To Sell or Not to Sell?
In a recent post on “Writing on the Ether,” Porter Anderson suggested that we (folks in the publishing industry) might take advantage of the lull this time of year offers–what some call “the silly season”–to “do some wising up.” While Porter is mostly talking about Amazon, I’d frame the “wising up” that’s needed more broadly. What business are we in, exactly?
The reflexive answer to this question is often “the book business.” This orientation emphasizes the creative role authors, agents, editors, designers, marketers, and publicists all play in producing a book and making prospective readers aware of it.
Somewhere on the other end of the spectrum (not often voiced) is the response, “No, we’re not in the book business–that’s incidental–we’re in the business of connecting people to content that matters (to them and to us).” This emphasis is at odds with the linear concept of the publishing process , focusing as it does on relationships, user experience, and on what’s valued and why.
These two ends of the spectrum have always been part of the publishing industry and can easily be seen in the traditional role of the editor (I was one for many years.) On the one hand, editors desperately want their books to be read, to offer educational value, a transformative experience of the literary art form, whatever. On the other hand, editors are snobs–If the reading public is too dim or distracted to see the value in the work the editor champions, then the hell with them. Disdain for best-seller lists and envy over who’s on them go hand in hand.
This dual personality isn’t something that is suffered by Amazon and other successful online retailers of books (Christianbooks.com is one extraordinary and little known example). Regardless of Amazon’s foray into publishing, their whole ethos is that of a retailer, whether they’re selling books, toaster ovens, or cloud data storage.
The choice publishers have to make is whether or not they really want to be retailers. Compromises, like Random House’s Biographile.com aren’t encouraging, from my point of view. While it’s a lovely, content-rich site, well-curated and well-edited, it’s a hedge. When prospective customers decide they want to buy a book they’re shuffled off to third-party retailers. This just seems wrong-headed to me, for a few reasons:
- From a customer-facing perspective, the user experience lacks continuity; using third-party retailers as fulfillment vehicles forces the customer to click through to several sites just to see what price and/or delivery time the customer prefers.
- By relying on click-thrus to third-party retailers, Random House isn’t optimizing their direct-marketing expense and effort. Where’s the customer data, for example? Did the prospective customer actually buy the book when they clicked through, or buy another book? How are you going to re-market to that individual without contact information or data on what was bought?
- Biographile (or any such marketing platform) isn’t able to make its offerings more enticing to generate sales conversions. Coordinating exclusive discount offers, bundles of products, pre-pub enticements, etc.—all of this is a nightmare to coordinate via third-party sites.
My concern is that experiments such as this will only discourage publishers from discovering whether there is a viable role they might play as retailers. And the clock is ticking.
I don’t mean to pick on Biographile.com or Random House, a publisher with an extraordinary abundance of very smart and savvy people. This may be an intermediate move in the direction of direct selling. In any case, the investment in marketing platforms that are not retail sites highlights the fundamental question facing our industry. Is there a viable middle ground between the traditional publisher role and that of the true retailer? And, if not, to what side of the publisher-retailer spectrum will you (me, us) drift?
At some point in the not-too-distant future, when Amazon has a large enough market share, the question may be moot.
N.B.: On Mike Shatzkin’s blog post “Selling Direct Will Become An Essential Capability for Publishers to Have,” there’s much more food for thought on this question, and a great array of reader comments.
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37 Responses to “To Sell or Not to Sell?”
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Nice post, Peter. I couldn’t agree more with your point that the true business of publishers is connecting readers to content that matters. I take a pivot from there and try to view the world as the “average” book consumer (for what it is worth, I try to channel my mother so as to get out of my “publishing insider” mind). When I do that, I realize how difficult a proposition it is for general trade publishers to develop scaled, meaningful direct-to-consumer businesses. Amazon has an enormous first-mover advantage here in that they have consumer’s profiles, retail DNA and the resulting brand, and the (in)famous focus on service/price/ubiquity, etc. Could publishers do it? Maybe. But it would be nearly as radical a DNA overhaul as IBM transforming itself from a hardware provider to a consultancy. The question for me is, at what cost (particularly opportunity cost) could publishers stop drifting and make the concerted effort. That cost strikes me as very, very high. And a lot would have to stop happening for retail to come to the fore of a publisher strategy in a way that resonates with consumers. Massive risk, basically. The elephant in the room, though, is the DRM issue on eBooks. By insisting on it, publishers empower closed platforms like Kindle and iBooks. They’d need to develop their own or remove it entirely, both of which entail another huge cost or risk. In short (actually long now!), I think they could give it a shot but it would be an uphill effort and, maybe, not the one worth pursuing aggressively. That’s a matter of opinion. Thanks for a thought-provoking post!
