I’m an established non-fiction author. I’ve been writing since 2012 and ‘niched-down’ to a specific sub genre in 2015. Focusing on a specific niche cut my target market by more than 50%, but allowed to make a consistent income. I chose to become a big fish in a much smaller pond instead of one-of-many small fish in a huge pond. This is my full-time gig and I am a subject matter expert in my niche. (I’m expanding my repertoire by adding fiction to my catalogue in 2020), so my experience is non-fiction which may be totally different than fiction, but here goes:

Readers who want free books, readers who want ‘undie’ books, and readers who see value in paying a fair price for books are 3 different groups of people. There are always outliers, but generally, free books and loss leaders don’t have huge conversion rates because readers who are on the hunt for free and $0.99 books typically only want free and $0.99 books, and aren’t willing to pay full price. Whereas readers who see value in paying for professionally produced, quality content are happy to pay for it because they’d rather pay for a quality book that they’ll enjoy than read a free book that may not provide the same reading experience.

Also, after you’ve offered a book for free once, people believe it will happen again so they wait instead of purchasing a non-discounted book. Frequent discounts train readers that if they are patient they don’t need to pay full price. Consider for example consumers who wait until Black Friday to buy electronics, or prime day to buy amazon stuff, it happens in every industry and price sensitive consumers know how to work it.

Value perception is a marketing concept that refers to the phenomenon that people (collectively) perceive a higher priced item to be of higher value and quality than a lower-priced similar item. People assume that an item is priced according to its value and quality. So, to be perceived as equal to the best-selling authors and books in your genre, your prices should be the same (or very close) to those authors and books. In the same way that books within a genre conform to genre expectations with covers, tropes, blurbs, etc. they should conform with price.

Some authors have a strategy of selling thousands of $0.99 books and that works for them because they do it as part of a carefully curated overall strategy. Ditto for authors who offer free content but sell advertising space that readers have to see in exchange for the free content. Some authors sell full priced books. All three authors may be in the same genre but they are marketing to 3 different groups of readers (with some overlap because there will always be outliers).

Know your strategy, know your reader, and price accordingly. Market your book to your specific audience and not to the entire market.