In case you haven’t noticed, we’ve been hit by a perfect storm in this decade. Borders went bankrupt; Walmart and Target sharply reduced their paperback real estate. Amazon opened its own romance line, Montlake, which means that one of the largest distributors of romance is now in competition with its own suppliers, the Big Six publishers.
Some people have predicted e-books will lead to the demise of the mass market paperback, but the opposite could be argued: Barbara Freethy self-published her backlist, hit #1 on the New York Times bestseller list, and those e-book sales fueled sales of her front list. No matter your point of view, e-books are a crucial game changer. Penguin’s parent company, Pearson, noted that in the first half of 2011, their e-book sales grew 128%, now representing 14% of Penguin revenues worldwide. At the same time, just as the iPad is starting to make inroads on market share, competition between the Nook and the Kindle has heated up.
Any one of these factors—by intensifying, failing, or succeeding—could dramatically change the future of bookselling. So I asked a bunch of very smart people, including authors, publishing professionals, and digital experts, what they thought was coming next. When asked about bookselling’s future, most people’s answers could be put in three groupings: the e-book market, bricks-and-mortar stores, and issues surrounding what’s being called “discoverability.”
This article touches on most of their ideas, but as Steve Jobs once pointed out, “you can’t connect the dots looking forward; you can only connect them looking backwards.” We have a frenzy of dots circling over our heads. Every once in a while all these different voices coalesced enough that I’m throwing out a prediction. (Please remember that I’m no Madame Esmeralda with a crystal globe!) But the most significant thing to keep in mind is that (in the words of Liate Stehlik, publisher of HarperCollins) “people are still reading and talking about books, despite the myriad of electronic media options that abound. The readers are still there & the format and how they discover books is what is evolving.”
The E-book Market
Electronically formatted books seem to be the focal point around which current author and publisher excitement—and anxiety—revolves. Everyone I surveyed considered the rise of eBooks (and their attendant eReaders) to be a good thing for bookselling. No one contested the idea that eReading will grow as a practice. Considering Penguin’s 128% increase in eBook sales in the first half of 2011 alone, one can conjecture there will be significant growth over the next five years, leading to considerable profits (at least in this area) for publishers.
That profit motive is, of course, a sticky point at the moment, as it concerns eBook royalty rates. Publishers maintain, quite rightly, that every book has nearly the same overhead: i.e., the printed book requires the input of an editor, copyeditor, art designer, and typesetter. Those people all need offices, as do the PR, marketing, and sales people. At the same time, authors point to the lack of printing and paper costs for eBooks, the absence of distribution costs, and the complete lack of a 50% return policy, which has always been the Achilles’ heel of the publishing industry. At this point, royalty rates shared with authors vary from as high as 70% of net (Amazon.com, with very limited distribution), 25% of net (the Big Six publishers), to as low as 3% for Harlequin (these numbers are being revisited). Is 25% a fair number? Not a single author I surveyed felt it was.
Prediction for the future: 100% unhappy authors means that number will shift in the not-distant future.
Should we be thinking about a reading future that’s almost 100% e-book? Author Linda Francis Lee, pointed to a possible correlation between letters and email: “In mid-November I read that the US Postal Service lost 5.1 Billion dollars in the past year partly due to increased Internet use driving down mail volume.” As nearly every household in America gains a computer, post office profits will only be further threatened. This makes it sound as if the post office and the paperback are headed for extinction.
But another place to look for parallels to publishing is the music industry, and there the picture is slightly different. Linda noted that while iTunes was launched back in 2003, digital music sales were only predicted to surpass physical CD sales for the first time in 2012. In short, iTunes downloads have only breached the 50-50 split mark after nine years on the market.
Quite a few people I talked to argued that consumers will likely decide they want both. Carol Fitzgerald, co-founder and President of The Book Report Network, foresees “bundling,” in which readers who buy print books are automatically given the e-book. Of course, that depends on books being formatted for every device. At the moment, Amazon will only allow the books published in its new lines to be read on a Kindle, thereby limiting authors’ (and their own) profits.
Prediction for the future: The idea that some books will only be available on one platform (Kindle, are you listening?) will go the way of the Dodo.
The biggest buzz in terms of the old-fashioned bookstore surrounds the growth of independents. When Borders went out of business, many towns found themselves without a bookstore—and independent bookstores are popping up to meet that need. Thousands of readers do want to buy physical books (count me as one of them). What’s more, so far eBooks are not making much ground in children’s books, one of the biggest markets for publishers. Parents need bookstores to shop in, and those bookstores will stock romance right alongside the Wimpy Kid. In fact, Wendy McCurdy, executive editor at Berkley, feels that “print books will still drive the market, even if its share of the market is less (for completely natural reasons) than what it was a few years ago—Just as movies shown in theaters drive the sale of DVDs and ‘On Demand’ viewings, etc.”
