Dr. John Hilton, who until just recently was a doctoral student of mine, has written a great dissertation on the impact giving away free ebooks has on sales of printed books. The findings may surprise you. Here’s a repost of the description from his blog:

I’ve posted on my dissertation before. The full version is now available here. Here’s a little summary of what the dissertation is all about.

What

Deseret Book placed eight books online for free download. All of these were “backlist” titles. This study tracked what happened as a result of those books being available.

When

The books were placed online September 9, 2009. This study compares sales of these books the ten weeks before they were available for free with the ten weeks after.

Results

During the ten weeks of the study the books were downloaded 102,556 times. Collectively, the books sold 68 more copies in the ten weeks they were online for free versus the ten previous weeks. This was an increase in sales of 26%. Over the same period of time in 2008, sales of these same books decreased by 38%. Furthermore, a study of comparison titles that were not put online for free found that sales of comparison books decreased both in 2008 and 2009, as illustrated below.

Featured Books Comparison Books 2009 26% -16% 2008 -38% -6%

Thus the increase in sales of the eight featured books in 2009 seems attributable to their being available for free.

Other interesting findings include the following: Visits to the online product pages of the free books increased 1,085% during the study. Some weeks, hits to http://deseretbook.com/free represented almost 3% of total traffic to http://deseretbook.com. (note: the books are still available, but now require registration. They did not during the experimental period of the dissertation). During the ten weeks of the study more people entered http://deseretbook.com through http://deseretbook.com/free than any other page (except the home page). All this happened with very little advertising. Though the impact of this additional web traffic was not quantified, it seems that the value of increasing awareness of http://deseretbook.com could be significant.

There was a moderately strong correlation (r=.65) between downloads and Internet print sales (the more books that were downloaded, the more books were purchased online). Thus if more books had been available and downloaded the number of additional books sold would likely have increased.

Another interesting point is that the authors of the books made available seemed very pleased with the additional exposure their books received. One of the eight books studied was out of print. This book was downloaded 14,914 times and its product page received 834 hits. This may indicate a lingering interest in out-of-print books, and may validate a “long tail” approach to book sales.

Limitations

One limitation of the present study is the relatively small number of books studied, and that the sales of these books were relatively small. The study could also have been strengthened if it were of a longer duration.

One area that remains to be researched is the perspective of the authors whose books were downloaded. In informal conversations with the authors whose books were used in this study, they expressed positive feelings about their work being disseminated more widely. It may be that authors, particularly those with books that are not currently selling well, would desire the increased exposure to the work that free digital downloads might bring.

Although this study provides some interesting results, there are many other questions to be considered. One question that might arise is, “What would have happened if the e-books had been for sale for 99 cents each?” If 10% of the people who downloaded the books for free would have paid 99 cents for the e-books, that would have provided a nice profit for Deseret Book. While it is possible that some people would have paid 99 cents for the e-books, it seems likely that people would have been less inclined to e-mail friends and blog about a “99-cent” offer than a “free” offer.” Future studies are needed to determine how many downloads would occur if they were very inexpensive instead of free.

Another aspect that should be considered is how much the popularity of electronic book devices (such as the Kindle or iPad) will change people’s proclivities to read digital books. Perhaps most important, if publishers made all or most of their books available for free digital consumption, would that have an overall negative effect on sales? In other words, in the present study the seven books saw increased sales, likely due to the special attention they received from being downloaded 102,556 times. If all books were available for free online would they see this same sales benefit? Obviously not.

So, much more to think about and explore! Hopefully this dissertation will be a part of an ongoing conversation. They said nobody ever reads dissertations … prove them wrong … go read it!