Secrets and changes in publishing

A shift is happening in the literary publishing field. Traditional publishers are losing their hold on the market and independent authors have swooped in and claimed a space of their own.

I’ve recently read this article and highlighted the major points/takeaways from it. The article is in reference to the Penguin Random House (Big Five Publisher) trial back in August 2022. It was an interview conducted by Thomas Umstattd, interviewing Jane Friedman.

Friedman speaks openly about the trail and shares her opinion on the various topics discussed in the trial.

Let’s begin…

1. Reason for the trial

Penguin Random House attempted a merger with Simon & Schuster, another one of the big five publishers, that was blocked by a federal judge. It was theorized that the merger might cause a loss in earnings for authors (specifically) a small group of top earners, due to “soft collusion.”

Opinion: Honestly, I’m indifferent. That’s not because of some deep-set hatred of trad publishing or the margin of success/profit being concentrated to a small amount of authors, but because I know self-publishing is the route for me and there are plenty of other small to mid-sized presses available for authors to get the publishing they desire, if it would have happened or happens in the future.

2. The luck in trad publishing

Penguin Random House admitted that luck plays a far greater role in an author’s success. A quote from the company's rep. "We’re not that good a business. There’s so much luck involved, and we can’t predict the future. You can’t even take credit for it when it works.”

Opinion: First, I question, why must this be the case? I understand fully that 85% of books “fail”, which is based on the book not earning enough to re-coup the cost of production, but this is a major company with a plethora of resources, capital, and relations that could far better support the products it pushes. Yes, luck does play a vital role in any business, but no business, save for gambling and the like, should rely on it enough to quote on it as if it absolves them of the responsibility they have to the author’s they chose to represent.

3. 2% of revenue goes to marketing

When compared to other consumer goods industries, this number pales in comparison. The average for consumer packed goods, where this figure is percentage is applied, is around 9% to provide context. A million dollars in revenue can either be $20,000 in marketing capital or $90,000. 

Opinion: I understand the reason behind such a low figure, but it shouldn’t be the set benchmark for all deals. The reason being is that with each unique book deal, the cost for marketing could vary depending on the audience and the author. It’s about knowing both. An author with little to no following could benefit more from a greater allotment of funds toward marketing, while the other could get by with a smaller percentage. This doesn’t consider the work each individual author has to do in the time leading up to the release of their novel and after; plenty fail to put forth the effort up front and begin the process after publishing.

On the other hand, I could make a case for the 2% based on the access to resources the author gains or should gain when signed to a major publisher. That includes placement on a list for thousands of books sellers and librarians to make the choice for your work to be stocked on their shelves. I feel if the author takes full advantage of the time they have before publishing, 9 months to 2 years, they can make a noticeable impact on the up trend of their sales.

Publishers should also hire teams to conduct in-depth market research to understand the varying audiences the aim to sell products too.

Marketing is a two way street in my opinion and both parties should make an effort to pull their weight to maximize success.

4. Wait-and-see strategy

This strategy describes trad publishers practice of releasing a book and waiting for the market response to it. If it gains traction, whether from sheer luck or author effort, they put money behind it.

Opinion: I’ll refer back to my views on marketing, publishers should spend the money, time, and effort to understand each unique audience it publishes work for. Again, that’ll require dedicated teams to do, but it would be to the business and author’s benefit.

Now, it seems like best practice for both parties, wishing to sell a product, to do the work upfront to increase the potential for the book to gain traction upon release. But publishers should also understand that their attitude toward the process is a major component to their repeated “failures”.

5. Indie authors win ebook sales

Trad publishers failed to capitalize on the advantage of eBook sales they way indie authors have. This is due in part to their upfront demand for the rights to eBook and audiobook publishing, with a royalty rate benchmark set at 25%. 

Opinion: Trad publishers have shot themselves in the foot here. This practice has made self-publishing in eBook format more enticing to authors because of the 70% royalty rate platforms like Amazon Kindle Direct Publishing offer. Though it tapers off to around 35% when books are priced outside the $2.99-$9.99 range. Despite this reduction in royalties, its remains a big draw for authors looking to profit more from their work.

Figures show that 30-34% of all eBook sales are from self-published authors, sighting a significant market share belonging to indies. Publishers also run into trouble competing with indie author book pricing due to their business practices.

6. Royalties

Authors are not earning out their advances. Additionally, publishers have made a habit of overpaying for books when offering deals and fail to negotiate properly on advances and royalty rates.

Opinion: Author’s not earning out their advances could be the result of some of the topics discussed previously, placing partial blame on both parties. In regard to advances and royalties, publishers would fare better by knowing the audience and negotiation advances and royalty rates based on known factors.

For example: A book in the romance genre could potentially outsell a book in the horror genre based on the market. It’d be to the publishers and the authors benefit for reasonable advances and royalties to reflect the margin of success for any one particular novel in a given genre. The horror author might receive less advance up front but be able to gain more in royalties, whereas the writer of romance would benefit from a larger advance up front and lower royalties based on the potential for success. [This is just an idea].

Still, the success of this practice would require a change in the way trad publishers conduct marketing and connect with respective audiences.

7. 12 Copies or less

19% of titles published sale less than 12 copies.

Opinion: There isn’t much I can offer here that I haven’t stated already. One thing I’ve noticed about publishing is that each book is different. Some leeway can be given for books that are a part of a series, but it stands for all others. An author can have great success with one title and fail the next. It’s something I’ve seen played out in shows and movies or read about in articles. The publisher’s name behind the book is not enough, as well as the author. They simply require more in terms of effort and some luck.

8. Building author brand

Trad publishers neglect to build their author's brands due to a perceived disincentive where the more successful an author becomes, the more it'll cost to sign them.

Opinion: Consumer goods thrive of repeat customer base. You’d think a publisher with a “gold mine” author would do all they could to support that author. They’d only stand to benefit from the relationship. As an author success and popularity rise, so too does the potential for greater sales revenue. Publishes might benefit better from nurturing its authors and building them into the best-sellers of tomorrow. It’s a strategy that could make them a draw for more authors to seek to trad publishing deals.

Conclusion:

The structure and practices that trad publishing has been built on, needs change. Authors have much more affordable and accessible options for publishing that make trad publishing less appealing. There are many authors still seeking traditional representation and that’s perfectly fine, but they should realize the power they hold in negotiations today. As more authors seek to benefit from their work more, self-publishing is the welcomed option. Not that trad publishers need to be threatened by this, but if they aim to compete in an ever-changing market, they too must change as well.

To the self-published authors and those aspiring who read this. I hope you find this encouraging and it provides some reassurance in the decision you made to pursuit self-publishing. And to the trad authors and those aspiring, don’t be discouraged, you’re positioned to seek the best representation possible for your work.

There’s space for all of us here.

Thank you for reading!

[Links to the article/interview are hyperlinked in the names provide in the open paragraph]