New Publishing? A Manifesto of Sorts
In my last post, I talked about how publishers have not leveraged some important technology developments nor, it would seem, understood the implications of those developments. I’ve never been at any publisher’s internal strategy meeting, though the DOJ anti-trust suit gave us a glimpse into what those might look like. That is, those discussions were not about how they might compete in a changing environment but how they might collude to avoid the changing environment.
I have a lot of setting up to do before I get to the tech part of the post. Bear with me.
We have some more clues about how traditional publishers are looking to the future. David Gaughran has a post that sets out a traditional publishing strategy that I’m calling “How to monitize Authors we’d never publish ourselves.” Basically, it’s setting up self-publishing entities that, alas for authors, are designed to separate authors from their money rather than enable an author to effectively put a book into the marketplace for readers to find and enjoy. On the face of it, how brilliant is that? Invest 0 dollars in a book and make thousands!
To make a stark comparison, when Amazon set up Kindle Direct Publishing, they did so in a manner that allowed authors to make money publishing books. Readers benefited from lower prices and content that wasn’t available to them otherwise. For good and ill, authors using KDP could publish a book that did not cost them a penny to produce. It is possible to invest only time. I would argue that today a Zero-Cost-to-Publish strategy is a poor one for authors to follow, but that’s a post for someone else to write. The other self-publishing vendors, Kobo, Nook, iBooks, Google Play etc also allow authors to publish books to their venues without any up front payments required. I’ll call this the Direct Publishing (DP) model.
What we see from traditional publishers is the opposite mindset. They have set up subsidiaries that certainly appear to have an additional and possibly even primary purpose of charging authors higher than market rates for the production costs of their publishing efforts, with additional offerings that charge higher than market rates for promotion. It’s hard to see how readers benefit from this. Under this “Monitize Authors We’d Never Publish” strategy, an author with the chops to write a good book must recoup more money than the DP model in order to turn a profit and continue writing. Thus, one would expect higher priced books from those authors and, assuming the author is not wealthy, quite possibly fewer books available to readers.
To be honest, it’s hard to see these programs as anything but what I’ve called it: Monitizing Authors They’d Never Publish with zero concern for readers.
Who’s The Customer?
Publishers do not see readers as their most valuable customers. It makes sense that the “valuable” customer is the one purchasing thousands of copies of a book. Walmart. CostCo, Barnes&Noble. Do even a mostly decent job of pitching product to these customers and you just sold 10,000 copies of a single book in one sitting over a catalog review. And, in fact, you probably sold several thousand copies of all your lead titles in one meeting!
And yet this is a true fact: There are more readers than Walmarts. There are more readers than readers who walk into Walmarts.
Here is another fact: When books disappeared from small stores, and when independent booksellers got squeezed out during the rise of the chain bookstore, and then again when chain bookstores went under and/or struggled, readers had fewer and fewer places to buy books.
The nearest Barnes & Noble to me is a 20 mile drive through some of the worst traffic in the United States. I NEVER go there. There are towns and neighborhoods that have no stores that sell books.
Enter online bookselling that allows the reader to get the book she wants without leaving her house. Online selling solved a huge problem for readers with internet access. Readers without internet access have fewer books to choose from at a higher price.
What’s a Publisher to Do?
Fact: publishers have fewer big customers.
Fact: Offline Readers have fewer places to buy books and those places offer fewer titles at higher prices.
Fact: Online readers have more places to buy books and more titles to choose from at a wider variety of prices.
Fact: Publishers are not competing in the online space.
Fact: Publishers received 0 dollars from self-published authors who sell millions of books.
Assuming those things are true, what are potential elements of a new publishing strategy? I recognize, by the way, that publishers owned by conglomerates may never be able to implement strategies proven to sell more books in the long run. The parent owner of a publisher may be perfectly happy with strategies that make a publisher profitable right now, even when it’s at the expense of future growth.
- Find ways to reach more readers
- Compete with self-published offerings that are out-performing you
- Reconsider business practices that have encouraged established authors to leave traditional publishers
- Reconsider business practices the self-publishing environment suggests are wrong
- Devise strategies that make you a good business partner for authors.
- Leverage reader contacts (that is, emails)
- Analysis of data
- Implement direct to consumer sales
Digital technologies have transformed the way information and content gets delivered to consumers. Institutions that have operated as gatekeepers for the dissemination of information/content they deem worthy no longer have the only gate. Once upon a time, if you wanted to take a vacation, you went to a travel agent. Travel agents were the gatekeepers of the information that helped a person decide on a destination and arrange how that person got from their home to the destination and back. The travel agent is no more.
