4) Marketing: Does Permafree Still Work?
By Randy Ingermanson
People ask me all the time if permafree still works as a marketing strategy.
That raises a couple of obvious questions: What is “permafree”? What does it mean for a marketing strategy to “work?”
I’ll tackle this issue as a series of questions and answers.
Q: What do people mean by “permafree?”
A: “Permafree” is a blend of the two words “permanently free.” It’s a marketing strategy that works only in one particular case—when you have a series of e-books for sale. You make the first book in the series permanently free, and then readers who like that book go on to buy the others in the series.
Q: You’re kidding me, right? Who would be stupid or desperate enough to try that?
A: Not kidding. Lots of indie authors use this strategy. I know many, many successful indie novelists, and my best guess is that the majority of them have used a permafree strategy for at least one series. Of these, most of them consider the strategy a powerful tool for bringing in new readers. I have used it myself and it’s worked very well.
Q: But isn’t this just training readers to have an entitlement mentality and expect everything for free?
A: There are all different kinds of readers. Some readers have an entitlement mentality and will only read free books. They will miss out on many great books that cost actual money. That’s their loss, not yours. Those readers won’t buy your books, but they may still generate word-of-mouth for you, and that has value. The great majority of readers are willing to pay money for good quality books. If they like your freebie, they’ll buy your non-free books. Yes, really.
Q: This sounds like it could only work for those cheesy self-published authors, not real authors who work for legitimate publishing houses.
A: Let’s be clear. Indie authors are legitimate. Many of them are earning tens of thousands of dollars per year. Some are earning hundreds of thousands. A handful are earning millions. Per year. Indies do have a huge marketing advantage here. If they decide to run a permafree campaign, they can do it without any hassle. They don’t have an editor or marketing director to say no. I do know of one small publishing company that ran permafree campaigns for all of its authors that had series. That company boosted its sales significantly. But permafree seems to be rare among traditional publishers.
Q: Why do you only do this for e-books?
A: Because paper books cost money—for paper, printing, handling, shipping, etc. E-books can be given away at such a low cost that the major retailers don’t charge you for it. They know it’s good advertising for the paid products they carry.
Q: Major retailers? You mean you can do this with Amazon? Barnes & Noble? Apple?
A: Yes, all the major retailers. Amazon. B&N. Apple iBooks. Kobo. Smashwords.
Q: I don’t believe you. I just checked. It’s true that Apple, Kobo, and Smashwords allow you to set a price of $0.00 on an e-book, but B&N and Amazon don’t. If you try to enter that price on your dashboard, you get an error message.
A: These two retailers are special cases. You can’t directly set the price to $0.00, but you can do it indirectly.
Q: How do you do it for B&N?
A: Use a distributor. B&N accepts e-books priced at $0.00 from distributors. You can use Smashwords or Draft2Digital or any of the other distributors. These take a cut of your profits, but if your price is $0.00, then their cut is also $0.00.
Q: How do you do it for Amazon?
A: Amazon has a policy of price-matching the lowest available price of the other major retailers. Set the price on Amazon for your e-book to the normal price you charge for the other books in your series. (If the others are $2.99, set the price for your permafree book to $2.99.) Then set the price on Apple, B&N, and Kobo to $0.00. Then go to the Amazon sales page for your book and click the link that says “tell us about a lower price.” A form will pop up. Fill in the form giving the URLs of the sales pages for the book on the other retailers.
Q: And Amazon will just automatically change the price to $0.00?
A: Maybe. Or maybe not. If they don’t, you can always politely ask Amazon to price-match your book from their Contact page. Remember that they aren’t obligated to do so, so don’t act as if you’re entitled. However, there is an enormous amount of sales data that proves that price-matching to $0.00 will earn them more money. So the odds are good they’ll do it.
Q: And this actually works? You actually earn more money?
A: Lots more. You’ll see many more free downloads that you would have seen paid sales. Of those, some percentage will go on to read Book 2, Book 3, and so on.
Q: What percentage? Prove it!
A: I’ve heard different numbers from different authors, ranging from 0% up to about 25%. I can’t verify any of those, but here are my own numbers for my 3-book City of God series. Book 2 has a conversion rate of about 4.3%. Book 3 has a conversion rate of about 3.5%.
Q: That doesn’t sound like much.
A: That is vastly better than the conversion rate on tweets.
Q: This sounds like some fad that’ll be gone by next week.
A: Permafree has been around for several years. I don’t know who tried it first, but I heard about it sometime in 2013. I began trying it in the early summer of 2014 and it’s been working for me ever since. It has declined in effectiveness, but it still works pretty well. When combined with a BookBub ad, permafree is amazing.
Q: This all sounds like hocus-pocus or voodoo or something.
A: Actually, it sounds like smart marketing. A sound marketing strategy takes potential customers through three phases:
- Attract potential customers who never heard of you.
- Engage them so that they know whether they like what you have to sell.
- Convert them to paying customers by making a great offer.
The free book Attracts readers like crazy. If the book is good, that Engages them; by the end of the book, they know if they like your writing. At the end of the book, you make a pitch for the next book in the series and Convert them.
Permafree is a simple, elegant marketing strategy that has been battle-tested by many successful authors. And furthermore, you only have to do the work once. Then it works for you forever. That’s passive marketing, and passive marketing is way easier than active marketing.
Q: If permafree works so well, why do you tell everyone about it? Aren’t you damaging your own sales?
A: Like every other novelist, I write in a niche. I’m not competing with the hundreds of thousands of other novelists out there. I’m not competing with the 14,000 readers of this e-zine. I’m competing with those few novelists who write books similar to mine, and most of those people are my friends. I hope all my competitors try permafree, because I want my friends to do well.
Q: This is way off-topic, but what niche do you write for?
A: I’m weirdly obsessed with ancient history. I’m also a theoretical physicist. I write heavily researched time-travel adventure novels set in first-century Jerusalem. By all logic, I should have no more than about ten fans, eight of whom should be my mother. But life isn’t always logical, and thousands of readers have been willing to take several adventures in my imaginary world. Most readers of this e-zine couldn’t care less about what I write, but for those few who do, here are the premise and links for Book 1 in my City of God series:
Transgression: A rogue physicist travels back in time to kill the apostle Paul.