PUBLISHED JUNE 2015
by Linda Carlson, Reporter, IBPA Independent magazine —
This is the third in a series of articles under the headline “Marketing Whatever You Have to Market.”
Access the full series here.
This is the third in a series of articles designed to help you brainstorm marketing strategies in the context of the basic “four Ps” of marketing traditionally outlined in business schools.
The series started by dealing with Product and the need to focus both on the benefits of what you’re selling and on what customers perceive they are buying. Next, it dealt with Price, stressing the need to understand the real costs of what you sell in all the sales channels you use. In this issue, the topic is Place—where sales occur and how your product or service is distributed to the end user through selected channels. The final installment of the series will cover Promotion, which means every way you communicate to prospective customers, with advertising, publicity, customer service, and direct sales being the most common ways.
Publishers get their books to appropriate places in a wide variety of ways, including via wholesalers and distributors, via physical and virtual bookstores and nonbook stores, and via postal mail, digital mail, personal appearance venues, libraries, businesses, associations, and schools at various levels.
There are three primary options to consider. Starting with the one that requires the most work, they are:
- selling direct to end users
- selling through retailers and other intermediaries, including but not limited to bookstores
- selling through distributors, including but not limited to book industry distributors
Many publishers use two of these channels, or all three, with most selling some books direct from their websites. Which channel or channels a publisher pursues for a given book or books depends on the potential and existing markets—who wants to read this, which channels handle the format(s), and what the price points are.
For example, a publisher that offers downloadable teacher guides at low prices, or free with a bulk order of the related title, typically has a well-established customer base among educators and can sell through specialty catalogs and websites, online retailers and bookstores, and/or institutional customers that place orders with the publisher or its distributor.
E-books are typically sold through online retailers and distributors. As with print titles, genre may determine which distributors will consider an e-book title (some specialize in academic or professional titles, for instance, while others decline erotica).
When every book was printed and bound, self-publishers often started out handling all sales themselves. They filled their garages or basements or spare rooms with cases of books, and then made sales calls on booksellers, libraries, wholesalers, and catalog and specialty retailers. This pattern is still common for micropublishers, especially author/publishers with extensive consulting or speaking experience, who often sell much of their inventory through their clients and their presentations.
Today, the regional wholesalers that take on single-title publishers have mostly disappeared, and although a few national distributors work with micropublishers, selling direct may be the only option some self- or small publishers have.
Selling direct can provide a financial advantage. When you sell to end users, no intermediary takes a percentage of the revenue. Authors with sizable followings can sell a good many books to individuals at full price, either in person or via a website. Even better, popular authors can sometimes get enough advance orders from end users to have cash on hand for paying the printing bill.
Another plus: If you sell in person or by phone, you can tailor your pitch to a prospect’s concerns, which improves the odds on making a sale. And even selling online can create opportunities to upsell, either with a shopping cart that automatically suggests add-ons, or with a “live chat” feature that allows consumers to communicate immediately with you.
Selling direct also lets you include promotional messages on invoices and in packages. And it lets you capture customer information for your databases, including e-mail addresses that can be used for future promotions and for reader surveys that may result in testimonials.
In most cases, selling direct requires a significant commitment. You and perhaps other people need to handle phone sales, take orders, pack books, issue invoices, arrange and travel to appearances, haul in the books, make speeches, and staff exhibits at book festivals and other shows.
You may also need to pay rental fees for tables or booths and to bear the cost of display copies, which usually cannot be returned to inventory because of smudged covers or damaged spines. Experienced publishers recommend that you count how many copies you have on display and watch carefully to prevent costs of “shrinkage” due to theft.
Dogwise Publishing is among the IBPA members that got started with shows. The copies of obscure titles about dogs that founders Charlene and Larry Woodward displayed at a dog show as a weekend lark in 1987 were so well received that they acquired inventory from the books’ publishers and took to the road weekend after weekend, each heading to different shows. This led to producing a simple catalog, providing a toll-free number, and in 1990, starting a publishing business that now includes thousands of products and makes dog shows still a core part.
Besides exhibiting at shows, publishers that sell direct often arrange for talks at schools, conferences, and libraries, which sometimes pay for presentations and travel expenses as well as for the books they sell. Such publishers have another tip for those who sell direct: Ask book manufacturers to limit the weight of the cases they ship to you. A 30-pound carton is far easier to lift in and out of your car trunk than a 50-pounder.
