The Shatzkin Files

Market research used to be a silly idea for publishers but it is not anymore


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When my father, Leonard Shatzkin, was appointed Director of Research at Doubleday in the 1950s, it was a deliberate attempt to give him license to use analytical techniques to affect how business was done across the company. He had started out heading up manufacturing, with a real focus on streamlining the number of trim sizes the company manufactured. (They were way ahead of their time doing that. Pete McCarthy has told me about the heroic work Andrew Weber and his colleagues did at Random House doing the same thing in the last decade, about a half-century later!)

Len Shatzkin soon thereafter was using statistical techniques to predict pre-publication orders from the earliest ones received (there were far fewer major accounts back then so the pre-pub orders lacked the few sizable big pieces that comprise a huge chunk of the total today) to enable timely and efficient first printings. Later he took a statistically-based approach to figure out how many sales reps Doubleday needed and how to organize their territories. When the Dolphin Books paperback imprint was created (a commercial imprint to join the more academic Anchor Books line created a few years before by Jason Epstein), research and analytical techniques were used to decide which public domain classics to do first.

In the many years I’ve been around the book business, I have often heard experts from other businesses decry the lack of “market research” done by publishers. In any other business (recorded music might be an exception), market research is a prerequisite to launching any new product. Movies use it. Hotel chains use it. Clothing manufacturers use it. Software companies use it. Online “content producers” use it. Sports teams use it. Politicians use it. It is just considered common sense in most businesses to acquire some basic understandings of the market you’re launching a new product into before you craft messages, select media, and target consumers.

In the past, I’ve defended the lack of consumer market research by publishers. For one thing, publishers (until very recently) didn’t “touch” consumers. Their interaction was with intermediaries who did. The focus for publishers was on the trade, not the reader, and the trade was “known” without research. To the extent that research was necessary, it was accomplished by phone calls to key players in the trade. The national chain buyer’s opinion of the market was the market research that mattered. If the publisher “knew different”, it wouldn’t do them any good if the gatekeeper wouldn’t allow the publisher’s books on his shelves.

And there were other structural impediments to applying what worked for other consumer items. Publishers did lots of books; the market for each one was both small and largely unique. The top line revenue expected for most titles was tiny by other consumer good standards. The idea of funding any meaningful market research for the output of a general trade publisher was both inappropriate and impractical.

But over the past 20 years, because a very large percentage of the book business’s transaction base has moved online and an even larger part of book awareness has as well, consumers have also been leaving lots of bread crumbs in plain digital sight. So two things have shifted which really change everything.

Publishers are addressing the reader directly through publisher, book, and author websites; through social media, advertising, and direct marketing; and through their copy — whether or not they explicitly acknowledge that fact — because the publisher’s copy ends up being returned as a search result to many relevant queries.

The audience research itself is now much more accessible than it ever was: cheaper and easier to do in ways that are cost-effective and really could not be imagined as recently as ten years ago.

We’ve reached a point where no marketing copy for any book should be written without audience research having been done first. But no publisher is equipped to do that across the board. They don’t have the bodies; they don’t have the skill sets; and a process enabling that research doesn’t fit the current workflow and toolset.

So when the criticism was offered that publishers should be doing “market research” before 2005, just making that observation demonstrated a failure of understanding about the book business. But that changed in the past 10 years. Not recognizing the value of it now demonstrates a failure to understand how much the book business has changed.

What publishers need to do is to recognize “research” as a necessary activity, which, like Len Shatzkin’s work at Doubleday in the 1950s, needs to cut across functional lines. Publishers are moving in that direction, but mostly in a piecemeal way. One head of house pointed us to the fact that they’ve hired a data scientist for their team. We’ve seen new appointments with the word “audience” in their title or job description, as well as “consumer”, “data”, “analytics”, and “insight”, but “research” — while it does sometimes appear — is too often notable by its absence in the explicit description of their role.

Audience-centric research calls for a combination of an objective data-driven approach, the ability to use a large number of listening and analytical tools, and a methodology that examines keywords, terms, and topics looking to achieve particular goals or objectives. A similar frame of mind is required to perform other research tasks needed today: understanding the effect of price changes, or how the markets online and for brick stores vary by title or genre, or what impact digital promotion has on store sales.

The instincts to hire data scientists and to make the “audience” somebody’s job are good ones, but without changing the existing workflows around descriptive copy creation, they are practices that might create more distraction than enlightenment. Publishers need to develop the capability to understand what questions need to be asked and what insights need to be gained craft copy that will accomplish specific goals with identified audiences.

Perhaps they are moving faster on this in the UK than we are in the US. One high-ranking executive in a major house who has worked on both sides of the Atlantic told me a story of research the Audience Insight group at his house delivered that had significant impact. They wanted to sign a “celebrity” author. Research showed that the dedication of this author’s fans was not as large as they anticipated, but that there was among them a high degree of belief and faith in the author’s opinions about food. A food-oriented book by that author was the approach taken and a bestseller was the result. This is a great example of how useful research can be, but even this particular big company doesn’t have the same infrastructure to do this work on the west side of the Atlantic.

What most distinguishes our approach at Logical Marketing from other digital marketing agencies and from most publishers’ own efforts is our emphasis on research. We’ve seen clearly that it helps target markets more effectively, even if you don’t write the book to specs suggested by the research. But it also helps our clients skip the pain and cost of strategic assumptions or tactics that are highly unlikely to pay off: such as avoiding the attempt to compete on search terms a book could never rank high for; recognizing in advance a YouTube or Pinterest audience that might be large, but will be hard or impossible to convert to book sales; or trying to capture the sales directly from prospects that would be much more likely to convert through Amazon.

With the very high failure rate and enormous staff time suck that digital marketing campaigns are known for, research that avoids predictable failures pays for itself quickly in wasted effort not expended.

McCarthy tells me from his in-house experience that marketers — especially less-senior marketers — often know they’re working on a campaign that in all probability won’t work. We believe publishers often go through with these to show the agent and author — and sometimes their own editor — that they’re “trying” and that they are “supporting the book”. But good research is also something that can be shown to authors and agents to impress them, particularly in the months and years still left when not everybody will be doing it (and the further months and years when not everybody will be doing it well.) Good research will avoid inglorious failures as well as point to more likely paths to success.

Structural changes can happen in organic ways. Len Shatzkin became Director of Research at Doubleday by getting the budget to hire a mathematician (the term “data scientist” didn’t exist in 1953), using statistical knowledge to solve one problem (predicting advance sales from a small percentage of the orders), and then building on the company’s increasing recognition that analytical research “worked”.

If the research function were acknowledged at every publisher, it would be usefully employed to inform acquisition decisions (whether to bring in a title and how much it is worth), list development, pricing, backlist marketing strategies, physical book laydowns to retailers, geographical emphasis in marketing, and the timing of paperback edition release.

Perhaps the Director of Research — with a department that serves the whole publishing company — is an idea whose time has come again.

But, in the meantime, Logical Marketing can help.

Remember, you can help us choose the topics for Digital Book World 2016 by responding to our survey at this link.

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Considering the very wide range of digital change topics that should be candidates for discussion at DBW 2016


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The challenge for the book business for the past decade has been rapid and less-than-predictable changes in the ecosystem because of digital. There are two underlying shifts that fundamentally alter the ecosystem: people substituting ebook consumption for print book consumption and people substituting online purchase of printed books for buying them in stores.

These two shifts, and a host of corollaries around product type, product creation, and marketing, are what people come to Digital Book World to be enlightened about and to discuss. Our job for the past seven years has been planning the program and booking all the speakers for that 3-day conference. The whole process takes months; there are about 35 or 40 discrete “sessions” and as many as 150 speakers and moderators involved.

Creating a timely and relevant program when we’re leading the target by several months — deciding on topics and recruiting speakers starting now for an event that will take place March 7-9, 2016 — is a challenge. More perspectives on the task add real value; we structure things so we can get a lot of help. We recruit a “Conference Council” — volunteers from publishing companies and their service providers and trading partners — to help advise me in shaping the event. This year we’re going to broaden the outreach for opinions about this and anybody reading this blog can be involved.

Here are the main topic headings we’re considering with a brief description of what we see as the current issues around each. The Survey linked to again at the end of this post allows you to express yourself on how important you think each topic will be to the publishing community next March when we hold the conference.

1. Data. This is a wide-ranging topic. We look for original data about what’s going on in the ecosystem wherever we can find it and we have done sessions in the past (and could again) about “Big Data” and what publishers need to understand about it. With pricing of ebooks becoming an increasingly important financial consideration for publishers and data being such a crucial component of doing that well, this is bound to remain a top-of-mind subject.

2. Global. Publishers used to be pretty much limited to their home market for marketing and sales. That’s why there is a robust international business in territorial and language rights. In the digital world, that limitation is not nearly as confining. US and UK publishers are learning there are big markets for their books all over the world, and global ebook distribution and print-on-demand make it possible for them to work those markets far more effectively than ever before from their offices, wherever they are.

