Earlier this week, I tested out PayHip, an online platform for selling digital downloads, as a venue for selling some of my ebooks. I’d read an author review of PayHip on Facebook and wanted to check it out myself.
Much of my decision was about timing—I had a newsletter scheduled to go out but was still waiting for one of my new titles to go live on Amazon, even though was already on Apple iBooks. I could either wait to send out the newsletter, or I could take the matter into my own hands and make the title available in Kindle format outside of Amazon.
So I decided to put two short stories in PayHip: the contemporary MMM romance Pacific Rimming and the sexy sci fi story Far From Home. Since lots of romance authors seem to be turning to PayHip in the wake of All Romance’s demise, I thought I’d share my mostly positive experience here along with one big warning.
Signing up for PayHip was easy. I gave them my name, my email, and made up yet another password for yet another website. (Since PayHip involves monetary transactions, I made a difficult one—no pets’ birthdays or ABC123 for me!) I linked it to my PayPal account in less than a minute; PayHip also works with Stripe, and I imagine that process is just as quick. Then I created a bio and added a few social media links for my author page. Easy!
The next step was uploading my books. That was also easy. I had already created epub and mobi files using Scrivener, so I uploaded those along with higher resolution images of the covers for the display pages. I slept in book descriptions, which was a quick cut and paste job from the blurb and review quotes I had already put together for publishing the books through Pronoun (a company that distributes self-published ebooks to Amazon, Kobo, Google Play, iBooks, and Barnes & Noble.) I could’ve easily been done with both books in less than five minutes if I hadn’t decided to also create a PDF file to give my readers as many formatting options as they would have once had on All Romance and can still get at Smashwords and Dreamspinner. I had never created a PDF from either Scrivener or an EPUB before, so figuring out how to do that added another 15 or 20 minutes to the process. But then I was done!
I sent out my newsletter and half an hour later I had my first sale. PayHip sent me a nice email to let me know that someone had purchased my book, and right after that PayPal sent me an email to let me know that $.99 and been deposited into my account. Another second after that and PayPal let me know it had sent 5¢ to PayHip to cover PayHip’s transaction fee.
And then, five minutes later, I got my first angry email.
A reader had paid for the book and tried to download it, but had downloaded the wrong format. I was surprised about that, because I thought readers would get a zip file of all three formats. Apparently, they are permitted to download all three formats, but they need to download them one at a time. The instructions on PayHip did not make this clear, so my reader thought they had lost their chance at getting the correct format. And they were annoyed.
I talked to a couple other authors and poked around the PayHip site to figure out what had happened, then got back to the reader, sending them the correct format. Hopefully the issue is resolved?
I don’t know. The reader didn’t respond. [Update on Feb. 12: The reader got back at me and let me know they were able to later download the correct file format. So the problem is more a lack of clear instructions than a technical issue. And the reader and I ended up having a very pleasant email exchange, so everything was good in the end. And something I failed to note in the original posting is that, since PayHip sends notification of every transaction, it’s easy to confirm that an individual paid for an item. So even if they aren’t able to solve the problem via the PayHip platform, the author can make sure the reader gets their download some other way.]
However, I had several other transactions that evening and all of them seem to have gone smoothly. Payment goes into your PayPal account as soon as the transaction goes through, minus PayHip’s transaction fee and any fees that PayPal charges.
Overall, it went about as smoothly as it I would expect anything in publishing to go these days.
The Big Warning
Every time a reader makes a purchase, they are brought to the author’s PayPal page. They will also see the name that is on the author’s PayPal account. This isn’t a big deal if you are an author who whose legal names and author names are the same, or if you have a PayPal business account that displays your business name when people make payments to you.
But if you write with a pseudonym and don’t have a separate PayPal account for business, guess what? Any reader who purchases your stuff through PayHip will find out your legal name.
That’s not a big deal for some writers, but a huge deal for others who need to keep their legal and writing identities separate for whatever reason. I’ve talked with several authors who thought that PayHip would keep their legal names private, only to find out after several PayHip transactions that every purchaser now knows their legal name. PayHip should be much clearer about this in its literature.