IBPA members also work through associations. W.W. West Publishing sells two editions of America’s National Parks: A Pop-Up Book, via the National Parks Conservation Association, which can promote books via e-blasts to 150,000 members. Each sale generates a donation to NPCA, and website sales of both editions have resulted to date in donations totaling more than $74,000.
Selling direct, whether your books are print or digital or both, involves promotion costs. Today, with hundreds of thousands of books published each year, it’s a challenge to create awareness of a title. Many indie publishers offset sales and promotion expenses to some extent by establishing “affiliate” relationships with online retailers through deals such as those pioneered by Amazon.com.
Some independent publishers deal with book-trade wholesalers and retailers themselves rather than through a book distribution company, either as a first-choice option or because they can’t get a distributor. And some that have distributors for trade book sales self-distribute in other industries.
Publishers who handle their own distribution often start by pitching relevant businesses about a title or two. As their sales and backlists increase, they add in-house sales reps. Larger firms often work with commissioned reps, who usually prefer publishers with several titles in the markets they serve.
At Addicus Books, Rod Colvin’s primary niche is consumer health books, with 60 percent of them sold to hospitals, clinics, and government agencies. Such so-called special sales are typical of many publishers who self-distribute. For Addicus, some sales to pharmaceutical companies have involved tens of thousands of copies. And, as Colvin notes, “The invoices were paid within 30 days and there were no returns!”
To sell to book and nonbook wholesalers and retailers, you need a discount schedule that is both aligned with industry standards and designed to increase the number of copies in each sale. For example, offering a 50% discount with the purchase of five or ten copies encourages specialty retailers to buy more than one or two.
It’s important to recognize that most big-box stores and book-trade customers do not buy directly from independent publishers except when placing occasional special orders. They prefer the convenience of buying titles from several publishers via a single order to a single source. This also maximizes their quantity discounts and simplifies accounting and returns.
Because no wholesalers require exclusives, publishers who self-distribute can sell to customers including bookstores and libraries while working with multiple wholesalers that also serve those markets.
For example, a publisher can sell through the wholesaling units of Ingram and Partners while also making sales calls on libraries, gift stores, and even the booksellers in its own region. (This is not true, however, if the publisher has contracted with the distribution units of companies such as Ingram and Partners. For information on how wholesaler and distributor units of these major players differ, see the two-part “21st-Century Physical Book Distribution” series: “21st-Century Physical Book Distribution: Part 1” and “21st-Century Physical Book Distribution: Part 2.”)
Small publishers that work with wholesalers must receive deliveries from book manufacturers, make sales calls, and deliver orders or contract with warehousing or fulfillment vendors. And the wholesalers usually expect them to promote their titles, and thus create demand for them.
When a title has a track record or when advance publicity has generated significant backorders for a title, some wholesalers will place advance orders for enough copies so that a portion of the press run can be drop-shipped from the printer. Drop-shipping has the advantage of reducing the publisher’s warehousing needs and eliminating at least a few shipments to the wholesaler.
The potential downside: When books are drop-shipped, the publisher doesn’t have the chance to spot-check for quality problems. (One Seattle publisher recalls the time several pages of erotica from another publisher’s book were mistakenly inserted in its nonfiction title for conservative readers.) A more common problem is damage that occurs during shipping; if the publisher doesn’t have the opportunity to open damaged cartons and examine the books inside, it’s difficult to file claims for unsellable books.
The terms for working with wholesalers vary, but they typically require discounts of more than 50 percent. Book-trade wholesalers usually pay for books 90 days after the end of the month in which they ship them to customers, so publishers will receive payment this month for books sold in February. Payments are always net of any charges for books returned by a wholesaler’s customers.
Innovating in Traditional Terrain
Chelsea Green, which self-distributes, recently established a place within a traditional place for reaching readers by inaugurating standalone displays in bookstores. A few years ago, the 31-year-old White River Junction, VT, publisher offered independent bookstores that had sold its titles in certain quantities the opportunity to take books on consignment in exchange for creating an exclusive Chelsea Green display. Although a CG sign is required, the size of the display is up to the bookstores.
“We like to have a shelf unit for the Chelsea Green display, but there’s no official requirement in terms of linear feet or number of titles,” explains Michael Weaver, the publisher’s trade and export sales manager. “Merchandising is left to the bookseller; what’s important is that the display fit their store and that it sell books.”
Stores select the titles for their displays. Their discount is 45%, and they receive free freight for any order of five or more copies.
“This offers better visibility for our books—both frontlist and backlist—and a way for booksellers, especially those with a community predisposed to our niche, to stock a depth of selection of our books without having to tie up money to pay for them,” Weaver says.