3 Marketing and discovery. This is the topic that cuts across books regardless of topic or format. For fiction or art books or anything in between, whether delivered in print or as ebooks, publishers are embarked on a long journey of learning about how discovery and SEO works in the most complicated consumer product marketplace imaginable. There are a variety of topics that we entertain under this heading and, you could tell from my own checklist in my last post, I could probably build the whole conference around discovery and figure the audience was getting a large percentage of what is most important.

4. Authors and self-publishing. Authors didn’t used to have much alternative to publishers; now they do. As a result, authors have developed marketing capabilities and support services have grown up to help them. This all raises a host of issues for publishers. They have to learn how to capitalize effectively on what authors can do on their own, but they also need to provide great marketing support to authors and be seen as collaborative and as adding real marketing value.

5. M&A and investment. Most publishers, and all big publishers, are looking to acquiring smaller publishers with complementary lists (and, of course, there are different ideas about what that means). And there are a host of start-ups with capabilities publishers want to see available which are also tempting investments. Quite aside from publishing, we live in a moment with a lot of investment capital available for start-ups and acquisition and publishers certainly need to stay aware of investment flows.

6. Is the book morphing into something else? With each new cycle of Moore’s law and each new delivery mechanism — whether hardware or platform — the question of what the “product” should be gets called for reconsideration again. The history of ebooks has been commercially discouraging for those who want see the book concept rethought from the ground up, but the topic never dies and never will as long as capabilities to present stories and information and to interact with content in new ways are put in front of publishers.

7. Managing and exploiting rights. The rights marketplace for books has changed dramatically in the past two decades. In the 20th century, book clubs and paperbacks were the big-revenue rights opportunities, with serialization to print periodicals also very important. Those markets are all dramatically diminished and the rights action today mostly is about foreign languages and territories. Now, even those rights are being rethought as we see the beginings of publishers thinking about controlling multiple languages for the books they acquire themselves.

8. Agents and editors, how they relate in a mutually-supportive way. They share ownership of each author’s personal loyalty, they both might shape the book editorially, and they both will hear the author’s career ambitions and influence him or her about self-publishing and their publishers’ efforts. If publishers are going to start collaborating meaningfully with authors about marketing, that suggests agents and editors are going to be working together differently.

9. Libraries. Aside from being important customers for publishers, libraries are increasingly being seen as a venue for discovery and perhaps even for book retailing. Whatever they will be in the future, it is likely their role will be different than what Andrew Carnegie envisioned a century ago.

10. Bookstores. Since the collapse of Borders, Barnes & Noble has continued to shrink and independent bookstores have appeared to grow. Books-a-Million and Walmart have become mainstays of the US trade, but they don’t replace Borders. The UK bookstore picture is even less diverse. The ebook market seems to be consolidating in the US with Amazon and Apple leading the pack and independents not really in the ebook game at all, at least at the moment. The key skill set of a publisher is to manage a diverse system of retail intermediaries that gets their books to customers. How the intermediary ecosystem will change in the months and years to come is therefore of existential importance to publishers.

11. Standards. There are evolving tech standards around content that live outside the book business. The question for publishers, particularly big publishers, is how much effort they should expend on standards-creation efforts which are, mostly, the domain of other media and tech interests. Can they let industry bodies like IDPF and BISG handle this, or do publishers have to involve themselves in these issues?

12. Outsiders coming in. We are seeing publishing coming from non-publishers and we see non-book retailers starting to peddle books online. These are trends that industry incumbents need to monitor and understand.

13. Millennials. Some believe that the human propensity to be a book reader is changing in fundamental ways as people born into the internet age become an increasing part of the market. There are other data points suggesting that the millennials aren’t so different from their predecessors. How should publishers approach marketing differently to different age groups?

14. Digital production tech and operations. Is there already a “new normal” for integrated print and digital publishing? Do publishers need to continue thinking about investing in technology for creation and delivery?

15. Audio. Audio publishing has gone all-downloads much faster than print. An even bigger technological disruptor may be coming as TTS (text-to-speech) technology gets better and better. What the linkage will be between audiobooks and ebooks in the future is something else every publisher needs to consider.

16. Publishing automation. From content management to product generation, automation has been part of every publisher’s life for the past several years. It might be fruitful to explore how people in publishing houses feel about the automation that has taken place — has it helped? — and get a sense of what needs to be automated in the future.

17. Mobile. Because of mobile, there are shifts in consumption and an impact on search and discovery and where the transactions take place. Many publishers have worked to optimize their websites for mobile use but there’s a lot more to know about the mobile shift that could affect what they publish and how they market it.

18. Video. This topic runs a gamut. Publishers can be tempted by YouTube stars with big audiences as potential bestselling authors. But how reliably can those audience be converted to buy books or ebooks? What do publishers need to know about video production? Do videos really help with book marketing?

19. Privacy. Should publishers or booksellers be doing anything to address potential compromises to reader privacy in the digital age?

And then we have six questions for all publishers that could inform or suggest additional topics.

* What growth opportunities do you see for today’s publishers?

* What potential change in the landscape are you most worried about?

* What “problems” are you trying to solve?

* Where are you investing your capital?

* When you hire today, what skills are you looking for that you might not have ten years ago?

* Can you tell us any topic you think is important that isn’t mentioned here?

This link to our survey is intended to allow you to participate in helping us decide what’s important for DBW to cover. Even a program as extensive as ours has to make choices and your input will help us do that more wisely. In case you’re interested, here is my personal list of what publishers should be thinking about, which is a very-much-abridged version of this post.

Under the direction of our Conference Chair, Lorraine Shanley, and co-Chair Jess Johns, we are following a parallel process for our Publishers Launch Kids show which will kick of DBW on March 7. If you are kids book publishing interests you, the survey for that show is here and you’re welcome to participate in that one as well.

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My personal list of what should be top-of-mind for publishers around digital change today


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What are the most important digital change issues publishers face?

To prepare for DBW 2016, we need to decide what publishers need to be thinking about and learning about next March, when the seventh annual DBW will take place. It would be extremely limiting for that selection to be based on my thoughts and opinions alone, and we have a process in place to make sure that it isn’t. (More on that to come in the next post here.) But if we were relying on me alone, here’s what we’d be focused on.

1. Ebook pricing. Publishers get anywhere from 50-to-70 percent of the retail price from most ebook retailers. Unlike the print world, where price-setting must take place before the book comes out and is, because the price is printed on the book, very hard to adjust, ebook prices can be changed quickly and frequently.

Pricing variation has historically been the province of the retailer. In the physical world, markdowns were almost never shared: the retailer voluntarily gave away part of their margin to gain market share or to build customer loyalty.

In the agency world that four of the Big Five have now created (with Penguin Random House almost certain to follow on), pricing is not only mostly controlled by publishers, they are the direct beneficiaries of higher prices and lose margin if prices are lowered.

It is true — and the indie authors who like it better when Amazon is in control rather than the publishers often point this out — that publishers have almost no experience with pricing and the impact of changes. But it is also true that the retailers, who do have more experience with it, have different objectives than publishers. Retailers want a competitive advantage against other retailers and, as part of that, they want to build customer loyalty. Publishers want to maximize revenue for each SKU, build awareness of authors, and use one book by an author or in a series to sell other titles under the same brand.

Publishers are starting very near zero on knowledge. How does discounting one title in a series affect the audience’s likelihood of getting started with it and then buying other titles at higher prices? If a book is in the news, is the right strategy to raise the price (to maximize revenue) or to lower the price (to get better market penetration on the back of the news). And is the strategy the same if the story is about the book, rather than the book being about the story? Do pricing strategies need seasonality rules, and how is that different across genres or topics?

All of these are things publishers will have to learn by a combination of experimentation, archiving of information, and analysis. A complicating aspect of this is that the market itself is still changing: a person’s ebook purchasing habits today, when they’re new to it, may change over the next couple of years, as they become more sophisticated consumers. This is a moving target but a very important one. And there is one person who stands out as having looked at this more closely than anyone: Dan Lubart, who owns Iobyte Solutions, and who previously worked for HarperCollins and now is at Hachette.

2. Building direct customer knowledge. What is knowable about audiences through listening and analytical tools today is stunning. It is critical to do audience research on a constant and ongoing basis. Publishers need to keep formulating theses about who their audiences are, then doing research to find where they hang out online and what words they use when they talk about the things the publisher wants to engage them about.

The customer knowledge is essential to do first-class search engine optimization, but it is even more important for a publisher that wants to do any kind of “campaign”. Buying keyword exposure is an exercise in constant experimentation, measurement, and management no matter what you do, but starting a campaign without doing the core audience research is simply wasteful. And what is true of ad campaigns is also true of earned media and traditional marketing campaigns. This is the marketing equivalent of “measure twice, cut once”. Don’t waste time, money, and effort doing something that research could have told you in advance wouldn’t work.

3. Building direct customer contact. Near as we can tell, the big publishers have been building email lists for years. There’s a Shatzkin Files post from the Fall of 2011 citing Tor.com’s having mailed to hundreds of thousands of people the month before, with a very high open rate and getting an extraordinary percentage of those to “take an action”.

