A Whole New World

by John Gilstrap

Michelle had a schedule conflict, so she asked me to switch blogging duties with her this week. She’ll be posting tomorrow in my spot, but we should be back to normal next week–or to whatever masquerades as normal among Killzoners.

I am amazed and grateful and totally baffled at the thing that keeps on keeping on with my eBook sales. As I write this post on Wednesday evening, No Mercy continues to hold the #4 slot in Kindle sales, while Hostage Zero holds the #17 slot. That’s nine days in the top five and top fifty, respectively–much higher cotton than I have seen in a very long while. Making the deal even sweeter, I received an email yesterday from the folks from Books On Board, the world’s largest independent eBook retailer, informing me that Hostage Zero is the #3 bestseller there. That’s all wonderful. I even got a brief mention in the Wall Street Journal.

Here’s where it gets confusing: On amazon.com, the sales rankings for the print version of my books seem to be going the wrong way. Mind you, I have no idea how any of the rankings translate into real sales, but as I write this, the Hostage Zero sales ranking is well into five figures, while the print version of No Mercy sits at 2,896. (FYI, 2,896 in total sales means, according to the site, that it’s #72 in Books>Literature & Fiction>Genre Fiction>Action & Adventure. How’s that for splitting hairs four times?)

My point is that there seems to be a disconnect between print popularity and eBook popularity on amazon.com. I have no idea why, but I suspect that the mean demographic of the eBook buyer/reader is significantly different than that of the hardcopy counterpart. I think that the marketing model between the two camps is entirely different. For example, among eBook community (of which I am an enthusiastic member), word of mouth buzz–the Holy Grail of book sales–is many times more efficient. You hear a rave review of a book that sounds interesting, and you have it in your hands with a couple of clicks of a mouse. Combine the buzz with a price point that allows readers to buy two eBook thrillers by a new-to-them author for less than the price of a single eBook by a franchise author, and a runaway critical mass is easier to achieve. From there, the author and publisher pray that the momentum becomes self-sustaining.

If my suspicions are correct that the marketing models between print and eBooks are dramatically different, I think it’s clear that the difference is one-way–that eBook readers are aware of what print readers are reading, but not necessarily the other way around. When you look at the Kindle Top 100, the vast majority of titles are bestsellers in their own right in the bricks-and-mortar world, and became eBook bestsellers as a matter of transferred momentum. Problem is, it’s difficult for that momentum to transfer the other way.

Think about it. In my recent travels, I was disappointed to discover that Hostage Zero and No Mercy were both absent from every airport bookstore I visited. The spaces where they might have been stocked were filled instead with the paperback versions of the hardcovers that occupied the same spots a year ago–and then, only if the hardcover predecessor made The List. Given the price per square foot of retail space, it makes sense that airport bookstores would dedicate real estate only to the surest sales. In order to ride the momentum of a runaway eBook, those stores would have to order new stock and take a new risk in an economic environment that punishes risk takers. Extrapolate that logic out to drug stores and grocery stores and all the other retail locations that used to be outlets for paperbacks, and I think it’s clear that the mass market original is a format on life support.

On the flip side, though, I think the market for $25 hardcovers is likewise pretty bleak. It’s the price, not the format. As it is, bestsellers are discounted down to $15 or less in the Big Box stores, a number that is feasible only because non-bestsellers are still sold at full price to offset the lost revenue. The print side of publishing seems to be creating a retail environment where bestseller prices are unsustainable, cheaper options are difficult to obtain, and full-price hardcovers will have an ever-shrinking market consisting only of people who are willing to shell out five times more than they need to for the same entertainment.

It’s a whole new world indeed. What do you all think? When you look into your personal crystal ball, what does the publishing world look like five years from now?

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12 thoughts on “A Whole New World

  1. I think that 5 years from now there will be only one big box book store left and that e-books will represent 50-60 percent of all fiction sales.

    I also think that if publishers don’t wise up and realize that they are overpricing their e-books, they are going to put themselves out of business

  2. I’m not sure that I see the eBook sales model as being that much different than the existing Amazon.com sales model for print books. When I decide I want a book, I’m pretty quick to click the buy button. Sure, it takes me a couple of days to get it, but I probably don’t need it immediately anyway. I think the results you are seeing may be because the people with Kindles are likely to have different reading tastes than the average reader. But you may be following into a middle ground where people are interested in your book enough to want to read it but they aren’t interested enough to want it hanging out on their bookshelf.

    I don’t know what the future holds, but I think it’s possible that in a few years eBook prices will be higher than print prices. My argument for that is that the people who can afford to spend money on the latest gadgets aren’t really that concerned about getting great bargains. They will be willing to pay extra for a book they can read now rather than waiting for the printed book to arrive.

  3. When e-readers first hit the market, had no interest. What could beat the feel of a ‘real’ book? As a new Kindle owner (No Mercy – which was great – being the first book I ever read on one) I’ve found that the ability to read excerpts & order books for immediate ‘delivery’ is great. Since I read 2 or 3 books each week & travel quite a bit, the convenience (& lighter load) is another huge plus.

    Author Joe Konrath is selling e-books like crazy – currently pulling in about $14K per month, last time I checked, & most of his titles sell for about $3.

    If publishers offer ebooks at reasonable prices, buyers will be more willing to take chances on authors with whom thay’re not familiar. I think it’s a win/win for authors & readers.

    5 years from now? EBooks will dominate in the fiction department.

  4. I agree with the other posters about the ebook market taking the lead. But here’s what I’d like to know: Have you come across any research, John, about the genre of books that sell the best on Kindle etc? Seems to me it’s mostly sci-fi, thriller and mystery. Are literary titles selling like that? Women’s fiction? Westerns and romance? I wonder if authors in those fields will be able to do as well in ebooks. And if not, I wonder if you’ll see a lot of authors switch to sci-fi, thriller and mystery to get in on the action.
    Thanks for the post.

