State of retail publishing 2017

[fjtorres]

From Shatzkin (with Data Guy quotes):

https://www.idealog.com/blog/changin...#disqus_thread

1- Agency really is stupid, after all:

When the combination of the new technologies accelerated the shift from buying in stores to buying online, and Amazon showed a willingness to sell ebooks for Kindle at prices below the costs publishers charged them, the big legacy publishers became alarmed. They could see no end to the switch to ebooks and it seemed logical to figure out a way to encourage competition across ebook ecosystems.

Their solution, aided and abetted by the new Apple iBooks ecosystem that debuted in April of 2010, was to move from “wholesale” pricing, where the retailer controlled the ultimate price to the consumer, to “agency”, where the publisher was the seller to the consumer and controlled the price. The intermediary — the retailer — was just an “agent” without pricing power.

This led to anti-trust action by the US government by which agency pricing was allowed, but only by newly negotiated agreements between each of the major publishers and their vendors, including Amazon. And the DOJ made sure that those agreements entitled the retail “agent” to discount from the publisher’s agency price, as long as the aggregated discounts to consumers didn’t exceed the retailers’ aggregate margin on those ebooks.

They needn’t have bothered. Amazon was essentially done with the strategy of discounting big publishers’ ebooks. And big publishers are left wondering whether they should be glad they got what they wished for. Let’s remember that those discounts from Amazon came from their share of the price; now with agency protocols, publishers can only discount ebooks by reducing their own take!

Hey! So it turns out Amazon was actually helping the BPHs under wholesale!

2 - The touted print sales growth is all at Amazon and it is all Amazon and Indie titles most likely.

Amazon continues to grow its share of print and digital sales. It appear to be approaching half of all print sales and more than 90% of ebook sales.

Data Guy says:

On the print front, Amazon is indeed very close to half the US market: Our own Bookstat-derived total of 312 million print units sold by Amazon in 2017 is 45.5% of Bookscan’s total reported 2017 print sales of 687 million, which means Amazon sales now comprise the majority of Bookscan’s “Club & Retail” share. Even allowing for the other 15%-20% of US print sales that remain untracked by Bookscan, that puts Amazon’s US print share is at least 40%. And that’s ignoring another 10-15 million unreported Amazon print sales a year from CreateSpace titles that aren’t trackable through Ingram “expanded distribution.”

Amazon’s share of of US print sales is still growing rapidly. In the prior year, 2016, the 280 million Amazon online print sales Bookstat reports were only 41.7% of 674 million total units and in 2015 Bookstall’s 246 million print unit total for Amazon was only 37.7% of Bookscan’s 653 million reported units. So Amazon’s online print sales continue to grow by a double digit percentage each year.

Barnes & Noble — the next largest retailer of print books, from their public financial reporting, was by our math contributing 23% of Bookscan’s total in 2017 — which means that B&N has shrunk to where it now moves only half as many print books a year as Amazon, and B&N’s own financials show those remaining B&N sales are shrinking by 4% a year. Book sales at mass merchandisers like Walmart and Costco — about 14% of Bookscan’s total units — are dropping 7-8% a year. The indie bookstores, which make up less than 6% of the US print book market, have been a beneficiary of B&N’s shrinking footprint and sales are about flat. But even if they were growing, this is a segment too small to really move the needle.

In other words, the overall 2-3% annual growth in print sales reported by the industry for the past several years is solely due to Amazon’s fast-growing online print sales, while all other channels shrunk.

Note that the shrinking channels all boycott APub titles and refuse most Indie titles.

3- Avid readers have moved away from B&M to online and digital. The fabled stroll through the racks is largely a myth.

... as a result of these industry changes, some genres and categories of books are getting almost all their sales through Amazon. That would mean that nobody else can do those books profitably. This appears to have already happened with romance books; other genres and topical categories will follow.

Data Guy says:

I’d expand your observation to say “through Amazon and other online retailers,” but what you describe is what the data shows. Almost 90% of Romance book purchases are online now, mostly in ebook form, with the majority of those sales going to self-published titles in the $3-$5 range. Adult Science Fiction & Fantasy titles are not too far behind. In general, the strongest indicator for how fast sales in a particular book genre will transition to online retailers and digital formats is typical reader “voracity” in that genre. A three-book-a-year reader is usually picking up their three books in hardcover in airports or brick-and-mortar bookstores (or receiving them as holiday gifts). But most fifty-book-a-year genre fiction readers are, by now, buying those books online, and most probably as ebooks—which usually means that half or more of them are self-published purchases.

Much more at the source.

Shatzkin has come a long way from the time when he demonized DataGuy claiming he had "an agenda". Mind you, he still pines for government action against Amazon but...
...well, baby steps...

[pwalker8]

Gosh, some blogger likes Amazon and doesn't like the big publishers. I'm shocked, shocked I tell you. Once again, I repeat. The people who have the actual data on publishing aren't releasing it. Some people are in the business of giving estimates based on various assumptions and formula. This has been going on for years.