Peter McCarthy
Thank you, Peter, for your thoughtful comments. I remember the work you did at RH’s Suvudu.com, so you’ve thought through all the relevant issues.
As regards the prospects for major publishers to “develop scaled, meaningful direct-to-consumer businesses” I think we may not be framing the question quite right. The major publishers are already in the “direct-to-consumer” marketing business. They just aren’t in the sales business (with the exception of MacMillian’s select imprints). What I still don’t quite get is why it doesn’t makes sense (at least for print, until the DRM issue is resolved) for Random House’s Biographile.com (and other pub’s marketing platforms) to fulfill the orders they are now ushering off to 3rd party retailers. Random House does have a shopping cart and could coordinate fulfillment of non-RH sales via Ingram. Then the experiment at Biographile.com would garner lots of rich, actionable, customer data. Of course, Amazon may have put the kibosh on that, or this may be an intermediary step. I don’t have the kremlinology credentials to even speculate.
The other point I’d want to make is that many, smaller, genre publishers have a very different opportunity with direct sales than do the big six. There are also some distributors looking to align their client publisher titles by subject so they can set up genre eCommerce sites that will perform direct sales fulfillment.
Thanks, again, for taking the time to share your thoughts.
Peter Turner
“whether or not they really want to be retailers”
I don’t believe DTC sales are nearly as critical as DTC marketing, because without the latter, the former would be pointless and ineffective. To make the kind of structural shift necessary for publishers to become viable retailers requires an investment in technology, resources, and staffing that in many cases might not make financial sense. It’s an easier shift for smaller niche publishers who might not have as strong a presence in traditional retail outlets and are managing small lists, but for a Random House, the volume of direct sales that would be necessary to make it worth it (aka, profitable) is probably unrealistic.
Guy LeCharles Gonzalez
Great to see your comment on the post, sir. Interesting perspective. I wonder, though, since sites like RH’s Biographile are already investing a considerable expense in direct marketing, why not capture the sales–at least that portion of the sales, print, that they can. Simon has similar marketing platforms and there are others, all driving the fulfillment to other retailers. Sorry to be dense, but I don’t see the advantage of publishers laboriously driving sales of their own and other publishers titles while not capturing the sale.
Peter Turner
You’re discounting the resources required to run an effective ecommerce operation. Adding the shopping cart to your site is the easy part, but you still need staff to manage, merchandise and market the platform, and that’s a very different skill set from what traditional publishers are used to, even those with solid direct marketing experience. Partnering with an Ingram, et al, eats into your margins, and if you go solo, shipping and handling expenses have to be factored in, and few publishers will have the scale required to keep those expenses down.
I’m not saying it’s a bad idea, per se, but it’s no slam dunk for all; it’s a more complex shift than most people realize or acknowledge.
Guy LeCharles Gonzalez
Thanks, Guy. I don’t think I’m discounting the hassle and cost of managing a d2c sales biz. (For what it’s worth, I actually managed a d2c book business and do have a sense of the staffing costs.) As you know, Shipping and handling costs are covered by the customer. And while you’re right, Ingram would eat into margin. But in the case of a publisher owned, publisher-neutral, marketing platform like Biographile.com, any non-RH sales via Ingram would be found money.
I do totally agree that the skill set is different (publishing vs. retailing) and it may not be in publishers DNA. I’d suggest they get a gene splicer double-quick!
Thanks again for your comments. Great conversation.
Peter Turner
Marketing platforms without access to consumer data are doomed to fail. I agree it’s difficult and expensive –maybe beyond the means of publishers– for a general publisher to change their ADN and their own focus on work-flow and internal organization, but they will be nix to being only content providers –not the most profitable option in the digital world– if they don’t.