[Update on Feb. 12: I got in touch with PayHip and a representative told me they hadn’t given lots of thought to pseudonyms, but now that the issue had been raised, they would figure out a way to make this aspect of transactions clearer to sellers and encourage those who need to keep their identity private to use PayPal business accounts rather than personal ones.]
Even if you already have a personal PayPal account, you can go ahead and set up a separate PayPal business account. PayPal allows individuals to have one of each, and it’s fine if they’re connected to the same bank account. You just need to use a different email address for each account.
Once you’ve created a PayPal business account, you can link it to PayHip.
My Review of PayHip
For authors, PayHip is not a great alternative for opening a storefront on your own website as far as integrating with PayPal or protecting your identity goes. But there are advantages:
- PayHip manages downloads for you
- PayHip collects VAT (sales tax) for purchases made in Europe
The first is great, because it means not having to install or maintain automation software on your website to manage ebook sales. And the second is a huge advantage if you have a lot of sales in Europe, because you are expected to collect VAT (sales taxes) on European purchases and send them to their respective tax authorities.But for other writers, selling directly from one’s own website using PayPal or Stripe might be just as viable an option.
Plus, authors get a much larger share of the proceeds than when selling via a bookstore. My share of sales through Pronoun are 70% at most booksellers. At PayHip, it’s 95%. That’s a huge difference for writers who just want to be able to pay their bills.
[ Clarification on Feb. 22: Both percentages given above are before PayPal’s or Stripe’s processing fees. For US customers, PayPal’s fee structure is generally 2.9% + 30¢ per transaction. when you get paid through Amazon, Amazon groups all purchases over the course of a month or quarter— depending on how you set up your account with them— into a single PayPal transaction. The 30¢ surcharge occurs only once for all of those grouped transactions. So, for example, if you sell 99¢ books over the course of an Amazon sales period, your take-home after PayPal processing fees is $99 minus the Amazon commission (usually 65% for self-publishers through Kindle Direct Publishing, so $34.65, but only 30% for authors who publish through Pronoun, coming to $69.30) minus 2.9% minus 30¢, equals $33.35 for self published authors who publish directly to Amazon, and $ $66.99 for those who published through Pronoun. But because customers purchase directly through PayPal when they use PayHip, you get charged 30¢ every time someone buys a book. So if you are charging $0.99 for your book, for each book you take home $.99 minus the 5% PayHip processing fee, minus the 2.9% PayPal processing fee, minus 30 cents; or
( $0.99 * 0.95) * .971 – .30 = $0.61
Multiply that by 100 and you get $61.00— much more than you would get through Kindle Direct Publishing, but a little less than you would get through Pronoun.
As book prices go up, the percentage of the book price eaten up by PayPal fees becomes less, because $0.30 is only 10% of $2.99 and only 5% of $5.99. This means that pay it becomes more of an advantage the more you charge for your book, with significant advantages for both Kindle Direct Publishers and Pronoun publishers starting at around $2.99.]
Stripe’s per-transaction charges are similar, so the break down should be virtually the same for them.
I am planning to keep my books on PayHip. Apart from the initial blip, it seems to be working fine for my readers. The storefront looks nice, and I don’t have the time to create a fully functioning ebook store on my website just now. But for other writers, selling directly from one’s own website using PayPal or Stripe might be just as viable an option.
[Yet another update, this one on Feb. 25: I didn’t mention in this article that PayHip allows you to set the price as a minimum, which allows purchasers to pay more for the product if they want to. Who would want to pay more than they have to for something? I honestly didn’t think anybody but my mother-in-law would choose to pay extra. Still, I set all the prices in my PayHip store as “$X.XX+”. The little “+” at the end of the price tells customers that they can throw in some extra cash if they like. And guess what happened? Someone actually did that yesterday. Whoa. Readers understand that when I earn more for my writing, I can write more. *Feels.*]
Writers and readers, what do you think of PayHip? Have you had good experiences with it? Bad experiences? I would love to hear your stories in the comments!
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