Tuesday, 20 January 2015

Why my books don't cost 99 cents

I was recently asked why my books are so expensive. Surely, the reasoning goes, if my books would cost 99 cents, I'd have more sales and make more money, and besides, it would curb piracy.


No. At 99 cents, I couldn't live off writing, simple as that. I most definitely wouldn't even have attempted becoming a full-time writer. In fact, I wouldn't have walked out of my day job, and would very likely now be doing some (read: any) job out there, leading to less time to write and possibly giving up.

Let's walk through the facts and numbers:

Amazon sets the price bracket

The common price points for books are heavily engineered by Amazon based on the payout. Amazon pays out 70% on books priced between $2.99 and $9.99, and only 30% on books priced below $2.99 or over $9.99.

In other words, a self-published writer makes about $0.30 for a 99-cents book, but about $2 for a $2.99 book.

And why is Amazon important? Because Amazon is 80-90% of everybody's ebook sales.


Cost of producing a book

Producing a novel-length book properly (edits, edits again, decent cover, formatting, conversion, etc) easily costs between $1,500 (that's low-balling, because I've cut deals with some people) and $2,000 - all of this is money you have to invest before the money is starting to roll in. There are people who don't invest in an editor, because an editor is by far the most expensive part of production, but a good editor makes all the difference. There are people who cut corners on editing and claim nobody notices. Well, I notice, and I want to publish books that are worthwhile, which means investing enough money to make sure I'm proud of what I'm putting out.

Now, if you self-publish, you need to sell nearly 6,700 copies to make your money back at $.30 royalties per copy. And this is where the kicker is - speaking from my own personal experience, I haven't written even one book that has sold that many copies. Even if I do manage by some miracle to sell 6,700 copies - at that point, I haven't even been paid for my work.

Conversely, let's assume you have a really, really good contract and a publisher would pay you 50% of earnings per copy (publishers pay closer to 25-40%), a publisher would have to sell twice those 6,700 (= 13,400) copies for the author to make $2,000 for a novel. The publisher has to pay for its own expenses, aka marketing, staff, possibly offices, conferences, IT support, corporation tax (that's after footing the bill for production costs of the actual book).


Investment in training/man-hours

I haven't crunched the actual numbers, but let's assume a novel is about 100-300 hours of work (I'm pretty sure that a historical novel, with all the research and fact-checking is a lot more than that) and you do manage to sell those 6,700 copies and do make $2,000 for a book. If you average the production time (200 hours), that would be a theoretical $10/hour (before tax, before cost like internet connection, heating, research books). That's about £6/hour. Minimum wage in the UK is £6.50/hr, while London "living wage" (how much you need to cover living costs in London) is £7.85/hr.

Now, I've made more making sandwiches at gas stations (EUR 9/hr), which required about a 30-minute training. Yes, everybody can write, but to write something other people want to read takes tens of thousands of hours of practice, which isn't paid and incurs quite a bit of cost as well. I'd estimate if you're working very hard and have access to mentoring and how-to books, it will still take 3-7 years to train yourself to become a writer who can write a decent story. I've been writing and learning for 20+ years.

And we often forget all the other hours an author spends on supporting their books and being available to readers: answering reader emails, blogging, paying out of pocket for print books for giveaways, swag, attending conferences, postage and admin for sending signed print books around the world, responding and being present on social media, responding to thousands of messages and questions overall. All those are hours not spent writing or doing a day job. I believe they have value.


Depth of market

I don't have access to actual hard sales data apart from my own and some data from friends and colleagues, but I do have a decent idea about the size of the m/m market specifically. In m/m, I'm considered a "mid-lister", which is a polite way of placing my sales somewhere in between "doesn't sell enough to make money" and "bestseller". I'm in that nebulous area where I'm making some money but still can't afford to travel to GRL on my writing income alone and where a month of bad sales means I'm fretting about whether this whole thing was a crap idea and whether I shouldn't just go back to a day job because every year out of the day job means I'm getting less employable.

I have steady sales on some books (thank you, Dark Soul and Market Garden), but even so, only very few of my books have sold more than 3,000 copies - and those that did were co-written (in other words, I only make half the money on those). I don't think any of them have sold more than 6,700 copies.

Now, obviously there are best-sellers in m/m who sell 20,000 and 30,000 copies of a book, so there's some depth in the market, and you could argue that the high prices keep people from buying the other books. Let's test that theory: I've experimented with freebies (Bookbub/giveaways), and the best performance of those was another 2,000 copies given away for free for a book that had sold 2,000 copies thereabouts.

