Tuesday, December 11, 2007

the hidden cost of a Christmas best seller part two



Following on from my post a few days ago, entitled the hidden cost of a Christmas best seller, I started a thread along the same theme on my favourite writers discussion forum, My Writers Circle. I guess it is okay to post the article from the Times Online on here, as long as I provide a link, so here goes. It does somewhat set the scene.

"Every day thousands of shoppers decide to buy a new book because Waterstones prominently displays or recommends it. The reader may imagine that merit alone has inspired the country’s largest book chain to champion the volume now resting in their hands. The truth is a little less romantic. In a confidential letter to publishers seen by The Times, Waterstones has set out what it expects them to pay if they want their books to be well promoted in its network of more than 300 stores this Christmas. The most expensive package, available for only six books and designed to “maximise the potential of the biggest titles for Christmas”, costs £45,000 per title.

The next category down offers prominent display spots at the front of each branch to about 45 new books for £25,000. Inclusion on the Paperbacks of the Year list costs up to £7,000 for each book, while an entry in Waterstones Gift Guide, with a book review, is a relative snip at £500. To the despair of publishers, similar charges have become standard across the industry. The leading chains excuse them as a “contribution” towards marketing costs and recognition of a booksellers’ power to create bestsellers by heavily promoting select books. At Borders, bookshop staff vote to decide the book of the month, while schools are polled to find the children’s book of the month. But the publishers still have to pay an undisclosed fee for the chosen book to be awarded the accolade. A spokeswoman for W H Smith said: “Our premium promotion spaces are oversubscribed, which suggests that publishers feel they are getting value for money.”

Anthony Cheetham, the chairman of Quercus books, a small independent publisher, said: “It’s not a system you can opt out of. If Smith’s offer you one of these slots and you say no, their order doesn’t go down from 1,000 copies to 500 copies. It goes down to 20 copies.” One of Quercus’s biggest successes is The Tenderness of Wolves by Stef Penney. It won the Costa Book of the Year award for 2006 but will not make the booksellers’ Christmas selections unless Quercus pays the going rate, Mr Cheetham said. “The big chains will choose, say, 100 books of the year for Christmas but they will only put into their final selection the ones that are paid for.

“We are currently trying to decide whether we feel strong enough to say no and see what happens with that book if we don’t pay. It’s difficult, the only publisher who is in a strong position [to negotiate with booksellers on this] is Bloomsbury, the proud owners of H. Potter Esq.” The imbalance is becoming more marked, with one supermarket proposing to start charging publishers just to pitch books at them. “There is a genuine level of exasperation and anxiety in the publishing industry that the booksellers have gone too far down this road,” Mr Cheetham said. “It’s the reader who loses because it’s throttling the distribution of a wider range of high-quality books and [perpetuating] the system whereby you plaster the entire country with copies of the same few books.”

Neil Jewsbury, the commercial director of Waterstones, defended the charges and said that the quality of books chosen for books-of-the-year lists and other promotions was not compromised by money changing hands. “Our expert booksellers, with years of experience, decide on what the best books of the last year are,” he said. “It’s only after that that we enter into a confidential commercial agreement with the publishers to decide how best to feature and promote these titles.” But most customers are not aware of the practice. One leading figure in the publishing world said: “What the book stores are doing is what other trades do, whether it’s frocks or sun-cream. The problem and the difference here is that the customers don’t realise it. They think what they are seeing is a recommendation and have no idea that the retailer has taken good money from the publisher for it.”

At Waterstones flagship Piccadilly branch in Central London yesterday shoppers said they were appalled by the practice. Helen Brooks, 36, a television sales director and budding author, said: “It’s disgraceful, I certainly would not trust them or their lists. It doesn’t do a lot for home-grown talent, small publishers or writing independently.”

Peter Wheeler, 68, a pensioner, said: “It’s a con.”

What it costs:

£45,000 For one book to appear in window and front-of-store displays, and in Waterstones national press and TV advertisement campaign

£25,000 To feature in a bay at front of store as a ‘gift book’ in its genre and be displayed at the till

£17,000 To be one of two titles promoted as the ‘offer of the week’ for one week in the run-up to Christmas

£7,000 To be displayed at front of store as a ‘paperback of the year’ and be mentioned in newspaper adverts.

£500 Price of an entry in Waterstones Christmas gift guide, complete with a bookseller review"

I won't post all the comments on here, since there are issues of security to consider, and to be honest, it would take too long anyway, so as this is my blog, I will concentrate more on my response to the comments.