But building lists and managing them for maximum effectiveness are two quite different things. And even more complicated is a next-generation challenge: getting publisher lists and author lists working in tandem. It would seem like a win all around for publishers to organize authors whose audiences are similar to email across their lists to everybody’s benefit. But it is easy to see why authors (or their agents or business advisors) would be reluctant to dive into something like that, or to want some control over their use in ways that effectively forestalls collective action.

Even for lists publishers entirely own and control, there is enormous work to do segment them properly and test, test, test to find the most effective ways to use them. And engagement with customers also includes branding and interaction with them in social media and targeted web sites or landing pages that can engage potential customers (and, of course, capture their email addresses as well).

4. New protocols for author collaboration around marketing. We’ve made the point in this space before that the author’s digital presence is an important component of any book’s SEO. A publisher extending its own efforts to make its books discoverable that is not including the author web sites in their analysis is missing a component essential to the success of their efforts.

This is a complicated question that will ultimately back right up to the author’s contract, but where each publisher needs to start is with an understanding of what they want from an author’s digital presence and web site. There needs to be a best practice “ask” and there needs to be analysis of what exists to pinpoint the ways it should be improved. One very alert Big Five house we know has at least an executive or two at a high level who sees the virtue in our suggestion that a graded analysis of an author’s online presence, together with specific recommendations for improvement, should be both a standard and promoted feature for authors of being published by that house. It is hard to imagine that this won’t be normal operating procedure in a couple of years but the time to start working on it, for everybody, is now.

5. Maximizing global sales: distribution and discovery. Publishers, coaxed by global ebook distributors like Ingram, Vearsa, and others, are increasingly aware that English-language ebooks have a global market. But maximizing those sales requires both having distribution to the retailers serving each market and optimizing the title description metadata so that search “works” at many places around the world.

Part of what is required there is — say it again — more research. The search terms that work best for any book may well be different in India or Australia than they are in the US. But the challenges in getting differentiated copy posted correctly in the right places are not trivial, and things don’t work the same in Amazon and Google, let alone in local retailers in each market. We figure that the sophistication of the global ebook distributors will be increasingly useful here, but it will also be necessary for each global publisher to understand their most important markets and retailers for their books to sell most effectively.

6. Building a company-wide understanding of SEO (editorial, marketing, and sales). The understanding of SEO at most publishing houses, from our experience, is both insufficient among the most knowledgeable in the house and grasped at all by far too few people. For the most part, SEO is the province of the “marketers”, but, in fact, it might even be as important that editors and salespeople understand it. The S in SEO stands for “search” but it might as well stand for “sales” or “shelved”.

Editors who don’t understand SEO lack an important tool to direct authors, particularly of non-fiction books, to address what the audience wants. Without SEO understanding, they can’t instantly tell a “bad” title (one that won’t work for SEO) from a useful one.

Salespeople, whether they are covering brick stores or online ones, need that understanding too.

The key to optimizing for search is knowing how the audience searches. This can only be accomplished by research, and it changes with time so the research for a similar book on last season’s list can’t reliably be re-used. That will become clear as we consider the next point.

7. Allocating effort across a large backlist. The biggest opportunity and the biggest challenge for publishers, as they have historically operated and as they are currently structured, is maximizing their opportunities across their backlists. The big houses are dealing with many tens of thousands of titles. We advocate techniques that require some human application so scale techniques have to be used to pinpoint the titles worth an effort.

Although we are developing tools to help digest the external cues that might affect where the focus should be — cues from the news and social graph — each publisher has to start with a combination of knowledge of the list, intuition, and a sense that sales can be improved to pick those titles worth reviewing for better audience understanding and descriptive copy improvement. Almost certainly, titles that are more than a couple of years old will need work for several reasons: the house knew so little about SEO when copy was written; time will have changed the search terms that matter; and reviews and awards and other things from the book’s experience in the marketplace might need to be incorporated.

8. Make sure you ignore what is not important. My Logical Marketing partner Pete McCarthy has worked inside big companies and he urged me to add this eighth point. No company has the people or bandwidth or resources to spend time on things that are not very important. Whether you use this list of mine or make your own, be very wary of expending any energy or capital or bandwidth on anything else.

Of course, DBW itself won’t be relying just on me to make the choices of what to cover and what to ignore. I have already created a much longer list of topics than this for our Conference Council to review. We have them express themselves on how useful each potential topic is in a Survey Monkey poll. We will give our readers the opportunity to take that same poll when we describe the larger list of topics in our next post.

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The utility of examining the text of a book to find search terms for SEO


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The first two things to understand about optimizing book copy for SEO that I’ve learned from Logical Marketing partner Pete McCarthy are:

1. Copy always used to be written based on “knowledge of the book”. It should now be written based on “research into the audiences”.

2. Copy from publishers was almost always B2B, intended for intermediaries in the marketing and supply chains. Now all copy ends up being B2C, important for consumers and search.

These are tough hurdles for the most established publishers to jump, because executing on the audience research piece not only requires a change in the workflow and distribution of work among staff, doing that also requires additional effort that employs skills that may be in short supply, if they exist in the publishing house at all.

With all that additional work in front of them, any automated solution that can be offered to publishers to diminish the pain of this transition is attractive. (We’re working on a few of those ourselves.) I’ve recently become aware of the new technology offered by Trajectory, which examines a book’s text for words that should be used for SEO.

Automation is good, but this is still coming from within the book. So I asked my Logical Marketing team to help me understand: is this helpful?

The answer seems to be, “it is a positive step but a very partial one. And it does not help anybody avoid the research we think is fundamental.”

The article by Jim Bryant of Trajectory on the Publishing Perspectives blog demonstrating the value of their capability is very clear. He used as one example a book called “The Mayo Clinic Diet”. A word cloud Trajectory created from the book showed clearly that there were two big words, “calorie” and “exercise”, which appeared frequently in the book, were important to its thesis, and were not in the copy the publisher created to describe it. That’s the positive step.

But Logical Marketing methodology is to find out what words the consumer uses to describe what is in the book, particularly in search. With a backlist book, this can be easily researched in Library Thing. The word cloud at Library Thing for this very same book says the terms that the consumers use are “diet” and “dieting” (which, being in the title, were already in the descriptive copy), “cookbook” (not in), “health” and “health and fitness” (not in), “nutrition” (not in), “weight loss” (which was in the original copy; hey! it is a diet book!), and “exercise” (in because it was identified by Trajectory.) “Calorie” apparently didn’t figure as important to the consumers on Library Thing as an associated term.

But going beyond the important terms not in the book and therefore never to be found by the Trajectory methodology, were those other prime terms — “cookbook”, “health”, “health and fitness”, and “nutrition”. And a bit more work on our part also identifies longer-tail terms that will be more important for discovery than what Trajectory found: “healthy diet”, and “lifestyle changes” among them. You get that very clearly from Library Thing.

Pete McCarthy did a post for the DBW blog recently that used “To Kill a Mockingbird” to show why the words that are in the book are not sufficient for first-rate SEO. (Pete used a fiction title because it is often said that fiction is harder to SEO than non-fiction. The point is that the methodology still works.) What is that literary classic about that a semantic examination of the text probably won’t tell you? Racism. Civil rights. It is also important Southern Literature. As an aside, you can combine certain of those tags to find comparable other authors for specific aspects of the book that will resonate with certain customers. You know another author who jumps out with that analysis? John Grisham. Will Trajectory’s method show you that? We don’t think so. They have built sophisticated technology to analyze writing style and story structure, but whether that would connect Harper Lee and Grisham is very doubtful. Using the characterizations of consumers connects them very clearly.

We don’t mean to dismiss Trajectory. We might well learn to incorporate it into our methodology in circumstances where it is available to us (if a publisher we’re working with has it), but almost certainly for new titles only. It is not worthless to examine the text of a book looking for clues to good keywords. But it is a mistake to ignore McCarthy’s first rule: that the descriptive copy that serves you best for SEO requires research into the audience, even gaining knowledge as rudimentary as in the example. Semantic examination of the text automates what we’ve always tried to employ manually: knowledge of the book. That’s useful, but it is really the smallest part of a much larger job to create descriptive copy optimized for search.

To modify an old aphorism, knowledge gained from the text is often unnecessary, but never sufficient.

As for backlist, the important terms that the Trajectory examination uncovered are found much more easily and quickly at Library Thing. The tool that was well-built to begin with, has existed and been iterated upon and had data added to it for years, and been underutilized for a long time because it was seen as a “niche consumer” capability, is still the best one. It is populated with terms used by real people not employed by the author or the publishing house. Its data is not based on transactional history, but on reading history. That’s what you really want for SEO. New titles are a bit harder, and Trajectory over time will likely solve pieces of that puzzle, but audience research is still a lot more important than an examination of the book’s text to achieve the desired result of having readers who are unaware of a book but would be likely to want it have it put in front of them for consideration.

We recollect that Amazon had the full text for many books and used to do a semantic analysis of it. (They certainly still do X-ray in Kindle, which is a version of it.) They haven’t emphasized it and they haven’t built on it. That suggests that the commercial value of it is questionable. And Google also identifies “common words and phrases” and provides a word cloud, which you can see here for “The Mayo Clinic Diet” if you scroll down.