[GlenBarrington]

Well, I can't speak for "the industry" but I can speak to how I buy books. I estimate 90% of my purchases are ebooks from Amazon, the remaining 10% is from other vendors who offer Kindle support.

I won't pay $8.00 US for an ebook book, and I sure as hell won't pay between $16.00 and $25.00 for a current book from an "established" author. It just won't happen. It's like I, and those authors, are living on different planets. Or maybe different universes.

I rarely pay even $5.00 for a book unless it's an author I really like. $3.00 is probably what I pay most often.

I rely on Kindle unlimited for most of my eBook reading. Yes, there is some real crap in the KU catalogue, but MOST of the stuff I have selected so far has been first rate.

[SteveEisenberg]

Originally Posted by fjtorres

Shatzkin has come a long way from the time when he demonized DataGuy claiming he had "an agenda".

What possible connection does saying someone has an agenda have to do with demonizing them?

But thanks for reminding me to check http://www.idealog.com. It was no longer a regular stop of mine because of the decreasing post frequency.

[barryem]

Most of the ebooks I buy are $1 or $2 and a few ard $3. Fortunately by watching BookBub and Book Gorilla I find plenty of good sale books that I want to read. But if a book I really want to read is $10 or $15 even, I'll buy it. That doesn't happen often, thanks to book sales.

I get all my books from Amazon. Well, sometimes Gutenberg but mostly Amazon. I don't like the high prices and mostly they're easy to avoid. But I'm a reader and if that's what I have to pay I pay it.

Barry

[darryl]

Originally Posted by pwalker8

Gosh, some blogger likes Amazon and doesn't like the big publishers.

You are talking about Shatzkin here? Seriously?

[fjtorres]

Originally Posted by darryl

You are talking about Shatzkin here? Seriously?

Funny, isn't it?
How quickly they forget!

[pwalker8]

Originally Posted by darryl

You are talking about Shatzkin here? Seriously?

No, I am talking the Data Guy, who the source of much of the initial quote.

Shatzkin is a consultant who has been bouncing around for years. He is famous for predicting that Libraries are a thing of the past back in 2011, so its not exactly like his every pronouncement is the word of God. Consultants get ahead by sucking up to their audience and saying provocative stuff, otherwise no one would write about them. If he's reduced to quoting from the Data Guy, then odds are pretty good he doesn't have the inside scoop on what the real numbers are. Garbage in, garbage out.

[darryl]

Originally Posted by pwalker8

No, I am talking the Data Guy, who the source of much of the initial quote.

Shatzkin is a consultant who has been bouncing around for years. He is famous for predicting that Libraries are a thing of the past back in 2011, so its not exactly like his every pronouncement is the word of God. Consultants get ahead by sucking up to their audience and saying provocative stuff, otherwise no one would write about them. If he's reduced to quoting from the Data Guy, then odds are pretty good he doesn't have the inside scoop on what the real numbers are. Garbage in, garbage out.

The use of scrapers is hardly magic. The data obtained is not a guess. The use of mathematical and statistical techniques to analyse that data is not black magic. The resulting "estimate based on various assumptions and formula", as you put it, is not mere guesswork. If Data Guy is in fact anti big publishing how has it affected his work? The methodology is public and open to criticism. In fact, Data Guy has proved very responsive to valid and constructive criticism. His figures are not perfect, but they are clearly close enough to it to give meaningful results and for businesses to pay for those results. And the trends reported certainly seem to have proved accurate.

[pwalker8]

Originally Posted by darryl

The use of scrapers is hardly magic. The data obtained is not a guess. The use of mathematical and statistical techniques to analyse that data is not black magic. The resulting "estimate based on various assumptions and formula", as you put it, is not mere guesswork. If Data Guy is in fact anti big publishing how has it affected his work? The methodology is public and open to criticism. In fact, Data Guy has proved very responsive to valid and constructive criticism. His figures are not perfect, but they are clearly close enough to it to give meaningful results and for businesses to pay for those results. And the trends reported certainly seem to have proved accurate.

All I can say is that authors who actually know their sales figures and are willing to talk about it publicly say he's way, way off. You can dismiss that if you like, but sometimes people will go with made up numbers simply because it gives them something concrete to go off of, not because it's particularly accurate. For some reason, people would rather latch on to WAG than accept that accurate data just isn't available. It just seems to be something in human nature, especially if the WAG is accompanied with fancy hand waving.

[darryl]

Originally Posted by pwalker8

All I can say is that authors who actually know their sales figures and are willing to talk about it publicly say he's way, way off. You can dismiss that if you like, but sometimes people will go with made up numbers simply because it gives them something concrete to go off of, not because it's particularly accurate. For some reason, people would rather latch on to WAG than accept that accurate data just isn't available. It just seems to be something in human nature, especially if the WAG is accompanied with fancy hand waving.

That is, of course, why authors are upset that the latest report identifies them with their information. I assume you are referring to one author, Dean Wesley-Smith, who writes in a comment on the Passive Voice Blog:

What is funny about me being sort of out front on this is that my books per title don’t sell well on Amazon. I make most of my money from my books in all the places Data Guy can’t get to, such as movie options, overseas sales, secondary markets, kickstarter projects, book funnel sales, sales through eBay, sales through our own B&M stores, and so on and so on. But I still don’t want that information on my 400 titles out there.