If that number had been 20,000 copies, that would have meant there's 20,000 people I'm not reaching because of the high prices. But there aren't. Even assuming the "freebie downloaders" would be willing to pay 99 cents for a book, I'd only reach 4,000 people with my average book if I priced it at 99 cents. Still way short of the 6,700 I need to earn the initial $2,000 investment let alone make even a dollar of profit.


Alternatives

Short of becoming a bestseller, who reliably sells 20,000 copies of everything (which isn't really in my control), there are obviously ways to make the numbers work. Considering that 70-80% of those $2,000 production costs are editing costs, there are authors out there who simply don't pay a professional editor. I've tried that: I've had Return on Investment checked by a lot of friends and I gutted it myself, and I'm a decent self-editor, but I know Return on Investment would have been a better book if I'd paid a professional editor. At that point in time, I just couldn't afford it and so I did the best I could. I don't regret it, but I wish I'd had had the money. But then, I expected it to sell maybe 100-200 copies in total.

Thankfully, there's so many free books out there that people who don't want to pay for their reading don't have to. There's tons of fanfiction and free fiction on the internet, and a lot of it is very good. The Kindle Free list is huge and gets more books added every day. Of my own works, there's Special Forces, which is 1,000,000 words (roughly equivalent to 10-15 novels, which would cost people normally $75-100 to buy if we assume an e-book price of $6.99 per novel).


Other authors are doing it

Some authors are making the 99-cent model work for them. Mostly, these books are very short (flash fiction, short stories) or aren't edited (the "throw unedited crap onto the market" model), and then readers complain about how the book was too short or the novel was so bad it wasn't even worth those 99 cents. However, this is not what I want to be known for - I like to take pride in my work and do the best I can, which does mean some investment in a good team. (And yes, I charge more than 99 cents even for short stories, because they still cost money to produce properly.)

But there are some authors that do edit their stuff and still put it out for 99 cents. These are usually first books in a series, or cheap tasters, and the bet is that the reader will enjoy the book so much they'll pay more for the next installments in the series, at which point, everybody wins and the author earns money from the other books (another version of this is the "permafree" series starter, where the first book is free). A 99-cent book is like getting offered a piece of cheese at the cheese counter - it's always to entice the customer to then buy more of the cheese they liked.

There are also bundle deals - I recently bought two 99-cents bundles. One was a bundle of ten epic fantasy novels, the other a bundle of ten hetero historical romances. These bundles are usually an attempt to break a bestseller list (like the New York Times Bestseller List), so the participants can adorn their names with the very coveted "New York Times Bestseller" bit. I bought those because I was quite ready to discover new-to-me authors in a genre I love (epic fantasy) or do market research in a genre related to my own (hetero historical romance). If I find an author I like, I'll buy their full-priced backlist.

And I think in some genres, the 99-cent model can work. But these tend to be BIG genres, like hetero romance or thriller/mystery. M/M in my view is too small to support the same kind of numbers. I'm hopeful this might change over time, but we're not there yet.


What if writing doesn't pay

If writers can't earn a living from writing, the obvious solution is that somebody else has to pay for them to live. I have writer friends who're on social security (nothing shameful about it - it's never really a choice), or have wealthy spouses (personally, I prefer the power balance in a relationship to be more equal). Others have several day jobs and run the risk of burning themselves out. I can't count the writers who have severe mental and physical health issues because of stress or massive self-exploitation to somehow make this thing work.

Obviously, nobody owes a writer a living. I'm not entitled to sales, but I am entitled to profit off my copyright (I wrote it, I get to sell it by law, so yes, I object to piracy). At the moment, my writing is my only source of income, and it's not enough to make pension contributions or rack up savings (and I'm 39 years old, so I need to plan for retirement, as I won't inherit any money).

At the moment I get by on less than UK minimum wage. I still need to make a profit, because my only alternative is to return to full-time work and that means more stress, less writing, fewer releases. I would even have returned to a day job, if I could have found a job in my field. EVEN so I'm acquiring qualifications to earn money from a career unrelated to writing - I like a Plan A, B and C.

But in the meantime, I need to charge more than 99 cents for my work.

38 comments:

  1. I am so glad this post exists.

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    1. Thanks! I assume you get those comments too? :)

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  2. Such a great, valuable post, Aleks, thank you for writing it!

    Last spring, I read a post on the same subject by Josh Lanyon, and one thing he said stuck with me: When he sells books at a lower price, he doesn't sell more of them, he just makes less money.

    In my own, relatively small experience, I found that when my book was priced lower, I sold far *fewer* copies. When I raised the price, six months after its release, I began to sell more copies EVERY MONTH than I had in the entire six prior months together, and the book hit a bestseller list at ARe--six months post release.

    Pricing within the Amazon $2.99-9.99 model doesn't just pay more per book, it seems, at least anecdotally, to sell more copies.

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    1. Vanessa - I think I read the same book. But largely, I'm following the advice of Dean Wesley Smith, who is no friend of pricing lower.

      And I have to say that I've read some awful 99-cent books, so after getting burned myself about twenty times (I don't even think I finished one of those), I'm back to paying "fair price" for the books I want.

      After the initial glut, I'm much more selective. I use Amazon's sample feature, I grab some freebies if the writer is proven or if it's a book I own/read in paper (I do subscribe to Bookbub), and I sometimes buy bundles (to support the NYT/bestseller bid, if nothing else), but generally, I avoid very cheap books and firmly believe I rather spend $5 or so on one book I know will be decent than playing Russian roulette with five 99-cent books.

      I priced Return on Investment at $5.99 because this book represents something like 12 months of work and is 107,000 words long - twice the size of a short novel. I didn't want to go much higher than that because it's an odd duck and not very commercial, but I'm not giving away a huge novel that was so much work for under $5. I just don't.

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    2. I agree, and I often spend $7 or more on an ebook--simply because I trust the author to entertain me. Granted, I am a stay at home mom who writes full time, so my book budget is not what I'd like it to be, but I stock up on ARe ebook bucks during all their rebate sales (the rebates apply to ebook buck purchases too) and that helps extend the budget for leaner times. I'd rather spend the money on one book I'll love than a half dozen that will leave me cold.

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    3. Yep, same here. :) And I do appreciate it. (Being on a limited income too at the moment...) *hugs*

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  3. Excellent post. Just tried to explain this recently, but you've done a much better job.

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    1. Feel free to link/quote if/when needed. Also, Jesus, at your quality level, that's a bitchslap.

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  4. Thanks for sharing this all so openly. I think we don't talk money and numbers often enough...
    I had the same experience with cheap books or freebies. Nowadays I gladly pay more. And if I'm already a fan of the author, I'd pay more or less any price.

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    1. I really believe more numbers help the discussion.

      And - thank you. Obviously it's not a free pass to charge, IDK, $100 for a book, but spending up to $10 on a novel from a favourite author? I'd do that, even though my income is currently pretty low.

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  5. This comment has been removed by a blog administrator.

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  6. Spot on post. I hope you don't mind me sharing. Your books are so worth it; they are what got me started on MM genre.

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    1. Thank you! And please go ahead and share. :)

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  7. I want to marry you... ROFL...

    Well said hun xxxx

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    1. It would likely be a sugar-mommy arrangement, I'm afraid. :) (I do cook and massage.) I'm poor.

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  8. Those who think your books are to expensive, should solve this little equation: The price of the book divided by the hours of reading, having fun, forgetting the world around, even bad days...

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    1. I do think a book represents excellent bang for the entertainment buck (considering what movies/DVD costs). Also, I work hard to make sure my stories have a good re-read value, which just means taking extra care during the writing to place all those little hints. :)

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  9. Great post. I've shared it a few places. It drives me crazy when I see people complaining because an ebook is so highly priced at $4.99. Too many don't understand the time and money investment that goes into publishing a quality book.

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    1. Sherri - Thank you! And yes, I agree. I think the indie movement has created a whole sub-section of readership who believe that authors in a niche can act and operate the same way authors in HUGE genres can act and operate. Sadly, that ain't so. I'd love to be in a genre where a Lee Child or John Grisham can make a few tidy millions. But m/m isn't like that (yet).

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  10. What an excellent article! Before Kindle became my sidekick because of constant travel ... I paid $24.95 for hard back books all of the time. I paid $5.99 to $8.99 for soft cover books. When I look at these prices ... I have absolutely no problem paying for ebooks. I look for new ... good authors that have something to say worthwhile. My established authors (you) are on automatic buy & I don't care what it costs. Excellence in any field is always worth the money. If you don't want a sloppy carpenter ... why would you want a sloppy writer! I will always pay for an experienced journeyman writer. I am so disappointed in people that they have to steal others intellectual properties & then post them for free. This genre has hard enough time being recognized ... why would you want to destroy it by not supporting it? Hopefully you can keep existing on nothing ... so enjoy your books! Course a corpse has a hard time writing! Where should we buy that would support you the most? Love reading your books in Alaska

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    1. Hi Ann - thank you. I'm a lot like you there; most months I was spending more on books than on food, but German book prices are quite mad (12-17 USD for a paperback), so maybe that does have an impact on how I price.