And, indeed, we’re dealing with Trajectory 1.0. Over time they may make their analysis increasingly relevant and useful. But no matter how smart and sophisticated you are, you can’t examine the book itself to find out how people reading it react to it and think about it and that is the information that tells you most about who might read it next.

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Advice for an author looking for a literary agent


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Until last week, I hadn’t stopped to think about how often I’m advising authors about how to deal with the publishing business. I would imagine this is something that most of us in the industry find ourselves doing very frequently. There are, after all, a lot of aspiring authors in the world and when one’s a friend, or a friend of a friend, they ask. And you try to help them.

As I wrote in an April post, I had assumed until very recently that an author couldn’t do herself any harm by self-publishing her work on her way to finding an agent or a publisher. When an agent I know and respect told an author I’d sent to him that he really found it hard to sell publishers already self-published books, it stopped me short. I sent out a query to a long list of agents and the consensus opinion that came back was that publishers are really uncomfortable picking up a book that has already made an appearance in the marketplace. (A deeper look at the results of this canvassing will be the subject of a future post.)

Although we all know stories of self-published books that went on to have fabulous runs with a publisher (“50 Shades of Gray” being the obvious example), it seems that most agents think that most publishers see the previous publishing history as a challenge. If the book didn’t do well, they don’t attribute it to poor or non-existent marketing. And if it did well, they sometimes wonder if the audience has been exhausted.

Obviously, there are both agents and editors who don’t think that way, but I was really surprised to learn that so many of them apparently do.

I would never attempt to advise an author on the techniques for self-publishing. That’s not what I know and there are many people, starting with our friend Jane Friedman (not the one from Open Road), who specialize in that (although she knows about finding agents and regular publishing too). But I have long had a formulation of how to recruit an agent which I passed along when asked.

This assumes the aspiring author is starting from scratch: they have a manuscript completed or in development and they need to start knocking on agents’ doors. What I suggest — not rocket science but most writers don’t know about it — is using the databased information at Publishers Marketplace to find which agents to target.

PM has a database of deals, so you can see what books have been sold from which agents to which editors and get a sense of what prices they sold for. That means an aspiring author can look for books of the same type or genre as the one s/he wants to sell, find the editors that are signing those up and the agents who are successfully pitching them. That not only gives the author a feel for who is right, it gives them “what to say” that will entice the agent. “I am writing to you because I have a book that fits the profile of deals I see you’ve made on Publishers Marketplace.”

Of course, I do know dozens of agents personally. But rarely do I have a sense of what they are looking for, what kind of author would be suitable for them. I have one friend in particular who runs a large agency and for whom I have very high regard. So, often, if I know somebody to be a good and competent writer, I’ll send them to him. But that’s a sloppy answer. I find I have no good way personally to distinguish among the dozens of agents I know. That’s why I send people to the databases at PM. I tell my writer friends that if they narrow down their search and let me know whom they’re targeting, I’ll introduce them to any targets that are in my circle. But that’s been the extent of my help and that’s as far as I’d thought it through.

Last week, I found myself offering advice to an extremely thoughtful author and her business-savvy husband. The author is Geraldine DeRuiter, who has an extraordinarily popular blog called The Everywhereist where she writes about travel (and lots of other things). We were introduced to her by her husband, Rand Fishkin, who is a longstanding thought leader about search and the creator and owner of Moz Analytics and Moz Research Tools, the experts on optimizing one’s presence through Google.

My Logical Marketing partner, Pete McCarthy, has long been an admirer of Rand’s. Aside from being Moz’s inventor, he’s a prolific blogger whose blog shows him to be very generous about sharing his knowledge and perspective. Because we’re working on a business idea that we thought Rand could provide useful insight about, Pete reached out to him. Because Rand is a mensch, he gave Pete an hour call of great advice for nothing. During that, we learned that his wife, Geraldine, had a book she was trying to sell. All I knew was that it had something to do with travel and that she had a very big blog. I didn’t even know her name. But we knew she was looking for an agent and we wanted to at least minimally return the favor Rand had just done us.

So I reached out to a very powerful travel publisher I know and asked for an agent suggestion. He gave me one name, an agent based in San Francisco and, as it happens, a person I know well. Since Rand and Geraldine are in Seattle, I thought that was worth passing along and I offered to make the introduction. That’s when I started to learn what even very smart people who know how to look have trouble finding out about how our business works. And I was forced to learn because Rand and Geraldine asked me about assumptions I had made that, it turns out, at the least required some explanation and perhaps required rethinking!

First I told Rand I had an agent to send Geraldine to if she wanted to connect with him. Rand passed me to her. She said that being in Seattle, she was as comfortable with people in NY as with somebody in San Francisco. But, she added, she had already reached out to a number of agents in New York. Some had gotten back. Some hadn’t at all. So, first she wanted to know, is that typical? Do agents often just fail to respond?

I told her:

There are SO MANY agents that it is extremely hard to generalize accurately about them. Except that one generalization that is pretty universal is that dealing with writers they don’t (yet) represent is the weakest part of their game. It should be. What they really DO is work on behalf of the ones they’ve got and the follow-ups that are important to them are around deals in the making for projects they represent.

I would assume nothing at all from non-response, not even any indication of competence. And yes, I think non-response may be the most common response.

You only need one agent. There’s not a lot of point from your end or from theirs to auditioning an army of them. You should insist on feeling very comfortable with whomever it is you choose but I wouldn’t try to handle more than two or three at a time at most. If you have any positive indications from ones you’ve connected with before, obviously you should keep them in play until you’ve made a decision. But there should be no need to “chase” in this case. If you have agents who have already indicated they’d represent you, I’d stick to that group for now. You can check them out on Publishers Marketplace or ask me about them and I might know something.

Rand came back questioning an assumption.

I just have one follow-on question – are you saying/suggesting that the agent themselves doesn’t matter all that much in terms of their ability to help get a good publisher/good deal? That they’re (nearly or somewhat) interchangeable? And therefore, Geraldine shouldn’t worry too much about pedigree, background, experience, or agency, and more worry about her personal fit/comfort with the agent?

I hadn’t ever thought about my own advice that way, but I have always stressed to authors the importance of feeling a personal comfort level with an agent. So I told Rand:

Well, there are definitely levels of capability. They’re not all the same. I would definitely check an agent out on Publishers Marketplace and make sure they’ve made deals with the houses and editors you care about (and you’ll have your ideas about them from the deal database at PM too). You can ask me and I might be able tell you about their brand, or even about them personally. But, yes, in general I think having somebody you feel comfortable with is the best way to choose.

Here’s the reality. There are five major houses. There are probably 500 editors to know in there. There are dozens of smaller houses. There are dozens of significant agencies in NY and London, and there are still indie agents that can do significant deals. So at the very top of the power end of the curve, you might not want the agent because your book wouldn’t be big enough to keep their sustained attention. You’re not “long tail” but you’re also likely not megabucks. You’re almost certainly in the middle.

There are a LOT of agents that have enough access to be successful for you. The most important thing is that they care and that they’re prepared to be persistent. Personal chemistry is the best guarantee of that.

By the way, I’ve actually done some agenting myself, including of six books I wrote, but also a bunch of others over the past five decades. But I’d never do it myself today. The industry has become more corporatized and structured. Even the editors I’m friends with who know me as a longtime publishing professional would know I’m a rookie agent. Publishers count on agents to be a reliable career guide to writers. They prefer real pros for many good reasons.

One more point occurs to me that is responsive to your question. The same agent is not equally good for every book they might represent. Enthusiasm matters. Happening to have strong connections with three editors who would just love this particular book matters. Having belief that Geraldine can be groomed into a prolific author over time would matter. In other words, the agent who made the most deals for the most dollars last year might not make a better deal for Geraldine and this book than somebody who had done half as well.

And all that uncertainty is why I’d go with a person with whom the relationship feels good.

Rand came back to me with this:

That makes tons of sense – thank you Mike. I only wish that information was more discoverable on the web – I’ve been doing plenty of searching the last few months as we’ve thought about this, and not come up with anything as credible or sensible as the reply you just sent. Goes to show that, for some queries, Google just isn’t good enough.

Now, Rand Fishkin is the master of how to find things out through Google. And Geraldine DeRuiter has built an extraordinary following (being married to the King of Search can’t have hurt), writes like a dream, and is pursuing an agent for her book with seriousness of purpose and calculation. The fact that all of this could be so helpful to them was actually a bit of a surprise to me.

Then again, maybe it isn’t all so surprising. This is yet another example of how granular publishing is: so many editors, so many agents, and then the numbers of them dwarfed by aspiring authors. In fact, they’re even dwarfed by the number of competent aspiring authors there are. Writing takes time. Reading takes time. Editing takes time. Developing a project takes time. Nobody gets paid until the reading takes place at a publishing house and a buying decision can be made. No wonder so many authors throw up their hands trying to break in and just publish themselves. Even with the best techniques and people with industry contacts to help make introductions, finding an agent is not easy for a writer.

