A Day at Digital Book World, Part 2 of 2 Parts

By Rosemary Harris


The Role of Publishers

Get books on shelves, paying up front (advances) royalties, publicize and market books, but they have to prove they're worth it. Some panelists said new and midlist authors will eventually question the necessity of traditional publishers as the intermediary between themselves and readers. (Bestselling authors will probably not, since they are the ones getting big advances which will most likely never earn out.)

Publishers doubt whether most authors will want to do all the work necessary to be self-pubbed. A Random House spokesperson (and others) believe publishers are the curators of content and will continue to be essential.

Print publishers are not going away for the foreseeable future.

Marketing

The publishers who spoke pointed to marketing success stories, but the examples were either already bestselling authors (James Patterson, Lee Child), juvenile titles or non-fiction.

With the exception of Harlequin romance, there were no genre fiction examples. In that instance, the brand was bigger than any individual author and had been for so many years that it was virtually impossible to point to any specific activity on the part of the publisher that helped generate sales.

The Dover Publications spokesperson cited examples of frequent outbound marketing to young parents, but cautioned that it was a "privilege" to be allowed to communicate with consumers (I heard this word from a few different panelists), so outbound marketing should be handled carefully to avoid inundating the consumer.

A Harlequin executive and a consultant to National Geographic mentioned cover surveys, premiums and contests as ways to engage readers online. All recommended free content as a way to build and maintain relationships.

Everyone talked about how authors were now required to participate in the marketing of their books through the use of social marketing, Facebook, websites, Twitter and mailing lists -- although all agreed that not everything was right for everyone and it was preferable to do a few things well than to spread oneself too thin.

The S&S and Harlequin reps said their houses gave tutorials and webinars to their authors to guide them in learning how to do these.

All of the panelists referenced direct marketing practices from the 80s and 90s. Not that much has changed, except the way we find the consumer. A 2% response to a mail campaign is still the gold standard.

Amazon

An Amazon VP came, rattled his Kindle and left without taking any questions. Basically, it's the company's goal to have every book in every language available to anyone within 60 seconds. He repeated anecdata on who wants e-readers -- specifically the Kindle, of course -- and why they are the way of the future.

He cited increased backlist sales when a new release was digitized and available on Kindle (this is also true in print.) He suggested out-of-print titles could have a new life on Kindle.

Most interesting, he talked about Kindle Singles, works from 5,000-30,000 words which Amazon is marketing/planning to market from $.99-$4.99. There is/will be a dedicated store for these on Amazon and Kindle.

He talked about Print-on-Demand, which he thought made sense for titles that were either out of print, temporarily out of stock or for those titles that were smaller (i.e., niche) and not likely to sell more than 2,000 copies.

He reiterated that price is key and again mentioned (it's been cited elsewhere by Amazon execs) the stat that a $2 increase in price can result in a 40% drop in sales.

The Future

Some speculated that by 2015 e-books would represent 50% of all books sales. The recent firings of buyers at B&N were used to illustrate this point. Others qualified that by saying yes, but only for certain subjects, genres, etc.



Rosemary Harris is the Anthony and Agatha Award-nominated author of the Dirty Business mystery series. The most recent title in the series, Slug Fest (available April 2011), is set at a Northeast flower show where more than just the plants are dying.

A Day at Digital Book World, Part 1 of 2 Parts

By Rosemary Harris

The day I spent at Digital Book World (day three of the conference) was approximately 7 1/2 hours of opinions, polls, surveys, charts, predictions and conflicting information. The one thing everyone agreed on was that the existing business model for book publishing was being seriously challenged, both in terms of print versus e-book sales and the sales of print books online. The differences arose in how those challenges would be met, and how fast and who would still be standing when they were.

The day started with a quote worth remembering all day long:

"Not everything that can be counted counts, and not everything that counts can be counted." --Albert Einstein

Some conventional wisdom at the show:

Hardware

Kindle currently has close to 30% of the e-reader market share, followed by B&N at 15% and Sony at 14%. Other formats make up the balance. B&N's Nook was rated highest in consumer satisfaction.

Use of MFDs (multi-functional) devices, i.e., iPads, phones, tablets and other devices was growing. Experts believe that MFD growth will continue and fewer people will be reading books on their home computers.

