Here's my third post on the e-publishing experiment I first embarked on in September 2012. Here are some lessons I have learned...
For starters, my initial hypothesis that I could earn more money by posting short fiction I have been unable to sell on Amazon and/or Smashwords than by sending it to print or online markets offering nominal fees (like $5 per story or $10 per story) has borne out so far. As of April 2013, I have been paid by Amazon approximately $24 with the four short stories I've got posted there. That comes out to be an average of $6 per story. This already covers the markets that offer only exposure or the lowest of payment.
(That being said, I have spent a large sum on advertising on both Facebook and Google that has eclipsed the revenue from the project, so I might not see a real profit for some time. Although this advertising in all likelihood played a role in the sales I did make, no money on advertising and only one quarter or one third of the sales equals profit, albeit a tiny one.)
Secondly, spiffy cover art does not necessarily translate into sales. Three of my four stories had cover art done for credit or for help on future projects and they have sold decent numbers, while Illegal Alien had a beautiful cover that I paid $45 for--and it's been the worst seller. Obviously you want to avoid the sucky cover art that plagues so many self-published works, but there is such a thing as overdoing it.
Thirdly, one way to generate sales of other product is to give some product away free. My Amazon sales have thus far dwarfed my Smashwords sales ($24 vs. $2.07) in part because I had all of my stories on KDP Select at various points. This allowed me to give stories away for free for several days at a time. In one specific case, I remember making my short story I am the Wendigo available for free for a time and making a few sales during this same time. Although my friend Jeff Baker has given away some of his fiction for free on Smashwords via the use of coupon codes, I never pursued this.
So beginning today and running until May 5, you can get "Illegal Alien" for free off Smashwords using the coupon code ND72T. Let's see if this generates any additional sales of my other Smashwords stories "The Beast of the Bosporus," "Melon Heads," and "I am the Wendigo."
Fourthly, self-publishing short fiction is something that will only make money in the long run. My story "Nicor" recently went online at Heroic Fantasy Quarterly and I will be paid $100. That's more gross income than my self-published stories will make for years at the current rates. No need to spend so much time marketing, playing with sales rates, etc.