Rand and Geraldine both suggested I summarize the advice I’m offering in bullet points:

  • If your goal is an agent to get you a publisher, think twice before you self-publish
  • Learn to use the tools at Publishers Marketplace to zero in on the agents who sell stuff like yours
  • Be persistent
  • It’s okay to approach more than one at a time, but don’t waste your time or theirs by approaching many
  • After you’ve found the right agents, make your selection from among them based on personal chemistry
  • Expect the process to take time

Maybe now that this piece is up on the blog for Google to see, Google will, for this question, now be good enough! (Or better, anyway.)

I checked in with some writers whom I’d advised in the past to see if they had any advice they wanted to give me! I got useful tidbits from two of them to add to this piece.

One suggested a website called agentquery.com, which is, in effect, a directory of literary agents with an emphasis on which are looking for new clients. It might be a useful tool in conjunction with Publishers Marketplace.

The other made the point that, these days, your agent is your primary editor and all writers need an editor. He said that your manuscript should come back from your agent heavily marked up and requiring a lot of additional work. His advice was to be wary of an agent that doesn’t start you off that way. This particular writer has had a long career as a magazine editor; he has the proper respect for the value of an independent editorial eye.

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Four of the big five have new deals with Amazon and only the biggest is still to negotiate one


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A reporter called earlier this week focused on what he figures are the upcoming negotiations over trading terms between Amazon and Penguin Random House. I had observed when Amazon was throwing sharp elbows at Hachette during their contractual dispute that Amazon wouldn’t try similar tactics with PRH.

Since then, with HarperCollins and Amazon having announced they’ve reached new terms, deals have been done with all the Following Four US publishers. It would appear that the DoJ’s and Judge Cote’s work to stop publisher-controlled pricing across retailers has been very largely undone by the deals independently arrived at. So it is a sensible question for a reporter to ask, as this one was: can Penguin Random House do better than the others did in these negotiations?

I don’t know the answer to that. And even after a deal is announced, none of us will necessarily know the answer. But this is an appropriate time to consider the power of Penguin Random House’s position in the marketplace. It is very strong. If I were any of the other four major publishers, I would fear PRH more than Amazon as a potential disruptor of my business. When I put that proposition to a UK-based executive of one of those companies at the London Book Fair last week, he readily agreed with me.

When one considers what a segmented business publishing is, the Penguin Random House combination becomes that much more eye-catching. These five companies — PRH, HarperCollins, Simon & Schuster, Hachette, and Macmillan — compete much more with each other than they do with anybody else. Cambridge competes with Oxford and other university presses. Quarto competes with Chronicle and Abrams and Running Press and outside the US with Egmont and other illustrated book publishers. Yes, a bestseller might come from anywhere: Harry Potter came to the US market from Scholastic and the UK market from Bloomsbury. But the publishers who compete for the bestselling authors and the front-of-store slots repeatedly are the Big Five, which were formerly the Big Six.

And when Penguin merged with Random House, that was not just any old merger of the Big Six. It was a merger between Number One and Number Two. It has created a single company that is, in the US market, about twice the size of its next competitor (about $2.5 billion in sales for PRH against about $1.2 billion for HarperCollins). And HarperCollins, in turn, is about double the size of each of the other three.

What that means is that PRH, like Amazon, can make its commercial decisions independently from the rest of the industry. They can take risks that would be very challenging for anybody else. Amazon could afford to get into a dust-up with Hachette that affected the supply of books in ways its customers could clearly see and make it public to try to make a point. Random House, even before the merger, could afford to stay out of the new iBookstore (they wouldn’t play ball with agency terms in the beginning) for a while, which would have seemed a big risk to the others. (Of course, the DoJ and Judge Cote didn’t see it as individually-discernible risk. Their explanation was “collusion”.) That decision by Random House paid off in big ways in 2010 with higher sales per ebook title (because they didn’t go to agency, which reduced the per-title take) and higher unit sales (because agency would have forbidden discounting, and Amazon went to town discounting Random House books against their agency competitors).

In the past year, Scribd and Oyster announced ebook subscription programs. Pretty quickly, HarperCollins and Simon & Schuster announced varying degrees of participation in the services. And then Macmillan followed. But Penguin Random House and Hachette stayed out. Hachette is the most author- and bestseller-driven of the major houses and author brands are the most likely long run casualties if subscription services succeed. But, if they succeed, Hachette will have to go back to them hat in hand. Penguin Random House won’t, necessarily.

Because if subscriptions are actually the wave of the future and the title rosters from Scribd and Oyster are sufficient to make that happen, then PRH could compete with them entirely on their own. They would have as many prominent commercial books from their own reservoir as the other services have aggregated. And they wouldn’t be sharing with a third party vendor.

It is worth noting that PRH has gone into the Scribd service with audiobooks.

When Oyster announced last month that they would now sell ebooks a la carte as well as in subscription bundles, some of the press saw more significance to the move than it warranted. Scribd started out as an a la carte document access site. Amazon itself formed a subscription service (Kindle Unlimited) the minute Scribd and Oyster announced what they were doing. If you have the capability to sell ebooks, why not sell them by whatever commercial arrangement the customer wants?

By the same token, the distinction between publishers and retailers is melting away. Amazon went into publishing very quickly after ebooks enabled self-publishing. Barnes & Noble published proprietary books for years, even before they bought Sterling in 2002. HarperCollins built a retailing capability for themselves in the past year. (The Tor.com imprint of Macmillan said they’d be selling DRM-free ebooks directly from their own site, but we have seen no evidence that they actually ever did.)

So, the reporter trying to understand the possibly-occurring Amazon-PRH negotiations wondered, would PRH become a retailer?

I don’t think so (at least not anytime soon), but I still believe — as I did when I first speculated about all this 2-1/2 years ago — that a store could have a competitive selection of books with titles exclusively from PRH. No other publisher could serve a general interest audience at retail without other people’s books as well.

How else could PRH be disruptive? They could offer a license to schools for their titles. If a school bought one of those to load its students’ digital devices with content, they wouldn’t have everything they might want but they could conceivably have all they need. How hard would it be to sell a competing license with less good stuff in it? How hard would it be to build an aggregation so that a competing license had as much good stuff in it?

The executives I’ve spoken with at PRH — and I have high personal and professional opinions of all of them — have consistently disclaimed any interest in most of what I’m suggesting. And, indeed, they haven’t started a subscription service and they’ve shown no signs of rolling out a program to create PRH-only bookstores. There are reasons, aside from altruism or short-sightedness, why they might resist these solutions. After all, PRH publishes about half the most commercial titles in the US book trade. Subscription services and retail competition would weaken the existing bookstore network, and PRH benefits from its existence in proportion to its relative size, which is to say “much more than anybody else”.

In fact, I’ve discussed the possibility that they could be so disruptive with the CEOs of two of the other Big Five, and neither executive (unlike the one I met with in London last week) expressed much concern. One said “they don’t want to do that”, meaning “they don’t want to destroy the competition in the trade” (which is a point of view that is actually supported by what the executives at PRH have said to me, as counter-intuitive as it seems). And the other one believes that having PRH in the game to negotiate with Amazon and B&N helps keep the terms of trade in check for everybody else as well. That executive likes having PRH there, with all its size and clout.

I had the conversation with the reporter that was the catalyst for this post on Wednesday morning and it was mostly drafted on Wednesday afternoon. Penguin Random House’s new consumer-centric web site was unveiled Thursday morning and underscores their support of the trade (they’re trying to push sales to retailers, not sell directly themselves). The site appears to give a page for every book they’ve got, which could well prove very useful as they build embellishments.

They refer the sales over to a robust choice of retailers for all formats. One thing I noticed was that a particular ebook I looked for — Napoleon, A Life by Andrew Roberts — is $45 in cloth, $20 in paperback, and the ebook is listed at $29.99! Running through the list of retailers to which PRH links directly, we can see that Amazon and Google Play discount the book down to an identical approximately 14.4% off $25.65 (with Amazon touting the massive saving over the hardcover price!) but the others listed — Apple, B&N Nook, Books-a-Million, and Kobo — offer it at the $29.99 list price. Close observers of the changing state of agency pricing will be watching whether the pricing or the discounting profile changes when PRH concludes that next round of negotiations.

And, incidentally, this also jibes with something we were told very recently by an ex-Nook employee, who said that the DoJ and Judge Cote effectively stopped B&N’s ability to compete with Amazon in its tracks when they opened up discounting of agency. Not only did they strip out margin that B&N desperately needed to compete, competing then effectively required price-monitoring capability to keep up with Amazon that was beyond their capabilities. Google has no problem doing that and maybe nobody else can keep up, but it would take looking at a lot more than one title to prove that.

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Pete McCarthy shows how audience research can be done quickly and efficiently


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I keep learning about “marketing today” from Peter McCarthy. There are two first principles about descriptive copy (a part of what is referred to as “metadata”, but a tricky part because, unlike trim size or price, it isn’t always obviously “right” or “wrong”) that all publishers need to take on board and adjust their workflows to accommodate. As far as I can tell, none of any substantial size have.

