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How to Understand Amazon Kindle Direct Publishing (KDP) Royalty Plan

When publishing your eBook on Amazon Kindle Direct Publishing (KDP), you have the option to choose between two royalty plans: the 35% royalty plan and the 70% royalty plan.

How to Understand Amazon Kindle Direct Publishing (KDP) Royalty Plan

Here's an explanation of each plan and how to decide which one to choose:

1. 35% Royalty Plan: With the 35% royalty plan, you earn a 35% royalty on your eBook's list price for each sale. This plan is usually best suited for eBooks with lower list prices.

2. 70% Royalty Plan: With the 70% royalty plan, you earn a 70% royalty on your eBook's list price for each sale. However, there are certain eligibility requirements to use the 70% royalty plan:

  • Your eBook must be priced between $2.99 and $9.99 (USD).

  • Your eBook must meet certain quality and formatting guidelines.

  • Your eBook must be available for sale in certain territories.

Choosing the Right Plan:

  1. 35% Royalty Plan: If you're planning to price your eBook below $2.99 or above $9.99, or if your eBook doesn't meet the eligibility criteria for the 70% royalty plan, the 35% royalty plan might be more suitable. This can be a good option if you're targeting a lower price point or if you're not concerned about the higher royalty percentage.

  2. 70% Royalty Plan: If your eBook falls within the pricing range of $2.99 to $9.99 and meets the eligibility criteria, the 70% royalty plan can be more financially rewarding. Despite the slightly lower royalty percentage, the higher price point can often result in higher earnings per sale.

Setting Your eBook List Price: When choosing your eBook list price, keep in mind factors such as market competition, the perceived value of your content, and the pricing of similar eBooks in your genre. Pricing too low might devalue your content, while pricing too high might deter potential readers.

For example a book on mindful productivity, considering the value of the content and the potential impact it can have on readers, a list price between $2.99 and $9.99 would likely be appropriate. This makes the 70% royalty plan an attractive option if your eBook meets the eligibility requirements.

Ultimately, your choice of royalty plan and pricing should align with your goals, the value you believe your eBook offers, and your understanding of your target audience's preferences.


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