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Keeping Count: What Industry Statistics Do and Don’t Reveal

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by Jim Milliot, Editorial Director, Publishers Weekly

Photo of Jim Milliot

Jim Milliot

It is a cliché by now to say that the book publishing industry is in the midst of a profound transition. But there is no doubt that the rise of digital publishing and bookselling has had a permanent effect on the industry. And while most publishers seem to have a better handle than before on how the hybrid market of digital and print books will unfold, the future still holds plenty of uncertainties.

That makes the use of industry statistics all the more important. The quality of those statistics has varied over the years, but for the most part the data publicly available today is good, if not entirely complete. Most of the bigger publishers now employ data scientists to analyze the information they receive from vendors and other sources.

And with better point-of-sale systems and other technological advances, publishers can get a good sense of what books are selling best and where sales are occurring.

As you may know, the main sources of industry-wide data are Nielsen, the Association of American Publishers, and the Book Industry Study Group. Read on for a taste of the information they offer.

Dollar-Sales Data from AAP

To gauge 2014 trends, the AAP used its StatShot program, which gathers data from more than 1,200 publishers. The strength of this approach is that it collects actual sales figures from the reporting companies, and publishers that report must supply figures for at least two years to enable year-to-year comparisons.

The weakness is that StatShot does not measure sales for the entire industry.

Until it was discontinued last year, BookStats, a joint venture of the AAP and the Book Industry Study Group, did estimate sales for the entire industry, using sales figures from reporting companies along with a sophisticated model for projecting to the full universe. And before BookStats was created, the annual Book Industry TRENDS report from BISG also estimated sales for the entire industry.

Dollar sales as derived from the AAP StatShot program for 2014 showed modest gains over 2013 dollar sales. For the 1,209 reporting companies, 2014 sales figures rose 4.9% to $15.72 billion, up 4.9% over the previous year. The largest increase, 20.8%, occurred in the children’s/YA segment of the industry, thanks to gains across all formats in that segment. Its e-book sales figures rose 33.6%, and its board-book sales figures jumped 33%.

Figure 1E-books accounted for 12% of all dollar sales in the children’s/YA segment in 2014, up from 10.9% in 2013, and the segment clearly benefited from strong digital sales of the blockbuster Divergent trilogy.

With no comparable blockbuster in 2014, dollar sales in the adult book segment fell 1.4% compared to 2013. The hardcover format had the toughest year, with sales down 8.2%. Sales in the mass market paperback segment dropped 4.2%. And those declines offset small gains in trade paperback sales (up 2.3%) and e-books, which were up 1%. and accounted for 27.2% of all adult book dollar sales last year, up from 26.6% in 2013.

Figure 2 PhotoHowever, e-book dollar sales had grown 3.8% in 2013 among publishers that report to StatShot, so the 2014 figure is one more sign that the explosive annual growth of e-books sales has stalled.

Together, dollar sales of e-books for the adult segment and the children’s/YA segment rose 4.8% in 2014 and represented 22.9% of combined sales, up from 22.7% in 2013.

Downloadable audio dollar sales jumped 27.2% in the year, offsetting a 7.7% decline in physical audio sales.

Unit Sales Data from Nielsen

Nielsen has been providing point-of-sale data for more than 10 years, counting only units purchased at outlets that take part in its BookScan program. It estimates that its reports cover about 80% of print book sales, but it does not report on e-book sales.

Nielsen’s year-end numbers showed that unit sales of print books in outlets that report to BookScan rose 2.4% in 2014, with total unit sales topping 635 million. The gain was driven by a 3.4% increase in the retail and club channel, which offset a 1.8% decline in sales through the mass merchandiser channel and other declines during the same period.

Unit sales through retailers and clubs, a category that includes Amazon and all types of bookstores, rose to just under 519 million.

The 2014 BookScan figures correspond to 2014 AAP data showing that print books sold fairly well last year after years of decline. Like the AAP numbers, BookScan numbers show that the juvenile segments led in gains, with juvenile nonfiction up 15.6% and juvenile fiction up 12.0% over 2013.

The 12.0% increase in juvenile fiction was fueled by sales of John Green’s The Fault in Our Stars, Veronica Roth’s Divergent trilogy, and Jeff Kinney’s The Long Haul.

As reported by Nielsen, unit sales of adult nonfiction rose 1.4% in 2014. Adult fiction was the only major category with a unit sales decline for the year, as no title in the category sold more than one million print copies at BookScan outlets. Its top seller was the trade paperback edition of Gillian Flynn’s Gone Girl, which sold just under 963,000 copies. That finding is in keeping with industry data showing that e-book sales have had their largest negative impact on sales of adult fiction titles.

Board books had the biggest unit-sale gain of the year, 17.4%.