Publishing, to succeed and survive in this changing times– have to understand that data strategies have become even more important than content marketing strategies.
I recently wrote a piece on an interesting experience at Random House Mondadori Spain, published on Publishing Perspectives. It’s not revolutionary in the sense that it didn’t imply the D2C shift, but using trackable QR codes in a promotional campaign in the commuting railroad network, they’ve been able to gather consumer insight that the company never before had access to. Besides, that direct consumer insight gained challenges previous assumptions about readers’ preferences. What you get from the retailer, if you ever get anything, is of no use to orient your editorial and publishing strategies.
Not to repeat myself, I invite you to read the short piece in PP.
Julieta Lionetti
Thank you, Julieta, for your comments, which are wonderfully put. “Marketing platforms with access to consumer data” are doomed to fail–that hits the nail right on the head. Only thing I’m not sure I agree with you is that content marketing is less important than data strategies. I’d say they go hand in hand. Good content marketing gives you good actionable data, and in term improves your content marketing strategy.
I will go read the piece on Publishing Perspectives. Here’s the url for anyone else who’d like to follow up as well: http://bit.ly/NDgyEg
Peter Turner
I tend to agree with Guy and Pete M. on this one – the emphasis should be on the marketing rather than the selling. Two items not mentioned above which are relevant: channel conflict (which grows in proportion to the strength of the efforts by publishers to SELL direct) and conversion. Once you’ve invested the energy and $ to attract someone to your site and have them interested in your product, the last thing you want to do is to get in the way of a sale. There’s a lot of friction in having a consumer create an account, enter credit card info, etc., especially if they already have an account at a retailer such as Amazon or BN.com; I think you’re much better off making it easy for them to click over to a place where they are used to doing business….while making it an option (as RH does) to do the purchase with you if they choose to do so.
Andrew Weber
Thanks, Andrew, for chiming in. Interesting perspective, and the prevailing view among publishers (and among the folks commented on this post, I guess!). I do have a tendency to be contrarian, but in this case I think there’s good evidence of a missed opportunity in retail for publishers.
Take Christianbooks.com, for example, an eCommerce site for Christian books of all strips, with 2.5 million unique visitors per month, as estimated by Compete.com. They’ve been around for 30 years, so I have to assume they’re financially viable, though I don’t have any direct knowledge of this. When they make a sale, their margin is less than it would be if they were also the originating publisher of the same book. Imagine, for a moment, if Christianbook.com was owned by Harper–with their Zondervan and now, Thomas Nelson, divisisions. Wouldn’t Harper do better financial overall, rather than push customers to 3rd party retail vendors?
The key to Christianbook.com’s success (I’m making that assumption here) and that of niche publishers like Shambhala, Chronicle, SoundsTrue, New York Review of Books, etc, is that they offer something other than low price and ease of ordering–they offer value in some way Amazon doesn’t or can’t. Again, I know I have a contrarian streak a mile wide, but my experience at Shambhala informs my view here. Every person who buys from Shambhala.com knows they are paying more than they have to, that they’ll have to open a new customer account first time around, and that their UX will be inferior.
What I take from this and other evidence is that people buy for a variety reasons. If you can deliver value to a significantly sized-interest group (which is what Random is doing with Biographile.com) then you can create life-time customer value for your investment of marketing dollars. I’m doubtful that one can sustain the cost of this sort of effort without customer data (to allow re-marketing) and the improved margin of selling direct.
Curious to hear your thoughts on this. In any case, thanks again for your comments.
Peter Turner
I agree with you that people buy for a variety of reasons, sometimes including a desire to buy from anyone other than a big player.
I also agree that profitability *could* be maximized by controlling the entire value chain from publishing through to retailing, but with the caveat that the dna required to be a successful retailer is different from the dna required to be a successful publisher.
It’s not hard to imagine it could be advantageous for a large publisher to run/control a big direct-to-consumer retail operation, but there’s a big challenge in how you get there as you’d have to be willing to endure the impact of any response from Amazon/B & N/etc.. If one were absolutely convinced that selling (not just marketing) direct was key to future success – and that you could do it well, you’d be willing (maybe) to take on that battle, but if you weren’t convinced (as I’m not) – it would be an awfully tall order.