1. Descriptive copy has always been written by somebody who really knows the book, which often meant an editor (sometimes a marketer) involved with it well before publication. Now the copy needs to be written with knowledge gained through research into the audience. That takes both time and capability that hasn’t previously been required.

2. Descriptive copy has overwhelmingly been intended for a B2B purpose — catalogs and title-information-sheets for accounts — and now all copy, whatever its original intent, is likely to end up being seen by the consumer and, more importantly, it will be influencing the search engines that respond to consumer queries.

This is a change that is difficult for a big company to cope with because of their size. But it is hard for everybody because of the uniqueness of each book compared to others. The research methodologies have to scale on one hand but also be right-sized and tweaked for each book, author, and brand. Books aren’t soap. Knowledge of the book itself is generally limited to the editor(s) involved until they push it out to the rest of the company. So it is natural for editors or their assistants to draft descriptive copy. But these people may not have either the time or the skills for audience research.

But if the audience research is seen as a separate activity that should “feed” the copy-drafting, then the challenges are to figure out who on the team should do it, how they acquire the skills and knowledge of the tools to execute, and — trickiest of all — how to budget for the additional time and effort required (which across a large list is substantial).

And then there’s the problem of making sure the copy is consumer- and search-engine-friendly, which is another set of skills that haven’t been resident at publishers but that must be employed today.

This morning, Pete has a post at the DBW blog which really tackles the first part of the challenge, spelling out a set of starter tools and techniques are necessary to do a quick-and-dirty assessment of a book’s audience(s). He describes a step-by-step exercise in audience research that can be done in an hour, once the array of tools he describes are mastered.

We used to say 10 and 20 years ago “the Internet changes everything”. I think that is now thoroughly grasped. Today publishers need to accept that “search and the multitude of other means of digital discovery, both observable and dark, change everything about how we create copy”.

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More thinking about how author and publisher marketing collaboration should change


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Because of our Logical Marketing work and our interest in author websites (admittedly just a corner of the author-marketing world, even if we think it is a cornerstone), I did a couple of recent posts, the basic thrust of which was that publishers needed to rethink marketing and the author interaction around it.

Now, British author Harry Bingham and American consultant and indie-publishing expert Jane Friedman have published the results of a survey they did asking authors what they think of their publishers. What Bingham and Friedman found suggests strongly that the topic of the author-publisher relationship around marketing will be the subject of attention from a lot more people in the months and years to come.

Bingham and Friedman corralled a really significant sample in response to their survey: over 800 authors, of whom nearly half had published six or more books, more than half said their last book was published by a Big Five or other large trade publisher, and more than 60 percent of whom had an agent. Fewer than 10 percent said their most recent book was self-published, so it is likely that the survey captures the views of the published author more reliably than the views of the self-published author.

But, in fact, these published authors are not strangers to self-publishing. Although about a third of the respondents said they had never considered self-publishing, well over 40 percent have done it and nearly a quarter say they’ve “seriously considered it”.

On the other hand, later in the survey 36 percent of the respondents were “horrified” at the idea of controlling every aspect of the publishing process while only 24 percent were “excited” by that idea.

The point to the exercise was to find out how authors felt about their publishers. There’s a lot of encouraging news in here for publishers around that. The authors are generally pleased with their editing, their cover designs, and the consultation with them around flap copy. But they’re much less satisfied with the interaction around marketing. Significantly more felt their books “weren’t really marketed at all” (28 percent) than felt that the publisher made “full use of” their “skills, passion, contacts, and digital presence” (17 percent).

Although half of the respondents were satisfied with the communication they got from publishers, only 20 percent thought they got the “systematic guidance” they needed so they could “add most value” to the overall effort. It is precisely that challenge that my prior posts, in perhaps an unneccesarily roundabout way, sought to address.

But what Bingham cites as most startling to him among the results was the publishers’ almost total lack of expressed desire for author feedback. About three-quarters of the authors say they weren’t asked for feedback at all from publishers and only 16 percent of the authors said feedback was solicited and they were able to communicate freely.

To me, the most telling questions were those that probed whether the author would leave their publisher or their agent if they had the chance. For the publishers: more would leave than would stay if they got an equivalent offer elsewhere. For the agents: by more than 6-to-1 authors who now have agents would stay with their representative even if they could get another. That’s powerful.

At the end of last week, we conducted a survey of our own among agents and editors, trying to discern whether self-publishing is a useful tool to get a deal. Much to my surprise, the consensus is that it is not useful. We got far more answers from agents than we did from editors, but the clear prevailing opinion is that publishers don’t know how to interpret independent publishing efforts and, most of the time, trying it does an author’s chances of selling that book to a publisher much more harm than good. Most agents responding said they really don’t want to try to peddle a book that has already been self-published unless it has achieved pretty extraordinary success.

(What’s “extraordinary”? One UK agent suggested that it would take at least 50,000 sales to get the attention of a British publisher. An American agent said in that market the number is about 100,000.)

Agents are less negative about whether self-publishing might be helpful selling a next or different book to a publisher, but, even there, they are far less than enthusiastic about the help it provides. One agent said that publishers care about the quality of the writing and very little about the author platform. (To me, this reflects the same lack of grasp of the importance of the author’s online presence that I was writing about in those recent posts. And whatever failures of understanding there are, they are more widespread among editors in publishing houses than they are among marketers.)

What the agents and editors seem to be saying to us is that they don’t think about self-publishing very much. There are definitely exceptions, but most seem content to ignore it unless an author has achieved outlandish success doing it.

It would seem that the level of concern among the establishment about the temptations of self-publishing at any particular time is directly proportional to the apparent health of bookstores and the growth, or lack of it, in the ebook market share at that time. Since, in the U.S., bookstores seem to be doing well right now (which I’d argue is still at least partially due to the subtraction of Borders’s shelf-space and the diminution in Barnes & Noble’s) and the ebook market share has appeared stable for some time, that level of concern is currently pretty low.

So, here are a few conclusions from all of this.

1. Agents are driving the bus. They control the authors; the publishers don’t. That’s not to say that publishers don’t know this; most of them surely do. But this reality — that publisher behavior is channeled by trading partners more powerful than they are — is definitely not appreciated by indie authors and it appeared not to have entered the DoJ’s calculations when they saw collusion in the marketplace a few years ago.

2. Publishers are missing a big opportunity by not simply soliciting author feedback on their experience with the house. Just asking for it would be a win and the chances are that ideas would surface that would be easily executed and could bend that author loyalty curve a bit more in favor of the house. And it would almost certainly also add marketing value with trivial additional cost.

3. Authors are starved for guidance to direct their efforts on their own behalf. They are looking to publishers for this, although they might also look to agents. Thinking through and then spelling out more clearly what authors should be doing to help themselves is a critical task the industry seems to have collectively avoided. Agents are good at providing career guidance. (What book to write? Which house to choose?) But they’re not marketers. They generally know little or nothing about SEO, mailing lists, accessing media and events and all the rest of it. Those things are squarely the publishers’ job and (with few exceptions) publishers have always preferred to avoid much author involvement

4. There are really simple things a publisher could do that would be very evident to authors and helpful to sales. Why aren’t publishers putting some lower-level marketing staff on the task of “retweeting” and “liking” author efforts online? At a slightly higher level of effort, why aren’t publishers evaluating author websites that already exist to make SEO suggestions? The author survey results suggest that doing even little things like this would help a publisher with author loyalty, which should be an objective for every publisher. Publishers should see virtue in the idea that providing authors with knowhow would make them more effective advocates for their own work. It would be very cheap to transfer that knowhow (once it was thought through) and publishers would effectively acquire enthusiastic, energetic and FREE marketing resources.

The two key assets publishers have are their network of authors and their network of accounts. The account side has been substantially disrupted in the past two decades by Amazon’s growth and knock-on effects that have included Borders’s demise and B&N’s increased power in the brick-and-mortar world. Part of the reason we are so emphatic about the importance of author websites is that their absence, or their weakness, creates a vacuum that strengthens Amazon’s grip.

But what the Bingham-Friedman survey reveals is that publishers are vulnerable on the author side as well. The agent world is consolidating too so each powerful agent is just getting more powerful. Every time a publisher signs a book, they get a crack at developing loyalty from that book’s author. Getting ahead of what are really pretty obvious and predictable developments, including the growth of digital discovery and reading and an increased interest from authors in being involved in their own marketing, would seem like an imperative which is escaping most publishers today.

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Seven key insights about VMI for books and why it is becoming a current concern


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Vendor-managed inventory (VMI) is a supply paradigm for retailers by which the distributor makes the individual stocking decisions rather than having them determined by “orders” from an account. The most significant application of it for books was in the mass-market paperback business in its early days, when most of the books went through the magazine wholesalers to newsstands, drug stores, and other merchants that sold magazines. The way it worked, originally, was that mass-market publishers “allocated” copies to each of several hundred “independent distributors” (also known as I.D. wholesalers), who in turn allocated them to the accounts.

Nobody thought of this as “vendor-managed inventory”. It was actually described as “forced distribution”. And since there was no ongoing restocking component built into the thinking, that was the right way to frame it.

The net result was that copies of a title could appear in tens of thousands of individual locations without a publisher needing to show up at, or even ship to, each and every one.