Figures for other format categories are:

  • trade paperbacks up 4.3%
  • trade hardcovers up 3.1%
  • mass market paperbacks down 10.3%, and still the print format most negatively affected by the rise of e-books

Consumers’ Reports

In 2014 Nielsen bought Bowker’s research business, which, among other things, had conducted surveys of consumer book-buying behavior. Renamed Nielsen Books & Consumers, it continues to track the buying habits of Americans 13 and older by sending monthly surveys to about 6,000 people that ask them whether they bought a book in the prior month.

People who say they did are then asked a series of questions that deal with where they bought the book (or books) and why. Nielsen says the program gives an annual overview of 60,000 book buyers who bought about 175,000 book units.

Highlights of the 2014 Nielsen Books & Consumers report include the finding that e-books accounted for 15% of respondents’ spending on all new books (including both backlist and frontlist titles, but not used titles), up from 12% in 2013, while e-books’ share of unit sales rose by 1 percent, to 21%. Apparently, e-book prices have increased, although their prices remain lower than those of print titles.

Print accounted for 70% of respondents’ new-book spending in 2014, a drop of seven percentage points from 2013. Declines occurred in the trade paperback and hardcover segments, while the share of spending for mass market paperbacks rose slightly.

Respondents still spent the most money on hardcovers in 2014, with the format accounting for 32% of their spending. Trade paperbacks, which ranked next in terms of spending, accounted for the most unit sales, although their share fell from 30% in 2013 to 27% last year. Hardcovers accounted for 26% of unit sales in 2014, down from 27%. Audiobooks, led by downloadable works, had a solid year, with their share of spending rising to 3% from 1%.

Figure 3 PhotoThe online retail channel, which includes Amazon, accounted for 35% of respondents’ spending on all new books—both print and digital—in 2014, down from 38% in 2013. Online retailers accounted for a larger share of unit sales (39%) reflecting the impact of lower-priced e-books. The decline in online retailers’ share of spending despite growth in the e-book market suggests that e-tailers’ share of print book sales may have declined last year.

Bookstore chains’ share of respondents’ spending fell from 25% in 2013 to 22% in 2014, and their share of unit sales last year was 21%. By contrast, the share for the book club/book fair channel grew to 10% of spending, up from 5% in 2013 (note: Audible is considered a club for this survey’s purposes, and the increase in sales through the club channel reflects higher sales of digital audio).

Independent booksellers’ share of spending dipped from 5% to 4% in 2014, according to Nielsen.

Nielsen’s survey also found that the percentage of e-book buyers who own an Android phone took a big leap in 2014, with 33 percent saying they owned an Android phone in 2014, up from 9% in 2013. Apple’s iPhone was still the digital reading device most of them owned, but its share in 2014 rose by only two percentage points over 2013 (the survey allowed consumers to report using more than one device).

The iPad’s share of owned devices also rose by two percentage points in 2014, while dedicated e-reader ownership declined; 21% of e-book buyers said they owned a Kindle e-reader, down from 25% in 2013, and 9% said they owned a Nook device, down from 12%. E-book buyers also showed slightly less interest in Amazon’s tablet, the Kindle Fire, with its share dropping by one percentage point in 2014, to 23%.

Some Great Big Gaps

The AAP and Nielsen data, while providing useful information that can point to important trends, does have some holes. As mentioned, AAP data doesn’t cover the entire industry, while Nielsen BookScan data doesn’t cover e-books. And lack of reliable e-book data is the most important omission.

Figure 4 PhotoAmazon does not supply figures for e-book sales, presumably because, given its large market share, the data would expose too much of its business. This omission means that industry numbers do not include e-book sales by hundreds, if not thousands, of publishers, and by tens of thousands, if not hundreds of thousands, of self-publishers. [See “Amazon: Friend or Foe?”]

Sales of print books by self-published authors are captured by both sets of Nielsen reports to the extent that they occur in outlets that report to BookScan or are reflected in responses to Nielsen Books & Consumers surveys. And BookScan does get data on print-book sales from almost all the largest retailers that sell books. But its coverage of sales in nontraditional outlets is weak, and those are places where many independent publishers and authors sell lots of books.

What we are left with, then, are statistics that show modest to flat sales growth for most parts of the industry in 2014. The rapid rise of e-book sales has clearly cooled, but so too has the worrying drop in sales of print books.

And it is worth pointing out one other trend not covered by the statistics—profitability. Using available data, Publishers Weekly has consistently reported that book publishers have remained profitable despite a struggling economy and the transition to digital publishing.

In 2014 PW found that profit margins were generally above 10 percent in five of the largest trade houses, and the magazine also took note of rising sales reported by distributors serving smaller houses. One thing that has helped publishers is that e-books, despite all the angst their arrival caused, are more profitable than print books.

Jim Milliot is editorial director of Publishers Weekly. He can be reached at jmilliot@publishersweekly.com.

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