Peter McCarthy

Not all books and not all subscription services are created equal


Digital change has forced many book publishers to rethink the mix of their lists. The most obvious aspect of that is the need for increased vertical-, topic- or audience-consciousness. In the days when bookstores did most of the selling, all publishers could reach audiences in stores by being displayed in the right section (or sections). In fact, stores figured that out pretty well whether publishers guided them or not. What constituted a sophisticated capability for the very general part of a general trade list (almost exclusively for non-fiction) was recognizing any multi-section shelving opportunities and having the persuasive power with a store to get it. Of course, computers and the exigencies of managing stock in far-flung outlets made that very challenging — if not impossible — to do with bookstore chains.

But all publishers now to varying degrees are trying to execute digital marketing. Even for SEO alone, an understanding of the audience is essential. (Most publishers don’t accept this yet, but my Logical Marketing partner Pete McCarthy says you have to do a couple of hours of audience research to properly position just about every title!) But to really reduce per-title marketing costs, publishers have to “gather” audiences (through web sites or apps or by collecting email addresses) that can be addressed to sell book after book. That requires that the books be selected to allow for repeated marketing to the same groups of people.

Yet another prism through which to view a publisher’s list is breaking down which titles work as ebooks and which ones don’t. Many publishers are looking at illustrated books differently because they haven’t worked well as ebooks. That’s increasingly critical because the print marketplace is shrinking as ebooks replace print for a lot of immersive reading.

Publishers are justifiably nervous about this transition. As the market becomes more and more ebook-centric, protecting revenue is a growing concern. Top line prices and publishers’ net revenue per copy sold have come down already and will continue to. A powerful player we all know has a growing market share and seems increasingly inclined to demand a bigger cut. Publishers and agents have been worried that subscription services could siphon off parts of the market and further erode margins.

Their resistance has been so strong that the two biggest entrants in that channel, Scribd and Oyster, are apparently paying heftier-than-retail percentages to secure the rights to include major publisher books in their offering, which makes some people (including me) question the sustainability of their model.

While I think general publishers’ tentativeness about subscription services is sensible, I don’t think it is equally sensible across their lists. Publishers need another prism to sort this one out. They need to think about their “chunkable” books — the ones that are least likely to be read from start-to-finish and most likely to be useful in bits and pieces — separately from their immersive narratives.

It is the immersive narratives whose economics are threatened by subscription. And it is the chunkable books, which include most of the illustrated books they publish but also include many others in self-help, business, and reference, which don’t work as ebooks in the individual sale model. Because the Scribd and Oyster subscription compensation is only triggered by a minimum (but publicly unspecified) amount of the book to be read, they aren’t likely to be remunerative in that context either.

But there is actually a way for all publishers to deliver digital revenues for the chunkable content they own which has very little stand-alone ebook market. (I really never thought it would; it made me think about “the unit of appreciation and the unit of sale”.) And the fact that so few of them — none of the big ones — have employed it so far makes me think that they are neither making this distinction around their own content nor looking at subscription in the nuanced way they should.

The opportunity to which we refer here is the granddaddy of digital book subscription services, Safari. They are quite different than Oyster and Scribd. First of all, they are primarily B2B, not B2C. They are too expensive a service to be for pleasure or consumer use; they are intended to be a professional tool. Therefore, most of their subscribers access their content under an annual per-seat software license bought by a big company or government entity.

The second thing that makes Safari different is that they don’t expect full book consumption to occur very often, if at all. Most of the technical and professional books in the repository are extracted and read topically. The attraction of the service is not so much that you can read any book you want, but that you can get a variety of presentations about how to understand something or solve a particular problem.

And Safari’s business model is different from Scribd and Oyster too. The way they do it — paying from a monthly revenue pool on a pro-rata basis divided among the content consumed in that month — appears at first glance to be less attractive to trade publishers than the high purchase price Scribd and Oyster pay when the (unknown) theshold of use has been passed. But for chunkable books, which are very unlikely to be consumed in their entirety and would often, if not usually, serve a purpose to a consumer without triggering the purchase threshold, it should actually be seen as a better model for the publisher.

The subject arises because Andrew Savikas, the CEO of Safari, recognizes that the million of users he has at companies like Bank of America, Boeing, and Oracle (for example) are people as well as professionals. So while they need the technical content that motivated those companies to subscribe them to the service, they also have health, career, diet, and investment interests that it would be a great convenience for them to be able to satisfy within the service. This raises some obvious questions for Safari (“how would Boeing feel about this?” was the first one that occurred to me) but we need not be concerned about them. Savikas runs Safari, and he is convinced that he wants this kind of non-technical content to make his service more attractive and lucrative. He said his data shows much of the consumption of this kind of content happens “off-hours” and is seen as an employee benefit.

This presents publishers with a pretty sizable opportunity that is perhaps being lost in the generalizations about subscriptions and preserving revenue and what works in digital form. Since most big publishers have cookbooks, business and personal finance titles, reference books, and illustrated how-tos on their backlists that are starved for digital revenue, whether they’re likely to sign more of them as the industry changes is irrelevant. These backlist books could be producing cash for the authors and publishers right now through Safari and any “risk” involved is not apparent to me. Frequently the revenue would be significant. At the same time, Safari would be providing “discovery” opportunities for those books with very large audiences: millions of well-employed people, many of whom don’t shop in bookstores — online or physical — very often.

And the books that are discovered on Safari can be readily purchased. Safari invites publishers to give them a URL of their choice for a purchase link. (They offer as evidence that they move books in the long tail that the most-purchased book on their site right now was published ten years ago.)

I don’t quarrel with skepticism about the subscription business model for the immersive reading that constitutes most of a general trade publisher’s list. But holding back the chunkable books from Safari is depriving those books of revenue and exposure to audiences with intent in a way that will almost certainly not cannibalize other sales. Big trade houses will be doing fewer of those books in the future, but that’s no reason not to generate the most exposure and revenue they can for the ones they have.

The last three posts, the most recent one on what I thought was missing from the Amazon-Hachette coverage, one on subscriptions and the first one I did about Amazon-Hachette, were not sent out by the Feedburner service that delivers email versions of the posts to subscribers. I suspect this one won’t be either. Until we move to a new distribution capability, I’ll continue to link to the undistributed posts with each new one, as I’ve done here.

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Peter McCarthy and I have a new business and publishing has a new digital marketing service


Today Peter McCarthy and I are formally announcing a new business which is a partnership between us: The Logical Marketing Agency. What we’re doing is applying the most modern and sophisticated digital marketing techniques and capabilities to the challenges faced by book publishers and authors — and therefore agents — and, because the same techniques apply — also by brands.

This business has been in gestation for about 18 months, since Pete and I first started working together on other projects. We are building on what he learned during nearly two decades in publishing, first working for The Reader’s Catalog and then The New York Review of Books, followed by six years at Penguin very early in the digital transition, and then six years at Random House. At Random House Pete’s job was, explicitly, to figure out how books would be sold in the future. So for several years he was tasked with experimentation, using the books from publishing’s most extensive and diverse commercial list and the resources of the world’s biggest trade publisher.

As my Idea Logical colleague Jess Johns and I came to realize how much Pete knew about the digital marketing challenge all publishers are aware is important but woefully under-equipped to tackle, we saw the great opportunity in “scaling” him. The Logical Marketing Agency is our vehicle to make Pete’s knowledge available and useful to every publisher or author who wants to make use of it.

Over the past six months or so, we have done initial, relatively small small digital marketing jobs for more than a dozen clients. They have included both major and smaller publishers in the US and the UK, authors, literary agents, and brands that aren’t publishers. By working with this initial group of beta clients, we have learned how to shape our offerings to directly apply what we know to publishers’ and authors’ and agents’ perceived needs and pain points.

First we thought about the two key elements that need optimizing: titles and authors. Titles need easy discoverability; they need to be found in the right places, at the right time, by the people who are likely to be interested in them. This often involves a nuanced understanding of search as it exists in environments like Google, Amazon, Apple, and others but can also encompass other means of enhancing a book’s reach into its likely audience(s). Authors need optimized web presences, so that their credibility and personal networks are grown and enhanced regularly and so that their reputation as authorities on the subjects that matter is confirmed on the Internet.

Of course, the key for titles is the metadata: the long and short descriptions of the book that are accessed by all the retailers and search engines and the BISAC (or, in the UK, BIC) codes that identify the book’s subject matter (and, therefore, its audiences).

