of your product – specifically, your new book.

So, as I said, a loss leader is a product that you put out at a cheap price to entice readers to check out your book, and (hopefully) entice them to read other books written by you in the same series or others.  I am currently experimenting with this option, along with giveaways, with mixed results.  So, I decided to write an article about it to help others who may be in a similar situation.

We all want to generate sales for our books, but the methods must be considered before proceeding.  The idea is that you’ll give out copies of the book or reduce the price to entice the public, and they’ll read your book, love it instantly, tell everyone, and soon enough you’ll be a millionaire.  You can have some negative outcomes to this, so be aware of them.

First, yes, offering THE DYING TIMES for $0.99 has helped increase sales, and the loss leader is helping generate sales for my new book THE WAR OF THE DEAD.  It has also stimulated sales for THE DYING TIMES, which started to lag a little bit towards early January.

I have also done giveaways of the book to allow people unfamiliar with the title to check it out and see what they thought.  The results of the giveaway have been more mixed – some positives, some negatives.  I’ll go over the giveaway first because it has more compelling information, and I’ll finish with the loss leader benefits and negatives, as it has become more beneficial.

Note:  This is not the giveaway referenced from the tab above, this is giving away free copies of the book and asking for reviews if the reader feels so inclined.

So, let’s look at book giveaways.  Since I’ve done the giveaway, the people reporting back have been pleased with the storyline of the first book, but the reviews have generally been lackluster.  Now, I don’t feel that the reviews are dishonest or anything like that, but I do feel like I had a little bit of a boomerang or backfire effect.  Let me explain.

Have you ever been at one of those grocery stores that offer free samples of a certain product?  Perhaps it is a new product that they are given money to offer for free so it will entice business.  Sounds like a decent concept, right?  The customer gets a free taste, wants more of the product, so they’ll buy it all up and we’ll be millionaires, right?  Not so fast.

Let me relate my experience with a free sample I received once.  I took the food item handed to me on a toothpick by the smiling clerk who was pushing her wares upon passers-by.  I appreciated the chance to try this new item, as I had heard about it a little bit before.  I tasted it – in all its prefabricated glory – and was not impressed.  I decided not to buy the product, and I actually told people to avoid it due to my negative experience.  Despite the fact I got it for free, I gave an honest review which, in my circle of friends, turned some of them off of the product.

Do I recommend you tell people they must give a positive review in order to sample your book in a giveaway situation?  Absolutely NOT.  I am simply trying to tell you that, just because something is free, doesn’t mean the person won’t bash it.  So, your giveaway-for-reviews event could backfire, and you should be prepared for that.

Another thing is that you should watch out and not put something in a popular place just for the exposure.  Yes, people will see your giveaway, and people will post to get it.  Do they read your existing reviews?  Do they look at the product description?  Do they even visit the product page before posting?  Usually not.

You could be writing a christian children’s book about a dragon and a young boy, and someone who is an adult atheist who hates kids and fantasy posts to get your book for no other reason than it’s free – people are enticed to grab free stuff when they see it, whether they intend to read it or use it for extra firewood.  When he reads it, he finds out that it’s filled with things he hates as a reader, so he deletes the book, refuses to buy anything from you again, tells all of his friends that your books are a sham, and then posts 1-star reviews all over the place.  Just because you’re offering something for free and in a popular place doesn’t guarantee you good reviews or positive feedback.  Books are about a connection between the author’s words and the reader, and not everyone is going to feel the same way after reading the book.

So, when hosting your giveaways, give your books away to people who have an obvious interest in what you are writing about.  Give the copies to people who actually have a chance of becoming regular readers.  But, don’t for a second think that this is going to be instantaneous, wonderful publicity.  Your publicity comes from your editorial reviewers – they will provide the most useful words of praise and the most constructive criticism, especially if you find a good one.

So, what do you do?  I find that having a loss leader in your series (or a couple of loss leaders if you write only standalone books) will entice people to read your work.  They may be more inclined to refer your book to others or read the others in a series themselves.  It’s more economical for people to try out your loss leader before spending bigger money on your books.

Bringing the book down to a cheaper price can increase the feeling of value from your book, also.  Someone who might have given the book a 3-star rating may be inclined to up it to a 4-star rating if the price was really good and the value is there.

There are those who might say pricing a book at $0.99 is bad for business, shows that the author doesn’t have confidence in their own work, and cheapens the craft of writing.  To that I say, we are in a very competitive field.  New authors come up every day and try to claim a slice of the pie for themselves.  I’m a new author myself, so I have to work on getting my own corner of the market that I feel comfortable with, as well.  It doesn’t cheapen your book or your writing, it’s simply competitive business.  You are basically in manufacturing as a self-publisher and author.  You may not print the book itself, but you are making the product.  Other manufacturing industries have been using the same technique for years (if not centuries) – sell a loss leader to get people interested in your other materials.

I could say that I’ve had some negative experiences with dropping the price to $0.99, but it’s been better than the giveaways.  If you drop the price down, more people will be willing to try the book anyway, which is good, but they may be well outside your target market and may not be suited for the book.  It’s a unique kind of product, so be guarded about how you proceed with giveaways and loss leaders.

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