Featuring Jenny Pedroza, co-founder of the Writers Coffee Shop; Mark Coker, Founder, Smashwords; Sandra (Sandy) Poirier-Diaz, President, Smith Publicity, Incorporated; and Bob Young, CEO & Founder, Lulu.com.
This panel’s industry insiders know how to ensure that a book will stand out in the dynamic world of self-publishing and they shared with CCC’s Chris Kenneally their insights on what every self-publisher needs to know about the secrets of the editing process; the art of cover design; the tricks of the publicity trade; and how to create and find winning sales ideas.
Recorded at uPublishU, the day-long self-publishing pre-conference program of BookExpo America 2012.
KENNEALLY: I have one question for everybody this morning. Is there any better place to be on a Sunday morning in the spring than the Javits Center at 9:00 AM? I don’t think so, considering the panel that we’ve got right now, and the subject for today, which is all about the explosion in the self-publishing world.
You can get all sorts of numbers. Self-publishing – any kind of publishing, really – is a bit like Congress. You can get all kinds of numbers to justify any statement you make. But I’m told at least 400,000 self-published titles will appear this year. So that means, in about the time it takes to have the conversation we will enjoy this morning, more than three dozen books will appear.
And in contemplating figures of that kind, I think of Mae West, but not for the reason that you’re thinking. Mae West said a number of things. She’s remembered for that sort of caricatured figure, but let’s remind ourselves that she was a great playwright, as well as a fine actress. And she pointed out one time that too much of a good thing is simply wonderful. That’s what we have right now. I think that the self-publishing revolution – and we’re going to discuss it with our panel – is really making it possible for people to express themselves in ways that simply weren’t allowed, weren’t available to them in the past. A recent poll said that four out of five Americans believe they have a book in them, and I want to ask you, what’s wrong with that?
So, with that, we’re going to start with somebody who I believe needs an introduction, because she’s appearing for the first time in her new role as a publisher. Jenny Pedroza, welcome. Jenny is from Mansfield, Texas. She’s the co-founder of The Writer’s Coffee Shop, an independent publisher based out of New South Wales, Australia. We’ll get her to explain the connection between Texas and Australia in just a moment. And last week she completed a 16-year career as a third-grade teacher to devote herself to publishing full-time. So, again, Jenny, welcome to uPublishU.
PEDROZA: Thank you very much.
KENNEALLY: Now, if you haven’t heard of Jenny or The Writer’s Coffee Shop, you probably have heard of a title they first published, which is called Fifty Shades of Grey. And we should tell people briefly that The Writer’s Coffee Shop was created by Jenny and three other women, Amanda Hayward, Jennifer McGuire, and Lea Dimov. The love of literature united them, despite the fact they were scattered around the globe. And after creating friendships in an online community, they had a desire to help talented writers become published authors, and The Writer’s Coffee Shop Web site grew from a place to discuss books into a publishing hub in October 2010.
And, Jenny, we’re going to have to talk a little bit about Fifty Shades of Grey. And I’ll remind the audience that I believe the figure now, in the last six weeks, is 10 million copies have been sold. It is the publishing phenomenon of this season. I believe 25% books of sold right now are Fifty Shades of Grey. Tell us about what went into discovering E.L. James, and making that book available to the world.
PEDROZA: Well, one of the things – we were an online writing community. That’s how we all met. And, basically, this was mostly women. I say women. I’m sure there were some men in there as well. But they’re mostly women. They were on there publishing for the first time, online. They were wonderful stories that they were too afraid to go out there and send to the big publishers. And so they were writing, and we were reviewing, and we were getting to know each other really well, and basically, we became good friends. And the author, E.L. James, was one of these women that Amanda, my co-founder – she and Amanda talked greatly for between six and eight months.
KENNEALLY: And these friendships conducted entirely online. You never actually met?
PEDROZA: Correct. No, we have now. We have all met now. But up to probably last year, we had not ever met in person. We’d Skyped, different things like that, but it was all online. And so we worked really hard to get her online and on board, and we brought the world Fifty Shades of Grey.
KENNEALLY: Well, what’s interesting about the story is that you really had no intentions of publishing. This was about community, and I think that that’s a note that we’re going to hear throughout the day’s program. Community is really important. And you certainly had no publishing experience, but that wasn’t something that held you back.
PEDROZA: No, it really wasn’t. We had an idea that, first of all, as you said, we were just writing together, getting to know each other a bunch. And I’d say there was about 50,000 of us at the time on our site. So it was a nice little quiet group. (laughter) And we continued to grow all the time. And, basically, we saw these stories, and some of them were just amazing. And we said, OK, these women need a voice. They need to be able to get their word out there. So that’s why we decided to start the publishing house.