Pete’s key insight about title metadata — one that is very hard for most publishers to accept, frankly — is that it can’t be done properly without research. You start by positing what the audiences for a book are or, in the absence of hypotheses, how to figure out what they are. Then you look for them online and find out more about the makeup of those audiences: who those people are, where they hang out online, what they’re interested in and what they believe, and what words and phrases they use when talking about the author or the subject(s) in the book. Then you have to research the search terms that matter, to find out which ones are used most frequently and by whom. It is probably not surprising to learn that the “right” search terms might not be identical in Google and Amazon. And from there, one can keep going, analyzing what Pete calls the “meaningful back end data” that results from good outbound social media marketing. You can learn who it is that is engaging with and what their beliefs are, where they live, and other attributes that can be used to properly position each piece of marketing collateral. And, that’s a process that can keep going for a long time if the vein is rich.

How long does this research take? If you know what you’re doing, it can be done in an hour or two. How many publishers have the know-how and the staff to spend a couple of hours researching before writing descriptions of all their new titles? According to what we’ve found over the past few months, the answer is “not many”. Or “almost none”.

Getting the descriptions and metadata right is what Pete (and the Logical Marketing Agency) calls “foundational”. You must do it or everything else you do afterwards sits on a shaky base.

But there’s another level of knowledge that can be helpful beyond the foundation. What can you do to further promote a title beyond getting its core discoverability right? Well, there are potential paid media opportunities (keywords you might buy or audiences you might target through well-placed banners or other ads). There are other books or other things that have audiences to whom the book would appeal that give keys to other potential promotions. Each of these can lead to further SEO efforts around an author or title web site, new social media tactics to employ and more. You can take what is gleaned in the original research to find new ways to target the audience and that chain, in some cases, can be extended productively many times. The research that turns up those opportunities is something Logical Marketing will also offer, through “comprehensive” title analysis, a deeper drive than “foundational”.

We are doing the same for authors, offering a “foundational” author audit and a “comprehensive” one. But for authors we have found demand for even more research and analysis. Major publishers have bought customized author audits from us for authors they wanted to poach from other houses and for authors of their own they wanted to do a better job for and, often, compare with other authors’ efforts. These are really in-depth reports, 50 to 100 pages in length and filled with data, interpretation, and actionable insights. They often require an execution team to handle implementing the suggestions, though, increasingly we will be offering those services as well. The more complex an author’s online footprint — whether from many books or from many other things in their career — the more work this takes, but the more value there is. A long career and a long list of prior books can bury the messaging to surface and focus on the current book. It is ironic that authors with the biggest online presence can be the most complex to maximize for a particular project.

Recently, we have had two of New York’s biggest literary agencies try us out. One of them was looking for a picture of how one of their biggest authors was doing. The other had specific objectives in mind for their authors and asked us to look at the online footprints of three of them — two very big, one a little less so — to recommend how to achieve those objectives.

There are two additional elements we have only dabbled with so far, but which could become a big part of our business and service suite in the future: backlist and running campaigns.

Getting the most sales out of the backlist requires two things working in tandem. First of all, the backlist metadata has to be optimized. That requires research too, although a bit different research than for a forthcoming title because people have read it and people have talked about it. That gives clues to audience and nomenclature that are much more reliable than what one can discern for a yet-to-appear book. If publishers don’t have the staff time to do by-title research for their new books, imagine how hard it would be for most of them to do it for their whole backlist. It is safe to say that no house is staffed to do this.

The other necessary piece to optimize backlist sales is a tool that will chart the news and social graph — trend analysis — that then can bounce each day’s developments off the backlist metadata to find titles that can benefit from current attention. Of course, that opens up the question of “what attention?” Sometimes a change in metadata will produce a big result, tying the title to current interest. But sometimes more effort will make sense, like a digital media campaign. This has, of course, been tried by certain houses and has sometimes been successful. But it is our belief that this kind of work has not been executed optimally. Paradoxically, often the problem is that it is done too broadly. But it is important work we have some new ideas about how to do it well and at a cost-effective scale and pricing.

And that brings us to the final component of our suite of services, for now. We will run digital marketing campaigns for publishers. We did one of these last Fall for a live event, rather than a book. Since our conversations with publishers and self-publishing authors repeatedly confirm that running campaigns is a real pain point — they know they don’t have the staff for it and they sometimes know they don’t have the skills or experience either — we see that as a big part of our business going forward.

Brands are like authors. They have online presences; they have reputations; they have audiences that have characteristics that, once understood, enable you to reach them better and to find them in other venues. In fact, authors are brands. Publishers know that and we believe that what we do for authors would work for many other brands.

So it is with high expectations and great confidence that we can be helpful that we launch this new business.

One thing we’re going to add shortly is a self-service offering for independent authors. The service organizations we know who do the tech and distribution work for self-publishing authors all say they need marketing. That looks like an opportunity to us. If you want to get ahold of us, you can email us at [email protected] A web site with more about our services has gone up at that address as well.

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Some things I will be looking to learn more about at London Book Fair


The London Book Fair is an every-second-or-third-year thing for me, going back many decades. From an English-centric perspective, it is like a mini-Frankfurt. All the UK players are there and a lot of US senior executives. But because it is so accessible to the Continent, you can get a taste of how things look to the rest of the world.

In the US, we look to me to be in a period when two dominant giants — Amazon for online bookselling and Penguin Random House for general trade publishing — are consolidating their positions. Amazon’s enormous market share is growing, both for print and ebooks. It is too early to draw the same conclusion about PRH, but my guess is that a year or two from now we’ll have seen them taking share from their biggest competitors just like Amazon is from theirs.

(Dominant giants will be part of a conversation I’ll be taking part in on a stage in London. I’ve been asked to participate in The Great Debate, where this year the proposition is “It’s all about size. Bigger is always better.” I’m arguing the affirmative with Ken Brooks of McGraw-Hill Education as my teammate. We’re opposed by Stephen Page, the CEO of Faber, and Scott Waxman, who is both an experienced literary agent and the entrepreneur behind Diversion Books, a digital-first publisher. It should be fun. And friendly. We’re all nice guys.)

The dominant US brick-and-mortar retailer, Barnes & Noble, appears to be fairly healthy in its traditional business. It is shrinking, but the store operations are still profitable and well run. They appear to have benefited from the demise of its erstwhile competitor, Borders (as have the independents). From across the Pond, one does not get the same impression about UK’s Waterstones chain. However, in the UK, there are forces we don’t have in the US: not just the ubiquitous newsstand-type WHSmith stores, but also two supermarket chains, Sainsbury’s and Tesco, which are each ambitiously trying to build a book business and their own ebook channel. One thing I’ll be asking everybody about is the impact these retailers have in the book marketplace, particularly when we get beyond the top sellers. Perhaps if they’re doing well, it would encourage Walmart to get serious about bookselling. Certainly Walmart would like to do anything they can to poke Amazon in the eye.

Without serious competition from new players who are well-funded, like the UK supermarkets, it is hard to see what stands in the way of the global ebook giants: Amazon and Apple and, to a lesser degree, Google and Kobo. Perhaps I can get a sense in London of how Barnes & Noble’s multi-territory expansion for Nook is faring. But, however they do, there is a so-far little-noted effect beginning to become evident that could tilt the global book business to the English-language marketplace, and to the US in particular.

In a recent conversation, an executive at a Big Five company told me of a recent development. His company had licensed a few titles for Russian language rights to a publisher in Moscow. But by which retailers would most of those ebooks be sold? The answer is Amazon, Apple, Google, Kobo and Barnes & Noble! And the Russian publisher, really just breaking into the ebook business, has far more limited access to these retailing giants than the US publisher which had licensed them the rights.

So the US publisher, in a suggestion that seemed in everybody’s interests, offered to be the “distributor” of those Russian ebooks to the major accounts. The deal was made and it worked. I said to the executive who explained this to me, “You could be helpful in distributing all their books, not just the ones you licensed them.” “Exactly,” he said.

But then we took the conversation a little further. This house is wondering whether, in an ebook-dominant world, it wouldn’t make more sense for them to publish books themselves in Spanish, Mandarin, and French (the first three languages they are thinking about). After all, the translations are done by freelancers. Anybody can hire them no matter where they are. And if most of the books sold are ebooks, and if the publishers of English, especially those in the US, have multiple daily contacts with the big ebook retailers and others don’t, then what is the point to licensing away those rights?

That approach would mean that publishers in at least some non-English territories would, at best, be able to license the print rights for the local geography they really cover. And it would mean that the biggest publishers with the biggest checkbooks to sign the biggest authors and titles will be able to benefit from an even larger share of the book’s global market while paying the author more than they could earn with a local publisher sharing in the other-language rights.

If this is more than one company’s inspiration right now, I should be able to find evidence of that at the London Book Fair.