Andrew Weber
Thanks, Andrew. I agree completely, it will be a tall order. And before risking having your knee-caps roughly removed, a major publisher like Random would, as you say, have to be reasonably assured that the project would work. Perhaps Biographile.com is an opening move, focused on building out the platform model for dozens of similar genre sites, which would sell direct. I, for on, hope so. It’s bold and risky, but at least it’s a worthy experiment, in that case, and laying for true transformation. I feel like anything short of dramatic change is going to spell certain doom for the big pubs. Thank you for continuing the conversation.
Peter Turner
A general comment, not really a reply to anyone’s comment in particular: I wonder if the fundamental question isn’t whether publishers should retail or not. More to the point is whether the ROI on acquiring customers (as opposed to prospective customers) is worthwhile or not. An experiment that would test this isn’t being embraced by the large general trade publishers, though it is being at least explored by any number of smaller, niche-oriented publishers and retailers.
Peter Turner
On this topic: I was struck by a remark by Rebecca Smart, the CEO of Osprey, talking about her company’s direct selling efforts, which include eschewing DRM. She explicitly said that her strategy was to find customers to whom she would make sales repeatedly. Because that was her strategy, she wasn’t worried about what they’d do with the files after she sold them. I found this a really useful distinction. Although I think that, ultimately, all publishers have to sell direct for the reasons I outlined in the post you cited, I can see that it is much more compelling for a niche publisher like Osprey for the reason Smart clearly articulated. Random House and other big pubs are not going to rely heavily on repeat sales as long as they have a “general” model for deciding what to publish. So, in that case and understanding that every company must have priorities, the way they’re doing it can make sense from their point of view.
Mike Shatzkin
Thank you, Mike, for joining the conversation. Your comment on the relative value of repeat marketing hits the nail on the head. I’d suggest that the era of “general” publishing” is over but that pubs who publish in many niches have the opportunity to realign their content assets (and acquisitions and marketing resources) by customer-orient categories of interest. Maybe then repeat marketing, to customers identified by their interests, becomes as viable for the general publishers as it does for niche houses like Osprey.
Peter Turner
One point I failed to make earlier: I believe any niche publisher can and should go direct. I also think have they opportunity to innovate on what the marketing and even the “transactional” relationship looks like. Osprey is a terrific example. O’Reilly is always the bright, shiny object in this space with their no-DRM, multi-platform eBooks, conferences, Safari access model, etc. They do a lot of this right and really get it. The lessons to be learned from them by other niche publishers are many. Of course, the niche players also *need* to do this. Amazon has never been a good account for them, for many reasons, and they are often competing against free. For the general trade houses, Amazon still moves units, which engenders a sort of Stockholm syndrome.
I actually wonder about models beyond straight file-purchasing. Subscription services tied to the social graph could — *could* — be fascinating. To me, they are the more interesting play for the majors — either on a genre, vertical, or cross-list basis. Spotify for books, basically. Mr. Shatzkin analyzed this today over at http://www.idealog.com/ and came out against such a model for general lists but possibly for niches. I am still up in the air…but interested for sure.
Peter McCarthy
Thanks, Peter, for your additional comments. One question, just to provoke further thought: isn’t the distinction between niche publisher and general publisher a distinction without a difference if the general publisher aligns content by niche? It’s how we present our content that describes what sort of publisher we are. I tend to think the distinction between niche and general is really an artifact of imprint-oriented thinking vs. genre-oriented marketing and sales.
Peter Turner
I agree that the distinction is moot if and when a general publisher niches its list for marketing purposes. 100% agree. It’s just that the general ones don’t always do it.
Peter McCarthy
Hey Peter,
Thanks for pointing to ORM as a shiny example. We’ve worked really hard at driving our customers to purchase direct, and to make it worth their while to do so. Just wanted to note that contrary to what you suggest here, Amazon is an important account for us. I don’t think we’re alone here – many of my colleagues at niche publishers rely heavily (sometimes very heavily) on their Amazon sales. It’s the nature of the long-tailed beast, so to speak. There’s not much shelf space devoted to nichey titles in the b+m stores that are still standing, so being as visible and as widely available online as possible is all the more crucial for niche publishers. That means being on Amazon (like it or not). They move units for niche players, too.