KENNEALLY: You know, not everybody has agreed that these writers should have a voice. In fact, for at least a while, the book was banned in Florida libraries. I understand that the ban has been lifted, in part because of a petition that was started by a mother and her 16-year-old daughter. So I guess I wonder about your thoughts as a now former third-grade teacher. You left the classroom to get on a plane to come here to speak to us today –
KENNEALLY: – which is really a great story. Do you think that there’s an incongruity there between being a third-grade teacher and the publisher of something that’s come to be known by –
PEDROZA: It would definitely not be part of the curriculum. That’s for sure. But I think it does speak volumes as to, when you have an idea, when you have a story in you – even third graders have stories in them – that you can get it out, you can get your voice out, you can be heard. And I think whether someone does or doesn’t want to read it, that’s your choice as a reader. That’s your choice as a writer, depending on what you want to write. So, sadly, even bad press is good press. Even the ban that got the word out there again. So it just depends on what you read.
KENNEALLY: Well, it reminds me of another Mae West quote that I like. Someone said, when they saw these diamonds she had, “Goodness, those are wonderful diamonds.” And she said, “Goodness had nothing to do with it.” And goodness has had nothing to do with your success, Jenny Pedroza.
KENNEALLY: But we’re very happy to have you join us, though. I want to turn to Mark Coker. Mark is just sitting beside Jenny. He’s the founder of Smashwords, an e-book distributor. He’s also an author, entrepreneur, angel investor, and advisor to technology startups. Mark and his wife Lesleyann co-authored a satire on daytime television soaps they called Boob Tube. The book was rejected by every major New York publisher, despite representation by a top literary agency.
And that experience, which may be familiar to people in the room, inspired him to start Smashwords, which is a free publishing platform that allows authors to publish their works online. Mark, just to give people another few figures around the explosion in all of this, in 2010 Smashwords published 28,800 titles, and I think the number in 2011 was 92,500. How many so far this year? Do you have an idea?
COKER: Well, our catalog has grown to 127,000.
KENNEALLY: So you’ve added 30,000 or 40,000 more since then, probably.
KENNEALLY: Well, it’s a remarkable story, and I guess I want to get your reaction, first of all, to what Jenny’s just told us. Does that sound familiar, when you go out to meet with self-published authors, people who are on your platform or work with other platforms, do you hear the same kinds of things?
COKER: Well, I think what Jenny said that really resonates with me is that writers now have the freedom to publish anything they want, and readers now have the freedom to choose from this amazing diversity of talent that’s now available to them. And although the publishing establishment thumbs its nose at Fifty Shades, it’s a brilliant book, because readers think it’s brilliant. And I’m really happy for its success, so congratulations.
KENNEALLY: It’s a really interesting thought, Mark, because I know you’ve written about this a lot. And that point about reader passion, and tapping into that, is something that authors really need to recognize and celebrate, and also never forget.
COKER: Sure. Sure. And I would also add that one of the challenges with traditional publishing is that you take – traditional publishers, the folks who work in publishing, are all wonderful, amazing, passionate people, but they’re making their best educated guess to acquire books that they think have commercial potential. But they don’t really know for sure which books have commercial potential until that book hits the streets and readers react to it.
KENNEALLY: Yeah, and so the greatness of any book, of any publisher, is almost accidental, which may be familiar to you as an angel investor, too.
COKER: Sure. To a certain extent, it’s all about creating the best product you can, and then throw it against the wall and see if it sticks. You really don’t know if it’s going to resonate with your target audience until the audience touches it.
KENNEALLY: One of the questions I think a lot of people in the room will have is, once I’ve written my book, how do I find readers? How do I get them to discover me? That’s the new term in the industry, discoverability. And I know you did a survey recently which looked into that question. It was on mobile reads, and it asked how e-book readers, or e-book buyers at least, discover books. Tell us what you found.
COKER: Sure, yeah. We did a non-scientific survey over at MobileRead, the online community of e-book enthusiasts, and I posed 12 questions. I asked e-book enthusiasts there to name the single most common method of e-book discovery that they use for the books that they purchase. I gave them 12 different answers that they could respond with. The number one response was that they turned to their online communities, blogs and message boards. That was about 28%. So they trust their hyperfocused online communities for book recommendations, and that was compared to only 4% who answered immediate friends and family. So that was interesting.
The second most common method of discovery was that readers look for their trusted favorite authors, that was about 18% answered that. So that speaks to the importance of author’s brand, and the importance of you as an author building your platform.
KENNEALLY: Let me take apart two things you just said, Mark, because I think they deserve attention. One is the point that communities matter. We heard that from Jenny. She started with a community that grew into a publishing business. Describe some of these communities. They cover absolutely any subject, any interest, any person.