One example of a potentially powerful new independent in taste-making terms is Parnassus Books, which Ann Patchett (the author of Bel Canto and winner of the PEN/Faulkner Award) opened in Nashville, Tennessee, after two big bookstores there failed. In Salon.com she described her independent as “a second chance at the bookstore of our youth, my youth. The little bookstore. The bookstore where the same people are in there every day, and they know you, and they remember you, and they’re happy to see you—and they give you a book that they really like.” Patchett considers one of the most important factors in a bookstore’s success is its location and parking. Amy Pierpont, executive editor at Grand Central Publishing, would agree: “While many retailers have sophisticated algorithms to help us find new authors or tell us what they think we’ll like, as of yet they just can’t compare with the experience of being in a physical store, surrounded by an abundance of riches, all ours for the taking. Nor can they compete with the rhythms of our daily life, patterns that take us out of the house or office, and past the local B&N or Independent, or into Target or Walmart to run an errand.”
While many retailers have sophisticated algorithms to help us find new authors or tell us what they think we’ll like, as of yet they just can’t compare with the experience of being in a physical store, surrounded by an abundance of riches, all ours for the taking.
Several people focused on the importance of service in the future of bookselling. The growth in niche stores, those focusing on literary fiction, for example, or romance, strengthens customers’ reliance on trained staff. A niche store would hire truly passionate staff, those who can readily hand-sell new authors or books. Wendy Wax, author of Ten Beach Road, points to the value of that friendly presence: “I know I’ll still want to be able to walk into a store [even given e-book dominance], peruse the shelves and maybe ask someone I trust for recommendations.”
Another huge question that surrounds the store on-the-ground has to do with the future of Barnes & Noble. They seem to be aggressively pursuing both ePublishing sales (with their Nook) and physical bookselling in bricks-and-mortar stores. And they are likely to be on the forefront of a bundled print/eBook venture, given the strength of the Nook and the wide geographical distribution of their stores. “Romance continues to be a very strong category for Barnes & Noble,” according to Jules Herbert, buyer for Barnes & Noble. The stores, therefore, are widening their romance selection. “We just rolled out to all our stores a Harlequin Series Romance bay,” says Jules. “For the first time we will be selling Harlequin Series Romance in a uniform and consistent set-up.”
Connie Brockway had some interesting thoughts about how bricks-and-mortar and e-book venues may merge in the future. “I could see bookstores evolve into dedicated browser stores,” says Brockway, “in which case a bookstore would charge publishers to shelve their books, knowing that a healthy percentage of their clients may be browsing their stores, then going home and buying the book online. These ‘browser stores’ might also entice buyers inside by carrying dedicated ‘in-house’ platforms that offer some sort of discounts to the patron for downloading an e-book onsite. Of course, this, too, would have to be subsidized by the book publishers.” Let’s take an example: if Brockway followed Patchett and established Brockway Books, you might wander in to browse the romance section, and find The Other Guy’s Bride, written by Brockway and published by Amazon in electronic and paper form. So there you are, holding Bride, but you want it for your Kindle. No problem! Download the book right in Brockway’s Books, through her Wi-Fi server, and you’ll get an automatic 15% discount.
The point is that, while booksellers and e-retailers will certainly face challenges in the next five years, the chances are that we’ll be seeing whole new forms of bookselling. Amy Pierpont thinks that the competition will improve both venues. “Rather than one buying experience—either e-tailer or physical store—replacing the other as some fear, I think both will become better at what the other excels at. Physical bookstores will make the shopping experience more expedient—making sure they have copies on hand—or can get them ordered, and into customers’ hands immediately, as well as expanding their selection if they’ve cut out the midlist to carry more ‘brand name author’ titles. E-tailers will become better at discovery—at steering readers in the direction of new authors and new subjects, at personalizing the recommendation process.”
The question of the “recommendation process” leads directly to my final category: discoverability. Browsing shelves are how we discover new authors and fall in love with books we’ve never heard of. Teresa Medeiros (author of The Pleasure of Your Kiss) points to a recent study that showed one-third of all books and authors still being discovered in bricks-and-mortar venues. And she adds a useful warning: “As authors and industry professionals, we spend so much of our time on the internet that we sometimes forget a large percentage of the population doesn’t live out their entire lives online.”
