There is already a ton on this subject, but I thought I'd throw my two cents in.  My experience with e-books was fairly unique due to the subject matter of the "So You Want to Play Go?" series.  I was writing about a game the average person had never seen or heard about, so I didn't have a lot of competition.  When I first released my books on the Kindle, there were no other books on Go in e-book format.  Cha-Ching!  However, I did pressure the other authors to convert their books to E-book form.  There had been a few books written by Western authors on the game, but after a few months, there were a ton (and by a ton, I mean six).  Being the only one in my class for awhile was great and I was selling between 50-100 units per month.  Once competition set in, I had a much harder time, as the other books had been out for years and were well known. 

My books were originally priced at $9.99.  I know, unthinkable in the age of 99 cent McE-books.  However I put a lot of work into my book and I wanted to be paid for it.  Besides, it wasn't a tawdry romance novel or the latest thriller.  It was a fairly long book filled with diagrams, and I felt I did a pretty good job of teaching people the strategies of Go.  Well, my customers felt $9.99 was a fair price.  Although something in the back of my mind started to gnaw at me.  I began to imagine invisible customers, browsing through amazon, and then turning up their noses at the high price.  Still, as long as the 50-100 some odd buyers came in, I made a decent monthly income, and I could buy the more expensive Ramen at the grocery store.  Then, the competition came.

First off, I was flattered at the way they priced their books. You know how on the Price is Right, there is always that last contestant who is completely asinine and bets 1 dollar above the second to last contestant just to seal their fate?  I loved the one time that didn't work, and the price came out to be exactly the price the third person set.  I assume the producers on that show were feeling capricious that day.  Anyways, the other Go themed e-books set their price from 50 cents to a dollar under mine.  I freaked out, and decided that I would start a vicious price war.  I would slash my prices to a nub, then watch as the invisible purchasers would smash through my door and leave my competition impoverished in the streets!  Yes, I would come out on top.  My Go books were superior, and now, I would get all the people who were on the fence!  So I slashed my prices, in half.  I know.  My ego kind of got in the way, and I hated the fact that the more famous Go book priced his 50 cents beneath mine.  I wanted to do more than pull the rug out from under the competition, I wanted to annihilate the floor. 

Well, I did destroy something, my revenues.  My price change did not result in more customers.  Quite the contrary, I've only had 45 some odd customers this week, when in previous months I could count on at least 70.  The difference is stark.  Without the added customers to make up for the revenue difference, my royalties are going to be a pittance, a faint glimmer of their former glory.  I've been trying to wrack my brain to figure out what happened.  I ran into a wall.  There are too many variables!  Perhaps September is a slow month for people buying E-books.  Maybe my earlier success had been to Go related events I was not privvy too.  Only recently did I find out that the Wall Street Journal did a video on the game.  That would garner interest in the game and might prompt people to go to Amazon in search of books.  WSJ could've given me customers and advertising, and I had been none the wiser!  I haven't done a whole lot by myself to try and advertise, as I just limit myself to twitter and any other free avenue, but there are hundreds of places where people could be learning about Go, and my book would pop up! 

Lowering my prices did not result in more sales, but I have no if it would be okay to jack them back up to $9.99.  I kind of want  to, but at the same time, I had a few reviews on Goodreads saying that the books were great, and because of the price, there was no reason not to get them.  A great compliment, but would that make up for the lost revenue?  I can't eat nice words.  I think my little experiment is over.  If I turn the price back to $9.99, then no would notice, and I'd be able to get away without angering customers.  If I wait too long, then people who were making plans to purchase my book, or who had heard about my book from a friend, might come to Amazon and see a jacked up price (from their perspective).  It's best to just sweep this experiment under the rug.