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Thursday, September 22, 2011

How About Making Some Money?

Too much of a good thing could kill the market – or at least force consolidation.  This is true for most industries.  Truth is, we need someone to be a clear-cut leader, the near monopoly that everyone else loves to hate but benchmarks themselves by.  Baseball has the Yankees.  Smart phones and tablets have Apple.  Online search has Google.  Social networking has Facebook. Fast food has McDonald’s.  Online book sales has Amazon.  And so on.  It looks like all of the daily deal sites need to fold up so that a few can succeed.  The Wall Street Journal reported the other day that a third of the daily-deal type sites have shuttered or were sold this year.  Take a look at the most visited sites for one-day sales offers and the share they have of the market (as calculated by the number of Web site visitors):

·         Groupon 47.6%
·         Living Social 29.5%
·         Eversave 10.6%
·         Deal Find 3.6%
·         Bloomspot 1.7%

The rest account for just a few percentage points, combined.  And yet it is questionable if any of these sites are actually making money, due to start-up costs and advertising.  That’s the thing with e-commerce -- so many sites develop a name for themselves but not so many are making real money.  They may get investors and issue an IPO but all of this is Ponzi-like speculation.  When it comes to really creating and selling a service or product that makes a decent profit, many are  challenged. Even Groupon is bleeding red ink.

So when you read about this company or that company with huge followings, probe a little deeper and see if they are really making any money.

Authors and publishers should be aware that the e-book gold rush is also overstated.  Just because costs to produce  an e-book are lower than printing books does not mean they are assured of success.  You need to market and promote the e-book and work harder at it since books lacking shelf-space miss out on accidental or point-of-purchase sales.

Book publishing was stronger when there were a few, well-established gatekeepers, both on the publisher side and the retail side.  Increased competition isn’t necessarily bad but now there are too many “publishers” and too many ways to sell a book and all of that choice, convenience, and democratization of the process to publish and sell may end up shrinking or stagnating the industry.

I envision more fracturing and diluting of the industry for several more years and then I envision mergers and the consolidating of some of the bigger players, and I see small presses or individuals joining forces in newly formed conglomerates, much the way some large distributors already represent hundreds of tiny presses.

There will be two clear worlds – those who publish  for profit and those that do so for fun, hobby, ego, or as a charitable venture.  This may be happening already but I think there will be a starker contrast over time.

Publishing will also phase in other multi-media, where books and video or books and music are packaged together or where books and membership blogs or Web sites are sold together.  It’s only logical that we see more bundling of media and information.  There’s so much of it out there and everyone’s competing for the same, scarce dollar.

But the real profiteers when it comes to the media appears to be the delivery service and the hardware maker.  Amazon makes money when selling the Kindle as does Amazon in selling the iPad.  Verizon makes money selling smart phones and service packages.  But what about the creative artist, the content creator?  He or she still searches for riches. 

Look at e-books and paper books. The average hard cover book may make an author around $4 per sale but only $2.75 for an e-book.  The publisher makes about the same amount either way.  If more sales go to e-books and there’s no increase in the number of sales, authors will start to earn less.  But Amazon makes money no matter what it sells -- printed book, e-book, Kindles, etc.

Maybe we should all be in the device-making business or become the utility service that data is sent over.  That’s where the money appears to be.



Interview With Cherise Fisher, Editor & Publishing Consultant

1. You have a 17-year publishing career and are the former editor in chief for Plume. In your opinion, where is the industry heading? I'm very hopeful about authors being able to share their ideas and stories with a wide group of interested readers. But I suspect that's not really your question. Your question is about the industry -- the behemoth that has developed over time to profit from authors being able to share their ideas and stories.