Consumers

27% say they buy from indies, statistics say the number is closer to 10%.

The core e-buyer is the same as the core print buyer -- female, suburban, over 40 years old. The power e-buyers (as it sounds) were suburban women, 30-44. Convenience, price and pass-along ability are important to these buyers.

E-buyers are proving to be hybrid - most are not eliminating print purchases.

E-buyers would buy from independent bookstores if pricing were competitive.

Online reviewers are important to e-buyers.

Seeing the book in a brick-and-mortar store first is important.

All surveyed said they read more now that they own an e-reader device.

46% of e-reader/MFD owners say they are inspired to read more print.

Marketplace

50% of all downloads were free books. Anecdata (anecdotal data) says "free" can be a gateway to future purchases. Free is not a business plan, but it can be a marketing plan. Hachette Book Group rep suggested free for a limited time. S&S recommended "open book" - web view only - for freebies.

Word of mouth still spurs print buyers. 47% of purchases at B&N brick-and-mortar stores are impulse buys, versus 26% at Amazon.

Most panelists claimed e-books drove print sales, although it was admitted that the surges in e-book sales (units) did not currently offset the revenue loss to publishers in lost print book sales.

Royalties

The agents and publishers polled did not submit comparable information regarding e-book royalties. More than 1/3 of the agents said they were getting 50% royalties for their authors; the publishers claimed it was 25%.

It was suggested that legacy (which I took to mean pre-existing) contracts, special deals with smaller publishers, ambiguous backlists (questions as to whether or not, or how long publishers would have e-rights, etc.) were most likely responsible for the discrepancy.

Yes, you can get a higher royalty from an e-publisher if there is no print edition of a book. Print pubs can't offer the same deals because of overhead.

--To be continued...


Rosemary Harris is the Anthony and Agatha Award-nominated author of the Dirty Business mystery series. The most recent title in the series, Slug Fest (available April 2011), is set at a Northeast flower show where more than just the plants are dying.

Notes from Digital Book World, Part 3 of 3 Parts

By S. J. Rozan

Session Nine: Sales Department in Transition

Here again, a lot of talk about how publishers are now running two businesses, the traditional one and the e-one, and the rules for each are different and still shaking out.

There was discussion about publishing becoming more nimble and able to produce "drop-in titles," about catalogs and seasons disappearing. It was widely agreed the hard-copy catalog was soon to vanish, and a central online system would replace it. Although the indie booksellers' panel agreed unanimously that sending sales reps is the single most important thing a publisher can do for a bookstore, sales forces are being cut and salespeople who remain are working more by phone and email. On the good news side, technology is helping publishers be more efficient, so stores don't have to carry as much inventory.

(SJR note: Also mentioned in passing on this panel, though it would have been of interest to hear about it in depth on the indie panel, too, is the group of stores which are not bookstores and not affected by the e-market. These are places like Urban Outfitters, where books are sold along with other impulse-purchase items. There's an interesting echo here of the "mission-driven organization" partnering discussed above.)


Session Ten: Author branding

(SJR note: in the interests of full disclosure, the agent on this panel was my agent, Steve Axelrod.)

Points made:

• "Branding," as used here, refers to a commitment from a company to a customer about the nature of the company's product. Authors are the company and our books are the product.

Readers like to feel included in the author's world, like to feel there's a real communication. An author's "brand" can be said to be the nature of the emotional connection between author and reader. To be successful with social media (Facebook, Twitter, one's own website, posts written for other people's websites, etc.) an author's voice must be consistent and her presence can't feel forced. Unless an author invents a genre, what sets one author apart from another is voice. One panelist said voice is like a regional accent: you don't know you have it but everyone else can hear it.

(SJR note: This doesn't mean you can't change your voice from book to book, as the book requires -- think Margaret Atwood -- but the author's online voice must be consistent.)

• All panelists agreed that the days of an author creating a work and handing it off to the publisher are gone. It's now at least as much, and often more, the author who's responsible for publicizing her book. The good news is, social media makes use of strengths writers already have -- the ability to use words well -- to reach readers. One of the panelists called social media "a gift to the shy."