COKER: The wonderful thing about the Internet and online marketing is that you can find hyperfocused communities of people who are appropriate for your book. Let’s say you wrote a book about how to grow massive tomatoes or pumpkins. Well, there are online gardening communities, and many of those communities have message boards or forums that you can join and participate in and add value to. So that’s some examples. And then, of course, there are probably dozens, hundreds of blogs that focus on growing tomatoes or gardening.
KENNEALLY: Right, but then the other piece was that the brand is the author. And brand is a term we hear a lot about. Publishers are trying to assert their brands. I ask myself, what is a brand? And I often think a brand is a commitment that, in the case of a company, the company makes with the customer – we’re going to do something, and we’re going to really do it consistently and well. Talk about what it means for an author to be a brand, and how do you get to that point where you’re recognized for that?
COKER: Well, yeah, I see the author as the brand as the same thing. A reader will come to know you and trust you, and expect a certain quality of content, of book, from you. So much of this is about you earning the reader’s trust, and you want to earn your target reader’s trust. If you’re writing romance novels, don’t target fans of horror or other genres. That’s the way I see it.
KENNEALLY: But at the end of the day, having done this survey, and just the experience with Smashwords, how important is marketing? What are some of the other pieces that are important, as far as you see it?
COKER: Well, those first two items in the survey were not surprising. The most surprising thing was that all of the other answers were fragmented. All the other slices of the pie were very small. So like 5% or 6% said they only look at e-book covers, and then if they like the cover, they’ll investigate the book. About 4% said that they will download anything, and then they’ll give it a try. About 5% said that they will only download free books, and if they like that book, and they like that author, then they’ll seek out the other books by that author. And if you looked at all the other answers, they all fell under this category of random browsing.
And what’s interesting there is it really, I think, accurately mimics how we often shop for books. If we walk into our local Barnes & Noble, we have this idea that we want to buy a book, and maybe it’s romance, or a thriller, or a memoir, but we don’t know which book we want to buy. And so we walk down the shelves, we’ll pick up a book, we’ll look at the cover, we’ll look at the back cover, we’ll open it up, maybe read a few pages. And so what we’re finding is that the e-book discovery process is very similar.
So one of the opportunities for authors is to really recognize how readers discover books. I like to think of a book as this object, and attached to this object you attach all these little dials and levers that make your book more available, more accessible, more enjoyable to your readers. I also like to think of this idea of mounting a beacon on top of your book. Those are the discovery items, so that when someone’s looking for a book similar to your book, they’ll find it.
KENNEALLY: And as far as beacons go, I want to turn to Sandy Poirier-Diaz. Sandy, welcome. Actually, why don’t you grab the mike there next to Bob? Yeah, we’ll get to everybody and just down the line, then I’m going to mix up the conversation a bit. But I think this is a good progression, because Sandy is president of Smith Publicity, with offices in New Jersey, New York City, London, Toronto, and Los Angeles.
In a 15-year career, she’s led, designed, and executed thousands of print ad public relation strategies, direct mail campaigns. Her publicity success includes placing clients in Today show, Parade magazine, Wall Street Journal, all that sort of high-end media. Sandy, Mark was talking about placing beacons on books, and certainly one way to help that beacon really get a laser brightness is to find yourself in the media. First, let me ask you this – in the past, the self-publishing label was a stigma, and I think you want to try to dispel the idea that that is no longer the case, or that it has gone away.
POIRIER-DIAZ: Absolutely. When Smith Publicity started by Dan Smith back in 1997, he was one of the first people who would actually take on a self-published author. He had a different perspective – as we do as a company – that we look at each book on its own merits, and if it has good quality, if the author has interesting credentials, it’s a good story, valuable information for readers, then we’re going to take it on and try to help authors really get meaningful awareness for the book, which is needed.
Now, probably five years ago or so, when we’d be pitching a book to the radio station, we would get responses back – if this is self-published, don’t bother sending it. Interesting information, self-published – not interested. Even five years ago. Today, that is absolutely not the case. We never hear that question – if this is self-published, don’t send it. So the world has accepted, the media has accepted that self-published books are of value, and have definitely a place in top-tier media.
KENNEALLY: In a way, it’s like the transition that made – I mean, you can’t call it a B movie any more. It’s independent film.
POIRIER-DIAZ: Exactly, and it goes along with – it’s true. I think –
KENNEALLY: So now maybe these are indie books.
POIRIER-DIAZ: Exactly. There was independent music, independent film, and now independent books. And as we were talking about before, let the buyer choose what they would like to read.
KENNEALLY: What about building a brand? How can media placement, publicity, build an author brand, Sandy? And maybe dispel another myth, which is about the difference between publicity and advertising. Just delineate those for us.