The other thing for me to learn, of course, is how digital marketing of books looks from the UK. In our fledgling new business with Peter McCarthy (take a look at his new post) we have already done some title optimization work for two UK-based publishers, one large and one medium-sized. So we’ve learned how to do the work using UK-based Google and Amazon and putting BIC codes rather than BISAC codes into the metadata. We’ll be formally announcing the new business and opening our web site the day before the London Book Fair opens. I expect to find a lot of interest in what we can offer, just as we have in the US. There is no doubt that the London Book Fair presents the best possible opportunity to find out very quickly what our own opportunity is outside the US as the need for sophisticated marketing naturally follows the growth and increasing complexity of the overall digital environment.

One person I will be sad not to see at London Book Fair is my longtime friend Bruce Robertson, a founder of the pioneering packagers The Diagram Group, who died a little over a week ago at the age of 79. Bruce was sui generis: a brilliant man with a unique gift for visualization that was the guiding spirit behind dozens of global bestselling illustrated books. Forty years ago, I had the opportunity to sell three of Diagram’s greatest books, “Rules of the Game”, “The Way to Play”, and “Man’s Body” when Bruce’s publisher at that time, Paddington Press, was distributed in the US by my family’s distribution company, Two Continents. I always enjoyed seeing him and hearing his witty, insightful, and often cutting take on the people and practices in our business. Fortunately, there were many opportunities to see Bruce and his endlessly good-natured wife, Pat, over the years, at industry events or when he was in NY or I was in London. We are all one of a kind, but some of us are more obviously so than the rest of us. Bruce was like nobody else. He’ll be missed by many friends from all over the world.

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Even the biggest and smartest publishers still have a lot to learn about digital marketing


Doing business development for my Logical Marketing partnership with Peter McCarthy (we are on the verge of formally announcing our new business) gives me repeated and continuing confirmation that Pete just knows more about digital marketing than anybody else in publishing. This is partly because he’s a damn smart geek with a marketing-oriented brain who grew up in publishing. It is also because he had the good fortune to be effectively running a marketing experiments lab for the world’s largest publisher for six years.

We recently had three examples from three different Very Big Publishers with Very Smart People of mistakes, or misunderstandings, or structural paralysis, that seem almost generic. All of them involve challenges that every publisher faces on a daily basis.

The first is from a publisher which is among the first to take a step that all publishers must take eventually: optimizing the metadata for their backlist. (Backlist is a topic that has interested us for a long time.) This is a mammoth challenge for every publisher of considerable size. They have tens of thousands of titles and, often, many of the ones selling best will have been published years — or even decades — ago so that nobody among the editors or imprint marketers have read it or thought through the markets for it, except when traditional reissuing activities have occurred or an exceptionally sharp marketer saw an opportunity.

There really are two distinctly separate problems inherent if you want to maximize backlist sales in the digital age. One is the one they are tackling: to get the foundational metadata — the book descriptions and their placement in the information chain — solid so that the titles are called up in response to the searches suggesting a possible customer for them. The other is to build a mechanism to observe the news and social graph each day and to identify the titles that can benefit from new developments. And then, of course, to couple the two in order to optimize a given title or series for the most appropriate semantics to drive both discoverability and conversion in different environments. SEO, yes. But really nuanced and real-time SEO which accounts for fundamental changes in how all the engines work and subtle differences inherent in each. We have our ideas about that engine (and have developed a proposal to address it) but, for now, like that publisher, let’s just worry about the first challenge: getting the backlist metadata foundations right.

The pioneering publisher we encountered is addressing the question across the many imprints in their large organization by asking each one to work on the metadata for their top-selling backlist. What this means, in practice, is that fuzzy-cheeked editorial or marketing assistants — most operating with little direction from senior people and, frankly, mostly working with senior people who wouldn’t really know exactly what to tell them to do (this stuff has gotten very technical in nature) — are the ones looking at what is there now (if anything) and fixing or updating it. This house will inevitably find that they get very uneven results and, because most of the work will be done by low-level people who turn over (or get promoted) quickly, it will be hard to generate training or processes that will show steady improvement of this work in the future.

Unless some great care is being exercised to introduce procedures most of these people would be unlikely to know about, this also runs afoul of Pete’s repeated mandate that research must be done for each and every title before a marketer can create optimized metadata. For backlist, in Pete’s methodology, this starts with finding out who the people are who have already read the book and commented on it and what words they use when they describe it. LibraryThing tags and GoodReads reviews are key sources for that, but for us LT fits into an overall workflow and orchestrated use of tools that Pete has developed and trained our team to to employ to thoroughly crack this particular problem of “how readers think about, talk about, and feel about” a given work or author or brand. LT and GoodReads provide critical insight to cement or alter the context in which a book sits.

So, aside from the massive distraction created by asking each imprint to take on such a substantial additional chore, the chances are good, actually overwhelming, that the results — the new metadata foundations that will be created — will not be thoroughly applied and optimal in the best cases and that most imprints won’t be as good as the best. And, in a problem that repeatedly bedevils publishers in the age of digital media (as we will see again below), the staff time to do this exercise is not readily available. Everybody doing this work already has a fulltime job, largely jobs managing author talent and frontlist, jobs which must be done.

In another case, the Chief Marketing Officer of a large publisher — one who has heard Pete speak, knows me, and is firmly committed to trying our services — talked with me about what he presumed would be Pete’s many ideas about how to apply a full-text search of a book to improve the marketing. I thought he would fall down when I told him, “Pete doesn’t believe in reading the book so I don’t think he’ll want to apply a full-text search.” My CMO friend was immediately skeptical so I told him what Pete has told me. “I’m marketing to people who haven’t read the book.”

There are definitely some situations in which you’ll want to pull things out of a book’s text, although I think they’re almost always about proper nouns. If you’ve got a biography of a baseball star and there are stories about teammates and opponents, you’ll want those names in the metadata to signal to searchers on those people that there is relevant material for them in the book. But, in general, full text doesn’t help.

You hone marketing metadata by looking hard at the markets, not at the text. The task begins by describing the audiences as precisely as you can: “teachers” is good, “high school science teachers” is better, and “high school science teachers with kids of their own” is better still. Then you find those people, learn where they cluster, and how they talk, and how they seek information. You apply the knowledge of what semantics they use and bump that against the terms that are searched in different venues to hone your pitch. There are shortcuts to get this work done (and we try to use them) but the application of a full-text search of the book is not one of them.

Experimenting with what is known as A/B testing, whenever you can do it, is critical. (It is admittedly difficult, though not impossible, to do it effectively in advance of publication.) Any media outreach campaign that is not utilizing A/B testing is doomed. Any digital marketing that is done without A/B testing is amateur hour.

And that brings us to the third time this month that we found with pretty near certainty that a big house was proceeding without knowledge Pete has.

We did an online audit for an author who is in the news. We found some circumstances which seemed to call for “paid media”: the purchase of search terms and phrases (ones on which major retailers had not bid and for which the book was not surfacing organically) or contextual display ads around news breaks to call attention to this author and his book in particular cases where we (really, Pete) believed it would do some real good.

So we made the suggestion to the top digital marketing thinker at this big publisher. He reported back that this kind of campaign had never worked for them, even tried on a big scale. Once again, Pete’s experience suggested to him possible reasons why it hadn’t worked for them and how it might. Pete told me:

The houses (almost to a one) do not know how to run these promotions, track their efficacy properly (they do broad “last-click” attribution, which is likely to capture a third of the actual effect, or so), and they make them amazingly expensive for themselves by not optimizing for the goals or for the platform, which at once benefits the platform and them.

Despite nearly infinite inventory, these places (the online venues) prefer that users click on ads when they see them. The better you are at it the cheaper those clicks are. Then you track the clicks and augment your attribution model with the known amplification effect (conservatively apply a % applied across outlets and formats per studies or in-house knowledge).

Drive a nice conversion percentage at Amazon and the book begins to rise. By rising, it gets better “placement” on Amazon via algorithmic store optimization (e.g. merchandised in the cart). That’s a virtuous circle that has momentum of its own.

So, once again, the problem seems to be that the targeting is too generic, using broad matches in AdWords and not applying negative keywords and the like. There is an outright lack of — or too little — A/B testing and segmentation, and there is no constant adjustment of the media buy reacting to the response. It turned out that a further conversation with this publisher revealed that their particular problem was around clearing the staff time to gain expertise and actively research and run these paid digital media campaigns, which, we agree, is not trivial.

Digital media is cheap to buy but expensive to manage.

The net effect of this is that potential consumers are in essence seeking the book but publishers are not putting the book in front of them because it is too inefficient to do so. The answer would seem to be to make the process more efficient rather than missing the opportunity. That’s why we’re training capable but less-expensive help to deliver that service as well.

