MONEY MONEY MONEY: How Data-Driven Decisions *Might* Help Authors Reach More Readers

RT Booklovers ConventionApril 11, 2012

Mark Coker Founder, Smashwords

Twitter: @markcoker

This presentation was first given at the Chicago RT Booklovers convention on April 11, 2012

On April 25, I modified it to include notes so Slideshare viewers have better context through which to understand

the data

Visit http://www.slideshare.net/smashwords/presentations to access a wide variety of other presentations from Mark

Coker

My backstory

My wife Lesleyann is a former reporter for Soap Opera Weekly Magazine. We wrote a novel, Boob Tube, that explores the wild and wacky world of daytime television

• Previous soap opera-themed novels had not performed well in the marketplace

• Publishers reluctant to take a chance on the book

• The experience opened my eyes to Big Publishing

Despite Representation by Top Literary Agency, Every Publisher

Rejected it

• Books judged on perceived commercial potential

• Publishers unable to take a risk on every author

• Thousands of great writers denied opportunity to reach readers

• Books forced out of print too soon

The Big Publisher Challenge

My Answer: Smashwords

• Ebooks !!

• Provide writers free tools to become their own ebook publishers

• Open up the printing press to all

• Open up distribution to major ebook stores

• Ebooks are immortal

• Smashwords is now the world’s largest distributor of self-published ebooks

0

20000

40000

60000

80000

100000

2008 2009 2010 2011

Indie ebooks published at Smashwords

1406,000

28,800

92,000 +

How Smashwords Distribution Works

• UPLOAD

• Upload a Microsoft Word file, formatted to our Style Guide

• Free conversion to 9 ebook formats

• Ready for immediate sale online

• DISTRIBUTE

• Distribution to multiple major retailers

• GET PAID

• Author receives 85%+ of net = 60% list from major retailers

LET’S GET STARTED

Smashwords Makes Ebook Publishing and Distribution Easy

WRITING A GREAT BOOK IS DIFFICULT

(and nothing is more important than a great book)

YOU WROTE A SUPER FAB BOOK

Let’s Examine Data That Provides Clues to Possible Viral Catalysts

What’s a Viral Catalyst?

• A viral catalyst is something that makes your book more available, accessible, desirable and enjoyable to readers

• Read the Secrets to Ebook Publishing Success (it’s FREE!) to learn how viral catalysts spur word-of-mouth

Navigating Data-speak (the dangers of “average”)

? ? ?

Useful (and not-so-useful) discoveries start with simple questions

? ? ?So I asked questions

We looked at about nine months of sales data, aggregated across the Smashwords

distribution network

Some findings are useful, some were just fun

Smashwords Distribution Network

Q:

Do authors who change prices frequently sell more books?

Impact of Price Changes

• Conclusions not clear cut

• Small sample sizes of Top 10, Top 40 not statistically significant

• