Many publishers have business models which look backward to the 19th century rather than forward to the 22nd. The traditional book publishing process can take as long as two years to get a title from manuscript to print book. While this has worked reasonably well in past decades, publishers need to radically change their business models moving forward in order to compete with a huge disruption in the traditional publishing business model: the self-published author. Authors are content creators and are the foundation of publishing. Without authors, there is no publishing. As technology and society changes, publishers need to also change and look for new ways to attract authors in order to continue to sell books.
As self-publishing loses the negative associated stigma and becomes more acceptable to both authors and readers, it will be traditional publishers who will have a more difficult time acquiring best-selling authors, mid-list authors, and new authors. In 2011, 2/3 of the books published were self-published titles. E-books outsold print books. Twenty-five percent of books on the NYT Best-Sellers’ list are products of self-publishers. Traditional publishers are now losing significant revenue to some self-published authors. Self-publishing is also attracting established authors lured by the possibility of greater financial gain and additional control of their work product. For example, Stephen King was the first major author to self-publish and many additional well-known authors since then have dabbled in the self-publishing pool. Self-publishing is now so accepted and (can be) so financially lucrative that there are self-published authors who have refused even seven figure publishing deals with traditional publishers.
As a result, some of the larger publishers are morphing business practices to include some kind of self-publishing revenue stream (Simon& Schuster, and Penguin for example) and are also seeking out and publishing books by self-published authors in order to boost sales. More than 250,000 self-published books are produced annually and 25% of the most popular titles sold on Amazon are self-published.
Self-publishing used to be a stigmatized operation for want-to-be authors who couldn’t get picked up by a traditional publishing house. Even the name “Vanity Press” held a negative connotation in the minds of both authors and publishers because self-publishing did not have a reputation for high-quality work. With new technologies, the growth of the e-reader, and the explosion of digital publishing, the successes of self-publishing and self-published authors are changing that negative connotation. Repeat success of independent authors means that many authors are no longer interested in signing with traditional publishers, especially if those have a fan base and can pocket most of the profits. This, for authors, is an appealing prospect even if the author only sells a few hundred or thousand copies. The end result is a greater profit margin.
Writers can digitally format their books with little effort by using a formatting program such as Calibre, buy stock photos as covers very inexpensively from companies such as Shutterstock, and sell them to readers through a variety of online retailers quickly and efficiently and possibly for a significantly larger profit percentage. Amazon pays indie authors 70% of sales for books priced between $2.99 and $9.99. Smashwords will publish the author’s book for free and take a mere 10% of the book’s sale price. Larger online retailers, like Sony or Kobo, take 30%
Traditional publishing is still very attractive to many authors who want the prestige of a traditional publishing house to validate their writing, but the number of authors needing this validation is dwindling. Traditional publishers promote best-selling books for a small period of time, while promoting mid-list and 1st time authors not at all. The result of this business model is that the previously self-published authors turn again to self-publishing. The author wants to take back the control and the money. Many self-published authors are making more money in a month than many debut authors are likely to receive as an advance from a major publisher. And, the self-published author still owns their rights. With print-on-demand options self-published authors no longer have to print hundreds of books and warehouse them in the garage. There currently is no reason for new or mid-list authors to publish with a traditional publisher other than for the prestige of being “published.” There are still myriad self-published authors selling six copies to their family, but the author has a better chance of making money through self-publishing than through traditional publishing.
As self-publishing continues to grow and become more and more accepted as a standard author publishing practice, how are traditional publishers going to attract authors and continue to make profits? If the cost of publication and distribution for self-publication is effectively $0 (on Amazon and Smashwords, for example), and the copyrights are retained by the author, and the authors’ works will never go out of print, there isn’t much of a downside unless authors become aware of the benefits of going the traditional publishing route (such as marketing assistance, and editorial assistance).
So far, in 2013, a self-published e-book is No. 1. Price may be a contributing factor to the growth of indie pub since self-published authors often offer their first publication free of charge to grow their fan base while charging low prices to sell more copies of their later works. This is a great marketing strategy. Traditional publishers tend to blame Amazon for low e-book prices, when the issue may actually be independent authors who lower prices to gain readers and sell more copies.
What is needed is some tweaking of the traditional business model. Publishers should streamline the publishing process so that more titles can be published at a faster pace. Publishing templates should be created and used (if they currently are not used). Marketing plans should be streamlined and provided to authors to help self-promote. The profit percentages will need to be adjusted to entice new or best-selling authors. It will be a disruptive process for traditional publishers, but can work successfully. For example, Entangled Publishing utilized a new business model to bridge the gap between traditional and indie publishing. They implement an agency model across all departments so that everyone from the copy editor to the marketing director has a stake in the book. If the book doesn’t make money, the employees don’t make money. It sounds harsh, but it is successful. They have streamlined production in order to publish as many titles as possible as quickly as possible. Whiskey Creek Press has some similar features and requires that each author submit a marketing plan with their manuscript.
So, what must traditional publishers do? Publishers and authors must work even more closely together to ensure that each title is as successful as it can be. More time and attention must be devoted to helping authors help themselves. A streamlined process will allow publishers to publish more books faster thereby giving more authors opportunity to become traditionally published. Publishers also need to do a better job of branding the publishing house, and market the publishing house, not just the book titles, which will draw more attention to offerings and also to create a relationship with the reader. One example is to (a la Amazon) offer bundled books for sale. If the reader likes a specific author’s work, the publisher should offer recommendations of similar authors’ titles that can be bundled and sold at a discount to the reader. If the reader is happy, they will buy more books from that publisher. Publisher’s also must be more open to new technologies that will ease the production process, or those technologies that the reader finds attractive, as well as give readers a “browse” opportunity as a reader would have in a bookstore. Some Open Access options should be made available on some titles to draw in readers who will then purchase other titles. Publishers should also expand out into other markets if possible and should also find a way to work with libraries in order to offer more content. Publishers could also offer some kind of assisted publishing process which would give authors more support in order to encourage authors to publish with them. Granted, these are daunting tasks, but if traditional publishers do not address the author question, then the disruption of self-publishing could be detrimental to the point of failure for the traditional publisher.