All of these examples are real and all of them are recent. All of the people laboring under what looks to Pete (and therefore “to us”) as erroneous understandings of how best to apply digital marketing are smart and sophisticated. And I wouldn’t have been able to provide better answers, or discern any problems with their answers, a year ago. But what Pete McCarthy knows was learned during six years working alongside many forward-looking colleagues (and a management) who remain at the Random House part of PRH, and much of what we’re planning to deliver is almost certainly already baked into their workflow to a certain extent, although (like most big publishers) largely at the imprint level and therefore with varying levels of focus and capability.

Many of the obstacles to competing effectively with the World’s Largest Trade Publisher are obvious. But not all of them. It would also appear that they also have the hidden advantage of already having incorporated much of what Pete McCarthy has learned into their digital marketing practices. This will not be evident to other publishers. It will be evident in PRH’s sales and in the (lower) cost of getting them.

And what I’ve described above are merely a few of the marketing principles of Pete’s as we see their importance in specific examples. The ramifications of applying the broader set of capabilities implied by these principles, and what could be built or taught to scale, are massive. Just think of what a 5% increase in backlist sales can mean when a house’s backlist consists of tens of thousands of titles!

We are building the Logical Marketing web site right now and will formally announce the business, with services tailored to publishers, agents, authors, and brands very shortly. It will include a self-service portal for self-publishing authors. But we are already applying Pete’s knowledge on behalf of publishers large and small, two prominent literary agencies, and several independent authors. If you’re interested in getting more information about these services, an email sent to [email protected] is the way to let us know.

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Publishers do need to sell direct, but here are five things they should at least be started on first


The “Code Meet Print” blog by Glenn Nano recently reprised a subject I wrote about 18 months ago: the benefits that flow to publishers that sell direct. In that piece, I highlighted the disagreement that seemed to exist at that time between my advocacy of direct selling of ebooks particularly and Random House’s lack of interest in doing so.

In the meantime, I’ve been working with Peter McCarthy, building a digital marketing business. Pete was the lead digital marketing strategist at Random House for six years ending shortly before I published the piece. Nano makes the point that only Random House among the former Big Six does not sell ebooks direct now (although Penguin, the other half of the supermerger, does).

But in the year I’ve been working with Pete, I’ve learned with more nuanced perspective where “owning the transaction” fits in the hierarchy of tools and opportunities for publishers to directly influence consumer behavior. It isn’t at the top. So I have a new-found respect for Random House’s reluctance to forge ahead with retailing (although they clearly have been pursuing a direct-to-consumer strategy for years) and a new-found understanding of many other things publishers can do to help themselves with direct-to-consumer book marketing without necessarily executing the final sale of the ebook.

Any publisher who has been awake for the past several years knows that they need to talk to consumers directly where consumers are and can be engaged. Search engine optimization, Facebook and Twitter (and Instagram and other digital venue) campaigns, and consumer databases were practically non-existent five years ago and are now universally-accepted components of the marketing toolkit.

At first blush, it seems like a no-brainer that if you are talking to the consumer, introducing them to a book and persuading them to buy it, then you ought to at least try to get the full margin on the sale by executing the final transaction (as well as, perhaps, learning even more by observing their behavior as they read). But, of course, there are myriad complications.

Selling ebooks with DRM at all costs money for the license, adds complications for the end consumer, and can’t be executed by anybody except Amazon for delivery to the Kindle.

Setting prices is devilishly difficult. Either you resign yourself to being more expensive than many of the retailers or you compete with them on price. That requires technology and complicates the relationship with the sources of most publishers’ sales. It also means the “additional margin” you’re aiming to capture might not be as much as you hoped.

Being a retailer requires customer service. That’s something publishers have no experience with. And the difficulty of delivering it escalates with DRM and with any kind of dynamic pricing policy.

It is not surprising that the first publishers to sell ebooks direct had both the characteristics of being “vertical”, working with the same audiences repeatedly, and of being willing — for whatever reason — to distribute ebooks without DRM, which makes them easily passed along to others without in any way reducing the access of the original purchaser. These publishers — like Osprey for military books and F+W Media for illustrated books on many discrete subjects and Baen and Tor in the sci-fi genre — were anticipating the opportunity that Nano points out HarperCollins is exploiting with Narnia: using content to attract consumers which would lead inevitably to some desire to purchase. And selling direct also enables those publishers to make special offers around pricing or bundling or loyalty that would be much more cumbersome, if not impossible, to execute in collaboration with the existing retail network.

The need to sell direct seems pretty obvious and pretty compelling and there are now a growing number of service providers who can make it possible for publishers to do this on the web and through apps. (We’ll have a number of them talking about that at Digital Book World.)

One thing I learned from Pete is that — at least for a time and maybe still — Random House, apparently uniquely, was able to gain very granular affiliate-code tracking from Amazon. (This was achieved, apparently, merely by requesting it.) An affiliate code is the mechanism that enables publishers (or any other third-party) to be paid a referral fee on sales executed from traffic they send to Amazon (or any other retailer which compensates affiliates for referrals) for a purchase. Publishers normally have one and only one for each retailer to use across all their referrals, so they get sales reporting and payments from each retailer that are consolidated across all their titles and all the campaigns they run for those titles.

That leaves them flying blind on one of the most important metrics in digital marketing: how their clicks convert. Publishers persuading consumers and sending the traffic as an affiliate to Amazon or B&N (or any other retailer) can only possibly know the total number of clicks that went through them to the retailer and the total number of copies of each book they are credited with selling. Painstaking matching could get them a conversion index for a title, but not broken down by campaign or referral source.

Because Random House didn’t have that blind spot, they were, first of all, aware that their conversion rate on clicks to Amazon was very high, much higher than they would expect to get themselves if they tried to encourage consumers to buy direct. So the capture of more margin per sale would be at the expense of losing many sales. But, in addition, the extra margin can get burned up pretty quickly with the costs of running a direct-sale operation. One that provides solid user experiences, customer service, and other now standard eCommerce practices anywhere near today’s customer expectation is expensive — more so when it isn’t your primary business. eCommerce is a huge distraction, especially when it is executed by the folks who are also your digital marketers! That, or additional head count (which further lowers margins), would constitute a publisher’s choices.

When Nano made the suggestion in his piece that publishers move their “direct sale” up in the hierarchy of what they offer the consumer, above Amazon and other retailers, he wasn’t reckoning that this would result in a predictable rise in “cart abandonment”, which would mean sales lost. Nor did he calculate a substantial increase in operating costs.

That granular knowledge also enabled Random House to measure the success of campaigns by the meaningful metric of “books sold” rather than the proxy of “clickthroughs created”. That data made it evident very quickly that the search terms and calls to action that drove the most clicks weren’t necessarily the ones that drove the most sales. And, in addition, Amazon likes it better, and is more likely to invoke their own marketing capabilities on your behalf, if you’re driving traffic for a book that converts.

And all of this leads me to a list of five things I’ve learned in the past year that are really essential for effective marketing by publishers in the digital age. And I think all of these things are more important than, and independent of, whether the publisher controls the transaction or doesn’t.

1. It is necessary to do research to create effectively-SEOd copy for each and every book. McCarthy works with about 125 listening and analytical tools that allow him to find where targeted audiences are on the web, when they’re there (he can tell you the optimum time to tweet or post) and what words they use, enabling optimized search and attracting the consumers with the right “intent” to learn more about books. At the very least, every book needs an hour or two of structured examination of its audiences employing a dozen or more of these tools. Publishers who have their editors or marketers create the book descriptions and other metadata without doing this research are missing a critical trick. (Full disclosure: the Logical Marketing Agency Pete and I have just launched is now selling the service of doing this work at a per-title price that any publisher can afford, and which we think might be a faster, better, and cheaper solution for many than burning their own staff time figuring it out.)

2. Optimizing an author presence also requires research, and the more famous an author is, the more complicated is the challenge of pointing readers to a particular book. We’ve done three big author-centric jobs in the early days of our agency: one helping a major publisher look at the online presence of a major multi-book author they want to woo away from a major house competitor and the others examining the online presences of celebrity authors with complex backgrounds and prior books as well. Author and celebrity networks contain all sorts of clues to how to expand the author’s base, by segmenting it and by finding other celebrities and brands that have a following with similar profiles.

3. Although this is a touchy subject at the time that we’re still living with the Snowden-NSA revelations, it is also essential for publishers to be building their database of consumers and and tracking their knowable attributes, preferably with companion “permission” to email them, but even without. Several years ago, we were made aware by an agent that the enormous email lists owned by Hay House of readers interested in “mind body spirit” books enabled them to out-market big houses in their vertical. What working with Pete has taught us is that starting only with an email address or a Twitter handle, one can learn a tremendous amount about most individuals. They don’t make much noise about it, but we know at least some big houses have databases of consumers that number in the millions. They know very little about many of them, but are able to learn more all the time. Someday, if not already, publishers will be bumping the attributes of a book they want to buy against their database of people they know they can touch to make acquisition decisions.