He is one author who has sales through channels DG doesn't currently reach, so his sales on the report would be understated. The Bookstat website claims date coverage of 96% of US ebook purchases and 94% of US Ebook dollar sales.

The plain truth is that the fact that the data coverage is not 100% does not mean it is comprised of "made up numbers" nor that it is not fit for its purpose. 100% accurate figures are indeed not available. But 90 percent plus accurate figures are. By your reasoning a country could never rely on census data, since it is not 100% accurate. Nor could business rely on just about any industry sales report.

[pwalker8]

Originally Posted by darryl

That is, of course, why authors are upset that the latest report identifies them with their information. I assume you are referring to one author, Dean Wesley-Smith, who writes in a comment on the Passive Voice Blog:



He is one author who has sales through channels DG doesn't currently reach, so his sales on the report would be understated. The Bookstat website claims date coverage of 96% of US ebook purchases and 94% of US Ebook dollar sales.

The plain truth is that the fact that the data coverage is not 100% does not mean it is comprised of "made up numbers" nor that it is not fit for its purpose. 100% accurate figures are indeed not available. But 90 percent plus accurate figures are. By your reasoning a country could never rely on census data, since it is not 100% accurate. Nor could business rely on just about any industry sales report.

Actually no, John Scalzi is the author that I was referring to. He's one of the few authors who will publicly break out his sales figures. He mentioned that the Data Guy was off by orders of magnitude in one of his blog post. He compared his actual sales figures with what was estimated and he sold almost twice as much.

The key word in your post is "claims".

Computer models, which is basically what this is, are an interesting tool, but accuracy is a key. Being off that much doesn't imply 90% accuracy. There is a saying in programming, Garbage in, Garbage out. Just because something is driven by a fancy set of calculations doesn't mean it's accurate if the assumptions driving the calculations are faulty. We see that all the time in political polling. Political polls tend to be off by far more than the listed margin of error a large part of the time, at least compared to the actual voting numbers.

It's a bit like the NYT best seller list. It's a great marketing tool and certain can help drive sales for individual books, but most recognize that being on the NYT best seller list doesn't really mean you are at the top in actual book sales.

[DuckieTigger]

Originally Posted by pwalker8

Actually no, John Scalzi is the author that I was referring to. He's one of the few authors who will publicly break out his sales figures. He mentioned that the Data Guy was off by orders of magnitude in one of his blog post. He compared his actual sales figures with what was estimated and he sold almost twice as much.

I think you are not being literal with that? Almost twice as much is maybe off by 1 order (singular, not plural) of magnitude when you have base 2 numbers. But assuming base 2 numbers is stretching it, even when digital data is talked about. Unless you specify the base of your number system (which is base 10 commonly by default if unspecified).

[darryl]

Originally Posted by pwalker8

Actually no, John Scalzi is the author that I was referring to. He's one of the few authors who will publicly break out his sales figures. He mentioned that the Data Guy was off by orders of magnitude in one of his blog post. He compared his actual sales figures with what was estimated and he sold almost twice as much.

The key word in your post is "claims".

Computer models, which is basically what this is, are an interesting tool, but accuracy is a key. Being off that much doesn't imply 90% accuracy. There is a saying in programming, Garbage in, Garbage out. Just because something is driven by a fancy set of calculations doesn't mean it's accurate if the assumptions driving the calculations are faulty. We see that all the time in political polling. Political polls tend to be off by far more than the listed margin of error a large part of the time, at least compared to the actual voting numbers.

It's a bit like the NYT best seller list. It's a great marketing tool and certain can help drive sales for individual books, but most recognize that being on the NYT best seller list doesn't really mean you are at the top in actual book sales.

Are you in fact referring to this?

https://whatever.scalzi.com/2017/09/...pe-not-at-all/

If so, it is Apples and Oranges. DG's data claims to cover US ebook purchases and US Ebook dollar sales. It is not about what a particular author earns or when. It is about how many books are sold and how much money those sales bring in. Not how much a particular author actually makes.

If not, please link to the article(s) you refer to.

[JSWolf]

Originally Posted by darryl

He is one author who has sales through channels DG doesn't currently reach, so his sales on the report would be understated. The Bookstat website claims date coverage of 96% of US ebook purchases and 94% of US Ebook dollar sales.

The plain truth is that the fact that the data coverage is not 100% does not mean it is comprised of "made up numbers" nor that it is not fit for its purpose. 100% accurate figures are indeed not available. But 90 percent plus accurate figures are. By your reasoning a country could never rely on census data, since it is not 100% accurate. Nor could business rely on just about any industry sales report.

This is why I've been saying that these sorts of numbers are just a guess. There are no hard numbers and the numbers given are not usually correct. Also, these numbers don't take into account sales outside the US. So this Data Guy should just bugger off and stop with his incorrect numbers.