Business Musings: It’s Up To You

Normally when I have blog with this title, I’m discussing the choices writers make in this new world of publishing. But this blog is different. This blog is about consumer choice.

I’m still reading Ripped by Greg Kot. This book, published in 2009, focuses on the changes in the music industry in the last fifteen years, changes that mirror the changes in the publishing industry. I’m reading slowly, taking notes, because I suspect I’ll be exploring many of the ideas he’s examined, only from a publishing perspective.

However, if you want to see where we’re headed, and what the thinking is behind some of the decisions that have already been made, take a look at Ripped. Sometimes the similarities are so self-explanatory that they’re breathtaking.

The penultimate chapter in the book focuses on Radiohead’s 2007 experiment with the In Rainbows album. For those of you who don’t remember or really don’t pay attention to music, here’s what happened.

Radiohead announced on September 30, 2007 that it would release the digital version of its In Rainbows album on its website. Fans could preorder, starting October 1, and pay any price they wanted.

The way Radiohead implemented this was simple: fans would use a checkout system that had a question mark where the price would normally be. When the fan clicked on the question mark, they got this message:

It’s Up To You

When the fan clicked again, the screen refreshed with this message:

No, Really, It’s Up To You.

Then fans could enter how much they wanted to pay—anything from 0 to $99 (because, apparently, the system wasn’t set up to accept any 3-figure numbers). The band also let their fans know that the music would be released in two other formats: as an $81 premium boxed set, and as a regular CD at, apparently, regular CD prices. (I have no idea, and am not looking that all up.)

Of course, this caused major consternation in the press and all kinds of gloom and doom about the future of music, the future of artists, and the future of the music industry.

From the perspective of 2016, it’s all pretty tame stuff. Bands have done this and more in the meantime. There have been all kinds of other promotions. Writers are now using similar methods on some of their projects.

Free is a price point as well as set-your-own price. I often participate in bundles that allow readers to get many digital books for set-your-own price (with usually some kind of minimum). Recently, I did a limited-time boxed set with several other writers on Amazon, offering our books as loss leaders for 99 cents. Not 99 cents each. 99 cents period.

Writers do all kinds of promotions. The consumers are getting used to these things now, and are reveling in their choices. Traditional publishers, initially resistant, are starting to experiment with these sorts of things as well, but with a twist—they modify their contracts and their royalty reporting so not a penny of earnings from the discount-priced merchandise make it the writer’s pocket. (Not kidding and yes, future blog post.)

But here’s the thing that we all forget, the thing never mentioned in all the price arguments, the experimental deals, the weird promotions, the thing that Greg Kot’s initial chapter on Radiohead reminded me:

You have always gotten to decide.

Consumers have been in the driver’s seat from day one. Before the internet, before indie publishing, before all the various changes, the consumer’s decisions were sometimes very easy:

Do I buy the $20 hardcover? Do I wait for the $7 paperback? Do I buy the book used? Do I get the book (essentially free) from the library? Or do I not get that book at all?

The difference for consumers came before the product ever hit the market. The gatekeepers strangled everything except the books/movies/music that appealed to a mass audience—as that mass audience was perceived by the gatekeepers.

It has become clearer and clearer that the gatekeepers didn’t base their assumptions on anything except their own prejudices. I use the word prejudices on purpose. The controversy surrounding the Academy Awards this year is just one example of the failure of the gatekeepers to recognize anything outside of their narrow worldview.

Consumers did not get to decide which products made it to the shelves. However, once the product was on the shelf, consumers decided with their dollars.

That decision was and is a very sophisticated metric. Because each consumer is different. Some want free everything. Some want to pay. Others want a physical object, and still others want to see/own/consume some item ahead of everyone else.

Each of these groups will vote for their method with their dollars (or with their downloads, in the case of the everything-free group).

In the early days of the Radiohead experiment, the write-ups focused on what Radiohead was doing as a way of cutting down piracy. Music piracy was a super big deal then, as the industry still reeled from its incredibly stupid response to Napster. (Suing your underage and impoverished customers for downloading your product—not a good business model. And, in fact, one of the few things traditional publishing is not mimicking from the music industry.)

Of course, the early write-ups missed the entire point. Radiohead got to make the album they wanted to make, and to release it on their own terms. Six years later, a hitfix analysis of the entire affair pointed out how the creative freedom of In Rainbows helped Radiohead:

…[In Rainbows] didn’t have to get final approval from a label, nor did its sales model have to sift down through the fingers of company shareholders. Radiohead found their feet and an updated sonic palate to make the album that they wanted, when they wanted, and get to keep most of the money afterward. If it weren’t for their indie revolution, they may not have sounded the same on spontaneous (and short) album King of Limbs, indulged in remix albums, one-off singles, new blood in the studio and on tour and given a whirl to projects like Atoms for Peace.