4. When publishers are proceeding with fully-optimized book metadata, author online presence, and as many proprietary connections as they can muster to deliver free or earned discovery, they will also find opportunities for paid campaigns that can buy them additional attention. But running these media campaigns properly is yet another new skill set that requires developing experience in people and technology to help them. The “media cost” of Facebook or Google advertising is relatively trivial (compared to what media cost in the pre-digital age), but the management of that spending requires expertise and close attention to optimize the messages and the targeting.

5. The opportunities that a digital marketing environment creates for increasing sales of backlist have, across the industry, hardly been explored. If publishers are failing to do the necessary research to deliver optimal metadata on new titles, most aren’t even thinking about it for their backlist. This is a complicated problem. You can’t spend the hour or two we consider minimal necessary research to position a new title across thousands of titles on a backlist on a regular basis. Both monitoring the outside world, news and the social graph, and keeping metadata optimized for changing circumstances are, as yet, problems without a lot of helpful tools (or start-up initiatives) to assist them with yet. But publishers have lived for years in a world where the biggest barrier to backlist sales was the lack of availability of books in stores. As sales made online now exceed sales in stores for many titles anyway, that’s no longer a barrier and a much more proactive everyday approach to selling backlist is called for. A proprietary direct-selling effort can be of only minimal value there until a publisher creates such a heavily-trafficked store that screen real estate can be an effective tool. So other solutions are called for and it is probably unnecessary to say that McCarthy and I are working on this challenge too.

We’ll be covering a number of these issues at next week’s Digital Book World. In addition to the session on “Building Direct Sales Relationships” — featuring Micah Bowers of Bluefire, Sameer Shariff of Impelsys, Doug Lessing of Firebrand and Marc Boutet of DeMarque, and moderated by Ted Hill — we’ll also have several sessions focused on backlist marketing, marketing to (and building) online reading communities, gathering and using consumer data to inform acquisitions and marketing, and how to make the most of all the various social media channels. 

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Don’t blame Amazon, Facebook, and Twitter for the fact that technology changes behavior


In the past week, we have seen the Louis C.K. rant against smart phones, the Jonathan Franzen deep intellectual swipe at what Amazon is doing to the world of publishing, and I had an exchange with a very dear old friend who does email (his wife doesn’t), but can’t handle texting or Facebook. Or thinks he can’t.

I remember about four years ago telling a family member of mine that it had gotten to the point that not having a cell phone was anti-social. I am quite sure that people who don’t have cell phones or Facebook accounts miss out on communication they’d have been glad to get. And by being outside communication streams that are increasingly ubiquitous, they actually place an unintended burden on people around them to keep them informed.

Futurist David Houle has pointed out that eighty years ago some people would refuse to get a telephone because a) people could just call you on it and intrude into your private space and b) people would know where you lived by looking you up in the phone book. These things were true (although eventually we got to “unlisted numbers”), but so were a lot of other things that were benefits. I was thinking about my friend who won’t do texting or Facebook. Hey, they’re just means of communication! Do you want me to mail you a letter to find out if you want to have dinner next Saturday night?

When the first means of electronic communication arrived, telegraph inventor Samuel F.B. Morse had the prescience to make the first message he sent be “what hath God wrought?” Indeed, progress in electronic communication changes the world in ways that prior generations would have expected were possible only from God.

Yes, we have entered a world where all of us are connected to the entire planet all the time, except at the moments we specifically choose not to be (leaving the cell phone in a drawer or turning off all audible signals from it). This is as good a thing for each of us as we make it. But we are also increasingly depending on everybody else to be connected this way too.

Many of us announce our most important life events (and some insignificant ones too) on Facebook. That keeps our friends and family apprised of marriages, illnesses, births, and political opinions without us having to send out cards and make sure we have all the up-to-date addresses. Many of us (me not yet among them…) can use Twitter effectively to get the most up-to-date information about a breaking news event. (No self-respecting journalist could be without this capability today, I suspect. Certainly any journalist who knows how to use Twitter has an advantage over any who doesn’t.)

About 15 years ago the CEO of a major publishing house, a person with a reputation for digital forward-thinking, told me he was questioning whether everybody in his shop ought to have email! (After all, people with email are tempted to have communication that isn’t necessarily about their job. He was okay with internal electronic communication on a closed system.) It seems like every technological change faces skepticism because every technological change brings along a set of possibilities for behavior that needs to be controlled.

But, this being a blog about publishing, I’m most interested in rebutting Franzen’s suggestion that Amazon is somehow bad for reading, or bad for reading good books. (I agree with him that Amazon makes things harder for publishers, but that’s not the same thing.)

First of all, let’s not blame Amazon for two things: being really good at what they do and the natural impact of network effects. The “network effect” is that the more people are on a network, the more valuable it is to each person on it. In the first two decades or so of the 20th century, phone companies could only reach their own subscribers. A person who wanted to reach all their friends in an area might have to have several phones with different companies. Most wouldn’t, so even with a phone, communication was minimized. Gradually, the “roads got paved” and the phone systems were knit together.

You know one of the things that resulted from that? Reform politicians who were outside the central city finally became competitive with the urban machines, who could communicate easily without phones because they were in close geographical proximity in the center of town. (Thanks for this fact to my late friend, Professor Richard C. Wade, who invented the field of urban history.) It is also true that over time many kids wasted countless hours talking to each other on the phone. I know because I was one of them in the 1950s and 1960s during my adolescence when all my friends were available through them. I would have been outside getting fresh air 40 or 50 years earlier. Oh, those terrible telephones!

Amazon and Facebook and Twitter have more value than any possible competitors because they have more people actively engaged with them every single day. B&N can’t compete with Amazon around reader reviews because it has far fewer of them. Amazon tells you that X people out of Y found this review helpful. You need numbers to do that. Only one person in many writes a review. Only one person in many reads any posted review. And only one person in many bothers to post that they found a review helpful. That’s one in many cubed. The denominator is one enormous number. Amazon’s book customer traffic is probably 10 times or more what BN.com’s is. So it is possible for Amazon, and for nobody else, to tell you that X out of Y found this review helpful with meaningful numbers. (Even if Jonathan Franzen and others aren’t impressed with the provenance of the reviews. And even if some of the reviews have been deliberately gamed.)

Meanwhile, New York Times book reviews are available to far more people than they were before Amazon came into being and through the same computers that bring in Amazon. And when Jonathan Franzen writes his piece for The Guardian, far more people (including me and anybody who clicks the link I provided above) will read it than would have when there was only print. And anybody interested in the new book of his that he is promoting can just click a bit more, probably to Amazon, and buy it.

This is bad?

It is true that Amazon is the pointed spear of change in the world of communication (although they are not alone). From the moment they made a massive database of books available online, they challenged the core proposition of bookstores and the biggest ones with the biggest selections were the most challenged. It isn’t really Amazon’s fault that buying books online is so attractive to so many people, it is the nature of the beasts: the book choice beast and the Internet database beast.

But Amazon takes advantage of this opportunity better than anybody else. This is where their superior execution comes in. I am very close to somebody who vastly prefers to buy her books from Barnes & Noble for reasons that would probably appeal to Jonathan Franzen. But, over many years, she has found that their search engine just doesn’t work effectively. So she finds what she wants at Amazon and then goes over to BN.com to purchase it! Most people won’t do that; they’ll just buy where it is easiest to shop. Is it Amazon’s fault that they’re cleaning BN’s online clock through a better service?

I spoke this past week with the communications director at a think tank who has their publishing arm reporting to him. He’s new to the world of books. He reports that his team keeps portraying Amazon as the enemy; from his perspective, they are “the answer”. Yes, he’s worried about whether their increasing hegemony over the book-buying public could ultimately result in some nasty cuts to his margins. In fact, probably they will. Amazon is likely the most profitable account for almost every publisher because their sales are massive and their returns are minimal. Some publishers report that even their demands for co-op spending are less onerous than Barnes & Noble’s. Of course, they will probably push the envelope over time and claw back more of that margin from publishers. Most retailers would.

In fact, Amazon can sometimes use network effects and its capability to execute (all of which could be summed up as “scale”) to improve its margins by creating new business that nobody else can. They may have done that with their new Matchbook program, which offers a print-and-ebook bundle. Perhaps Barnes & Noble could have done this (and perhaps at some point they will), but only publishers with a very large direct-to-consumer business could execute this themselves.

Amazon is probably smart enough not to want a world in which, as Franzen fears, they publish everything that isn’t self-published by an author. They know they benefit from the investments publishers make and they’re probably even detached enough to know they benefit from books being in the marketplace because they’re supported by sales Amazon doesn’t have the breadth to make. And let’s remember that book sales are probably down to a low double-digit percentage of Amazon’s business. They have bigger fish to fry than building their market share or their margin at the expense of publishers.