POIRIER-DIAZ: Sure, and a lot of what we do is education, because you all are experts at writing books, you’re experts at your topic and passionate. And we provide a lot of information about the difference between, say, publicity and advertising. Advertisement is paid, where you pay to place a specific ad, whether it’s in a magazine or on TV. The consumers know it’s paid. The consumers know you’ve paid for that space.
Publicity, the biggest difference is, we make you part of the news. Much more credible. Very much more difficult to get, because we have to convince the writers and editors, reporters, producers, that what you have to say is of value, as opposed to just putting an ad in the paper. So the ad is very controllable, you know what’s going to be there, but being quoted in a story, having your book featured in some way as part of the story. Absolutely, in the reader’s eyes, and book buyer’s eyes, much, much more credible.
KENNEALLY: And an author has to be ready to talk about something besides the book.
KENNEALLY: I mean, if I was going to interview Jenny, which I would love to continue to talk with you – I was a reporter in my previous life – I would want to ask about the third-grade teacher, what the reaction was in the classrooms, in the schoolyards, how it feels to suddenly find herself as a publisher. There’s a story there that goes well beyond the book itself. And you direct authors to help develop that story.
POIRIER-DIAZ: Absolutely. And we always joke, when you’re doing a radio interview, nobody wants to talk to a book. They want to talk to someone who’s interesting, lively, engaging, has something to share with their reader. So it really, oftentimes, isn’t about the book. If you ever listen to NPR, for example, and you’re hearing the author have a really interesting background, interesting – like Jenny – it makes you want to go out and learn more about them. So what we’re really trying to do with media placements for author is to spark that interest, so that the consumer will want to learn more about you, and hopefully go out and buy your book.
KENNEALLY: I want to turn finally now to Bob Young at the end, with the Lulu cap on. Bob Young, welcome.
YOUNG: Thank you, Chris.
KENNEALLY: Bob is founder and CEO of lulu.com, an international marketplace for new digital content, with more than 300,000 recently published titles, 15,000 new creators from 80 different countries. And I think the point I want to bring up is that this is hardly your first startup. You were co-founder of Red Hat – you had a red hat in the old days, now you’ve got an orange cap – which many will recognize is the open-source software company that gives hardware and software as a standard platform on which to certify that technology. Red Hat is now a Fortune 500 company, and so you went from there to found Lulu in 2002, which is – I don’t know, in the terms of self-publishing, in terms of publishing, is in a galaxy far away. Things have changed so much in those 10 years.
YOUNG: They sure have. My background is in technology, so I’m looking out at this group – and, by the way, thank you all for showing up at 9:00 on a Sunday morning. When Chris and I were discussing this event, we thought we’d be talking to each other. (laughter) And we were hoping a few of you might be at home reading your Twitter feeds. That was about as close as we thought we were going to get to an audience. So I’m flattered. I think we’re all flattered by the effort you made to show up.
So my background is in technology. I build technology companies. And after we did Red Hat – and I start things. Like Mark, I’m very much an entrepreneur. And the reason I’m an entrepreneur – many entrepreneurs are entrepreneurs because of a vision, because of – I’m an entrepreneur because no one would give me a job. (laughter) And that puts me in exactly all of your category.
When you go to write a book, before you put pen to paper, I would encourage you to think about your book as your business. And so when you think about any business, how do you start? And you don’t start with the product. You start with the customer. So you have to have a clear idea of who you are writing for. And if you can start with that – so my favorite author at Lulu – we have a bunch of great authors showing up here at our booth during the conference for the next few days.
But my favorite author is not one that we were able to convince to come to New York City, because he’s a software engineer working out of his little apartment somewhere in some skyscraper in Singapore. He contributes to an open-source software project called Zen Cart. It’s a shopping cart, so you may run it on your own Web sites, if you run a bookstore, for example. And he writes the material, the training manuals for this. It’s a very specialized service, and he’s very good at it, so he charges a lot for these manuals.
KENNEALLY: What’s a lot?
YOUNG: He charges $75 for a book.
KENNEALLY: And in a year, do you have an idea, or can you tell us how many he sells?
YOUNG: He only sells between 1,000 and 2,000 books a year. But he knows precisely who his market is. But keep in mind, the whole point to self-publishing, the whole point to an open publishing platform, is you’re in charge. You keep all the money. So in his case, on $75, he’s earning more than $50 per book. He sells 1,000 books – Jenny, I’m not sure how many copies of Shades of Grey – but Mr. Goh sells 1,000 or 2,000 books a year. If he sells only 1,000 in a bad year, he’s only pocketed $50,000.
