The last week of February, writer Scott William Carter and I taught a workshop to about twenty-five driven indie writers. The thrust of the workshop was how indie writers can make more money.
During the four days, Scott and I covered everything, from professional cover design to blurbs to paper books to web sites to bookstores to audio sales to traditional sales and translation sales and so much more.
What was fantastic for me was that with twenty-five-plus driven indie writers in the room, the synergy was almost overwhelming. We talked about pricing of electronic, pricing of trade paper, and pricing of audio. We all tossed around a ton of ideas, studied covers, talked about the levels of sales and how they added up and on and on. The workshop didn’t seem to stop for even lunch or dinner or much sleep.
In other words, it was a workshop I couldn’t believe I had been a part of. I learned so much, I had ten pages of notes of things I learned, AND I WAS TEACHING THE THING. Not kidding.
The Magic Pie
So on the last morning, I went to the white board to attempt to put the entire workshop together. Again, remember, the focus was helping indie publishers/writers make more money with each piece of work.
And our second focus had been to try to get indie writers out of short-term thinking and into long-term business planning.
At the white board, I drew a big circle as I am want to do. You know, the image of a pie. My metaphor of a copyright as a magic pie in a magic bakery.
I wanted to summarize all the topics of the long four days into one drawing.
Each story, each novel, each book is represented by one of these pies and each slice is an income stream every month.
So I drew a big slice of the pie and labeled it “Electronic Publishing” and then divided that down into the major players such as Amazon, Pubit, and Smashwords, trying to be general about the size of slice in relation to the size of the income. (I was being general, so I added in the smaller slices for other streams such as other online bookstores or Overlook under “other.”)
I then added another large slice and called it “Traditional Sales” since we had talked about selling to magazines, selling translation rights to overseas publishers, and so on. All that we considered traditional. Most indie publishers early on will make most of their income either in electronic or traditional.
You can see on the chart on the right all the different things we considered in our Long Term approach to indie publishing and making money.
The POD or paper book slice is represented smaller, but for many publishers that slice will just grow and grow. Notice I also have a slice called “Bookstore Flow” which means sales of indie books (and eventually electronic books) to bookstores.
We have a slice called “Web (direct)” that represents selling off your own web site and of course, audio books. And the “Special” section are for things like signed books, enhanced books, limited editions, and so on.
Size is Everything
I know that now most indie publishers chart would be mostly electronic and only a tiny slice, if any of POD or audio or anything else. Electronic publishing is a great way to start. And rightfully, the focus of most starting publishers has been there in this early-adaptor period.
The thing to remember is that the size of the cash streams will change over time in relation to each other. That’s something an indie publisher needs to plan for. For example, I fully expect almost half of WMG Publishing’s income in two years will be from the combined Bookstore Flow and POD Publishing sections. And I expect audio will be bigger than I have it projected and special editions might be huge.
I expect for me (personally) the traditional income to shrink.
And then the workshop ended.
While I was doing this drawing, Annie Bellet’s husband, Matt, had joined us and was drawing the above chart on his computer as part of the notes as I drew my rough drawing on the white board. After we were finished and everyone was standing around still talking, Annie showed me the drawing and I asked Matt if I could use his nifty sketch for this post and he agreed. Thanks, Matt.
But then Annie and a couple others went up to the white boards, laughing and when I had turned around, they had drawn their own representation of “Short Term Thinking” on the board beside the image of “Long Term Thinking” I had drawn.
The chart they drew is on the right, thanks once again to Matt Bellet.
And sadly, I agree.
That second image is how so many indie writers think about their business. While I and others use the cash flow streams from the Long Term Thinking chart while we build for a future.
I have talked about this before. But since there is a huge difference between long-term professional thinking and short-term “I want the money now” thinking, I wanted to just point this out once more.
And these two charts illustrate that difference perfectly.
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Copyright © 2012 Dean Wesley Smith
Cover art copyright Philcold/Dreamstime
Illustrations of charts Copyright 2012 Matt Bellet
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Actually I was half-joking about the translations. I’m not a writer, but I’m having a go at getting some translations up using similar strategies. Based on what you and Kris have been saying I see my best option as being to stick to translating the works of one author for a while and not doing any ‘marketing’ until I have a number up. I’m just putting my first one up this weekend – 4 weeks (9 Mar – 6 Apr) from scratch to Kindle-ready (print-ready file too) for a 26,000 word novella and have just started on the second (the author I’ve chosen has over 30 works and only one has been known to have been translated into English – plus he died over 70 years ago so I don’t have to worry about his rights). That’s working in my spare time (I’m doing a Masters thesis as my main ‘day-work’) and is reasonably fast for a translation – 300 words an hour is a good pace which explains part of why they can be expensive (26,000/300 = ~87 hours; 87 * $50 = ~$4,500 – also many translators have other jobs so the marginal value of their time is higher). With works that have extensive intertextual references or special terminology or spoken dialects it slows down a lot.