The band was not only reinvigorated creatively, but In Rainbows ended up selling millions worldwide, debuting on the charts at Number 1:

According to Radiohead’s publisher, Warner Chappell, In Rainbows made more money before the album was physically released than the total sales for the band’s previous album, Hail to the Thief.

Some of that was due to the extraordinary publicity around the pay-what-you-want release. But music, like books, is always about word-of-mouth. If the album had sucked, the sales would have tanked quickly.

But the album was good. Many music publications listed In Rainbows as one of the albums of the year. The album (or its producers) was nominated for five Grammys (and won two of them). In 2012, Rolling Stone ranked the album at 336 in its updated list of The 500 Greatest Albums of All Time.

Ancient history, right? Another medium, right?

No. Not at all. Because we can actually look back nine years and see all that this  experiment accomplished.

The one thing it did that can’t be easily measured outside of the band’s inner circle was put the band in touch with its consumers. Even the free-only consumers had to leave their email address and sign up for some kind of mailing list from the band.

And that’s a price, as those of you who get countless emails know. Just this afternoon, while shopping at a brick-and-mortar store, I shocked the clerk when she asked for my phone number and my e-mail address to fill out her computerized form. I said, “No, I don’t give those out.” She blinked at me in surprise, continued to process my purchase, and then said, “You know, you’re the first person to ever say no to that.”

I don’t always say no. I just don’t want to be on every mailing list on the planet. I’m sure you don’t either.

What none of the Radiohead articles got, not even the later analysis, is that the consumers really did get to decide. They got to decide if they wanted the album. They got to decide what format they wanted the album in. They got to decide how much they wanted to pay for the album. And they got to decide whether or not they would support Radiohead.

I have no idea if Radiohead was surprised by all of this. I know that I was when I placed a donate button on this website in 2009, and people started supporting the blog. (Thank you!) A number of you have asked me to do the same for free fiction on Mondays, but I can’t justify it to myself. I list that as free fiction, and asking for a donation seems wrong to me.

I started the free fiction in 2010, and it took about a year before I noticed something about consumer behavior regarding the stories. I only post the story free for one week. Then I take the story down.

After that week, several people buy the story. That doesn’t really surprise me: they read the blurb, think the story sounded interesting, and then get a copy. It’s the stories I sell during the week that surprised me. Those people know I’ll take the story down and they want to hang onto it.

For a while, I accommodated a lot of those folks with a Send To Kindle plug-in. Then Amazon stopped supporting the plug-in, and I had to take it down. Still, I expect a number of folks copy and save the story or download it onto some kind of file. Others actually make a purchase. (Thank you!) And then there are the purchases I can’t see—the people who buy a short story collection with that story in it or the novels the readers buy because they liked a certain short story.

For years, musicians complained when their music couldn’t get radio airplay. Airplay is important. It introduces consumers to music. Introductions work in all entertainment media. Introductions act as something that makes the consumer decide, yes, this is something I want to spend my hard-earned dollars on.

Loss leaders do it (stories for free for example) and so do bundles or anthologies or magazines or a loaned book or…a variety of things, things we producers of entertainment can’t always grasp.

But what things like the Kot book reinforce for me isn’t the value of free when properly used (which I have always known). It’s about choice and the strength of the consumer.

Traditional publishing—traditional anything in the arts—has always been about limitation. Traditional publishers make a book available in hardcover until the paperback gets released. Then the paperback supplants the hardcover. Shelf space is at a premium, so a hardcover book only stays on the rack for a month, maybe two or three if the book actually has legs.

Music—even music lucky enough to get radio airtime—only plays in rotation for weeks or maybe months (or, in the case of the Eagles’ Hotel California, for-freakin’-ever. Or maybe that was just my perception).

I’ve often blogged about the scarcity model in traditional publishing, and how traditional publishing used scarcity to get readers to buy a book immediately. (Buy it now! You might never see it again!)

But I almost never mention the other side of the limitations, the limited format.

Go back to the Radiohead example. The album was free in digital download in 2007. The album also had a limited edition boxed set with (I presume) extras) for the hardcore fan. And the album had a CD for those who didn’t want an MP3, but wanted a hardcopy format.

All were released within weeks of each other. And once again, the consumers could choose what they wanted.

They were in control. They chose from all of the formats. Some people only got the free download. Some only got the $81 boxed set. Some probably got all three formats.

But consumers could choose.

Consumers can also choose if they want something with mass appeal or something with limited appeal. I’m not just referring to the limited edition, although that does appeal to the hardcore fan and the hardcore collectors. But also to the fan who is interested in a certain type of music or a certain type of book.

As I mentioned in a piece earlier this year, it’s not just about the number of eyeballs any more, it’s about the fan base. When an artist makes 70% of the income off a project instead of 1% or 2% or even 10%, the artist can take risks. The artist has to sell fewer copies of something to make an actual living. And that allows the artist to experiment.

