My book business career (on the fringes since 1958 and pretty fully immersed since 1973) has been spent considering the path from “intellectual property creator” to “book purchaser”. This is a world occupied by authors and packagers and agents; by publishers of various sizes and capabilities coordinating the many tasks and steps from the raw material to the purchased book; and by the many in different seats in and out of publishing houses who are in their own way handling the marketing challenges of a world that has changed from almost-all-bookstores (for consumer books) to digital marketing and “known book buyer” email lists.
Book publishing has changed dramatically in the past 30 years, in the past 20 years, in the past 10 years, and even in the last five years. It has evolved from a business that was once heavily, if not entirely, dependent on personal relationships: between authors and agents, between agents and editors, between marketers and key influencers, and between sales professionals and the wholesalers and retailers. The older you got, the bigger and more powerful your network became, the more valuable you were. Today it is a business of digital savvy, nimble marketing thinking, command of the multifarious ways your own and other email lists and social media can be accessed and exploited, and, once in a while, capitalizing on the opportunity to move real numbers of books through physical retail to augment the usual diet of sales made online.
The “incumbents” — established publishers — had a massive moat protecting them from interlopers when most books were sold in stores. Now well under 20 percent (across all formats) are sold in any kind of physical stores, well under 10 percent sold in bookstores that were the marketplace those incumbents once “controlled”.
The older established publishers do have one major embedded advantage that persists: their backlists. Life is better if you control the rights to a lot of properties that are discovered through search or have pockets or instances of fame or relevance. In the old days, you had to know something would happen in advance and have the wit and relationships (and inventory) to get the books in place in stores. Today, you can sell a book online today that isn’t printed yet and Ingram will ship it to your customer (or theirs) for you tomorrow.
Relief from the need to manage inventory on the deep backlist magnifies the advantage — the profitability — of owning one.
Dramatizing the point that big changes have occurred in the past decade or so, one big bonus for publishers with deep backlists has been the emergence of audiobooks as an increasingly commercial format. Audiobooks have a cost-of-entry that ebook and print-on-demand efficiencies don’t require: a voice reading the text is not (yet) a simple push-button output of the same file that produces any version of the book. But the digital structure set up for ebooks (and for music) makes seamless delivery of the audio format work throughout the book ecosystem, so yet another way to get revenue from the same branded intellectual property is ubiquitously available.
The incumbents are not nearly so advantaged when they publish new books. With bookstores selling fewer than ten percent of the books, they are clearly not the best lever to make something happen. Many publishers have (by now) built their own email lists of “known book buyers” (as has Ingram), but the nature of consumer publishing, particularly for the big players, is that you publish across many categories. Direct-to-consumer marketing works best with communities of interest. So it isn’t just the marketing that has to change, so does the title acquisition strategy if you want to make the most effective use of previous purchasers to launch new books.
This piece is written from the perspective of the U.S market, but the digital transition has made it relatively simple for any company based anywhere to sell their books everywhere. In this global marketplace, two companies have emerged as indispensible: Amazon and Ingram. In an online-sales-dominant marketplace, Amazon is fully half the market. (Kindle is way more than half the ebook market.) And in a world that is otherwise very much splintered and which historically required that publishers sell rights to local players all over the world to reach customers outside each company’s home market, Ingram offers a suite of tools to reach the rest of it. Ingram’s physical and digital wholesaling sells to literally every retailer in the world, including Amazon. It is noteworthy that established retailing brands like Wal-mart have recently been taking print book share from Amazon and other online retailers because Ingram enables them to offer any book in print without stocking any! They have the digital traffic; Ingram enables them to offer all their customers the full menu of books: print, e, and audio.
Obviously, the biggest publishers pay close attention to Amazon and Ingram. But both companies have systematically and programatically addressed smaller players. One way to think about Ingram is that they provide capabilities that require investments at scale which they make available to publishers of all sizes on a per-use basis. They provide tools to compete, on a title-by-title basis, to smaller publishers as well as to entities with resources but no particular book publishing background or network.
The net effect of all of this is that for every year for quite some time the share of the total book market that is held by established entities publishing books as a commercial endeavor has diminished against the total. Self-published authors, aspiring next generation publishers, and entities that are publishing “as a function” rather than “as a business” keep growing in number and output. Those categories sold pretty close to zero percent of the books in 1990.
None of this is particularly cheerful for agents. At the same time that publishers are becoming increasingly careful buyers of new material, they can be (and are) more demanding about the development of what they buy before they get it. That favors agents who are good editors and developers; it also asks them to do more work. This puts increased pressure on the long-standing convention that agents not charge authors for editing services. More and more, they do. More and more, they have to.
Another effect of publishing’s evolution is that it makes big publishing houses much less exciting employers than they were. They aren’t growing title output or sales reach. The only part of today’s publishing organization that is growing is the function of digital marketing. There were once clear paths from entry level to executive suite in editorial, sales, and publicity and marketing that were credible and comprehensible based on successfully building relationships. This is just not true anymore.
We have gone from about 5000 bookstores in 1990 to more like 1250 today, and, on average, today’s stores carry a fraction of the number of titles the bigger ones did back then. In other words, shelf space has declined far more dramatically than store count. We have gone from about 500,000 titles available in 1990 to about 20 million titles available today. We have gone from perhaps 15 or 20 publishers with their own distribution organization that were real competitors for most books an agent might sell in 1990 to five (soon to be four) today for the biggest books (six-figure advances) and perhaps another half-dozen for the next tier. In fact, Ingram’s distribution operations are at a scale comparable to the four or five biggest publishers so smaller publishers looking to get help at that scale no longer are obliged to do it with a publisher that could, on any book, be a competitor. We have gone from a world where nobody could effectively deliver a book without a publishing organization in 1990 to one where anybody can today.
This is not an epitaph for book publishing. More books will be published in any month of 2022 than were published in the whole year of 1990. Books will become a much more standard feature of all marketing, brand-building, and reputation-enhancing efforts. Amazon and Ingram provide infrastructure that many configurations of “publisher”, including one author working alone, can exploit. But we’re living in a world that has been transitioning for 30 years, with a legacy structure of gatekeepers maintaining a great deal of current control. The old procedure of “get an agent, get an advance, let the publisher do the work” is getting harder and harder to exploit and it is becoming the exception, rather than the rule. Access to the infrastructure to reach book readers has certainly been democratized, but the access comes with no guarantees of sales success. Publishing a book in a professional way has never been easier or cheaper. But achieving sales success just keeps getting harder and harder.
A meticulous reader might be frustrated at the unsupported numbers in this piece: for title counts, percentage of sales in various venues and formats, and in my tally of how many publishers can do one thing or another. I have checked my thinking with some of the smartest and best-informed people I know and some numbers got revised due to those consultations. But there really are no “official” numbers to be trusted for the various counts (number of publishers who can compete for big books, number of titles available…) attributed here.
I apologize for the ambiguity about “4 or 5” big publishers. That’s because this post is being written while Simon & Schuster is still a fifth big player because their sale to Penguin Random House has not yet been approved and consummated. So there are five Giants now and there will be four when that sale goes through.
While I have your attention, I want to urge you to take a look at our fabulous website on climate change to see what my partner, Lena Tabori, has built with a little help from me. ClimateChangeResources aims to be the hub for information and action on the most pressing subject facing humankind.