Kat Meyer
Just to be clear, I think it was Pete McCarthy who posited that Amazon was less of a factor for niche publishers. I don’t have any data on that, though I know that Amazon’s market share while I was at Shambhala was very significant. In fact, that was one of the reasons why we wanted to build up the d2c business (got up to 12% gross revenues) as a hedge against their online marketshare.
Peter Turner
Yes. I was replying to Peter McCarthy. All you Peters are hard to keep straight.
Thx for clarifying though. ~ Kat
Kat Meyer
No worries. Happy to be confused with @PeteMcCarthy any time.
Peter Turner
Thanks, Kat, for sharing on ORM. I was always under the impression that AMZ under-indexed for you all relative to the major general trade folks. But, I am very likely wrong. Appreciate your reply!
Peter McCarthy
Well, at least we’re getting away from the usual one-size-fits-all, “publishers must…” tone that dominates most discussions of this sort. I agree, generally, that niche publishers definitely have a more logical path to direct sales than big trade publishers, but I’d still argue that direct sales is not the end-all, be-all of direct consumer engagement.
Its viability will vary depending on the publisher involved and the community they serve, but as Julietta noted, there are many ways to get actionable user data that don’t involve becoming a retailers, and it’s that opportunity that MUST be tackled first and foremost, because without that expertise, having a shopping cart on your site will be as effective as launching a MySpace campaign for a series of business titles.
PS: It’s also worth noting that there are far more niche publishers ALREADY engaged in direct sales, print and ebooks, most of whom fly under the radar in these discussions because, really, most people are usually talking about the Big Six, no matter how many times they type the word “vertical.”
Guy LeCharles Gonzalez
You’re right, Guy. A surprising number of niche publishers have been actively selling direct for a while now. Most of them either came out of magazine space (e.g. Interweave, Tauton Press, F&W, Chronicle) and there are also a surprising number of niche book retailers giving it a go, often in the religious or spiritual landscape (e.g. christainbook.com).
One question I want to keep in the foreground, regarding general publishers, is why they can’t realign themselves for the d2c market along genre lines. Then any general publisher is a niche publisher (of many niches). The DNA problem is still there but the expertise that allows a generalist to be a niche marketer can be brought in-house.
Curious to hear your thoughts on this as you’ve been there when you were at F&W.
Peter Turner
There are many small genre imprints that sell direct and fly under the punditry radar, including a variety of RPG publishers who’ve been doing so with PDFs long before the Kindle ever launched. Once you take the 10-15 major trade publishers out of the equation, you’re probably left with a majority of publishers having some level of direct sales in the mix.
While niche imprints at big publishers have the potential to do a lot better at direct marketing to readers, I suspect their ability to launch a respectable direct sales effort is hampered by their larger corporate structure. You can hire the expertise, but if direct sales aren’t a core part of the larger corporate strategy, the chances of success are limited and the likelihood of it even getting off the ground is slim. F+W, which is made up of 15+ distinct “imprints,” certainly didn’t nail ecommerce on the first try, but because it was decided that direct sales would be a core part of their strategy for the future (before Borders finally went under), and there was already a connection to readers via the magazines, it was an “easier” process that still took a couple of years to refine and gain traction.
I’ve said often that publishers don’t get enough credit for the experiments they do undertake, and then are criticized for moving too slowly, but usually those critics haven’t worked within a larger organization before, or are willfully ignoring the realities of pushing major initiatives through multiple teams of stakeholders who may not all be on the same page.
Guy LeCharles Gonzalez
Thanks, Guy, for continuing the conversation. “Publishers don’t get enough credit for the experiments they do undertake, and then are criticized for moving too slowly” and that “usually those critics haven’t worked within a larger organization before.” That’s a fare point (and certainly applies to me, though I worked at a small publishing house that was distributed by Random House, so I guess I have some sense of it.)
I don’t necessarily fault what from the outside seems like “moving too slow,” though I do worry that Amazon’s market share will at some point approach the point where much of this discussion will be moot.
