The vast majority of indie authors can't make serious money at the 99 cent ebook price point, but some will tell you the increased exposure that comes with higher sales volume is worth the cost. They'll explain that more sales increase their rankings, possibly putting them on genre bestseller lists or, if they are very lucky, into the Kindle top 100.
A good number have achieved success with the bottom-rung pricing strategy, but at what cost? Joe Konrath, a bestselling ebook writer, has run a number of 99 cent sales recently; here he mentions the loss he's taken for the sake of making the bestseller list with The List.
For a time I priced Unbroken Hearts at 99 cents. My ranking improved dramatically. It also brought me readers from outside the genre: Bargain hunters who snapped up anything at the 99 cent price point. Most don't read the sample. At 99 cents it's an impulse buy, and why not? They've been conditioned to believe price will go back up next week, as it does when traditional publishers put their books on sale, and many readers can't tell the difference between a trad published book and an indie. By employing professional cover artists and editors, the indie works can look just as "pro" as the big boys.
Is it a deal if the customer starts reading the bargain book and doesn't like it? Is it a deal for the author when the disgruntled reader leaves a bad review because it wasn't their 'cuppa'?
The worst Amazon review I've received on Unbroken Hearts was submitted when I had the book on sale (99 cents). John Locke's 99 cent books attract as many negative reviews as positive (see Saving Rachel), in spite of rising to bestseller status.
What do those bad reviews tell us about the reader's perception of value?
My takeaway is the reader's time ranks ahead of price.
What's more, I'm not convinced an indie-published book can't make the top hundred with anything but a 99 cent price. Carpenter is killing it with The Killer at 2.99. Blake Crouch is making a run at the top with Run, also 2.99. I'm bidding to take down the old dog-eared, established names with TAKEDOWN. Sorry, I couldn't resist ;-)
I'm making more, but selling fewer copies, on TAKEDOWN, at 2.99 with the 70% royalty. I'm also hauling more revenue on the Easton Hearts series at 2.99 than I made at 99 cents. Yes, fewer actual copies are sold, but I'm hoping to engage more thoughtful and discerning readers.
It's all about finding a fit with the right audience. My books aren't for everyone, and I don't want them to be a blind bargain purchase. My goals are to delight the customer AND maintain a sustainable business model.