Fans can choose to follow the experimentation or they can choose to only buy certain items, or not buy anything at all, but still enjoy an artist’s work for free. I’m sure there are a lot of readers who come to this blog who have never donated any money or paid cash for any of my books. Yet these readers have read my short fiction and my nonfiction, and, I hope, have enjoyed it. Then there are the folks who donate a great deal to the blog or buy every book I write.

I don’t quiz my readers. I have no idea if the people who are reading for free are doing so because they can’t afford to buy books or because they don’t want to invest their hard-earned money into one of my books. And honestly, why they only read for free is none of my business. I make the works available so that they can.

I also don’t quiz the folks who buy everything. I don’t know if purchasing my work limits their purchases of other writers’ works or if these readers have money to burn. I also don’t ask if they read everything they buy. Again, that’s none of my business. I just try to make sure that I have the work in a format that will appeal to as many readers as possible.

The freedom of format, the increased choice, is what makes this modern world so good for artists of all stripes—if only the artists take advantage of their own choice.

Artists who offer their work in a multitude of formats respect their fans and readers and those who are casually interested.

Artists who offer their work in only one format are acting just like traditional businesses, be those businesses the music industry or the publishing industry.

Indie writers in particular are making this mistake over and over again. Their book is only available as an ebook, and exclusively on Amazon. There are no boxed sets, no trade papers, no hardcovers, no audiobooks. The books aren’t available on Kobo or in brick-and-mortar stores. The books aren’t even available on the writer’s website. (Okay, I’m guilty of that one, but I’m right now working to change that—expect to order books off this site by 2017.)

The constant unavailability mirrors what used to happen in the bad old days of traditional publishing. Back then (and sometimes now), the byzantine tangle of rights and rights management in the old days made it exceedingly expensive for someone in France, for example, to get an English-language copy of one of my books.

I was reminded of that just this week when a Star Wars fan in Australia tweeted to me and Del Rey, the publisher of Star Wars here in the U.S., that he can’t get a paper version of the Star Wars novel I wrote in 1995—not without paying a premium shipping price. For some weird reason, my Star Wars book is not available in paper in Australia right now.

Del Rey tweeted back that they do not control Australian rights. I don’t either.

If this were one of the books published through WMG, I could point this reader to a variety of places he could order the paper book online. I would have other ways to provide him a copy of the book for significantly less than he would pay through some jobber.

And, most importantly, the paper format of the book wouldn’t be out of print in Australia. WMG does what it can to make sure my books are in print in every country where it’s possible to have the book available. As each new market comes onboard, WMG enters it.

Sometimes that old scarcity model, those old limitations, rear their ugly heads. And think about this: Who is the idiot at Star Wars Australia (whatever the company is) that let any of the paper books go out of print in 2015-2016, as the new movie came out? Didn’t some genius there realize that these books would have a brand new market all over again?

Of course not. Because that would take thought, and a glance at the backlist, and no one in traditional publishing looks at their backlist.

Just today, we had a WMG meeting about our backlist. We’re sprucing up some of it, taking about changing other parts, revisiting pricing—again—and figuring out ways to make the old new again.

I love it when someone tells me how unsuccessful my books are because that person looked up one of my titles on Amazon’s Kindle bookstore and saw that the title’s ranking (for that hour) was low. My books are available in more places now than they ever were from traditional publishers. I’m selling books in a variety of formats all over the world, through a variety of distributors and bookstores and websites and all kinds of other places.

I’ll have numbers this year, because we finally freed up enough money to track the 500+ WMG titles through a detailed accounting program (instead of the thing the various distributors supply). It’s really easy to keep track of your one or two or ten books through Kindle-only. Now imagine keeping track of 500+ titles through dozens of different sites per title. Add subscriptions, and brick-and-mortar orders that came directly to that, as well as some of the other formats we use, and realize that Kindle tells only one tiny part of the story.

Because we’re trying to be unlimited. It’s not possible yet. We don’t have enough resources to be everywhere. We’re hoping 2016 becomes the year of the hardcover (as well as the limited edition hardcover on some projects), but we’ll see.

As we’re providing all of this choice, we’re keeping one thing in mind: the consumer gets to decide. You get to decide, based on your needs, your tastes, and your desires.

This new world has changed for consumers as well. They have more choice now. The traditional publishing world bemoans this. The tsunami of crap that they keep muttering about is really about them trying to tightly control the marketplace—put up limits. Yes, discoverability is hard right now, but that’s what word-of-mouth is for. You can now read a niche book on a small topic that interests only 1,000 people worldwide if you so choose (and if the author is smart enough to indie-publish). You can also read a blockbuster bestseller if you so choose.

It really is up to you, the consumer.

No, really, it is up to you.

And isn’t that the coolest thing?

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“Business Musings: It’s Up To You,” copyright © 2016 by Kristine Kathryn Rusch. Image at the top of the blog copyright © 2016 by Canstock Photo/adrenalina.