  5. The publishing industry pros seem to think that e-books will be about 50% of the market by about 2015 and none of them seem willing to say that e-books will end up closing down the print industry, although writers like JA Konrath are saying exactly that.

    I’m on the fence, but the question I ask that I don’t hear being answered by the publishing industry pros is:

    Part 1: If half of your market (versus product, I suppose) is made up of e-books that do not require warehousing, printing, paper, and avoids the returns policies, and if you can get pricing somewhere reasonable (whatever that is), how are you going to be able to justify the higher costs of print publication with the costs of paper, warehousing, etc.

    Part 2: And if, as a result of increased e-book sales, and higher-rising costs as a result of the print product itself due to decreased buying-in-bulk for paper, etc., won’t that mean you will have to increase the price on print books in order to cover costs, which will, as a result, decrease sales and push people more and more toward e-books????

    Or am I missing something?

  6. Mike, at ThrillerFest last week, Gina Centrillo, CEO of Random House confessed during a luncheon speech that she had no idea how the eBook was going to affect the marketplace in the long run. She did, however, tip her hand to a strategy to make an eBook into some kind of a superbook, a multimedia experience that will justify a higher price point. Publishers are terrified that price deflation will destroy their business model.

    This goes to Timothy’s point about a time in the future when eBooks will be more expensive than print books. The critical flaw in all of this logic, I think, is the failure to embrace the fact that deflationary pressure is a constant throughout the entire entertainment industry. Movies are a prime example. Hollywood is making more money than ever at the box office, but it’s on three-quarters of the ticket sales. The whole 3-D revolution is a strategy to “justify” $12-and-up movie tickets. I think it’s unsustainable.

    JaxPop, thanks for the plug. You and Mark both lean on the reasonableness of prices moving ahead, and I believe that’s key. Here’s the problem for the big publishing houses: They make their real money based on their franchise authors, to whom they’re on the hook for multi, multi-million dollar advances. Some of these run close to eight figures per book, with contractually required mega-tours and media campaigns. How can they begin to pay for that at a $9.99 per book price point?

    Publishers, like business people everywhere, are slow to wake up to a changing business model, and they’re making the classic boutique-industry mistake: They’re trying to manipulate the tastes of their customers instead of adapting to it.

    Rebbie, if you follow the link in my original post, you’ll see the Kindle Top 100, and from what I can tell, it’s a pretty eclectic mix of fiction, from literary to thrillers.

    John Gilstrap
    http://www.johngilstrap.com

  7. John, Maybe the publishers need to change their business model.

    At SleuthFest this past February I had a talk with agent Donna Bagdasarian about the added content or superbook idea. Frankly, I’ve owned a Kindle for 3 years. I only read on the kindle now, and all I want to do is read books on it.(I’m reading No Mercy right now by the way)

    There have been at least half-a-dozen books over the past several months that I have passed on because of price. These are authors that I used to buy in hardcover, but I won’t pay more than $9.99 for an e-book and I won’t pay more than $6.00 for a book that’s out in paperback.

    The sad part is that by the time the price goes down I’ll have forgotten about the book and moved on to another book, another author.

  8. Interesting numbers, John- and for the record, the fact that HOSTAGE ZERO wasn’t in airports is a travesty, plain and simple. I’ve been tremendously disappointed by the past few book by blockbuster authors that I’ve read. I sat down poolside with NO MERCY on Wednesday, and consumed it in one sitting- it even kept me from snorkeling, I was so engrossed. Then, the next day, I blew through HOSTAGE ZERO. They should both be at number one, in my book.

    On a side note- I think that this Thursday/Friday posting might have cause our synapses to cross. We both have characters with the surname “Calderon” in our most recent books. I laughed out loud, it was such an odd coincidence.

    Thanks again for the switcheroo…

  9. No biggie. John G. is stealing your characters by invading your dreams. Wait, isn’t there a new DiCaprio film about that? Never mind. He’s buying the material from Leonardo.

  10. Unfortunately, I think it will be very difficult for independent bookstores to remain competitive in the coming years unless they figure out a way to get into the ebook game. Sales on ebooks were up 167% last month, and I don’t see the growth slowing anytime soon.

    I wouldn’t be surprised if the US print book market goes the way of the UK market. In the UK, they have a couple of big chains (WH Smith and Waterstone’s), but most sales are through grocery stores and big box stores (online print sales I don’t know about, but I’m guessing their comparable to the US, which is low). I think there will continue to be a demand for print books, but anyone who thinks ebooks aren’t going to radically change the market is sticking his head in the sand.

    I agree that ebooks and pbooks are totally different markets. I have the same experience as John. On Amazon, the pbook of The Ark is ranked around 13,000 (that can change wildly in a day from 6,000 to 20,000), while my Kindle ranking ranges from 1,100 to 2,000. And the iPad version of The Ark is ranked in the top 15 Mysteries & Thrillers. So I think John is right that ebook readers can more easily act on recommendations.

  11. My sales are already predominantly in big box stores, groceries, and drugstores, interestingly enough (but then, my books are all MMP).
    I suspected it was something like that, JRM, thanks for illuminating me. Clearly I need that dream catcher to be flipped around so that it acts as a firewall…

  12. I’m getting more and more driven by instant gratification, so I predict a robust growth curve for ebooks. On the plus side for writers, a previously owned ebook won’t wind up being resold for .01 over at Amazon. There’s piracy to consider, of course, but pirates can already scan and upload a hard copy book if they’re determined to do so.

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