I frankly don’t hold out a lot of hope for the large publishers, especially those who are publicly traded as any proposed significant, systemic move, will come with major downturns revenue projections–a dynamic that may be a partial cause of what seems like slow movement.
One last point. I’m starting to hear more speculation about what the end game is and what a post-Big Six era might look like. I suspect there are a lot of slidedecks in VCs’ inboxes looking to carve pieces up. That’s a gloomy note to end on. My apologies.
Peter Turner
Publishers who don’t invest in a better direct channel are missing out. I was mortified at BEA when a senior manager from a big six publisher said she didn’t see a reason to build a strong direct channel. Unfortunately too many other publishing executives agree with her point of view. More importantly, too many of the others who want to try the direct channel are going about it all wrong.
What I don’t see being asked in this discussion is one simple but very important question: Why would a consumer want to buy from you rather than Amazon or B&N? Just about every publisher offers a direct channel with catalog pages on their website but very few give customers a reason to buy from them.
At O’Reilly I like to say the reason for our direct sales success is our worst-kept secret: DRM-free and multi-format purchases. IOW, when you buy from us on oreilly.com you’re not stuck with DRM and you have access to all the popular formats (mobi, EPUB, PDF). The truth is only the second point is unique; anytime you buy an O’Reilly ebook from Amazon or another retailer it also comes DRM-free. So why do so many people buy ebooks on oreilly.com?
The main reason is our website is much more than just a set of catalog pages. It’s a destination for our customers. They’re coming there for plenty of other things, not just to buy ebooks. Our website isn’t just an ecommerce site. It’s a community site first and foremost.
Publishers can’t just open a website and expect customers to buy direct. Amazon is like a giant magnet and you need to offer your customers a reason to come to you instead.
So before a publisher gets too excited about the direct sales opportunity I hope they’re asking themselves “what makes us unique and why would a consumer want to buy direct from us?”
Joe Wikert
Thanks, Joe, for joining the discussion. You’re admonition at the end of your comment is the crux of it, it seems to me. “[B]efore publisher[s] gets too excited about the direct sales opportunity I hope they’re asking themselves what makes us unique and why would a consumer want to buy direct from us?”
You all at O’Reilly have found a key, if not a unique, value that customers appreciate. Other publishers, niche and otherwise, have value they can deliver that other online retailers can’t. I learned at Shambhala that customers were willing to buy direct, almost defying any logic, as they all must have known that they were paying more than they had to, were going to get worse customer experience, and that they’d need to set up a new customer account (while they likely already had one at Amazon). The lesson was that people buy from retails for many different reasons. Our role as publishers turned retailers is to amplify that reason, that value, for potential customers.
One question I’d ask you, Joe, is what happens to O’Reilly’s D2C efforts if DRM becomes a mute point and one of the key advantages you all offer your direct-to-consumer market becomes common place?
Peter Turner
Nothing would make me happier than for DRM to completely go away, Peter. As I mentioned in my earlier reply, since all O’Reilly ebooks are available in DRM-free format from other retailers I wouldn’t say that’s an advantage for oreilly.com. What is an advantage, however, is that multi-format feature. When you buy from Amazon you get a .mobi file for your Kindle (or Kindle app). When you buy from oreilly.com you get the .mobi file plus EPUB and PDF, so you can use it on pretty much any reading device out there.
On a related note, earlier this year I wrote a blog post with the title, “What if DRM Goes Away?”. Here’s a link to it: http://bit.ly/I5ANhN
Joe Wikert
I guess what I’m wondering is if you see DRM-free publishers offering less value in a books-in-browser world.
Peter Turner
Not necessarily. To me it’s not so much about DRM as it is about creating community and a reason for customers to buy from you rather than somewhere else. As I noted, we’re competing against Amazon in a totally DRM-free world and we’re doing quite well. But we wouldn’t be in this position if we hadn’t spent so much time and money making oreilly.com an attractive destination for our customers.
Joe Wikert
Right, Joe. I had forgotten that your books are permissioned for simultaneous device usage on Amazon. The heat must be getting to me.
Peter Turner
Hi Peter (and everybody else),
Nice web site.
Congrats on successfully creating a forum for this lively discussion.