$50,000 puts him in the top 1% of all published authors in America. So he is a one-percenter living in his little flat in Singapore. And what Lulu has enabled him to do by offering this platform is he gets to bring his book to market without having to travel to New York City. And along with what we were able to do with Jenny and Shades of Grey, it gets you out of bed in the morning.
And so this is my real attraction to this show, why I like publishing so much more than technology. In technology, it’s a cold service. A very valuable service, but it’s – how do you get excited about selling another computer? But selling another book, that’s a passion, and you’ll see it over the course of the next few days, of just everyone on every side of this industry is passionate about what we do. It’s just so much more fun than technology.
KENNEALLY: Right. Well, to underscore the point of the transformation that’s taken place in the industry over the last 10 years, Lulu now not only supports authors, but you’re working with publishers. So these technology components, these APIs that allow people to sell in multiple currencies, or to distribute, and so forth – sometimes an author grows into a publisher. Take a look at what we’ve got here on this end of the table. Talk about that change, and the way that technology is influencing the publishing business. I like to ask the question, since when did publishing become a technology business? It’s now very much a technology business.
YOUNG: It sure is, as Mark will tell you. Mark has – what do you call yourself? Are you a publisher?
COKER: We’re a distributor.
YOUNG: OK, but here’s Mark, one of the leading distributors of new books these days, and he doesn’t put a single word on paper. So this is all about technology. And by the way, just for your benefit, so that you don’t get too intimidated by the amount of technology you’re dealing in, that’s what you look to guys like Mark and me to do for you, is there are great technology partners for you guys who, if we’re doing our job properly, will protect you from all this technology.
KENNEALLY: Right. Well, you raised a point, Bob, in the case of Smashwords – not the only platform that does it – it’s e-book only. And I want to ask a question of anybody on the panel here about the debate around print or not to print. I think everybody’s got an opinion here. I’ll ask Jenny first, really. You all started in an online community, but ultimately felt, I think, that going to print was important. Why?
PEDROZA: I think that there’s something magical about having the book in your hands. And primarily we did sell e-books. There’s no doubt about it. But you have to think of the genre that we were writing, as well. I think that the privacy of having it on your reader was one of the factors of why we sold so many in the e-book area. But we’ve had people that have bought the e-books and have come back to us to get the printed books, because they want to have them. There’s something about having that book in their hands.
KENNEALLY: In fact, people scrambled to get the last printed editions from Writer’s Coffee House because once Vintage took over, those were going to become collectors’ items.
PEDROZA: Right. In fact, for a while there, some of them were selling upwards of $900 per print. Not ours, but people were selling theirs on eBay and different things like that. Yeah, there’s a certain aspect of it. People want to have that in their hands, which is not something that you can actually do with an e-reader sometimes. It’s just a different – and it may eventually work its way out. But it’s kind of like a letter in the mail. I kind of equate it to that. You can get an e-mail, and that’s great, but there’s something about when you get a card from your grandma that just makes it kind of special. So it’s kind of along that same area.
KENNEALLY: Yeah. Sandy – and I know everybody’s got an opinion, but I want to ask what the media thinks. Does the media expect to see a printed copy? Will they talk about an e-book only?
POIRIER-DIAZ: That’s a great question. Probably over the last two years, we have started working with e-book-only campaigns, and there’s a service called NetGalley. If you haven’t heard of it, they’re fantastic at getting your e-book for free to the media librarians, booksellers, etc. So that’s a great way to get the book in the hands.
Three years ago when NetGalley started, when we tested it out, not many people had e-readers. Now, if you’re a book reviewer, that would be your first tool, is to have an e-reader. Who wants to take home stacks of books? So while we still like to have a few printed copies for the people who don’t have e-readers, there are many projects that are very successfully reviewed by the media in e-book-only format.
KENNEALLY: And isn’t the reason because then you can hold it up in front of the camera?
POIRIER-DIAZ: Yes, and sometimes we just get covers to do that, exactly.
KENNEALLY: Is that right? Really?
POIRIER-DIAZ: Yes, exactly.
KENNEALLY: Bob Young, your business still prints books. You believe in print. Defend print.
YOUNG: OK. So we do everything. We’ll do PDFs if you want to read it on your monitor – let me rephrase that, if your customer needs to read it on his monitor. We do e-books if your customer needs to read it on his iPad. We do physical books in a wide variety of format. So if your customer needs to read it on paper, if he needs it printed in Australia, because he doesn’t want to ship a paper book to Australia, we can print it for him in Asia. We can print in Europe. We can print wherever your customer is.
The point is – and here’s the secret, pay attention – there’s no such thing as a book. There is only content. The book is simply the vehicle. We’ve confused the traditional reader, which was sheets of pages bound between a cover. It was an iPad or a Kindle – I was going to say 100 years ago. We’re talking five years ago. So in the same way a Kindle is a reader, so is a physical printed book a reader. There’s no such thing as a book. So if you have content, and if you’re selling content, the trick is, who are your readers, and what format do they need to read in?