To make this system functional at the beginning, the books, like magazines, had a predictable monthly cycle through the system. The copies that didn’t sell in their allotted time were destroyed, with covers returned to the publisher for credit.

Over time, the system became inefficient (the details of which are a story for another day, but the long story short is that publishers couldn’t resist the temptation to overload the system with more titles and copies than it could handle) and mass-market publishing evolved into something quite different which today, aside from mostly sticking to standard rack-sized books, works nothing like it did at the beginning.

My father, Leonard Shatzkin, introduced a much more sophisticated version of VMI for bookstores at Doubleday in 1957 called the Doubleday Merchandising Plan. In the Doubleday version, reps left the store with a count of the books on-hand rather than a purchase order. The store had agreed in advance to let Doubleday use that inventory count to calculate sales and determine what should then be shipped in. In 18 months, there were 800 stores on the Plan, Doubleday’s backlist sales had quadrupled and the cost of sales had quartered. VMI was much more efficient and productive — for Doubleday and for the stores — than the “normal” way of stocking was. That “normal” way — the store issues orders and the publisher then ships them — was described as “distribution by negotiation” by my father in his seminal book, “In Cold Type”, and it is still the way most books find their way to most retail shelves.

After my Dad left Doubleday in 1960, successor sales executives — who, frankly, didn’t really understand the power and value of what Dad had left them — allowed the system to atrophy. This started in a time-honored way, with reps appealing that some stores in their territory would rather just write their own backlist orders. Management conferred undue cred on the rep who managed the account and allowed exceptions. The exceptions, over time, became more prevalent than the real VMI and within a decade or so the enormous advantage of having hundreds of stores so efficiently stocked with backlist was gone.

And so, for the most part, VMI was gone from the book business by the mid-1970s. And, since then, there have been substantial improvements in the supply chain. PCs in stores that can manage vast amounts of data; powerful service offerings from the wholesalers (primarily Ingram and Baker & Taylor, but others too); information through services like Above the Treeline; and consolidation of the trade business at both ends so that the lion’s share of a store’s supply comes from a handful of major publishers and distributors (compared to my Dad’s day) and lots of the books go to a relatively smaller number of accounts have all combined to make the challenge of efficient inventory management for books at retail at least appear not to need the advantages of VMI the way it did 60 years ago.

And since so many bookstores not only really like to make the book-by-book stocking decisions, or at least to control them through the systems they have invested in and applying the title-specific knowledge they work hard to develop, there has been little motivation for publishers or wholesalers to invest in developing the capability to execute VMI.

Until recently. Now two factors are changing that.

One is that non-bookstore distribution of books is growing. And non-bookstores don’t have the same investments in book-specific inventory management and knowledge, let alone the emotional investments that make them want to decide what the books are, that bookstores do. Sometimes they just simply can’t do it: they don’t have the bandwidth or expertise to buy books.

And the other is that both of the two largest book chains, Barnes & Noble and Books-a-Million, are seeing virtue in transferring some of the stocking decisions to suppliers. B&N, at least, has been actively encouraging publishers to think about VMI for several years. These discussions have reportedly revolved around a concept similar to one the late Borders chain was trying a decade or more ago, finding “category captains” that know a subject well enough to relieve the chain of the need for broad knowledge of all the books that fall under that rubric.

This is compelling. Finding that you are managing business that could be made more efficient with a system to help you while at the same time some of your biggest accounts are asking for services that could benefit from the same automation are far more persuasive goads to pursue an idea than the more abstract notion that you could create a beneficial paradigm shift.

As a result, many publishing sales departments today are beginning to grapple with defining VMI, thinking about how to apply it, and confronting the questions around how it affects staffing, sales call patterns, and commercial terms. This interest is likely to grow. A well-designed VMI system for books (and buying one off-the-shelf that was not specifically designed for books is not a viable solution) will have applications and create opportunities all over the world. Since delivering books globally is an increasingly prevalent framework for business thinking, the case to invest in this capability gets easier to make in many places with each passing day.

VMI is a big subject and there’s a lot to know and think through about it. I’ve had the unusual — probably unique — opportunity to contemplate it with all its nuances for 50 years, thanks to my Dad’s visionary insight into the topic and a father-son relationship that included a lot of shop talk from my very early years. So here’s my starter list of conceptual points that I hope would be helpful to any publisher or retailer thinking about an approach to VMI.

1. Efficient and commercially viable VMI requires managing with rules, not with cases. Some of the current candidates to develop a VMI system have been drawn into it servicing planograms or spinner racks in non-book retailers. These restocking challenges are simpler than stocking a store because the title range is usually predetermined and confined and the restocking quantity is usually just one-for-one replenishment. We have found that even in those simple cases, the temptation to make individual decisions — swapping out titles or increasing or decreasing quantities in certain stores based on rates of movement — is hard to resist and rapidly adds complications that can rapidly overwhelm manual efforts to manage it.

2. VMI is based on data-informed shipments and returns. It must include returns, markdowns, or disposals to clear inventory. Putting books in quickly and efficiently to replace sold books is, indeed, the crux of VMI. But that alone is “necessary but not sufficient”. Most titles do not sell a single copy in most stores to which they are introduced. (This fact will surprise many people, but it is mathematically unavoidable and confirmed through data I have gotten from friends with retail data to query.) And many books will sell for a while and then stop, leaving copies behind. Any inventory management depending on VMI still requires periodic purging of excess inventory. That is, the publisher or distributor determining replenishment must also, from time to time, identify and deal with excess stock.

3. VMI sensibly combines with consignment and vendor-paid freight. The convention that books are invoiced to the account when they are shipped and that the store pays the shipping cost of returns (and frequently on incoming shipments as well) makes sense when the store holds the order book and decides what titles and quantities are coming in. But if the store isn’t deciding the titles and quantities, it obviously shouldn’t be held accountable for freight costs on returns; that would be license for the publisher or distributor to take unwise risks. The same is really true for the carrying cost of the inventory between receipt and sale. If the store’s deciding, it isn’t crazy for that to be their lookout. But if the publisher or distributor is deciding, then the inventory risk should be transferred to them. The simplest way to do that is for the commercial arrangement to shift so that the publisher offers consignment and freight paid both ways. The store should pay promptly — probably weekly — when the books are sold. (Publishers: before you get antsy about what all this means to your margins, read the post to the end.)

Aside from being fairer, commercially more logical, and an attractive proposition that should entice the store rather than a risky one that will discourage participation, this arrangement sets up a much more sensible framework for other discussions that need to take place. With publisher prices marked on all the books, it makes it clear to the retailer that s/he has a clear margin on every sale for the store to capture (or to offer as discounts to customers). And because the publisher is clearly taking all the inventory risk, it also makes it clear that the account must take responsibility for inventory “shrink” (books that disappear from the shelves without going through the cash register.)

Obviously, shrink is entirely the retailer’s problem in a sale-and-return arrangement; whatever they can’t return they will have paid for. But it is also obvious that retailers in consignment arrangements try to elide that responsibility. Publishers can’t allow a situation where the retailer has no incentive to make sure every book leaving the store goes through the sales scan first.

4. Frequent replenishment is a critical component of successful VMI. No system can avoid the reality that predicting book sales on a per-title-per-outlet basis is impossible to do with a high degree of accuracy. The best antidote to this challenge is to ship frequently, which allows lower quantities without lost sales because new copies replace sold copies with little delay. The vendor-paid freight is a real restraint because freight costs go down as shipments rise, but it should be the only limitation on shipment frequency, assuming the sales information is reported electronically on a daily basis as it should be. The publisher or distributor should always be itching to ship as frequently as an order large enough to provide tolerable picking and freight costs can be assembled. The retailer needs to be encouraged, or helped, to enable restocking quickly and as frequently as cost-efficient shipments will allow.

5. If a store has no costs of inventory — either investment or freight — its only cost is the real estate the goods require. GMROII — gross margin return on inventory investment — is the best measurement of profitability for a retailer. With VMI, vendor-paid freight, and consignment, it is infinity. Therefore, profitable margins can be achieved with considerably less than the 40 to 50 percent discounts that have prevailed historically. How that will play out in negotiations is a case-by-case problem, but publishers should really understand GMROII and its implications for retail profitability so they fully comprehend what enormous financial advantages this new way of framing the commercial relationship give the retailer.

(The shift is not without its challenges for publishers to manage but what at first appears to be the biggest one — the delay in “recognizing” sales for the balance sheet — is actually much smaller than it might first appear. And that’s also a subject for another day.)

6. Actually, the store also saves the cost of buying, which is very expensive for books. The most important advantage VMI gives a publisher is removing the need for a buyer to get their books onto somebody’s shelves. The publisher with VMI overcomes what has been the insuperable barrier blocking them from many retail establishments: the store can’t bear the expense of the expertise and knowledge required to do the buying. It is harder to sell that advantage to existing book retailers who have invested in systems to enable buyers, even if some buyer time can be saved through the publisher’s or distributor’s efforts and expertise. But a non-book retailer looking for complementary merchandise that might also be a traffic builder will appreciate largely cost-free inventory that adds margin and will see profitability at margins considerably lower than the discounts publishers must provide today.