As authors and industry professionals, we spend so much of our time on the internet that we sometimes forget a large percentage of the population doesn’t live out their entire lives online.
As more and more eBooks have flooded the market, one result has been blizzards of white noise. Midlist authors are dumping previously published romances onto Amazon for .99¢; other authors are writing mass-market originals at the rate of thousands a month. How on earth is a reader to “discover” a new author? Is she going to choose by price (all those .99¢ books)? How will she know if a book has been edited, or even checked for typos? We’ve all heard horror stories about the eBooks with no conclusion, or romances suddenly morphed without warning into a four-way erotica involving furs and feathers. Where can readers turn for guidance?
Significantly, all this is happening at the same time social media has changed our interaction with strangers. I would argue that authors are now the brands that matter, even more than publisher names such as Harlequin or specific lines such as Loveswept. Our book culture is increasingly author-driven, and social media seems to be commodifying the charisma of the authors who sell material on its platforms. This leads to the very real fear that big name authors will sell more and more, while other segments of publishing programs will sell less. “Big name and bestselling authors have a potential to get bigger in this new landscape with a built-in audience for e-shorts and backlist specials,” says Carol Fitzgerald. “Debut authors have the advantage of being new and being news as a result. Midlist authors who will have fewer places for readers to find them offline will be grappling with how to be found online. While this never has been easy, now it’s going to become even more difficult to find readers when languishing on the midlist.” As Liate Stehlik, points out, “e-shopping is very easy if you know what you want, but how do you discover the new author/book online if you’ve never heard of them?”
Fear of the invisible midlist is giving a frantic edge to authors’ use of social media. Of course, the “Author” has always been an advertising proposition. But now, an author’s work is literally never done. We update so often that we hardly have time to do anything worth updating. Our books alter as they’re being written, due to constant interaction with readers. I look back to the days of my first novels with sharp nostalgia. If I got a letter from a reader, it came in a brown envelope from my publisher, and I only got three of those in five years, mostly from one woman who lives in Canada. These days, letters pour into my website, Facebook page, and Twitter.
Publishers look at 28K fans on Facebook and see potential readers; frankly, I look at that number and see exhaustion.
Still, for all author complaining, the confluence of social media and author charisma is going to do more than sell that author’s own novels. In a blizzard of e-books, readers will look to names they trust for recommendations. Review sites are likely to flourish for the same reason. As Wendy Wax puts it, “Fewer stores and less shelf space in the big boxes will make online reading recommendations increasingly important.” Connie Brockway already has an online bookstore on her website; she thinks it’s likely that authors will band together to create similar sites, in some cases stocked with books they’ve self-published.
One of the more controversial ways by which readers might discover new authors is through cloud-based rentals. “I think that cloud-based rentals of books is going to be a huge benefit for us,” writes Lisa Kleypas, author of Rainshadow Road, “because it will encourage more sales and exposure. Especially when you consider the addictive nature of romance novels, it’s going to help authors at every level by giving them a chance to ‘hook’ new readers.”
At the same time that publishers offer authors support in reaching readers through social media, they are also trying to figure out how best to approach Facebook and other sites themselves. HarperCollins, according to Liate Stehlik, is investing in market research. They’re emphasizing “consumer marketing, creating and reaching out to various online communities, and then analyzing data and metrics to see what worked and what didn’t.” HarperCollins will focus on maximizing promotional opportunities with retailer partners, including strategic pricing optimization (and then having that analyzed as well). In short, in a perfect storm, almost every marketing tactic is an experiment that needs analysis to determine whether it proved a success.
As authors, we need to do a similar kind of analysis, albeit on a smaller scale. We should try out new tactics—in social media, marketing, or publishing—and then keep a sharp eye on whether a given tactic moves the bottom line. To return to Steve Jobs’ comment about the blizzard of dots that we won’t be able to connect for another decade: You still have to trust in something, he says: “your gut, destiny, life, karma, whatever. This approach has never let me down, and it has made all the difference in my life.”
I think we can all agree that his gut instincts not only made a different in his life, but in ours as well: a good role model to follow.
I spoke to a great many people while writing this article, and not all of them are quoted. Thank you to everyone who took time for their day to answer vague and unanswerable questions. I’d particularly like to thank my editor, Carrie Feron, who has mulled these issues with me over many a cup of tea. All mistakes are mine.
Eloisa James is the pen name of Mary Bly. She is a tenured associate professor of English Literature at Fordham University, who also writes best-selling Regency romance novels under her pen name. Find out more about www.eloisajames.com">Eloisa James.