The system is flawed, and every writer knows this, but it is the only system for the moment that we have, and we have to do our best to work with it by selling to different markets and not just the book stores. It is good that a paper of the calibre of The Times was discussing this and opening peoples eyes to these practises, as that is ultimately the only way that things will change. When the supermarkets somewhat similar practises were revealed to the public they faced a huge backlash with people turning to local stores and farmers markets etc instead, and from the comments posted on The Times website, at least some people are doing the same with the chain stores because of this, and buying either direct or online instead. Understand that it makes no difference to me as an author; I make the same regardless of whether my book is bought from Amazon or Waterstones - they both after all use the same wholesaler and get them for the same 40 percent discount. That is the thing that gets up my nose even more to be honest - the fact that these stores make £6 a copy from selling my book while as I as the author get £1.39 for 5 years work. I don't know many people who would work for 27.8 pence a year!

One member though did state that she has gone through the rounds of writers conferences, talking to agents, publishers as we all do, and the attitude from many still seems to be the going down the self publishing, or heaven forbid print on demand route is seen as the 'kiss of death'. She queried why this is, and my response, which can be read on the site is as follows:

I think that to a large extent both publishers and book sellers do feel threatened by print on demand, because like so many other things, they do not want to admit that it is their mis treatment of authors and the failings of the publishing industry in general that has led to so many of us choosing to embrace this route in the first place. People self publish for a variety of reasons - sometimes because they have a niche market that enables them to sell direct to the public cutting out the middle men, sometimes because they have been unable to secure a commercial publishing contract and remain convinced, despite the rejections, that there is a market for their work, but increasingly people are also choosing this route because they are tired of being treated by the industry as a disposable commodity and they wish to take back control of their work, and their own power. I chose to self publish for all of the above reasons and then some, as regular or even occasional readers of this blog will know.

The industry is led by greedy retailers, and that is the bottom line. It is the book sellers that demand the high discounts and not the publishers and wholesalers, and it is also the book seller that takes the biggest share of the books profits. In my case from a cover price of £14.99, print costs swallow up £4.06, the wholesaler earns £2.64 and the book seller £6, leaving £2.29 split between myself and the publisher, 60/40 in my favour. It is not a lot, but more than I would have got from a commercial publisher, since the book price would have been lower. How though can this be fair, when I spent 5 years and £5000 writing and paying for this book to be published, not to mention the cost of phone calls to get the shops to stock it, emails, stamps, printer ink, paper, etc, etc, etc? It just doesn't seem right, but very, very one sided. I sometimes think that I must have been mad to have even contemplated doing this, but I keep soldiering on regardless because it my vocation, my life times work, and also because it who I am; as a writer I can no more stop doing this than I can stop breathing, it would be like cutting off my right arm without anaesthetic.

It is though ultimately the book buying public who have the power to change things. This will only happen if we the authors educate our readers as to what is going on. The publishing industry is notoriously resistant to change and everything happens so slowly, and that is also part of the problem, for in the digital world including print on demand, everything moves very fast. Although there are moves towards firm sale instead of sale or return which should in theory help authors, book sellers are demanding even higher discounts to compensate for this loss.

I mentioned an article on The Bookseller just recently that quoted one of the buyers from Foyles (another chain I have been trying to get into with some success). The buyer actually stated that independent authors need them more then they need us, and sadly a lot of the time he/she (the buyer was not identified by name, but I don't think it was the one I have been dealing with) is correct.

Across the water The Writers Guild strike is proving that it is screen writers who have the real power and not studios and television networks, but they are in a different league to the more humble book writer. Nevertheless though it is time the retailers realised that without us to write the books there would be no Waterstones, Borders or WH Smiths. The way forward then is to educate the book buying public as to what really goes on in whatever way that we can. Write about it on our blog sites, let people know on your mailing list why you ask them to buy direct from you and list the figures involved as to who gets what, write to the newspapers, take part in discussions like the one they had on The Times Online, add your comments to the blogs that The Bookseller links to (I do this a lot as well), do whatever you need to do in order to get the point across without antagonising.

It is a dangerous path in some ways to tread, since there is always the fear at the back of ones mind that if the wrong person reads it the retailers will boycott your work. I have to then be very careful with what I say, as at the moment although I hate to admit it, until I can get some decent media coverage from the national press, I do need the book shops more than they need me. It is an uncomfortable fact. I have tried online selling, social networking, book fairs, you name it I have done it - the bottom line is though that 90 percent of books are still sold through shops. So for all my good words above, for the moment I shall continue to do my best to tread softly and work with the flawed system that we have in the best and only way that I can.

