Business Musings: Heads, Sand, and Traditional Publishing (Fear-Based Decision-Making Part 4)
Something fascinating happened on the way to writing this blog post. The Big Four TV networks held their upfronts. And, as the Hollywood Reporter writes in their coverage, “What a difference a year (and a global pandemic) makes.”
In the past, the upfronts were where network television sold their fall shows to advertisers. The list would come out, big stars would schmooze the advertising reps, trailers would get shown, and critics would eviscerate some new shows and gleefully anticipate others.
Um…not this time.
This time, there were hardly any trailers. In fact, according to THR, the “buzziest” trailer was for the Friends reunion special that airs on HBO-Max.
What seems to have stunned all of the TV reporters who attended the upfronts is that the networks—all of them—focused on their portfolios. For example, NBCUniversal discussed the content airing on their various platforms. ViacomCBS focused on its “beautiful ecosystem” of “premium content.”
But here’s the analysis that caught me. From Variety:
As technology gives rise to piles of consumer data, the networks are no longer solely in the business of selling TV commercials. They are also working to define niche audiences, and then assemble them for sponsors eager to find the next great vein of soda-drinkers, auto-intenders and IT decision makers.
In other words, as JP Colaco, who heads up ad sales for WarnerMedia, told the gathered virtual attendees, “IP is the new primetime.”
Finally. Someone gets it. And as THR said, it only took a global pandemic for this to happen…to TV.
TV has changed greatly, and so, frankly, has book publishing, thanks to the disruption that was 2020.
But I’m not seeing the same kind of internal analysis from traditional publishers. In fact, an article on Jane Friedman’s Hot Sheet newsletter for March 31 reporting on Ingram’s marketing webinars was the closest thing I’d seen to any kind of analysis of the changes of the past year.
Most of the things mentioned at those marketing seminars could have been written six or seven years ago. Things like… publishers need to optimize online retail (well, duh) and online sales favor backlist (another well, duh) and pricing is important…and you indie folk see where I’m going here.
Traditional publishing is terrified of online sales, but can no longer deny that they’re important. That was the biggest change that came out of the pandemic, and even then, I’m thinking they will deny it.
Right now, the articles I’m seeing on traditional publishing glorify how first quarter book sales are up from the first quarter of 2020, and only a handful of article writers acknowledge that book sales fell off a cliff in March of 2020, only to be revived later in the year. So, if book sales weren’t up in Q1 of 2021, we’d all have a serious problem.
We don’t. Not only have book sales grown on all platforms—and these are traditional sales—but Amazon’s book sales went down slightly as consumers got used to buying on smaller sites.
From the Hot Sheet coverage:
Target and Walmart have performed well, and they even took away a small percentage of Amazon’s share in book sales (about 2.5 percent), according to Jess Johns, consumer insights manager at Ingram Content. This may come as a surprise, given the large increase in revenues that Amazon has reported, and it’s true that the pandemic has been very good to them. However, Peter McCarthy, director of consumer insights at Ingram Content, pointed out that the online retail marketplace has become more diverse during the pandemic, not less. People are willing to shop at many different types of stores; they pay attention to business and brand values as well as to the impact of their buying decisions on the community.
This is important for all of us, and I’ll deal with it in a future blog post somewhere down the line. But traditional publishing’s reactions to all of this is fearful and full of “yes, but.”
Backlist sells really well online because people discover books they missed in that short window at the bookstore. Rather than celebrating the rise of the backlist and sprucing it up for new-to-them consumers, publishers have gone into gloom-and-doom mode.
An April article in that company town newspaper, The New York Times, is filled with transitions like “publishers fear…” and “publishers worry…” Rather than quote from the article, I think you should just head over and read it. There are some interesting statistics in the article, but more hand-wringing than I thought possible.
As you read this, remember that frontlist in book publishing terms is prime time in television terms. And remember what JP Colaco said above: IP is the new primetime. Or in publishing terms, IP is the new frontlist.
Of course, traditional publishers miss this entirely.
From the Hot Sheet’s coverage of a panel discussion hosted by Publishers Weekly and Westchester Publishing Services comes this little nugget from Dominique Raccah, the CEO of Sourcebooks:
If the world that we are living in has moved from 65 percent frontlist to 65 percent backlist, then the fundamental infrastructure that we’ve all built into our businesses needs to shift to represent that. And that includes the efforts that we ask from our authors. We need to be talking to our authors in different ways and asking different things from them. That’s the question I think that’s fundamental, and I don’t know whether we have data on that. I certainly don’t. I don’t know if the shift that we’re looking at is going to be an ongoing one or whether we’re going back to having the same frontlist momentum we’ve had in the past.
Notice this: “I don’t know whether we have data on that. I certainly don’t.” And contrast it with all of that data-driven information at TV’s upfronts this year.
Traditional publishing has been terrified of data from the beginning. As long as I’ve been in publishing, publishers have fought against having accurate data—from sales figures to income levels. Even now, when data is easy to come by, traditional publishers have not hired data analysts to help them figure out what exactly is going on.
And Raccah’s statement about “asking different things” from their authors? The different things are weird. Because, with the exception of blog tours and increased social media presence, everything traditional publishing asks of its authors is in support of a system that developed over sixty years ago.