• To the question of whether publishers are/should be focusing resources on creating an online presence for a writer, the panelists agreed the answer was no. This is at least in part because an online presence is author-specific, not book-specific. Because an author can leave a publisher after any given book, it's not cost-effective for a publisher to build an author brand. Publishers will build their own brands. One question from the audience called this new time commitment from authors "indentured servitude." The response was call it what you will, it's necessary, and authors who don't work this system will fail.

• There was a warning sounded about the wide reach and permanent nature of online activity. Talking back to reviewers, etc., is as wrong-headed on line as it would be in a traditional venue, but the informality of the Web makes it an easy trap to fall into.

• In the end, it was agreed, authors who are successful with social media are the ones who

-- understand the available tools;
-- define themselves clearly and consistently; and
-- understand their audience.

How to do the first two is largely up to the writer. About the third, it was suggested that writers communicate with their audiences and see what seems to strike a note with them. Questions, quizzes, conversations; looking at where readers come to your books/blogs/Facebook posts from; seeing which of your blog/Twitter/Facebook posts get the most responses and what the responses are; all these things should help a writer create a "brand" and a loyal readership.


(SJR final notes on Day One: A lot of confusion and scrambling in the industry. Author branding is essential. Know your readers, be real and, at whatever level makes you comfortable, be accessible. It may also be useful to look for a way to use/help out your local indie, if you have one. Self-pubbing is something to keep an eye on. New technologies not developed yet could change the game.)



S.J. Rozan is the award-winning author of 12 novels, including the mystery series featuring private investigators Lydia Chin and Bill Smith. Her most recent work, On the Line, finds Bill in a high-stakes chase to locate the kidnapped Lydia. For more information about S.J., go to www.sjrozan.com.


Photo of S. J. Rozan with the God of Wealth by S.J. Rozan.

Notes from Digital Book World, Part 2 of 3 Parts

By S. J. Rozan

Session Three: Organizer Predictions

Mike Shatzkin of the Idea Logical Co. made some predictions about issues publishers will need to address in the next year or two:

• Sooner or later, brick-and-mortar bookstores will disappear -- the chains sooner, the indies later.

• Publishers have always been dependent on intermediaries to reach their customers. Now the nature of the intermediary is changing. Publishers should not try to sell directly to consumers, but they should have a two-way street going, to reach out to consumers to make their products visible, and to gather names.

• Agents, who traditionally "cureate" before publishers do, will see their roles change mightily in the e-world.

• Ease of e-delivery world-wide will eventually make the concept of foreign sales for English-language books obsolete.


Session Four: Enhanced Content

This was a largely technical talk about multimedia and displaying across multiple platforms. The important fact for the writer is that a new set of standards is about to be released, called "epub3," that will make it much easier to provide content to all e-devices: not only written content, but photos, graphics, video and sound. (SJR note: I give smell about five years...)


Session Five: e-publishing in Europe

The gist of this session was that English-language e-publishing in Europe is a very confusing situation, while translation e-publishing of books written in English is controlled differently in different countries -- both the publishing itself, and the distribution channels. (SJR note: this is an area where an agent is absolutely essential, I think.)


Session Six: Presentation from Google

(SJR Note: This was an irritating mix of platitudes and generalizations. Google claims to see its mission, now that it's in the book business, as "reading unbound." Readers can choose what to read, where to shop, and what e-device to read on. All that was possible before Google, but they've integrated the experience. The two facts writers might want to consider are: one, that Google is "partnering" with independent bookstores -- it's a little unclear what that means right now but it's something to keep an eye on; and two, that their third largest-selling category is "thrillers." Since in the rest of their top 10 there was nothing about mystery or suspense, I think Google lumps crime and mystery all in that category.)

Session Seven: The Future of Brick-and-Mortar Bookstores

This panel of financial analysts was focused on the chain stores, which means largely B&N, with some attention still paid to Borders, and some to Books-a-Million. They raised some interesting questions, while making only one statement: brick-and-mortar bookstores will continue to exist for another two decades, if not longer. They'll exist in changed form, though. Points made:

• The big box was never a good business model for bookstores. Certain business practices exist for bookstores that don't exist for other retailers: discounts, returnability, agency pricing. All function against big boxes.