As an example, if you’re publishing workbooks, biology textbooks, that will always work much better on paper than it ever will in any form of reader, because you can interact with paper in a way you can’t interact with your e-book reader.
KENNEALLY: Right. I’ve also seen stats that show that still, today, 2012, the most common way that people read a book online is on a laptop or a PC. So as much publicity as the iPad or other tablets have received, people are still reading on their breaks at work, at lunch, and that sort of thing, at their desk, using a laptop. And so, keeping that in mind, I think, and again, thinking about how people read, is an important point.
Mark, I’ve saved you for last, because I know you have a contrary view of all of this. Is that fair to say?
COKER: Yes and no. I agree with –
KENNEALLY: That’s being clear.
COKER: I agree with Bob that print, e-book, these are just formats. They’re just containers for your words. Now, I’m a lover of print books. My wife and I collect books. We own thousands of books. We have so many books they won’t fit in our library. And our idea of a great vacation is going to a used bookstore in some unknown town. But I think, for most self-published authors, I think print is dead.
Now, there are exceptions. If you’re a nonfiction author, and you’re a subject matter expert, and you do a lot of public speaking, and you’re out before many people, or if you have a really large platform, then print makes a lot of sense for you. I would encourage you to do that. But if you’re a fiction author, I would encourage you to do e-book first, and then if your book becomes big, and it becomes commercially viable to do print, then do print. There are great providers out there that will help you do print. Lulu is one of them, CreateSpace is here. I definitely recommend those two folks to look at.
Now, Chris, on the market share, you talked about how – I think you mentioned e-books account for about 20% of the overall market, and print is the rest. I think those stats are misleading, because although those statistics are probably somewhat accurate, they’re referring to the entire universe of books. And as a self-published author, you don’t have access to brick-and-mortar bookstores. It’s really difficult to get your book into brick-and-mortar bookstores unless you have the support of a large publisher. So it means you’re not going to be able to easily tap into that 80%.
And when you have both a print book and an e-book listed for sale at Amazon or Barnes & Noble, and your customer has a choice between purchasing a $15 or $20 or $30 book and a $3 e-book, the sale will often go to the e-book. I know most of our authors at Smashwords – we’re working with over 40,000 authors – most of them will tell you that they sell many more e-books than they do print books.
KENNEALLY: We’ll get to the subject of price in just a second, but I was thinking about books. I also – I’m a book author, I’ve committed that crime once or twice. I love my books too. I loved my record collection at one point. And I know that my daughter hasn’t bought a CD probably in three years. She buys one for me every once in a while, because she knows it’s for the old man. But I imagine a time when the book collection as object, as a physical thing, will take the same place as that record collection. But we’re still in that transition period, I believe.
Let’s talk about pricing. Mark, continue with you. Does price matter? If so, how?
COKER: Well, price definitely matters. If you’re self-publishing an e-book, your customers, your readers will expect that that book is priced less than the print counterpart.
KENNEALLY: How much less?
COKER: Well, a lot less. We’ve done some research here. We just published some research about a month ago. We looked at our entire catalog of books, and millions of dollars of sales across multiple retailers, such as Apple, Barnes & Noble, Sony, Kobo, all these retailers that we distribute to, and we sought to identify, what is the average price that consumers want to pay for books, and what price points earn the author the most money, and what price points get the most downloads.
We found that, surprise, surprise, the price that gets the most downloads is free. We looked at our downloads over at Apple, and free books get about 103 times more downloads than paid books. So that’s really interesting. It says that free is important if you’re looking to build your platform and reach a lot of readers. If you price your book at 99 cents, you’re going to reach a lot more readers than you will at $9.99, but we found that you’re not going to make more money. We actually found that the 99 cents and $1.99 underperform all the other price points.
We found that $2.99 to $5.99 seems to be the sweet spot for self-published e-books. This is one of the things about self-published e-books. When you self-publish an e-book, you are going to earn 60-80% of the list price as your royalty, which is a lot more than you would get from traditional publishing. From traditional publishing, you’re going to get 5-17%. And so what this means is that you, as a self-published author, can price your product lower, yet still earn more per copy that you sell than you would through the traditional route.
KENNEALLY: That’s what they call the new math, as far as publishing goes. I want to drag Bob Young back over to that microphone. Bob, the instance you gave us of Mr. Goh in Singapore, he’s charging $75 a copy. So it’s possible to go far higher than $5.99 or $9.99. Tell us what you’ve learned at Lulu about price.