      And thank you for the support/vote of confidence I'm doing my best to deliver the absolute best book I can because I know that my readers can tell the difference if I don't. I want to take pride in my work and entertain people as best I can.

      And yes, the genre would be nothing without our readers. In many ways, we're in this together, and it's only because of reader support that we can even dream to have full-time writers in this genre.

      Best for me money-wise is always the publisher's website (I get about twice the money and get paid much quicker on the sale), but anywhere that's convenient for you is good for me.

      Thank you!

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  11. Thanks for such an interesting post, which i found via Sue Brown's blog. My first book is in for professional editing at the moment so pricing is something I am going to have to seriously consider very soon, so this really did chime with me. Whilst many of us will gain great personal satisfaction from writing we need to value the sheer hard work and sacrifices made in other areas of our lives in order to get to the point of publishing something that makes us proud - and price in a way that doesn't tarnish that and will be seen as fair by readers who want to read something that truly appeals and not just because it's free or super cheap. As a seasoned ebook reader myself, I've read some truly awful very cheap and free books, which makes me view such offerings with a jaundiced eye. I really enjoyed your post, and that's made my mind up to check out your books!

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    1. Hi Anon- thanks for your comment. Yes, pricing is a delicate situation. Generally, I follow Dean Wesley Smith's recommendation to not under-price. I think the market will bear books up to $7.99, but there's a lot of downwards pressure. And it's tougher when you're just starting out, so I don't envy you that position. It's exciting, but also a bit scary., and the learning curve can be steep. Do make sure to ask other writers for advice/help - most people in the genre are really helpful and very candid if you ask them, so don't be afraid to get some opinions. And good luck on your journey! :)

      Re: free and cheap books - I haven't found many diamonds in the rough, so if anything, I'm getting more conservative after a year or two of wildly downloading everything I could get my hands on. :)

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  12. My kindle is full of freebie / .99p books that I haven't bothered to read! However the books and authors I love, I will buy at whatever they cost and read over and over again......but I do want value for money and size does matter......I'm from Yorkshire - we don't like to be ripped off ;-)

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    1. Hah! I *love* Yorkshire. (Went to a writing workshop in Hebden Bridge and fell in love with the landscape. I might retire somewhere in your area there...) :) No, I get you. You can't go crazy on the prices. I have a pile of free and very cheap ebooks, but the ones I actually read are favourite authors or books that were recommended or that my friends are reading.

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    2. In the fine art world, especially that part of it centering around open-air festivals, there's the same pricing war going on. Rank amateurs believe they can scrape as much money as possible from the crowd by offering the lowest prices. Then they're surprised when the steering committees kick them out, usually for buy-sell trickery or just plain bad quality. All that low prices do in many markets, art and writing included, is set an equally-low expectation of quality.

      Sorry, while Amazon has that skew toward mid-priced books, I won't be offering anything self-pub for $.99.

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    3. Crane - And it's false economics too. For all the crappy 99-cent books I bought, I could have bought quite a few good novels that wouldn't have wasted my time. But yeah, you hear a lot "Oh, for that money, it doesn't have to be any good" - seriously, the most precious, non-renewable resource we have is time. Why spend that with crappy books/art?

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  13. Thanks for this information. It makes the indie authors situation much clearer. As a reader it is a major eye opener. And people say I should write a book-(I'm not really sure why) right, no experience, no training-my ego has not bought into that deal. And it won't. (although I do think I am still cute, but that's a different help line lol). You write really good books, thanks for that.

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    1. Brent - Thank you!

      If people tell you to write a book, it's usually because they think you'd do a good job/have an interesting voice/have a story to tell. And yes, a lot of training, IMHO, comes from reading a LOT. A passionate/heavy reader will always start from a different point than somebody who doesn't read when they're both starting out as writers.

      I'd never tell somebody not to write. I'm finding it a fulfilling way to spend my time and get antsy when I don't. But it does take a bit of training and a lot of practice, and even then you're in a hobby/profession, where, as Hemingway said, "Nobody is a master". I have some quite deep, spiritual thoughts on writing as a Japanese Do kind of pursuit, but generally, if you have voices living inside of you, try and let them out. I would do so at the start with no big expectations. (There are debut authors who sell, but most "debuts" are actually the 4th, 5th or sixth novel.) It's a funny thing - you need the ego for the faith you HAVE something to say and people should hear it, and then the humility to step outside the ego and just serve the story. So, if you feel called, do it. :)

      And I'm glad it's helpful/interesting. I do appreciate the whole indie movement. Nothing better than publishing books you're passionate about without people telling you you "can't". And their price points make sense in large genres, where you have potentially millions of readers. But m/m is such a niche that it works along different rules/guidelines. If there already was that kind of readership, everything would be different.