Here’s another historical perspective to ponder which I believe is analogous. In the first half of the 19th century, many of the bestselling writers in the US were poets. One big reason why was a low level of literacy. Books were read aloud by the person who could read to the others who couldn’t. That was an environment that favored poetry over prose.

But then came the crusade for universal public education and improvements in transportation that boosted it along. By the latter part of the 19th century, poets had yielded to novelists and, in fact, poetry has declined in commercial popularity pretty much ever since.

So we can say that universal public education was a dagger to the heart of poetry’s commercial advantage. In some people’s minds, that might be a good reason to reconsider it. The arguments against the natural effects of digital communication, selectively finding perhaps-true negatives and dwelling on them, strike me the same way.

We have two great shows running this coming Thursday, September 26, being staged by Michael Cader’s and my Publishers Launch Conference in conjunction with the team at Digital Book World. The Marketing Conference is a collaborative effort with Peter McCarthy, who is rapidly gaining recognition as the industry’s leading thinker about books and digital marketing. The Services Expo is three mini-conferences that will help publishers find the service providers they need to help with tech on editorial/production, digital asset distribution, and rights and royalties. The Services show is priced low so that you can attend just one of the three mini-conferences if you want and still get a very fair deal. I’m co-moderating the Marketing Conference with Pete and I can assure you that it will be amazing. If you have any time left on your calendar on Thursday and you’re near NYC, you’ll be glad if you spend some of it with us.

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Future systems needs for publishers to manage marketing becoming clear


From talking to people about insights gained about digital marketing from Pete McCarthy and learning new things both by having the conversations and then ruminating about them. it has recently become obvious that as people learn Pete’s lessons, they’re going to encounter a new problem they don’t have a solution for. This must already be apparent in some quarters. (Actually, if it’s not, it shows your digital marketing efforts are probably in need of improvement.)

A core tenet of Pete’s approach is that you define the audiences for your book (and one big jump is to get from “topics” in the book to “audiences” for the book) and then you use a variety of tools to find out what words these audiences use when they’re searching, where they hang out, how they get recommendations, and what else they like, believe in, and do. All this is done with the objective of aligning marketing efforts with true consumer intent and behavior.

Once you have defined the audiences and found the right terminologies, places, and times, the next question is which terms work best to drive engagement, and then sales. You often find that out by doing some experimenting: finding ways to market to the audiences (a Facebook interest, a Twitter hashtag) and testing the different words (and sometimes imagery) you think will resonate with them. This is classic A/B testing.

So if you have, as you might for many books, five audiences and six search terms under each, you could have 30 different “experiments” to conduct for that book from just your initial research. That’s a lot of A/B testing to keep track of.

One very quickly realizes that a major publisher using this approach should have tens of thousands, perhaps hundreds of thousands, of experiments taking place simultaneously.

This ties into another point Pete has made to me and which will be the subject of the final panel at our Marketing Conference on September 26. You can know whether digital marketing is “working” or not. “Working” means “positive ROI”: you spend a dollar on the marketing effort and you get more than a dollar back. As long as that is true, you keep doing it. If it isn’t true, you (probably) stop.

In other words, the old practice of setting a “budget” for a book’s marketing effort is an anachronism in the digital world. (That’s the main topic of that wrap-up panel.)

This idea also recalls a concept that was the topic of a post here three years ago: that marketing spending should be seen as “investment” because what is learned or gained in the way of customer attention helps the marketing efforts of the future.

I spoke with a big house CEO in the UK last week about this and he wholeheartedly agreed that the need I identified was a pain point. But, he said, at this point the experiments in his shop, and he believes in competitors’ shops as well, are not even being systematically measured for ROI.

While it is a tall order, the benefits of doing this — making all marketing spend an “experiment” and measuring its ROI — are too great to ignore and the alternative is choosing to guess when the answers are out there to be gotten.

This leaves a big gap between the marketing that is actually possible today given our ability to learn about audiences and search terms and social media engagement on one hand and what publishers can practically do across their lists on the other. That is, we’ve learned about some things that can really work, but which are devilishly difficult to scale.

The number of experiments taking place in most houses should likely exceed the number of active titles in the marketplace. Some of these might be no- or very low-cost. You can learn a lot buying $50 worth of keyword exposure in Facebook. But if you don’t continue it (or even increase it) if it is working (or turn it off it isn’t), then you don’t gain the benefits you should and possibly a good practice can turn into a disaster.

Once publishers more broadly learn and understand the marketing techniques Pete has developed (many of which will be explained at the Marketing Conference), they’ll discover the need for the next tool: a way to automate the management of these techniques on a broad scale. They’ll want technology that measures whether something is working and turns it off or continues or even extends it based on ROI. (Indeed, before they can do that they’ll need to develop their own “attribution” model that ties marketing spend to results and then to profit; it is not as simple as direct online conversions, though that is the logical place to begin.) They’ll want exception reporting that bubbles up what humans need to look at on a regular basis.

This is a complex technology problem. If it is seen as primarily an IT requirement, publishers might be reluctant to fund a solution. If it is seen as essential for marketing, it might be looked at differently. This is a dichotomy Pete put his finger on, which he calls the awkward dance between marketing and IT.

Right now, the chances are good that most houses aren’t doing enough research (into audiences and search terms) or enough experimenting. The research doesn’t pay off if you don’t use it, and the use doesn’t pay off if you don’t measure and manage it. (Or as Pete says, and will say at the conference, “rinse and repeat”.)

A lot of this is common practice outside the publishing industry and many “marketing automation solutions” do exist, some of which have been adopted by some houses for some specific uses. The trick is to find the tool that fits the need; like a pair of pants, it has to fit. And with the sheer number of small and diverse experiments required for publishing — so many ISBNs and so many retailers and so many marketing venues — the right comprehensive tool hasn’t been created yet.

I wonder if any of the established systems providers or start-ups looking to help publishers are working on this problem. If the formula for success is “see a need and fill it”, it might be a good idea. As publishers develop their competence at digital marketing, the need will be very apparent.

Also on September 26 and in the same midtown Manhattan venue as our Marketing Conference, Publishers Launch Conferences (in conjunction with our partners for this event, Digital Book World) will be presenting a Publishing Services Expo. The Expo consists of three mini-conferences designed to help publishers figure out how best to get help from service providers in three distinct areas: 1) Editorial/Production, 2) Rights and Royalties, and 3) Digital Asset Distribution. The Services Expo is priced low to make it affordable for attendees who want only one or two of the three tracks. Ticket-holders for the Marketing Conference are also allowed access to the Services show for anybody who wants to duck out for a particular piece of it.

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Marketing will replace editorial as the driving force behind publishing houses


One of the things my father, Leonard Shatzkin, taught me when I was first learning about book publishing a half-century ago was that “all publishing houses are started with an editorial inspiration”. What he meant by that is that what motivated somebody to start a book publisher was an idea about what to publish. That might be somebody who just believed in their own taste; it might be something like Bennett Cerf’s idea of a “Modern Library” of compendia organized by author; it might even be Sir Allen Lane’s insight that the public wanted cheaper paperback books. But Dad’s point was that publishing entrepreneurs were motivated by the ideas for books, not by a better idea for production efficiency or marketing or sales innovation.

In fact, those other functions were just requirements to enable somebody to pursue their vision or their passion and their fortune through their judgment about what content or presentation form would gain commercial success.

My father’s seminal insight was that sales coverage really mattered. When he recommended, on the basis of careful analysis of the sales attributable to rep efforts, that Doubleday build a 35-rep force in 1955, publishers normally had fewer than a dozen “men” (as they were, and were called, back then) in the field. The quantum leap in relative sales coverage that Doubleday gained by such a dramatic sales force expansion established them as a power in publishing for decades to come.

Over the first couple of decades of my time in the business — the 1960s and 1970s — the sales department grew in importance and influence. It became clear that the tools for the sales department — primarily the catalog, the book’s jacket, and a summary of sales points and endorsements that might be on a “title information sheet” that the sales reps used — were critical factors in a book’s success.

There was only very rarely a “marketing” department back then. There was a “publicity” function, aimed primarily at getting book reviews. There was often a “sales promotion” function, which prepared materials for sales reps, like catalogs. There might be an art department, which did the jackets. And there was probably an “advertising manager”, responsible for the very limited advertising budget spent by the house. Management of coop advertising, the ads usually placed locally by retail accounts that were partly supported by the publishers, was another function managed differently in different houses.