YOUNG: Chris, this is probably why you invited Mark and I on the panel. You need at least two people to get to fisticuffs who are in the same space. (laughter) And here’s where Mark and I probably disagree, is that I think – again, I’m a business guy first. I look at your book as your product, and the single most common mistake businessmen make across the universe is, they underprice their product. Let me repeat that. The single most common mistake most businessmen make at all times is they underprice their product.
Because that’s how the free-market system works. We work because we get paid for what we do. If you write a great book, and you don’t earn any money from it, you don’t have any money to pay the rent so that you can write the next great book. You are not serving your customers if you’re starving to death, because your customers want a brand. They want a better book the next time. If you don’t earn anything from your book this time, how do they earn any book next time?
Now, don’t get me wrong. I’m a big fan of free. I’ve built a company that has become a billion-dollar company on the premise of free software. But you have to be very tactical with free. Free is a great way to build an audience, but once you have an audience, how do you monetize that audience? How do you get them to pay you for it? If you’re providing something of great value – John Grisham, as a great example – John Grisham doesn’t have to give away his book for free. In fact, John Grisham isn’t even in the $2-$5 price range – is that your sweet spot?
COKER: $2.99 to $5.99.
YOUNG: Thank you. So $3-$6. He’s not in the $3-$6 price range because he has a brand of sufficient quality that when you buy that John Grisham book for $9.99, or whatever the current price is, there’s a quality assurance with that book that, when you buy a new book from someone you haven’t heard from before, you might not have. So if you can build a following by giving books away for free – Shades of Grey being a great example – then you’ve got an audience for the publisher, if you sign up with a traditional publisher, will work for you, or an audience that Sara (sic) will help you connect with.
So the trick is to do your analysis of who you are writing this book for. In Mr. Goh’s case, he was writing this book for technology users who were using this shopping cart tool to make money. He goes, if I can help them make a little bit more money on their Web site, $75 is chump change to them. His argument is, he should probably charge more than $75.
KENNEALLY: I want to put Jenny on the spot here – Jenny, if you grab that microphone – and ask you about the monetization piece of this. I mean, when you sat down in Texas and worked with people in Australia – and we haven’t even got to that point about how the heck you found somebody to talk to and work with in Australia – but when you got together originally, was money part of the discussion?
PEDROZA: Oh, absolutely. We weren’t ever thinking it was going to ever be this big, but, yes, there was a definite – we had to figure out how much the authors were going to get, how much the platform that we were using was going to get, and then, of course, what we were going to get in order to survive. Now, we never, as a company – I think he hit the nail on the head with that. You have to be able to price it high enough that you are going to be able to continue to grow. I think that’s important.
KENNEALLY: And you have to grow – sorry, you have to have that income, because as you’ve grown, you’ve begun to work with editors and designers. There’s a whole network of people who go beyond just the four of you.
PEDROZA: Absolutely. Well, we started with four, and now we have about 35 around the world. We have people in Belgium, we have people in the UK, Australia, all around America. So it does. Now we have to support this growing workforce. So it definitely is. You have to really watch and make sure that you’re charging enough, but not too much, so that you can reach your target audience, definitely.
KENNEALLY: Do you have any specific pricing range that you found was more successful?
PEDROZA: We have found that e-books, around $9.99 is probably the – is our standard. Any over than that – that’s where we have capped it. And then as far as print books, we kind of base it on the number of pages and the audience that it goes to.
KENNEALLY: Right. Well, we’ve come up to the end of our official time. We got a bit of a late start, and I want to offer at least an opportunity – there’s a big crowd here. I don’t see any microphones for people to go up to, but I’ll do my best to relay a question or two before we let this great panel leave the stage. So I see a hand there. Yes?
KENNEALLY: If I can sharpen that question and rephrase it, you’re asking, why can’t we all just get along? I think that’s the question. And I think the point is that what we’re seeing here is, that may be the legacy of something that began 10 years or more ago, and as the self-publishing author community converges with the traditional publishing community, I think that that debate is going to end – if not end, at least the volume level will go down. I’m seeing Bob Young nod yes. Bob, what do you think?
YOUNG: Well, yes and no. But Chris, this goes back to your former profession. The media loves confrontation. It’s hard for us to get any media coverage if we don’t say bad things about someone. (laughter)
KENNEALLY: So obviously Bob succeeded today. He’s been teasing Mark mercilessly here.
YOUNG: The short answer is, you’re exactly right. There’s lots of room for both traditional as well as self-published. But as Mark and I demonstrate, and certainly as Shades of Grey illustrates, you don’t have to go through the traditional publisher, where only 20 years ago that was a requirement to get your book to market.
KENNEALLY: Right. And I love the idea that the questioner made – a point she made, which is that this is about entrepreneurship. This is something really apart from publishing itself. I see a hand back there. Yes?