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  14. Great post! I am linking to it :)

    I feel like this is an issue that I have to re-hash (at least for myself) every few months. The desire to price low is always there, whispering that if I just went a bit lower, I'd have more sales.
    I've done it, it never works. And my prices are already on the low end!

    But I think this post is especially timely now, with the impact of KU, and us all trying to see through the dust before it settles.

    Also great point about the niche aspect of m/m. I admit, I have never thought of it in that way. Generally I worry that the higher pricing in m/m comes from its association with "kink" and erotica, and so I tend to reject those pricing models, because I refuse to think of m/m as a kink. But you have given me another reason to consider a higher price, so thank you!

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    1. Hi Amelia - I think it's the lure of the "indie circus" we're seeing in mainstream publishing. The stories of the JA Konraths and Amanda Hockings out there who made a million dollars pricing at 99 cents and $2.99 and laughing all the way to the bank. The thing is, the low prices don't even work for the indies anymore - or at least not to the extent that it used to. And these people are in VASTLY bigger genres.

      RE: KU - I'll be crunching a LOT of numbers at the end of the month, when I do the taxes and reporting for my company, which holds my copyrights. I have 6-7 months' worth of KU data for Return on Investment, and I'll be crunching that.

      But even so, RoI will leave KU in early February and go wide. This is partially because I dislike Amazon's low payout when its competitors pay full whack for a borrow, and in part because I'm not that keen on monopolies in general and also, there are readers out there who want to read the book on different platforms. I'll see how wide distribution compares to the KU numbers - so we'll take again in about 6-7 months. :)

      I don't think the high prices have to do with kink/erotica (you can get a lot of erotica for free on the net)--and more with the expected sales numbers.

      The very fact that the market bears the prices is a positive, of course, because it does allow authors to make a bit of money even on a thousand lifetime copies sold.

      There's some downwards pressure from publishers who sell both m/m and m/f - they tend to do "genderblind" pricing - it's hard to explain why m/m romance costs $4.99 when an m/f romance of the same length costs $2.99 and both are sold through the same channel. It's not easy, but generally, the m/f has a much, much higher sales ceiling - in other words, where an m/m bestseller might shift 20,000-30,000 copies, an m/f bestseller shifts 200,000-300,000 or even more. At the same time, m/f is harder to break into and possibly much more competitive, though I see more competition these days in m/m.

      In any cases, I think the "easy ride" is over. We'll see how the genre stands in 5 years from now. :)

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  15. An excellent post. I had to go look up your titles and I'm honestly surprised that people are complaining about the prices. They're not high in the slightest. I imagine Amazon's influence on pricing brackets has conditioned buyers to expect either .99 or 2.99 and when a book deviates from that, they get sticker shock or something.

    I don't have a .99 book available. I may end up with a loss leader start of a series at some point, but for now I'm growing my back list.

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  16. Grumbletonian alert!

    Even as a reader, not a writer, I'm sick to death of seeing people complain about the price of books. I just want to tell them to STFU already. Barely any of the queer romance books I buy are as expensive as the mass market paperbacks I used to get.

    What ever happened to the concept of SAVING YOUR MONEY for what you want instead of whining that you can't afford it? Is that even a concept people understand anymore? I have purchased many, many things over the years by SAVING MY MONEY, including my new cars! (I hate car payments, so I save ahead of time).

    When I first ventured into e-bookland I downloaded every freebie and 1-clicked every deal. I did get some good bargains, like every Georgette Heyer for 1.99 on her 100th Birthday or every 89th Precinct Ian McBain mystery for 89 cents on his birthday. Otherwise, I no longer jump at sales like that. I buy what I want to read. I read a LOT, therefore I buy a lot. Reading is my main means of entertainment, so I don't begrudge the prices.

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    1. Hi Susan - Thanks for commenting, and I think you're absolutely right (and have very similar habits to mine). :) I think some areas of the indie movement have definitely made readers expect prices to be incredibly low - but m/m is a niche market with its own constraints.

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  17. I have more 99 cent rubbish on my kindle than I care to admit. Repetitive plots, horrible writing, and nonexistant editing is my experience. When I stubled onto your work, I took a chance on a higher price tag due to reader reviews. Neadless to say, I've never looked back. I dont even look at the price on your stuff anymore. I always know it is worth it.

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