• Amazon right now is willing to make no profit, even take losses, on ebooks to gain market share. This, among other things, makes the financial future hard to predict for B&N, which sells both hard-copy and ebooks. Amazon does, too, but doesn't devote the huge square footage to the hard-copy books.

• There's a lot of talk about B&N "re-purposing" a chunk of square footage in each store, but for what new or sublet purpose, no one's sure.

• Google is aggressively pursuing local indie bookstores (see more, below) for its own purposes; for whatever reason, though, indies may get an online presence from this that will further cut into B&N's advantage of scale.

• What may be outmoded is the idea of "bookstore." While the selling function will take a back seat to e-commerce, the physical experience of being among books, authors and people who can make informed recommendations might end up being provided by something/someplace else. This might, for example, be an aspect of the industry that publishers take over, as part of the "added value" they bring. (again, see more, below)

• Bottom line: industry analysts are not recommending their clients invest in any of the bookstore chains at this time. (SJR note: given the generally optimistic nature of much of what I'd heard so far, this was a bucket of cold water.)


The above morning sessions were all-conference. In the afternoon -- after a decent box lunch -- I went to three breakout sessions.


Session Eight: The Future of Independent Bookstores

(SJR note: this session had a true-believer quality that made it hard to judge the realistic nature, or lack thereof, of what the speakers were saying.)

Points made:

• Indie bookstores have long been doing direct-to-consumer targeted marketing.

• One viable option for an indie bookstore is to partner with a "mission-driven organization with a constituency." The example on the panel was a bookstore within a museum, which began as a museum giftshop but has grown to be a destination in itself, a store with the added advantage of a connection to the art on the walls.

• Another indie talked about curation and recommendations online, with online ordering and a pick-up-in-store option. This store depends to a certain extent on signed copies, which ebooks just can't provide.

• Mentioned also was the idea of a small-bookstore bank, extending credit to indies. Right now, the burden of bookstores' undercapitalization is borne by publishers in the form of credit and returnability. Small publishers can't afford these, which keeps the very products out of indies that they're best suited to "curating."

• Google, as mentioned above, is aggressively pursuing partnerships with indie bookstores. What this does for the store is provide a channel through which to sell ebooks, to keep customers from "migrating" to Amazon, etc. What it provides to Google is a source of local customers to whom they can then target ads from local businesses.

• All panelists were optimistic -- as some of the publishing execs had also been -- that we might be entering a new golden age of indie bookstores, as ebooks take away the big boxes' cheap-and-quick part of the business, leaving the specialization and curation in the hands of stores educated and nimble enough to do it.

--To be continued...


S.J. Rozan is the award-winning author of 12 novels, including the mystery series featuring private investigators Lydia Chin and Bill Smith. Her most recent work, On the Line, finds Bill in a high-stakes chase to locate the kidnapped Lydia. For more information about S.J., go to www.sjrozan.com.

S.J. Rozan photo by Marion Ettlinger.

Notes from Digital Book World, Part 1 of 3 Parts

By S.J. Rozan

The second Digital Book World conference was held last week in New York. The organizers, F&W Media, a publisher of magazines and books, founded this meeting a year ago to bring publishers together to discuss the impact of the digital revolution on the industry. My guesstimate of the crowd was around 2,000, mostly publishing company professionals, some bookstore owners, agents, very few writers. I'll give a precis of each session I attended and then a wrap-up. My two-cents notes on each session are in parentheses.

The morning sessions were for the whole convention; breakout sessions were in the afternoon.

First, some terms:

Form factor - refers to the shape/size/physical configuration of an e-device.

Dedicated device - the Kindle, Sony Reader, etc., whose purpose is reading e-books; also referred to as an electronic ink device. This is in opposition to a tablet.

Tablet - the iPad and others like it that have many e-uses beyond books.

Ecosystem - sync-ed or sync-able devices: laptop, tablet, smartphone, etc.

One-to-one vs. one-to-many marketing - self-explanatory, but terms rattled off when discussing the marketing potential of social media.

Vertical communities, a.k.a. verticals - geographically spread but interest-focused groups.