But the idea that all of this, and more, might be pulled together as something called “marketing” — which, depending on one’s point of view, was either also in charge of sales or alternatively, viewed as a function that existed in support of sales — didn’t really arise until the 1980s. Before that, the power of the editors was tempered a bit by the opinions and needs of the sales department, but marketing was a support function, not a driver.

In the past decade, things have really changed.

While it is probably still true that picking the “right books” is the single most critical set of decisions influencing the success of publishers, it is increasingly true that a house’s ability to get those books depends on their ability to market them. As the distribution network for print shrinks, the ebook distribution network tends to rely on pull at least as much as on push. The retailers of ebooks want every book they can get in their store — there is no “cost” of inventory like there is with physical — so the initiative to connect between publisher and retailer comes from both directions now. That means the large sales force as a differentiator in distribution clout is not nearly as powerful as it was. Being able to market books better is what a house increasingly finds itself compelled to claim it can do.

In the past, the large sales force and the core elements that they worked with — catalog, jacket, and consolidated and summarized title information — were how a house delivered sales to an author. Today the distinctions among houses on that basis are relatively trivial. But new techniques — managing the opportunities through social networks, using Google and other online ads, keeping books and authors optimized for search through the right metadata, expanding audiences through the analysis of the psychographics, demographics, and behavior of known fans and connections — are still evolving.

Not only are they not all “learned” yet, the environment in which digital marketing operates is still changing daily. What worked two years ago might not work now. What works now might not work a year from now. Facebook hardly mattered five years ago; Twitter hardly mattered two years ago. Pinterest matters for some books now but not for most. Publishers using their own proprietary databases of consumer names with ever-increasing knowledge of how to influence each individual in them are still rare but that will probably become a universal requirement.

So marketing has largely usurped the sales function. It will probably before long usurp the editorial function too.

Fifty years ago, editors just picked the books and the sales department had to sell them. Thirty years ago, editors picked the books, but checked in with the sales departments about what they thought about them first. Ten years from now, marketing departments (or the marketing “function”) will be telling editors that the audiences the house can touch need or want a book on this subject or filling that need. Osprey and some other vertical publishers are already anticipating this notion by making editorial decisions in consultation with their online audiences.

Publishing houses went from being editorially-driven in my father’s prime to sales-driven in mine. Those that didn’t make that transition, expanding their sales forces and learning to reach more accounts with their books than their competitors, fell by the wayside. The new transition is to being marketing-driven. Those that develop marketing excellence will be the survivors as book publishing transitions more fully into the digital age.

A very smart and purposeful young woman named Iris Blasi, then a recently-minted Princeton graduate, worked for me for a few years a decade ago. She left because she wanted to be an editor and she had a couple of stops doing that, briefly at Random House and then working for a friend named Philip Turner in an editorial division at Sterling. From there Iris developed digital marketing chops working for Hilsinger-Mendelson and Open Road. She’s just taken a job at Pegasus Books, a small publisher in Manhattan, heading up marketing but doubling as an acquiring editor. I think many publishers will come to see the benefits of marketing-led acquisition in the years to come. Congratulations to Pegasus and Iris for breaking ground where I think many will follow.

Many of the topics touched on in the post will be covered at the Marketing Conference on September 26, a co-production of Publishers Launch Conferences and Digital Book World, with the help and guidance of former Penguin and Random House digital marketer Peter McCarthy. We’ve got two bang-up panels to close with — one on the new requirement of collaboration between editorial and marketing within a house and then in turn between the house and the author, and the other on how digital marketing changes how we must view and manage staff time allocations, timing, and budgeting. These panels will frame conversations that will continue in this industry for a very long time to come as the transition this post sketches out becomes tangible.

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7 starter principles for digital book marketing learned from Peter McCarthy


Times are changing in publishing and publishers know it. Almost every publisher recognizes that their value to authors, and therefore their future, is dependent on their ability to deliver effective marketing at scale. In this day and age, that means digital marketing, which also has the characteristic of being “data-driven” marketing. And not only is that a science that is really less than 10 years old, it is changing all the time. Ten years ago many of the most important components of digital marketing for books today — Twitter, Facebook, Goodreads — barely existed or hadn’t been born yet. They certainly didn’t matter.

Publishers can’t address their digital marketing challenge by simply spending more because the choices in digital marketing are endless. They have to be smart about what they do. Which means they have to be smart about something for which there is little established wisdom and no deep experience inside of publishing houses.

For a large part of the past year, I have been learning about digital marketing for books from the man whom I will regard as The Master until the day comes when I meet somebody who knows more. He’s Peter McCarthy. Pete started his career with nearly 3 years at The Reader’s Catalog, New York Review of Books, and the Granta family of publications. Reader’s Catalog formed part of the backbone of Bn.com 1.0. Then Pete spent six years at Penguin in the early digital days helping them build a DAM system and put out ebooks for the first time, followed by six years at Random House pioneering their digital marketing efforts.

Pete has made the point repeatedly that much of what he knows, does, and is teaching me is already well understood in the modern world of branding and marketing. The distinctions among psychographics, demographics, and behavior, and their importance in marketing, were new to me but are familiar stuff to people who sell Pepsi or Toyotas. Pete’s really invented something in publishing by looking for comparable products that aren’t other books, but outside publishing they know all about seeking comps that aren’t precisely the same as their own product. The techniques Pete employs to find audiences in people that are like the known audiences for a book are standard tools in consumer marketing outside publishing.

But that doesn’t mean publishers can just hire big digital agencies to help them. It won’t work. Because while publishing can use techniques that sophisticated marketers are using to sell other products in other places, the truly more complex world of books will be hard for them to cope with. And marketing budgets for a title that are rarely five figures, often three figures, and sometimes less than that don’t fit the best agencies’ idea of “workable”, either.

The big agencies would actually have no clue how to deal with thousands of highly differentiated products at the same time, which have some interconnectedness to them (because they’re all books, so Amazon author pages have to be optimized for all of them, for example) but mostly are unrelated. And not knowing that causes lost value two ways:

1. They don’t have techniques to apply mass optimization across hundreds or thousands of highly differentiated “products”, because the work they do doesn’t require it;

2. They don’t have the capacity big publishers need to run hundreds (or maybe even thousands) of campaigns at one time with realtime “budgets” (or “go, no-go” gauges).

So the big agencies wouldn’t know how to deal with a publishing house. The granularity would frustrate them and they’d freight each ISBN (publishing speak for “SKU”) with too much overhead.

That has left most publishers on their own, with service providers delivering some by-title assistance (you can hire somebody to do an author’s tweeting for them), but with the publishers themselves left to sort out how to make maximum use of a book or author’s digital footprint and social media presence to drive sales. And it is not really surprising that Pete McCarthy, having had the opportunity to meet the marketing challenge across thousands of titles and authors and hundreds of genres, topics, and imprints, would have figured out a lot of things that elude the publishers who aren’t digital marketing sophisticates and the digital marketing experts who rarely, if ever, encounter the granularity and product diversity that characterizes book publishing.

I’ve learned a lot from Pete, but I’ll never catch up to him and I won’t even try. He uses more than 100 different digital tools to help him understand followers in various social platforms and who they are. He is using a marketer’s understanding of each individual’s demographics, psychographics, and behavior (and behavior’s subset, intent), to define the groups of people he sees clustering. That, in turn, helps him find groups of people who are similar to the ones who already like the author or the book.

Pete has articulated many principles which make a lot of sense, even to somebody who didn’t know about demographics and psychographics and who has not worked his way through even a handful of “listening” tools, let alone a hundred or more.

1. The digital marketing menu contains nearly an infinite number of items. That results in a tremendous amount of wasted effort spent trying things that a little research would have indicated will never work.

2. The key to making sales is to put the right message in front of the right person at the right time. Research finds the right people; testing finds the right message and the right time.

3. The various tool sets will allow you to profile the “followers” of a book or author in Facebook, Twitter, or LinkedIn (or by securing an email address) and it will enable you to understand for each of them what kind of following they have. This is critical research to do before you invest effort and time in actual marketing.

4. Another key research element is to carefully pick your nomenclature. Tools can also tell you how common various words and terms are in searches made through Google, Amazon, and other venues. This informs the best choices for metadata tagging, of course, but it could also affect a book’s titling.

Understanding the book and author’s digital connections and the right language to describe the book you’re selling are “foundational” elements; everything flows from them.

5. The whole concept of marketing “budgeting” needs to be rethought. While the trap or danger in digital marketing is its infinite number of possibilities, the opportunity is that the results of efforts are visible and measurable. So everything that is tried should be measured and evaluated, continued it if is working and either altered or terminated if it is not.