Once upon a time, music companies decided what music was sold to the public. Two words for you. Arcade Fire. The point is not that there’s no place for the traditional music business, but that they are no longer the sole gatekeeper. I’m not saying indie music is profitable for all indies. But not so long ago, indie music wasn’t even possible.
Businesses that deliver information/content to consumers have, in recent history at least, had very high profit margins with a relatively small amount paid to the creator of the content. Music and books are both examples of the profit addition accruing disproportionately to the re-seller. Because the profit addition is so large there is tremendous opportunity for digital technologies to disrupt that once inviolate profit space.
Movies are next. It’s already started. In 5-10 years, high quality indie movies will be delivered to your digital device direct from the creator. It will not matter that there are 100,000 “failures” the point is that there WILL be successes and those successes will not share a single penny with the current movie delivery businesses.
Everywhere the content creator has been squeezed out of the profits, there will be immense motivation among content creators to turn away from those delivery systems.
Newspapers, I should point out, pay nothing for their content. (They pay to have the content transformed into words and images.)
To use a favorite publishing bugaboo, in the long run, Amazon does not need Hachette Book Group. Amazon, however, has nothing to deliver to consumers without the authors who write for Hachette. If Hachette as a business entity vanished tomorrow, every author who ever wrote for Hachette would still have content that readers want, and they could get it to them without Hachette.
That’s why what Hachette had to say about their agreement with Amazon is so alarming:
The new agreement delivers considerable benefits. It gives us full responsibility for the consumer prices of our ebooks. This approach, known as the Agency model, protects the value of our authors’ content, while allowing the publisher to change ebook prices dynamically to maximize sales. Importantly, the percent of revenue on which Hachette authors’ ebook royalties are based will not decrease under this agreement. (emphasis added)
The fate of traditional publishing may well lie in those words, and it’s not a pretty fate. Hachette, my friend, if you want to stay in the game, you need to pay authors more. If you don’t, there’s a lot a authors who are looking to the digital vendors and seeing more money and better working conditions.
What do readers get from the DP model of publishing? More books in niche reading markets. Lower prices. Stories that take more risks. New genres.
Side bar: When I’m looking at vendor book reviews, you can bet I’m looking at the one stars. Not because I won’t buy a book if someone hated it, but because I want to know how many of those 1-stars are warning me about typos and bad writing.
Please do not trot out stories about terrible books flooding the market blah blah blah. The existence of bad books does not cancel out the existence of good books. A bad book does not make a good book harder to find unless your algorithms suck really really badly. Not to mention that the majority of authors who write good books already don’t make a living traditionally publishing. So they also don’t make a living self-publishing. And?
If you’re a traditional publisher, you’ll need to pay your authors more or the profitable ones will leave you, and the ones who could be profitable for you will never come knocking.
You need to bite the painful bullet of fixing inefficiencies of print distribution. You’ll need to invest in digital infrastructures that allow you to reduce the cost of book production and distribution so you can free up money in the profit addition pool that you haven’t been sharing with authors. Your margins are there. If you don’t take action now, someone else will come along and take it from you.
You need to find out how to get more people to buy more books (hint, it’s not by raising prices across the board). If you can make that happen while also catering to the smaller pool of readers who will pay more for fewer books, do that, too.
- Technology. Use it. Implement it.
- Gather your data and analyze it.
- Where you don’t have the data because the vendors you hate most in the world won’t share it with you, then devise other methods/metrics of gathering similar data.
- Get a store front going and sell books from it at a competitive price or with compelling add ons to justify a higher price.
- Give ALL your authors a place in your store.
- Format agnostic. If reader A wants mobi format, sell it to them.
- Hire back some of the staff you laid off and start paying attention to all your titles. Your motto should be “No WTF metadata EVER.”
- Apps that help readers find books. (This does NOT mean an app that helps readers find your lead title only.)
- When a book cover isn’t working, change it.
- Find out if book covers aren’t selling your books by asking readers what they think. AB test all aspects of your offerings.
- Reach out to readers
- Invest in IT infrastructure. Implement an XML work flow
- Study the actual impact of piracy on your titles.
- Localize and invest more money in translations
What are your suggestions?