I started in publishing in the mid-nineties. That's not so terribly long ago, but the environment was totally different.  I didn't have internet access or an email address in the beginning. I spent a tremendous amount of time standing over fax and photocopy machines, assembling review clips, and scouring through Books In Print. Titles were sold by an army of sales reps who visited independent bookstores that dotted the United States. Having your book selected for the Book of the Month Club really meant something,  and the success of your book was closely linked to getting print reviews.  I can't speak to cause and effect, but I would say that the convergence of several things --the predominance of internet use, the corporatization of the major publishing companies (where the marketability of a book is at least equally important than the quality of the book itself), the  corporatization of bookselling (and the accompanying collapse of independent bookselling), the advances in technology when it comes to producing and enjoy books,  the rise of Amazon (which gave people not only an opportunity buy books outside of established routes at a discount, but also gave readers the power to review books) -- all of these things and more has accelerated a dramatic shift in the industry. I realize that I'm making generalizations that anyone can poke chock full of holes, but what I've witnessed over the past seventeen years is this: there was an elite group of people who made decisions about what should be published and an even more elite group who would tell the masses what was worthy of being read. And now the process is far more democratic. Readers and writers have a lot more self determination when it comes to books. I say that this is a good thing. Now the 600 lb gorilla, also known as the major English language publishers, are going to have to catch up by changing the way they do business -- or suffer extinction.

2. What do you love the most about being a part of book publishing? Being an editor both satiates and inspires  my curiosity about everything. It gives structure to my tendency to be bossy and talkative. But most importantly, publishing has given me joy in knowing that I am contributing to our world’s future, beyond what I can imagine. The truth is this: books connect people to each other through shared experience. And I think connection  is our most essential human impulse. It's a privilege to be a part of that process.

3. You are the Editor in residence at A Chapter a Month. What is that? What do you do there?  I am primarily a Developmental Editor and a Writing Coach.  But I am also the Editor in Residence for the wonderful website achapteramonth.com. One of my authors -- the talented, prolific, and entrepreneurial Victoria Christopher Murray -- figured out a way for readers to enjoy their favorite authors more regularly. Fans can buy a fresh, exciting chapter every month for 99 cents from a selection of popular authors, and give witness to how novels evolve. There are also writing workshops for aspiring authors on topics like character development, plot, etc. Every three months, as the Editor in Residence, I do a workshop through  live stream webcam, answering whatever question workshop attendees might have about publishing. I'm fascinated by what people want to ask me.

On September 28th, I'm starting a 10 week online writer's group. Whenever writers ask me for publishing advice in the past, I would tell them to workshop their book. It's so important for writers to get constructive feedback. Now I'm excited to be able to develop a group -- and you won't even have to leave your home to participate! Registration is going on now. For more information, see http://www.achapteramonth.com/index.php?option=com_k2&view=item&layout=item&id=124&Itemid=246

4. When you edit a book, how do you go about making it better without compromising what already makes it good? My first job is to be a reader, not unlike the readers who will eventually buy the book. I read a quote by Ursula K. LeGuin that really resonates for me: "The unread story is not a story; it is little black marks on wood pulp. The reader, reading it, makes it live: a live thing, a story." Writing is such a solitary task, and it is very natural for the writer can become insular, myopic. As a discerning reader, I can expose the writer to the impact of their words, apart from his or her intention. From there, it is a conversation between author and editor. I'm an editor who asks a lot of questions, and makes lots of "suggestions" (some more forcefully than others). The notes I offer are intended to probe. My ultimate goal is to fully dissolve into the writer's voice so I can magnify what he or she is doing well, and fortify what is lacking. If you approach editing that way, it is impossible to compromise what is working well with a book.

5. How come you’re not on Twitter yet? Ha! I get why celebrities would want to update their fans through Twitter. But I'm not a celebrity -- just a civilian trying to make a difference in the lives of authors and readers. Having said that, I was also late to Facebook, and now I love it. So there's hope for me and Twitter.

Brian Feinblum’s views, opinions, and ideas expressed in this blog are his alone and not that of his employer. You can follow him on Twitter @theprexpert and email him at brianfeinblum@gmail.com. He feels more important when discussed in the third-person.

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