If you charge too little, people will think it's of little value, and they won't purchase it, or even it they do buy your book, you will have to sell thousands of copies to get to the point where you can begin to see a profit.

If you price it too high when compared with your competition, you will find yourself steadily lowering the price, which will cause you all kinds of new problems in the future.

For example, if you sell your ebook at first for $39.99, and later reduce it to $24.95, don't you think the people who bought it for $39.99 are going to be very upset?

Choosing the right price for your ebook is one of the most critical parts of the marketing process.

The first rule of pricing ebooks is to never underprice.

Determine the highest price your audience can afford, and then if you find your book isn't selling, you can always reduce the price. Before you take that step, make sure you are promoting your book like crazy on the Internet and on websites.

The price should be aimed at bringing in profits, but you should never forget that price is one of the factors that people use in judging the value of your ebook before they buy it.

So always start with the highest price, and then launch a mega-marketing campaign.

Pricing an ebook is particularly difficult because ebooks are a fairly new commodity. Since they are digital, the value of an ebook is as confusing as the understanding of what digital actually is to the average lay person. This means that we must look at ebooks in a different light in order to determine their actual worth in this brave, new cyber world.

Let's look at the difference between a book in print and an ebook.

A printed book is an object you can hold in your hand, store on your bookshelf, even hand down to the next generation. It is priced on factors such as paper stock, design and production costs, and marketing.

But the fact that unites ebooks and print books is that they are composed of ideas. It is the ideas in these books that have the ability to change, or possibly transform, people's lives.

Part 2 and 3 Continued...