KENNEALLY: Just to be sure everybody heard, the question is asking, so is there any reason – I’m going to, again, sort of narrow this down – is there any reason to work with a traditional publisher? Maybe the question could be put this way. What kind of an author might find it preferable to work with a traditional publisher? And I agree, I think Sandy could take that question.
POIRIER-DIAZ: That’s a great question. The author that is a better candidate for a traditional author is one that doesn’t want to be an entrepreneur. When you’re a self-publisher, you have to find your editor, often. You have to do the book cover design, back cover copy, find distribution channels. You have to market yourself, which you have to do traditionally as well.
But if you really want to focus on, perhaps, just writing, or other parts of your career, a traditional publisher may be a better place for you, because they’re taking care of all those details. You lose control, the timing is out of your control. It could be a year to two years before your book gets to market. But maybe that’s OK for you.
From a publicity and media perspective, there is still a little bit more of a benefit to having the traditional published title or brand next to the name. It does raise you up a little bit. Not enough to necessarily pick one over the other, but it does open a few more doors, especially getting on the bookstore shelves. I think less than 1% of books published actually get on bookstore shelves. But a traditional publisher usually has the avenues to make that happen. So there are a few reasons why somebody may choose traditional.
KENNEALLY: Mark, you want to get in there on that?
COKER: I agree with everything you said there. But I would just point out that I think 10 years from now, there probably won’t be very many bookstore shelves. When you look at how self-publishing has evolved over the last 10 years or so – and Bob can probably speak to this more than I can, because they are a true pioneer on the print side – four years ago, when we started Smashwords, there was a stigma with self-publishing. Self-publishing was seen as the option of last resort. It was seen as the option for failed authors.
Now that stigma is disappearing, and it’s disappearing very quickly. I think what we’re going to see over the next few years is a new stigma develop, and that’s going to be the stigma of traditional publishing. I think authors will be sitting around the table, and someone will raise their hand and say, I just got a big deal with New York, and their fellow authors are going to say, I’m so sorry to hear that. (laughter) Now, laughing about this –
KENNEALLY: That’s the tweet of the morning so far.
COKER: This conversation actually is already happening among some of the best-selling independent authors.
Now, to the comment that was made earlier about this battle between self-publishing and traditional publishing, I think it would be great if we could all get along. I certainly respect both sides of it. But I think it’s also important to understand and respect that there are millions of writers out there who have had their dreams crushed by traditional publishing.
Traditional publishers acquire books based on perceived commercial merit. So if your book isn’t perceived to have great commercial potential, then your book is worthless to them. All of us who love books should recognize that a book should not be valued by its commercial potential. The book should be valued by its impact on the reader. And even if your target audience is only 20 readers, that book deserves to be published. That book is valuable to the world.
KENNEALLY: Bob Young, 30 seconds on why rejection slips are a thing of the past.
YOUNG: OK, yeah, simply because you can publish any way you want. But keep in mind, what do publishers do? And, again, just to pick on Mark –
COKER: I’m not picking on you. (laughter)
YOUNG: I’m disappointed! Everyone picks on me.
COKER: Look at his funny hat. (laughter) (applause)
YOUNG: OK, so –
COKER: Don’t fall for it.
YOUNG: – the reason traditional publishers – sorry, rejection slips are a thing of the past is, A, because you can publish yourself. But the key thing to remember is most of us are not salespeople. I happen to be a salesperson, which is why I wear funny hats. And that’s the role of the publisher. There will be a new generation of publisher who will help you take your book to Smashwords, and to promote it on Smashwords, if you don’t want to or don’t know how to do it.
Sandy and I, when she was visiting us a few months ago, I kept saying, well, why aren’t you the publisher? Because they think of themselves as simply the publicist. And I’m going, but you don’t need warehouses, you don’t need copy editors, you don’t need all of that infrastructure. You’re the sales organization. Why aren’t you the publisher? I’ll let Sandy answer that one.
KENNEALLY: Well, I’m going to have to take it as a place to stop, because, in fact, everybody here is a publisher. That’s why we’re all here at uPublishU. I want to thank our panel this morning, Bob Young, founder and CEO of lulu.com, Sandy Poirier-Diaz, president of Smith Publicity, Mark Coker, founder of Smashwords, and Jenny Pedroza, thank you for coming all the way from Mansfield, Texas. She’s a co-founder of The Writer’s Coffee Shop. Thank you all.
COKER: Thank you.
KENNEALLY: As a final thought – and you might want to tweet this – not everybody agrees that this is a good thing. Somebody said once, times are bad. Children no longer obey their parents, and everyone is writing a book. (laughter) Cicero said that in the first century BC. Take care. Thank you.