As any economics or marketing geek will tell you (like Scribl’s co-founders), prices in traditional markets get set by the economy and by marketers.

You know that supply and demand help determine prices: when supplies are up, prices go down. When prices go up, more competitors enter the market, suppliers make more stuff, and the supply increases. Back down go prices. But it’s not all automatic. Marketers tweak prices to differentiate their product relative to a handful of specific competing brands and to make sure everybody makes a profit—including manufacturers, middlemen, retailers, and so on.

Simple, right? Supply and demand, plus marketers, set the prices of most of the stuff we buy.

Hint: Ebooks Are Not Potatoes

But what if the supply were limitless? What if it cost virtually nothing to make what you’re selling? And what if there were a nearly limitless array of unique products or brands? That is, what if there were as many different products as, say, different potatoes, but unlike potatoes, the items were not interchangeable, because customers care which one they get?

That’s what digital creative content is. The supply is endless. It costs virtually nothing to “manufacture.” The choices are vast beyond any customer’s ability to browse. And every ebook or audiobook or song is unique.

Up till now, new self-published authors have acted as if they were already recognized brands while distributors of digital content have acted as if they were selling oil or potatoes (commodities). Authors set the prices. This is disastrous for authors in the long run. The newest authors with the least recognition have to keep setting lower prices to be discovered at all. This may help with their near-term downloads, but it drags down the perceived value of all books, as even top-tier books must also lower prices, meaning new authors must go even lower, and so continues the vicious cycle.

The Googles, Amazons and Apples of the world don’t mind. They have the famous Long Tail, and view the vast array of titles as a commodity market – millions of titles each earn a tiny profit, totaling billions for them. To them, your book is just another potato in the bin.

And where does all that leave you, dear author? It leaves you making pennies when you could be earning real money. Meanwhile, readers who would love you (if they could only find you) have no clue who you are. Most authors can’t afford to develop their brands enough to make them stand out.

The Answer: CrowdPricing

In CrowdPricing, each title moves between a set of predefined price tiers based on popularity within its genre. When a title’s downloads increase, its price goes up a notch. When downloads decrease, the price drops to the lower tier. Notice we said “within its genre.”

CrowdPricing rewards authors based on the market appeal of their work relative to similar works; meanwhile, a new book finds fans through a lower starting price. And long-term prices are protected by keeping the full prices for the most popular titles. This ensures customers don’t lose track of the value of a book, protecting all authors from continual price declines until books are nothing more than a commodity. Even better, these more expensive books expand the market for independent authors. They attract the very customers who previously shunned books from independent authors over fear of spending time on a book they won’t like. With CrowdPricing, those readers can browse with confidence, knowing they can trust that all of the top-tier books have proven themselves with other readers.

Here’s another metaphor: CrowdPricing is the automatic transmission of content marketing. It starts in a low gear (low price, that is), then switches to higher gears as its sales accelerate.

At the same time, CrowdPricing is honest and fair. Each book’s price has been set by genuine interest from other like-minded customers—not by marketers. So customers trust it, naturally. And customers buy more when they trust the experience. Everybody wins.