This reality collides with the historical practices and commercial realities of publishers, particularly big publishers. Editors, who have to sign up the books and keep agents and authors happy, want to tell agents and authors what their marketing budgets and efforts will be. Whether the book is selling or not, agents and authors don’t want to hear that the marketing spending was cancelled because the efforts weren’t adding value. But a house can’t just add to the budget when something is working and not cancel anything that is not, or they’ll go broke.

6. The whole concept of “time” also needs to be rethought, both “time on the clock” (work people do) and “time on the calendar” — not just how long programs run (as above) but also when they take place in relation to the lifecycle of the book. In the digital era, whether books are well-represented in stores at any moment is not necessarily the key determinant of how well they’ll sell, so pushing a backlist book that might be thinly distributed but which is suddenly timely is perfectly sensible (“the calendar”). And it wasn’t that way five or ten years ago when marketing efforts wouldn’t be extended if books weren’t in the stores. It is also true that the external costs of digital marketing could be very low but a campaign could consume a lot of in-house time (“the clock”) with copy creation, design, and posting.

7. The key to successful digital marketing is to do the research that finds the right messages and targets, test the messages to the targets looking for a defined result, measure the impact, and then adjust the messaging and targeting. Pete calls that “rinse and repeat”. The objective is to find replicable actions that provide results with an ROI that can be continued until the ROI stops.

With Peter McCarthy’s help and in conjunction with Digital Book World, Cader’s and my Publishers Launch Conferences has organized a Modern Book Marketing Conference to lay out the core tenets of digital marketing for publishers. (So we can all learn from Pete McCarthy.) 

After Pete opens the day by introducing his basic approach, we’ll have a panel of top publishing strategists — Rick Joyce of Perseus, Angela Tribelli of HarperCollins, Matt Litts from the Smithsonian, and Jeff Dodes of St. Martin’s Press – talk about how they apply digital marketing in their companies. Then Murray Izenwasser of Biztegra, a top digital marketing company, will clarify the core principles of using consumer demographic, psychographic, and behavioral data before Susie Sizoler of Penguin covers how publishers can build powerful customer databases and reader insights. Marketers Matt Schwartz of Random House, Rachel Chou of Open Road Integrated Media, and Brad Thomas Parsons of Houghton Mifflin Harcourt will  talk about how they promote, including a “lightning round” of commentary about how and when to use the most important venues and tools: Amazon author pages, Twitter, Facebook, Goodreads, and many others.

We will have a round of speed-dating, so attendees can meet with key sponsors and expert speakers in small groups and get their individual questions answered. And we’ll conclude the day with Erica Curtis of Random House on best practices for measuring and analyzing your marketing ROI, and two panels. The first, on “how digital marketing changes budgeting and timing”, will feature case histories from Sourcebooks, Running Press, and at least one other publisher. The second on the new collaboration required among authors and marketers, will feature agent Laura Dail, outside marketer Penny Sansevieri, inside marketer Miriam Parker of Hachette, and an editor still to be selected.

This Marketing Conference is co-located with our Publishing Services Expo, which I described in a previous post, and attendees of the Marketing Conference are welcome to sit in on any part of PSE as well. At the breaks, sponsors and many of the speakers from both events will be available to the audiences for both events.

Full disclosure and a teaser “announcement”: Pete McCarthy and I are forming a digital marketing agency to apply his knowledge on behalf of publishers, authors, and agents. We’ll reveal more details, including our starter assignments, over the next few weeks.

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Promotional activities market to the Three Cs: creators, channels, consumers


Somebody in the office just asked for some help thinking through the distinction between marketing and sales. Our conditioned response on that distinction is that sales efforts are about managing the channel partners and marketing is what encourages end users to buy. But, of course, we rapidly recognized that formulation was never a clean one and is even less so in the digital age.

The conversation recalled for me what might be the best generic advice I ever gave during a consulting assignment that was not incorporated by the client (which no longer exists; a company that has since been sold and merged into another) nor, as far as I know, by anybody else in the business. I rarely, if ever, say this: but here’s a suggestion for a practice that every book publisher ought to implement and none has.

The assignment at the time — probably around 2006 or 2007 — was to examine the marketing activities of this publisher and shed light on how they should be rethought in the emerging digital age. To do that, we did our best to measure the impact of the marketing spending that was taking place. And, to do that, we looked at sales at retail as best we could discern them — through BookScan and through POS reports from retailers — for the weeks prior and the weeks following advertising and promotional activities to look for discernible “lift”.

It was a sobering exercise. What was really shocking was the lack of sustained benefit from the coop marketing activities with retailers. We often found there was some lift during a promotion, but hardly ever was there any sales benefit sustained after a promotion.

One thing that arose in that discussion was that a very big wad of spending was for ads in the NY Times Book Review. They hardly moved the consumer needle at all. When we probed internally, we found that the marketers knew that would be the case, but those ads weren’t placed primarily to sell books. They were placed to sell authors on publishing with the house. So I gave them the advice that everybody should follow and nobody does.

“Call it what it is,” I said. If the spending isn’t meant to drive sales, but rather to recruit authors, call it “editorial”, not “marketing”. Don’t make the marketing people responsible for having it deliver sales results; make the editorial team responsible for having it deliver better authors or better author deals.

The advice to “call it what it is” is sound, but actually spotlights how the distinction between “marketing” and “sales” is getting harder to define these days. In fact, “editorial” is part of the same mix now too. One of the generic challenges of our time is how to integrate a publisher’s (largely digital) marketing efforts with an author’s (almost entirely digital) marketing efforts and online presence.

Here is perhaps a clearer way to think about it. We have “promotional activity” that ranges from base functions like metadata provision; through old-style stuff we still do like book-by-book pre-pub promo copy (might not call it “catalog copy” anymore), press releases, advance reading copies in various forms, and author tours; on to relatively new activities like buying keywords and banner ads, blog tours, “content marketing”, and growing and using customer lists.

The categories of target are the Three Cs: creators, channels, and consumers. All need to be satisfied with the promotional activities, which are the marketing efforts. The first group — the creators — should be interested in and pleased by what they see being done to influence the channels and consumers. In fact, that’s why the NY Times ads were important to them. They believed those ads helped them sell books. (Of course, Times ads also impress the authors’ friends and relatives.) And although the evidence in the consulting assignment we did was that they did little to move the consumers, it is possible, even likely, that those ads (if used correctly) did influence the channels.

There’s another way publishers need to change their thinking around marketing, and that also will require some “adjustment” of author expectations. In the pre-digital age, the primary purpose of marketing for most titles was to help the sales force get the requisite number of copies in place at retail for a Big Bang on publication date. That meant that the largest and most persuasive possible plan needed to be thoroughly articulated before reps hit the stores, and that would be some months before the books would be available.

That approach may still make the most sense to be persuasive to the creators and the channels, but it is not the right way to approach consumer marketing anymore. As Peter McCarthy, the champion digital marketer who is helping us organize our PLC/DBW Marketing Conference has explained to me, it can be a tough selling job to convince an agent that a sustained digital effort, course-corrected as it goes, will be as valuable in driving sales as a big ad in a recognized vehicle that costs several times as much would be. Is the publisher doing the right thing or just trying to save money? You can excuse an author or agent for considering that possibility.

And this raises another way publishing practice is going to have to change in the digital age. If marketing efforts become less about an initial burst of activity to get big inventory placements and “orbital velocity” right after publication date and more about systematically building on what is proven to work as the book lives in the marketplace, then budgeting is going to have to change even more dramatically than the suggestion I made to the client would require.

What is the right amount to spend on a book becomes clear only as you do the spending, read the results, and respond to them. Some things will work so well that they are essentially self-liquidating; they become marketing investments that rapidly pay for themselves. In those circumstances, whatever the budget says, you’d be unwise to terminate them as long as that remained the case. Similarly, you may discover things in marketing Title A, new this year, that tells you something that might work effectively for Titles J, T, and X, which were published in the near or distant past. J, T, and X don’t have marketing budgets in most of today’s publishing environments.

And digital marketing efforts often make the most sense when they support a range of titles. After all, since a big part of the cost is finding the “right” audience and how to reach them, once you’ve done that, you’d want to benefit across the range of an author’s output or across several topical titles that have the same audience. That’s not the way publishers have historically budgeted their marketing dollars.

In McCarthy’s view, marketing breaks into three big buckets: B2B, B2C known, and B2C unknown. In the paradigm of my Three Cs, creators and channels are B2B and the consumers are the known (a publisher’s own database of consumers, for example) and unknown (buying a Facebook ad). But, however you frame it, old thinking must yield to new; old distinctions between marketing and sales will be increasingly irrelevant; and budgeting for marketing needs to be completely rethought.

The modern marketing challenge returns us to what we consider the core themes of “scale” and “vertical” and reminds us, again, that marketing one title at a time according to the old-fashioned playbook is not a winning strategy in the future.

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