7. Within reasonable limits, the publisher or distributor should be happy to honor input from the retailer about books they want to carry. It is important to remember that most titles shipped to most stores don’t actually sell one single unit. Giving a store a title they’re requesting should have odds good enough to be worth the risk (although that will be proven true or not for each outlet by data over time). Taking the huge number of necessary decisions off a store’s hands is useful for everybody; it shouldn’t suggest their input is not relevant. Indeed, getting information from stores about price or topical promotions they are running, on books or other merchandise, and incorporating that into the rules around stocking books, will help any book supplier provide a better and more profitable service to its accounts. After all, having a store say “I’d like to sell this title for 20 percent off next week in a major promotion, would you mind sending me more copies?” opens up a conversation every publisher is happy to have.

Of course, in a variety of consulting assignments, we are working on this, including system design. It is staggering to contemplate how much more sophistication it is possible to build into the systems today than it was a decade-and-a-half ago when we last immersed ourselves in this. In the short run, a VMI-management system will provide a competitive edge, primarily because it will open up the opportunity to deliver to retail shelves that will simply not be accessible without it. That will lead to it becoming a requirement. As I’ve said here before, a prediction like that is not worth much without being attached to a time scale. I think we’ll see this cycle play out over the next ten years. That is: by 2025, just about all book distribution to retailers will be through a VMI system.

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Starter thoughts for publishers to develop new author marketing policies


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In a prior post, we suggested that the time has come for publishers to have clear policies around what they should require from author web presences for an effective publishing partnership. This is a really complex and multi-faceted challenge for every publisher. The purpose of this post is to discuss that proposition in more detail, with a focus on how a publisher should approach developing those policies and the potential contractual relationship changes that they imply.

1. The first step is for a publisher to articulate their minimum standard for an author’s online presence. We have found that the role of web presences an author controls in helping Google and other search engines understand an author’s importance in context is routinely underappreciated. In addition to a properly-SEOd web site, publishers will want to make sure authors fill out their Amazon author page, their Google Plus profile, and their Goodreads page as well. All of this verbal metadata — along with images including photos and book covers — builds a strong foundation for discovery.

Obviously, Facebook, Twitter, LinkedIn, Medium, Instagram, and Pinterest (among others) could also be a constructive part of the web presence for many authors. A publisher’s thinking should include them too, taking cognizance of the fact that they are more important for some authors and topics than for others and that it is hard and cumbersome to do anything about them if the author doesn’t do it for him- or herself.

2. Although many, if not most, authors will have a website or the intention to create one, many others don’t. In that case, the publisher will want to have a fast, inexpensive, and effective way to put one up on the author’s behalf. (The non-website components of the foundation don’t lend themselves as readily to publisher assistance.)

For authors who either don’t have the skills to put up their own WordPress site or the budget to pay for a unique one to be designed and built for them, the publisher should provide a templated interactive process to create a site inexpensively. They also will have to do the research into key words, topics, and phrases to inform the SEO. We believe that for a publisher who will operate at scale, building dozens and perhaps hundreds of these sites per year, the cost should come down to $2,000 or less per site, perhaps $1,000 or less for first-time author sites that have minimal needs for unique book pages.

3. The sites should be seen as author sites which have pages for the individual titles on them, not book sites. That means the publisher has to accept the idea of putting all of an author’s work on the site, which definitely enhances the author’s online authority even though it may promote books from other publishers. Making a site that ignores an author’s whole output is superficially self-serving for a publisher, but it is actually counter-productive if the objective is to promote the author’s online presence and discoverability.

4. Of course, in more cases than not, the author will already have a site. In that case, the publisher won’t be building one but does need to assure itself that the existing site meets the SEO standard. The means an SEO check is necessary, using much of the same knowledge and techniques as the publisher would use to establish the right key words, phrases, and topics they’d use if they were building the site themselves. In addition, publishers should evaluate the site for user experience, including the speed of loading. We’ve seen many author sites which failed on that scale.

5. The publisher should also be giving authors advice about maximizing other opportunities. If the author might blog, suggestions about length, frequency, and topics are worthwhile as are very specific ideas about maximizing the other platforms like Facebook. The publishers should be giving authors a Wish List, making absolutely certain that no opportunity for author-based promotion is ignored because of a lack of awareness on the author’s part. By the same token, knowing what the author is doing enables coordinated marketing, such as the publisher’s own social presences being used to “like” or “favorite” or “recommend” what the author is doing. Doing these things will add to the publisher’s online authority as well as giving boosts to authors on a regular basis.

6. A number of publishing service companies and independent entities have created rosters of freelance service providers that can help authors with their publishing efforts. A lot of these — like cover designers or line editors — are not necessary for an author lucky enough to have a publisher. But we know that authors sometimes want help with ongoing content generation, from blogs to tweets. Although authors should obviously avoid handing over their online identities to surrogates they don’t even know (and that is not what is being suggested here), we know that busy authors can use help with what can be time-consuming social media. Publishers would be much smarter to develop their own list of trusted helpers for this kind of work, perhaps even instructing or training them in order for them to qualify for publisher referrals, than to allow these things to happen by accident or chance. (By the way, this might be a useful way to allow an employee who is on maternity leave or any other sabbatical to stay active from locations other than an office.)

7. Looking across a number of websites enables a publisher to see the impact of Google algorithm changes, which very few authors can do. (This will be particularly important on April 21, when Google starts “punishing” the ranking of sites that aren’t mobile-friendly.) Seeing the behavior of Google for different sites, those “whacked” by a change and those that aren’t (and changes to the algorithms occur all the time, not usually as dramatic or heralded as the one around mobile), allows insight into what needs to be done to benefit from the change, or at least avoid being punished. One person in a publishing house could be helping literally hundreds of authors stay optimized and avoid the need for each of these authors to know enormous amounts about SEO themselves. (Of course, it is also true that an author who is especially brilliant at SEO might not want a publisher focusing on the landing page she created that boosted traffic and teaching other authors to compete with it. Those authors are the exception, not the rule.)

This is not a capability we’ve seen publishers create for themselves, even though they can. We’d argue it is a great benefit for an author to be published by a house that has thought through these requirements and is providing an SEO check and research into search terms. Publishers should be doing this. The early movers will gain a temporary, but substantial, competitive advantage for themselves with authors and for their authors against the field.

8. What should be clear is that the author is being given a choice: they can build their own website (or do the tweaking necessary to one they already have to bring it up to standards) or they can have one built for them by the publisher from the templated choices the publisher offers.

9. This leaves two very large commercial questions for the publisher and author to negotiate, both of which should rise to the level of being covered in the contract. The first one revolves around the investment in and “ownership” of the author’s website and, perhaps the investments needed for ongoing marketing on the author’s behalf. Of course, there is nothing to discuss if the author builds and maintains her own site and social presences. The publisher should still provide all the help they can — SEO research at the beginning and analytics help all along — but there would be no reason for any compensation or publisher ownership.

However, if the publisher invests the dollars to build the author’s site or pays for any of the ongoing efforts by freelancers, there is definitely a negotiation to take place and there are a few moving parts to that negotiation. One way to address this might be for the publisher to advance the money for this work but have the opportunity to recoup it out of proceeds, as though it were part of the advance. Or the publisher could just render the author a bill for the site creation cost (remember, we’re positing $2,000 or less) which the author could simply pay. Another possibility is that the publisher might “own” the author’s website. That is not an end result we would recommend and, if it is necessary, there should be a “buy back” clause that enables the author to recover that ownership if, for example, they move on to another house. In any case, the point to these new elements in the author-publisher agreement is that they assure that what is necessary to optimize 21st century book publication is in place. Both partners in this arrangement — author and publisher — should want that to occur. It really should not be beyond the negotiating capabilities of the two parties to come to a fair agreement about how the necessary investments are compensated.

An approach that could evolve would be that houses have a “web site allotment”, making the sites they create “free”, but then they should pay that same amount in support of authors who create their own sites.

10. The other knotty element that should be negotiated is around the use of email lists that these optimized author sites will generate. It is self-destructive for either the author or the publisher to simply say “they’re mine!” Email list use has a lot of history, but best practices in cases like these are necessarily still evolving. For example, a publisher might build a mammoth email list by working with 10 authors with similar audiences for a promotion going across their email list base. Each author will benefit from being exposed to many readers of the other authors. Most authors will want that to happen if the opportunity is presented to them. Another possibility is that a house does a promotion and each author involved sends a personal note to his/her list letting them know about the promotion which, perhaps, could be a book signing or a webcast. The point is that the house has lists and the authors have lists, each can benefit from collaboration with the other and the house can create synergies by building joint efforts among authors.

These questions are complex but, while time passes, they are not getting any simpler. The value of the web and email list assets that can be optimized with cooperation is increasing, which means the cost of not doing this right is also increasing. It is simply not acceptable for every author and every publisher to avoid the discussion, leaving us with tens of thousands of entities operating in siloed vacuums. That’s the status quo. It isn’t satisfactory.

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