Occasionally I do get to speak to a more enlightened manager or book seller who understands the problems that we as authors have to face, and that does make it more worthwhile. There are a few who work for Waterstones and some who work for Borders as well! Same Day Books are the most enlightened ones that I have come across - even they are struggling, as 2 of their 5 branches have closed this year, and and there are redundancies in the offing - they are concentrating more on online selling now, since there are less overheads, but that is a whole other discussion ....

Continuing on though with the same theme, the industry has for some time now it seems been debating the issues surrounding digital publishing. This covers of course not just the rise in print on demand, but also the threat as they see it from e-publishing. It has come much more to the forefront in recent weeks with the launch in America of the Amazon Kindle reading device. The technology is not as yet available here, but it is only a matter of time.

Adam Powell talks about this on his blog, which is linked to The Bookseller, where he also talks about the Espresso machine, which is of course a giant print on demand machine recently installed in various public libraries and book stores across the pond. Dane Keller, CEO of OnDemand Books, the creators of the Espresso machine, are keen to try and also get it into stores over here. The only problem is that there is only one company through which material can be accessed, and even then some of the out of copyright material they have access to is still in copyright here, since the laws are different. What this basically means then is that there is very little that can actually be printed.

Adam makes the point that by utilising digital technology in the form of both print on demand and e-books, it will help to cut out the middle men, thus you would think, maximising profits for both book sellers and publishers. However, although the big presses may complain about the high costs of distribution and heavy discounting (they should try being a small press or self published author, then they would have something to really get upset about), he also points out that nearly all of them - including Penguin, HarperCollins and MacMillan either own or have a large share in their own distribution companies - why then would they be willing to put part of their own profits at risk? It would be cutting off their noses to spite their own face.

Personally I can't see e-readers catching on, not even in the United States. Nothing, and I mean nothing, will ever replace paper books, people love the feel of them and being able to leaf through at their own leisure on the train or in the local coffee house before or after work. Both Amazon and myself as an author would love to be proven wrong, since the idea of cutting out all these middle men has much appeal - my own book is in fact already available as an e-book as part of the Authors OnLine publishing package. I have only ever though sold one, to some unknown person overseas who I suppose preferred to read it in this way. When I do sell in this form I earn considerably more - about three times more in fact, since the only overheads are the credit card processing fee, and then 60 percent of what is left (about £5) is mine. This cannot compete or compare with the £1.39 I get from paper copy sales. I have said enough about that though already to fill 10 textbooks, and I am not talking mobile phones here either.

As a worst case scenario, in 10 0r maybe 20 years time, 10 percent of books may be sold as e-books. Traditional publishers and book sellers will somehow have to find a way of making up for those lost sales. The most obvious way is for them to sell the e-readers in their shops or direct from their own websites. Why though should a consumer go to a publishers website instead of Amazon where they can everything they need at low cost in the same place, not just from one publisher, but from all of them. Amazon in this scenario can be seen as a giant online book supermarket against which the high street stores cannot realistically compete other than on service, and the ability to browse, but even this is being diminished with the search inside option and Google Books.

The British Retail Consortium predict that 15 percent of all Christmas related purchases will be made online this year, compared to 13 percent in 2006. This then must be seen as the real threat, which may be much greater than anyone could imagine.

1 comment:

Bluemoose said...

AS a small independent publisher getting any title into the high street stores means entering into one sided negotiations. Amazon demand 60% and the main wholesalers are not far behind. If you're a small independent you have tyo go through Waterstones specific wholesaler and sign onm the dotted line before you can start showing your titles to bookshops. Thank the lord that I've been repping for various publishers for over 20 years and knonw some managers who haven't had the waterstones chip inserted into the brain and do have some autonomy on buying. Buying space is not new but it diminishes the industry and negates the rise of new promising writers because agents and publishers know that if they are to invest ina new writer they have to know it will be a besteller, hence the increase of celebrity authors and knowing theuy have to pay for titles in store means they are less likely to take a punt on an unknown writer regardless of how brilliant they are. Genre specific, lazy celebrity formulaic stuff is being published by publishing houses who are too fearful of the bottom line to take a risk. Publishing is becoming risk averse and it is uup to regional independents to take on the challenge of investing in new talent. All publishers will soon be publishing crime forensic lite thrillers and then have one gardening celebrity title and a Big Brother spin off christmas title. 3for 2's will soon become 8for 12's and then bookshops will be like Turkish bazaars with haggling becoming the norm for a book.