Drop-in title - a book not scheduled or in a publisher's catalog, but published because timely or otherwise thought worthwhile at a particular moment.

Bizdat - business data; self-explanatory, here only because I was astonished to actually hear this spoken.


Session One: The results of a 2010 publishing executive survey commissioned for this conference.

The survey has industry insiders seeing huge growth in the e-book segment of publishing. With the choice of e-readers expanding, readers will be able to find an alternative with which they're comfortable at a price they can afford.

All the execs surveyed expect e-sales to be a progressively larger part of the market, with a concomitant decline in print sales. They think e-books will be 50% of the market in book numbers (though not, significantly, in income, since they're priced lower) by late 2014. If this is true, then presumably sometime in 2015, e-books will begin to surpass print books.

Many execs expressed optimism that this will ultimately mean people will be reading more, especially as e-books are lower-priced and instantly available with a click. However, they also say 2011 will be a "bumpy ride" as publishing company personnel will require "significant re-training" and publishers will need to re-focus. No other industry, the survey taker pointed out, has had to move this quickly to react to the effects of the digital revolution in its area.

(SJR note: Remember, this is only what publishing executives think will happen this coming year. They may be wrong, but since it's what they're planning for, writers might want to take note.)


Session Two: CEOs

A lot of positive-sounding statements from this group, but as you listen closely, they're more tempered.

One exec said the explosive growth of e-publishing isn't a storm that's engulfing traditional publishers, it's a tsumani they can surf to reach new heights.

Another said, in some ways, we're entering a golden age of publishing: e-devices create a "frictionless delivery system" to get content to readers. He cautioned, though, that a golden age of publishing is not necessarily a golden age for publishers. New skills sets, some known but not widely learned, some not yet known, will be needed to do the publisher's job of connecting creative people to their audience.

A third: digital publishing is about lowering barriers, making it easier and more seamless for books with smaller natural audiences to reach their readers. Connecting Tom Clancy to his readers, he pointed out, was never the problem.

All agreed they're now running two companies, one producing print books and one e-books. Some insist the difference between these two companies right now is less of an issue than understanding the changing nature of the distribution of print books.

Three major issues emerged from this panel.

• One was the question of the role of publishers in this changing landscape. If e-readers and digital packagers can connect writers seamlessly to their audiences -- self e-publishing, in other words, now available on a monumental scale -- what added value does a publisher bring? The answer was widely agreed to be "curation," which can take two forms: the traditional gate-keeper plus editorial-improvement element; and the possibility of discovering what an audience wants and then finding a writer to produce it. This second role is one step beyond the previous point about connecting writers to smaller natural audiences.

• The second was the issue of "discoverability." In the bookstore model, whether chain or indie, people strolled through displays of books. They might have come in for one thing, but they found others. Publishers paid for different kinds of shelf space in the chains; indies that hand-sold shelved accordingly. For e-books, with no physical place to go to make that first discovery, how do you reach the target audience?

(SJR note: The 800-pound gorillas in that room, of course, are the demise of newspaper reviews and the shaky future of B&N and Borders, about which see tomorrow's blog entry. If the chains go under, the question becomes the same for print books, too; it's almost there anyway, now that newspaper reviews have all but vanished. The touted social media -- overwhelmingly Facebook and Twitter, for now -- allow access to vertical communities, but once you find them, what do you do? Take an ad, try to start buzz? Word-of-mouth is amplified by the thousands of online review sites, but whom do you trust and how do you find them?)

• Third is the pricing question. Publishers are still in wild flux, trying to figure out not only what skills they need in the e-world, but the true overhead cost of an e-book and therefore the pricing structure needed to make a profit. Meanwhile, authors e-pubbing their own reverted works are pricing them low, and Amazon is willing right now to price e-books for the Kindle at a loss to grab a massive market share, fighting off the tablets. These phenomena could fix consumers' expectations at a price point so low, publishers (especially the "Big Six") won't be able to afford to make new books.

--To be continued.


S.J. Rozan is the award-winning author of 12 novels, including the mystery series featuring private investigators Lydia Chin and Bill Smith. Her most recent work, On the Line, finds Bill in a high-stakes chase to locate the kidnapped Lydia. For more information about S.J., go to www.sjrozan.com.