Is the Book Market Contracting?
Jane’s note: This went up prematurely. I was out all day yesterday and when I got home, I was exhausted and forgot that I had this scheduled. In any event, it’s cleaned up with links and everything! Sorry folks.
In the past few months, three of the big five traditional publishers have posted a downturn in sales: Hachette, Simon & Schuster, Reading these reports has felt alarming to me. Although it should be noted because of the falling euro, Penguin Random Houses’ earnings were up due to the foreign exchange rate for 2014 and that the large publishing house expects earnings to rise in 2015 after the restructuring.(You can read more about Pearson’s 47% share here).
In 2011 Borders went out of business. The company began with 21 stores in 1992 and expanded to 256 stores by 1999. According to one article at Slate, Barnes & Noble saw even greater growth than that. With the rise of the supersize stores was a decline in independent bookstores, with over 1000 closing between 2000 and 2007.
Over the past holiday season it was reported that independent bookstores did well, but at least one publishing person indicated to me that overall book sales during the holiday season were very soft. I couldn’t find any markers of holiday book sales, but spending was down across the board during the 2014 holiday season, both online and in brick and mortar stores.
When Borders closed, Barnes & Noble bought Borders’ book loyalty lists and paid $13.9 million to acquire the Borders brand name and website. The following year Barnes & Noble reported a 10.9% decrease in bookstore sales, according to the Ann Arbor News. In 2013 Barnes & Noble announced that it would shrink its national store count by 30% over the next 10 years.
The acquisition of Borders proprietary information, which included client list emails, addresses, and even purchase information, did not result in a great uptick of sales for Barnes & Noble. B&N saw some gain, but there was an overall net loss.
The truth is when Borders closed, the book market contracted.
This is not to say that Barnes & Noble is not profitable; in 2013 they made $374 million. Print still makes up the great majority of all trade book sales, in the United States as well as internationally.
But there do seem to be signs of contraction within the book industry. I realize that some people will say that the decline of traditional publisher sales have been picked up by independent authors and perhaps even Amazon. Based upon public reports by indie authors, however, it does not appear those sales are up. In the beginning of 2014, Bella Andre indicated that the next great frontier for independent authors was international sales.
I mean no disrespect to self published authors, who I think have really brought about significant change in the industry and created a much more level playing field between publishers and authors than there was before. But I don’t believe independent authors bring new readers into the market. The audience for self published books, is largely made of up readers who were brought in by the traditionally published book market and my guess is that the average reader of self published works is embodied within that 30% digital v. 70% print number.
(I know that there are books where the numbers are 90% digital and 10% print but I’m referring to the overall book market which appears to be stabilizing at 30% digital revenue v. 70% print revenue. I use the term revenue because I think digital unit sales are up but the per revenue unit is down due to low prices).
Romance saw a great influx of readers from E. L. James’ series, which was published initially by Writer’s Coffeehouse but then launched into the world by Random House. I don’t think that there’s anyone who would disagree that the backing of Random House helped to facilitate the spread of that particular novel.
I know many people will say that current industry book numbers do not account for the huge rise of independently published books as well as Amazon’s own numbers. We’ve briefly referred to Hugh Howey’s efforts at data scraping and I’ll just say that if anyone believes that Howey’s computer guy is the only one that scrapes data, that would be an extremely naive belief.
Not only do big companies have the ability to scrape the data in similar ways, they have thousands of data points to compare those scraped numbers against to confirm or disprove what the scraped data means. In sum, I don’t think published reports are so far off the size of the book market. (And yes, I’m referring to the US book market)
It’s not a knock on indie authors, because those authors individually don’t have the resources that a huge conglomerate like Random House or Penguin has to place behind a print book. There are very few authors for whom they can spend six or even seven figures pushing the book. That sort of phenomena is not isolated to publishing. For example, one of the most popular and fast-growing social media apps is meerkat. But meerkat relied heavily on Twitter’s API, which could cut them off at any time (and did limit access when Twitter acquired a rival product).
The reason that I’m concerned about this is because I truly believe in the concept of a rising tide lifts all boats but the converse is also true: when the the tide recedes, that in turn can hurt all books and subsequently all readers.
If the book market contracts and if traditional publishers contract, there is far less likely to be risk-taking on the part of traditional publishers. As we can see by the way in which Amazon’s bestseller list works, new trends are born but burn out at a ferocious rate.
As much as I would like to see more experimentation from self published authors, I can see why it doesn’t happen. Self published authors have to take all of the risk in publishing in exchange for reaping all of the reward. It makes sense for them to write books that they think are salable. A traditional publisher however can pay in advance to an author and eliminate / reduce that risk for the author. The publisher then shoulders the risk in exchange for a greater amount of the profit. But if the market is contracting, traditional publishers will have less of an opportunity to take risks and they will have to rely more and more on chasing trends.
This isn’t to say that they don’t already do that but I would argue that they would have to accelerate that even more.
I hope I’m wrong, but I’m very concerned about the contraction of the market and I’m worried that the book future looks grim.
It’s hard for us as readers to act against our own self interests. Our own self interest tells us to buy books at the lowest price possible. For example, last week during the great Avon sale I bought over 40 books. Almost all of them were at $.99 and almost every one was a book I’d already read. Robin talks about the culture of buying and I am a big part of that culture.
Who’s to say the next Harry Potter isn’t being written right now and will bring in a new generation of readers? I hope that’s true but for now I watch the book market with guarded eyes, concerned about its future.