"If you sell for pennies, readers will assume that's what your book is worth."
"Nobody will pay £2.99 for an unknown indie, so you have to price cheaply or you won't sell anything."
"People will take a chance at 99p. They won't at £2.99."
"You've worked for a year, sweated blood, paid a fortune for a cover. Why on earth would you sell cheap? Don't you value yourself?"
"The 99c books are all un-edited rubbish."
Contrasting views I've seen around the internet. I started at 99c on amazon.com with a UK price which was matched at the exchange rate - came out at about 76p initially. It gets you readers - people take a chance. But yes, I sweated blood and yes, I paid for a cover. There are years of my life in my books, but I figured if I priced them too high I might as well not bother selling them at all. At the moment it's about reaching readers and building a platform, not making money.
In January, I changed my UK prices to reflect the new EU VAT rate (since amazon.co.uk is based in Luxembourg, the VAT rate is 3%). I figured it'd be transparent to the user, but I'd get more money.
And a week or so ago, I upped all my prices radically. Now I'm selling at $2.99/£1.49, the minimum price to get a 70% royalty rate. So I get a far bigger % of each cover price even if I don't sell as many. My sales rate has remained stable.
The reason for this? I've probably exhausted the market of buy-em-cheap readers, who hoover up everything at 99c and may never actually read it. I've done the promos on the "cheap-reads" websites. Now I want to attract people who actually want to read my books specifically. Those who buy at the higher price are more likely to sample first and make an informed decision. It's still not really about the money (though it helps!), but about targeting specific audiences now.
Who knows? I may go higher again. But I think I'll wait a few months and see what happens. The beauty of this is that I can change my prices more-or-less whenever I want.