Finding the right price point for a product or service is one of the lessons taught in business schools around the world. "Will the consumer pay that much?" "What's the real and perceived value of the product?" "Where is the competition priced?"
For comic books, the questions are difficult to answer. Although long-time comic book fans are enthusiastic about spending money on their favorite hobby, will new readers see the same value in the product? When considering the competition, to what entertainment medium does the comic book industry compare? TV shows? Movies? Novels?
The subject of pricing is particularly timely this week, as DC Entertainment - which had been a stalwart supporter of the $2.99 price point - just announced that numerous DC titles will change from $2.99 to $3.99 for its print editions. Although all the company's twice-monthly titles are staying at $2.99, many of the monthly print books will experience a price increase, but will also have a digital code to add value.
As Newsarama continues a series of articles examining issues affecting the comic book industry's direct market (see our first installment about over-saturation here), we talked to retailers about how much price affects sales, whether DC's move will make a difference to readers, and what the magic price of comic books should be.
According to the retailers Newsarama surveyed, customers respond negatively to higher price points but will pay the extra amount if they believe the comic book is worth more.
"Price is just one of the factors that go into consumer buying decisions," explained Joe Field, owner of Flying Colors Comics in Concord, California. "It all comes down to whether readers are feeling satisfied by what they are buying. That's more about what's on the pages between the covers, rather than the price on the front cover.
"A $3.99 comic book by unknown talent on unknown properties with little to no promotion is too expensive," Field said, "while a $3.99 title by popular creative talent on well-known properties is a good deal. So when it comes to my preference on price, it's always about whether the comic sells or not."
"The bottom line is quality," said Mike Wellman, co-owner of the Comic Bug in Manhattan Beach and Culver City, California. "$3.99 is an acceptable cover price as long as the consumer is getting a 20- to 22-page story, not a 12-page story and an eight-page back-up."
On DC's announcement about increases on several of their print titles, most retailers didn't think the effect would be substantial - if there would be an effect at all.
"I dont think our customer base cares," said Jesse James, owner of Jesse James Comics in Glendale, Ariz. "We asked everybody Wednesday (over 100 customers that collect DC "Rebirth"). Not one dropped a book. Customers have their budgets, and at the most this would have cost them $15 more a month. I know some people are approaching it as a negative. We just need to educate, inform and inspire our readers. The only stores this will effect are the stores that over-hype the situation negatively."
"I don't think [DC's] dollar price increase will hurt sales much or at all and the added digital code is a plus," Wellman said. "I would say that the quality across the line at DC is pretty good, but they just have to be careful not to compromise quality in order to mad-dash to get product out bi-weekly."
"This is probably a net positive," said Matthew Price, co-owner of Speeding Bullet Comics in Norman, Oklahoma.
"With some exceptions, this probably gives the lower-selling titles a little more runway, while allowing the twice-monthly titles to remain at $2.99," Price said. "The $3.99 price point is still within the boundaries of what customers will accept. I think the higher-selling titles (for the most part) remaining at $2.99 is a good move, however."
$3 to $4 standard
So what's the magic price point? Retailers fell somewhere between $2.99 and $3.99.
"I think customers were fairly complacent with the $3.99 price point until DC and Image showed that it was excessive," explained Charlie Harris of owner and operator of Charlie's Comic Books in Tucson, Arizona.
Carr D'Angelo, owner of Earth-2 Comics in Sherman Oaks and Northridge, California, said DC's move to $3.99 matches what most publishers are doing. "Most Image are with exceptions like Saga and The Walking Dead," he said. "There's also a $3.50 price point among some publishers.
"The $2.99 price point [before DC raised some of its prices] was a great way to get readers to sample a wide array of 'Rebirth' titles, but $3.99 seems to be the standard price of comics these days," D'Angelo said. "Readers don't mind paying for comics they enjoy, so I don't think there will be too much impact."
Wellman of the Comic Bug also called $3.99 an "acceptable" price. "I believe the industry standard cover price to be $3.99 for quite some time now," he said.
"In our case, the $2.99 price point has worked better in sell-through, making it more profitable for us," said Price of Speeding Bullet Comics.
Although retailers said customers are fairly complacent about pricing between $2.99 and $3.99, when a price jumps above $3.99, they expect additional content or benefit.
"The Batman, Superman, and Star Wars annuals all arrived together a few weeks back," Harris said, "all priced at $4.99 each. But the DC annuals had 38 pages of story while the Star Wars only had 30 and the customers definitely noticed. But no one balked at the $5.99 price for the nicely packaged AD: After Death series from Image."
"Marvel has a lot of $4.99 and $5.99 titles," D'Angelo said. "It definitely concerns readers when prices creep up without added value of extra content. There has been resistance to the higher price points of Marvel Comics."
Ryan Seymore, owner of Comic Town in Columbus, Ohio, agreed that Marvel's price increases have been noticed by customers and are affecting sales. "Marvel's recent practice of charging $4.99 for the first issues of their soft reboot and upwards of $9.99 cover price of other 'important' issues has not been well received by guests," he said.
Field said the rising price points also affect whether retailers even place orders for the book to be included on the shelf. In a market that is more and more competitive - with a wide variety of titles from which to choose - retailers are less willing to purchase heavily on a comic book that doesn't have returnability and costs more.
"$3.99 for a comic book by unknown creators with no marketing behind them increases retailer risk," Field said. But the retailer also noticed a trend at Marvel and DC - that events bring out the higher price points. "It's clear that Marvel and DC have a strategy now of up-pricing 'event' comics by well-known creators (see Civil War II and Dark Knight III as two recent examples). The higher cover prices, though, keep some consumers away. So publishers must be weighing those factors and deciding that getting more dollars on fewer copies pays off in the end."
Besides, Field said, the "bottom line with pricing as far I'm concerned as a retailer is that every ordered but unsold comic book is too expensive, while every ordered and sold comic is priced just right."