When we rebuilt Chelsea Green’s web site & marketing several years ago our first priority was to build a community around our clearly-defined (and exploding) niche. We wanted the site to be a destination and repository offering the expertise of the authors. We optimized our site and content for laissez-faire social media promotion—to aid in content discovery. (We also pushed content to larger sites in our niche, with their help.)
My goal was to create a positive-feedback loop where our content on other sites drew visitors to our site, who in turn, pushed our content out to more sites, which, in turn, drew in more visitors. All my decisions were guided by this strategy. And, to that end, I would ask myself every day a form of the question Joe poses above, “Why the F*#%! would anyone care?!” If the content I was pushing was actually giving something to the people reading it—knowledge, advice, a laugh, etc.—then it would do well for us. (I didn’t always get it right.)
We needed to be an important player in the niche—for SEO purposes, for community purposes, for credibility purposes, and for sales purposes. We didn’t focus on building direct sales. We wanted to provide people with an easy option to buy direct, but we also wanted to make the sale as easy as possible for folks.
Here’s my quick takeaway: Niche publishers will have an easier time with D2C and marketing because it’s easier to build a trust-worthy brand when the brand actually represents something. The internet organized itself by interest or topic area. (…As is most other digital data.) Any content-producing company will have an easier time merging in if already uses that structure.
Thanks,
Jesse
P.S. Let’s hear it for Twitter’s ability to drive traffic to a post….
Jesse McDougall
Interesting post Peter – the comments have definitely provided some useful food for thought for research I am currently doing on publishers and D2C sales in the UK.
In publisher vs. retailer scheme of things, I wanted to ask what you (or anyone else here) thought might constitute a ‘healthy’ proportion of sales for a publisher to gain through direct sales channels? Especially where the larger ‘general’ trade publishers were concerned.
Given the take-up for direct sales in the UK has been somewhat slower than in the US, I also wondered whether you had any thoughts on why this has been the case, and whether you think it is likely that more UK trade publishers will soon follow the direct sales trend. As I generally understand it, one reason US trade publishers have made more progress in direct sales has been out of necessity (due to a lack of physical bookstores compared to in the UK), and another has been a more developed e-commerce culture. However it would be interesting to know, from those more informed than I, whether there were other, more important reasons for this disparity.
Julie Woon
Thank you, Julie, for your comments. Your question about what might constitute a “healthy” portion of D2C sales is a great one because it highlights how diverse opportunities are for publishers and this sales channel. I used to work at a smallish house and we hit 12% of total net sales via D2C. But, I don’t think there’s been any attempt to collect data on publishers D2C sales, so I have to venture an educated guess to provide any broader frame of reference. Perhaps other folks following this blog can offer their data or best guesses.
For major publishers, I’m sure the D2C revenue is <1% and I doubt there's much opportunity unless they build subject-oriented brands that will draw customers. The story is much the same for many mid-sized publishing houses, though there are exceptions, like Dover and Chronicle Books, who do pretty well D2C, perhaps 10%-25%? But, in truth, most publishers either don't sell direct to customers or they have a shopping cart on their site but do little or nothing to drive traffic. In short, what publishers are realizing D2C is all over the map. What would be "healthy"?--a whole lot more! What's possible D2C?--completely depends on the publisher and their strategic plans to invest in this sales channel. I kind of doubt this helps much in terms of your question. I'm sorry.
You'd also asked about the UK publishers, saying that they're slower to see direct customer sales than US publishers. That may be true though I wonder why you have that impression. I think there are more experiments going on at US publishers (for example, Tor's move to sell DRM-free direct and Random's new verticals like Biographile.com) but the jury is still out. Again, I hope others who know the UK market better than I do will chime in. I'll do what I can to stir them via Twitter.
Peter Turner
Hi Peter,
Thanks for the reply. I still find it interesting that D2C sales appear to be an area where larger publishers may not be able to leverage size to their advantage, and actually the more interesting opportunities are with independent publishers. I did wonder how publishers managed their own pricing against Amazon – whether the former would always be more expensive, or if there was much room for more ‘special offer’ deals.
Regarding the difference between the UK and the US, this was just the sense I got since the majority of comment on D2C sales has been from the US – though this might just be, as you say, due to greater experimentation in the US.
Julie Woon