Nelson to Raise Prices Across the Board
Jim Milliot -- 12/18/00
Saying he "hopes to redefine the current pricing structure in the CBA market," Michael Hyatt, executive v-p of Thomas Nelson Publishers, announced last week that beginning in May the company will increase the retail prices on its frontlist titles by $3 to $5 for hardcover books and $1 to $2 for trade paperbacks. Prices on backlist titles will increase as they are reprinted.
Hyatt said the across-the-board price increase, the first in three years, is being done to help Nelson compete with New York publishers for authors as well as to improve profit margins. Hyatt acknowledged that retailers may be concerned about the price increase, but maintained that "our long-term viability and growth is dependent on better margins." According to Nelson, a study found that the average price of a bestselling Nelson hardcover, $19.39, was substantially below the average price of $24.81 for a New York Times bestselling hardcover.
Hyatt said the reluctance by religion publishers to raise prices is based on a number of myths such as the belief that a company cannot charge as much for a small-format book or for a book with a small page count. Hyatt also believes that the idea that people are more likely to buy a lower priced book is untrue, with the possible exception of books by new authors.
Hyatt considers the "greatest myth of all" to be that people will not pay as much for Christian books as they do for secular books. "There is nothing in any of our market demographics to suggest this," Hyatt said.
Hyatt said the pricing strategy "is good for everyone. Retailers win by having better operating margins. Authors win by earning greater royalties. And we win by becoming more competitive."
Volume 246 Issue 51 12/18/2000