He adds that the program has been especially valuable for selling titles in Chelsea Green’s 400-title backlist. In 2014, for example, sales in the two dozen stores dedicating exclusive space to CG titles were 73% backlist, 27% frontlist. By contrast, sales of Chelsea Green titles in indie stories that carry them on traditional terms were almost equally balanced in terms of backlist (54%) and frontlist (46%).
Whether a similar program will work for other publishers depends in part on the number of titles available, the number of titles introduced each year (to keep displays fresh, Weaver notes), and, for publishers that don’t self-distribute, existing distribution contracts.
Book industry distributors—including Independent Publishers Group, Legato Publishers Group, Perseus, and the distribution departments of giant publishing companies such as Random House—require larger discounts than wholesalers do, and they charge fees for many services in return for relieving publishers of most sales, warehousing, and order fulfillment responsibilities. Along with fielding sales forces, they issue catalogs and maintain websites to promote titles. Some provide access to Nielsen BookScan reports, which help publishers monitor bookstore sales.
A distributor large enough to have both inside and outside salespeople and to contract with commissioned sales reps can significantly improve a publisher’s sales. When boating publisher Pardey Books switched to Midpoint Trade Books a few years back, hoping to reduce its returns, returns actually rose, but “that’s because Midpoint got so many of the titles into larger chains,” Lin Pardey reported. “It got 400 to 600 copies of each new title on the shelves of Barnes & Noble.” And to the Pardeys’ surprise and satisfaction, most of the returns could go back into inventory, resulting in higher sales overall and fewer unsellable copies.
Like the Pardeys, some publishers find that their distributors’ sales staff can generate sales not possible when they were selling direct or self-distributing. For instance, Tell-A-Gram Publishing couldn’t get the Bas Bleu catalog to carry its only title, The Grammie Guide, but thanks to Small Press United, a unit of Independent Publishers Group, the book appeared in that catalog this spring. Similarly, Aquila Polonica Publishing’s distributor, NBN, has placed some of its titles in catalogs such as those from the History Book Club, the Book-of-the-Month Club, and the Military Book Club.
Many book industry distributors have relationships with print-on-demand and short-run book manufacturers that can relieve publishers of tasks associated with getting titles printed or reprinted and delivered to a distributor’s warehouse. And many have contracts that leave client publishers free to use distributors in industries they don’t serve.
Another distribution option entails contracting with an appropriate independent publisher that distributes books from smaller companies along with its own titles. And still another involves contracting with one of the book manufacturers that operate, or are affiliated with, warehouses and order fulfillment services that provide wholesaling or distribution. Think, for example, of Ingram’s Lightning Source (although its services seldom include warehousing since it manufactures print-on-demand) and Amazon’s CreateSpace (which offers print-on-demand manufacturing, a form of distribution to trade channels, and retail sales).
This option can reduce a publisher’s initial investment and relieve the publisher of post-production tasks (note, though, that manuscript editing, book design, and promotion services are available from Lightning Source and CreateSpace).
Along with distributors’ fees—which include a greater discount than that charged by wholesalers plus warehousing and catalog charges—the most obvious downsides to working through distributors are that the relationship is typically exclusive, at least with respect to customers in the distributor’s arena, and that it’s the distributor rather than the publisher that interacts with retailer customers.
Eliminating publishers’ interaction with those customers means that the publishers get no feedback from them on current titles, no suggestions from them about new titles, and no chances to upsell. Outsourcing sales, customer service, order-taking, and order fulfillment to a distributor also eliminates any control over those functions by publishers.
Primary Pointers on Place
“Where can we reach the targeted readers for this title, and how will we get it there?” are questions publishers need to ask about any manuscripts they are considering. Even an important and well-written book is unlikely to be successful unless the most promising audience for it is identified and the book is brought to that audience’s attention and made easy to buy.
Accordingly, selecting, establishing, and managing the most effective channels for reaching readers is a critical challenge for every publisher, regardless of size, expertise, and financial resources.
This is one of the most important reasons that successful publishers usually publish for well-defined niches and seldom, if ever, publish titles outside their area of focus, or outside the area or areas of focus for their distribution channel or channels.
For more advice and information about distribution, see:
Linda Carlson (lindacarlson.com) writes for the Independent from Seattle, where she is the author of Advertising with Small Budgets for Big Results: How to Buy Print, Broadcast, Outdoor, Online, Direct Response & Offbeat Media. She self-distributed job-search guides for a dozen years and works with distributors for her Company Towns of the Pacific Northwest (University of Washington Press) and for clients’ titles.