You hear about authors using pen names, but what's the point? What are the benefits, exactly?
Publishers
For those authors writing for a publisher, what happens with books that don’t get picked up? Some may let them sit while others self-publish them under a pen name so it doesn’t interfere with their published name.
It's a great way to put work that the publisher doesn’t like to use.
Rejected manuscripts are often great books that the publisher doesn’t feel falls under the “hot thing” right now and turns down. Authors turning to self-publishing these rejected books often find they do rather well.
Diversity
Many authors write several types of books. A great horror series here, a great romance series there, maybe a military series over here. When an author writes several different genres, it's best to use a pen name for each.
Readers who love one of your genres may not like that you also write romance. Readers looking for more of the same type of book will look under your author name for more. It’s easier for them to find what they want when the same genre of books exist under the same pen name.
Pen names open up authors to anything they want to write. Instead of being pinned down to a specific type of book your readers would expect, try using a pen name for projects you want to explore.
Protection
During your writing career, especially if you plan to write a lot of books, you can get some enemies along the way, angry or upset readers, or jealous competitors, etc. The more successful your books, the more these types of people come out of the woodwork. If you use one name to write all your books, you may attract some unwarranted attacks in negative reviews or online about all your books.
Using several pen names helps limit a negative person reach. It happens more in nonfiction type books where your book on a similar subject starts doing better than a competitor’s and starts pulling business away. The author or their fans can often get nasty with your book.
Marketing
If you plan to advertise your name on blogs or websites, you can market the name instead of a ton of book names. It's easier for people to associate a name with a number of books than remembering all those book names individually.
If you have ever noticed, publishers with a top selling author will market the name more than the title. If you take a famous author and look at their books in a timeline, you will find that the publisher made their name small on the first book or two and it slowly got larger until it now takes up 50% of the book in some cases. That’s because the name sells books since it's associated with a specific type of book.
When not to use a pen name
If you plan to only write science-fiction, for example, and even if you plan to write several series within that genre, you would keep the same name. Pen names are for separating your work from your real name or to separate genres. But if you are going to focus on the same genre there is no need for more than one name.
In this case the same name would help you launch new series and new books, since fans of your other science fiction would be interested in your new stuff.
Combination
Most authors do a combination. They work with a publisher under one name, self-publish under another and use other pen names to experiment with other markets and genres. So use pen names when it's appropriate and in your best interest.