That system is dependent on brick-and-mortar bookstores to drive book sales and discoverability. Ask a traditional publisher how readers discover new books, and the publisher will tell you it’s through promotion and presentation in a physical bookstore. These people have no idea how to promote books in the digital space and they don’t want to learn.
Remember, these are the people who got sued by the U.S. Justice Department for ebook price fixing, so that they wouldn’t have to compete in the digital space. They want to “save” independent booksellers, but they’re not willing to make changes that would actually increase book sales.
In fact, many book sales have moved from the business-to-business model (publisher to bookstore) and become direct to consumer. No big book publisher is set up to do that and they should be. They’ve had more than a decade to set up those systems.
They’re actually complaining that backlist now makes up roughly two-thirds of book sales instead of monetizing that backlist, as the TV companies have finally learned how to do.
I should have compassion for the folks in the traditional publishing industry, but I don’t. The handwriting has been on the wall for a decade or more, and they’re refusing to look at the wall.
To be fair, most of the people who are employed at traditional publishers are young and new. The consolidation of the traditional publishing companies meant what it always means at corporations—the older, experienced people are forced to leave because they get paid the most, and in their place are young, new people who are credulous. They believe their bosses when someone says this is the only way to get things done.
And as I mentioned in earlier posts, younger people are even more terrified than their elders of rocking the boat and getting fired—partly because the younger person knows they lack experience and depth.
Last week, I mentioned that the TV/Film industry is the most fearful industry we’ll look at here because they deal with the largest budgets and the fact that each project needs to keep hundreds of people employed. Much as I dislike the fear in that industry, I understand it.
I don’t understand traditional publishing. The old ways of doing things have barely functioned in the 21st century. Publishers have gotten by because people love their product, but traditional publishers are like that old mom-and-pop restaurant on the corner with the best pizza. You don’t want to look in the kitchen to see if it’s up to today’s cleanliness standards, and you know that the equipment in there could catch fire at any moment.
Traditional publishing thinks we like it that way, when (to stretch the metaphor a bit too thin) all we care about is the yummy pizza. We don’t care how it’s made.
The pandemic proved to traditional publishers that people like and need books (well, duh) because book sales went up (fueled by the backlist). But as you can tell from the end of that Raccah quote above, traditional publishers are hoping things will go back to the way they were even though there’s a mountain of data that shows it will not.
For example, McKinsey & Company released a survey that showed that consumers will continue their pandemic behaviors into the post-pandemic world. In other words, even the most reluctant consumer learned how to navigate the digital space to buy things. Now, the ease and convenience of online sales has proven to be “sticky,” something consumers continue to want to do—particularly in the realm of books.
That’s bad news for traditional publishers, but their entire business model is based on the bookstore model. They doubled down on it—out of fear—when the Kindle started disrupting the publishing industry in 2008 or so, and they continue to double down on it.
Everything in this industry is based on fear. If a book doesn’t sell “well” out of the gate, then the traditional publisher pulls the marketing budget, hoping that something new will sell better. (In a world where backlist rules, that decision is beyond stupid.) Writers need to fit into certain patterns and trends, which is why we got so many billionaire sex books after E.L James and why there were so many Gone Girl clones a few years ago.
Just like in the movie-TV space, it’s easier to sell a book that’s Gone Girl only written in the style of James Baldwin than it is to sell something brilliant that is its own thing. This is why indie (self) publishing has done so well, but no one looks at that data.
I’ve never seen an industry more data-resistant than traditional publishing. And in a digital space, where data can enable greater sales, that’s a kiss of death.
The more I read about where traditional publishing is going in this new century, the more I wonder why any writer with sense would join traditional publishing.
But we’ll deal with that fear next time. Because it is a fear, and nothing more.
Unlike parts of the TV industry, the publishing industry did not use the time during the pandemic to accelerate its move into the future. If anything, traditional publishing seems to be doubling down on its relationship with the past.
That’s what terrified people do. They make clingy decisions out of fear rather than decisions that require a bit of risk that would lead to massive growth.
The pandemic proved that there are hundreds of thousands of readers out there who are hungry for books that are new to them, books they won’t discover in a brick-and-mortar bookstore. (In fact, studies have shown that most readers do not live in a community with a single bookstore.) Basing all of a company’s decisions on an outdated model that hasn’t really reflected consumer behavior in this century at all is willfully ignorant at best and stupid at worst.
The consolidation in this industry will continue until some parent company realizes just how much IP it has purchased—and somehow figures out how to organize the mishmash of files and bad contract storage to weaponize that IP.
But that’s in future—and judging by the behavior of the people in charge of traditional publishing, that’s far in the future.
I’d say too bad, but there are other parts of the industry that will step in. For those of you who didn’t see the 2019 blog posts on this from me, you can pick them up in Rethinking The Writing Business. Which all of us should do, now that we’re moving out of this pandemic.
We need to rethink everything.
Only some of us—and I’m looking at you, traditional publishing—are too terrified to do so.
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“Business Musings: Heads, Sand, And Traditional Publishing” copyright © 2021 by Kristine Kathryn Rusch. Image at the top of the blog copyright © Can Stock Photo / khunaspix.