And I’m not surprised. That was always true for me when I led the Write For Your Life seminar in the mid-80s. Someone pointed out two cardinal principles to me:
1. You teach what you need to learn.
2. The teacher’s the last one to get the lesson.
Interesting that you see POD likely to increase its piece of the pie. I’ve come to believe that myself as I track the POD sales of The Night and the Music. One of the things this suggests to me is indie publishing is not purely an eBook revolution. The eTechnology fuels it and drives it, but it’s more seismic than that.
Lawrence, thanks for the comment and I agree, sometimes it is the teacher who is the last one to catch a clue. In a number of places in that February workshop I said “Do as I say, not as I do.” (grin) And I really needed some of the stuff I learned from Scott and the other twenty-five professional writers in the room. Fantastic fun. One of those four days that will never be repeated or duplicated and I felt lucky to have been there.
And I honestly believe the successful small press (indie press) will be making more money on the paper side than on the electronic if they do it right after a very short time. And having indie publishers hand me completely professional-looking books certainly gave me even more hope. So I agree completely, indie publishing is not purely an eBook revolution.
Not sure how you are feeling, Larry, but honestly, I’m back having fun with my writing again. And I’m having fun with the publishing side as well. That’s something I haven’t felt about writing and the publishing business in a very long time and I missed that feeling a great deal. That chase you described in your great article from 1981 just wore me down after a few decades, and then the shifts over the last decade on the publishing side ground me down even more. But now it’s fun again and I’m getting up in the morning looking forward to the day. Makes me feel younger. (grin)
@Randy: thanks for sharing your use of KDP Select. I’ve been trying to figure a way to use Select wisely, but was still spinning my wheels. Now . . . I have an idea!
Just thought I’d say how cool it is that Lawrence Block pops in here from time to time to comment. And how on top of things he seems to be with the “indie revolution.” I guess to stay in the game as long as he has you have to be pretty good at adapting. (grin)
Steve, it is very cool. And adapting is the key to staying around longer than five or ten years. Most can’t and thus don’t, sadly.
@Joemontana: “Not to beat a dead horse, but the idea that a short story is not worth 2.99 is a bit bizarre to me.”
Doesn’t really matter what you think, unfortunately. What matters is how well it will sell at that price. For an unknown writer I think that’s a tough sell at that price. The beauty of indie publishing is you get to put it out there and see how it does.
So Dean is that pie chart a reflection of WMG’s current sales? In other words can you break down your sales revenue and see that about 25% is coming from the ebook platforms, about 25% is coming from traditional publishing, a chunk is coming from audio, etc.?
Or is it how you hope things will go? My first reaction is that the chunk of the pie for ebook sales will be bigger and traditional will be smaller, unless by “traditional” you are referring to contractual work being sold to the NY publishers. That’s something a lot of indies won’t be a part of, I’m guessing.
Mark, we’re not at the pie chart completely yet, but gaining on it. Right now, because WMG Publishing did as all indie presses did (because this is a digital revolution), we focused on ebooks, so that part is larger, but the trade paper (POD) part is increasing and suspect the income from paper will be larger by this time next year. And we did have a small direct paper sale off our web site the last six months because of one title. And we are selling to a few indie bookstores, which will increase starting this summer. And we do have a nice audio cash stream. The traditional side is sales to magazines, of books going to other sources that are up on WMG as well, such as Hollywood, overseas translation, library, and so on. The only two areas we don’t have started on the cash streams are the graphic and the “special” section, although we do have plans for both within the year. So yes, that chart looks like WMG Publishing, but the proportions of the size of each slice are different and will be constantly changing from month to month. As will every indie publisher’s chart.
@Ramon: “Someone told me it was rather simple to get books into ibooks, for example, without using smashwords.”
You have to upload via a Mac. Never done it myself but plenty of indies have. I only have a PC so I’ve never tried it. It’s probably worth it in the long run if you have a Mac because you get an extra 10% and you have more control over your description, etc.
By the way, if people want to see a larger version of the long-term pie, you can always right-click and select “view image”. It pops up a larger image that way that is more clear to see.
I keep a print-out of the long-term pie up on my wall. Right next to the goals for number of titles produced each year.
My first audiobook is almost done, Dean! This is too cool.
Thanks for the pricing analysis of AmazonEncore, Irwin. Following your example, I did one of Amazons 47North imprint, which focuses on science fiction, horror, and fantasy. Considering I write science fiction, I thought it would be a good idea to look at the pricing points Amazon is comfortable using to get its new line going.
As it’s too long to post here as a comment, here it is on my blog: http://jamarlow.com/2012/04/amazon-47north-pricing-analysis/
J.A., great blog on the topic of pricing. Folks, go read the blog and if you want, come back here to talk about it. I’ll push people to it on the front page, J.A.
Well done.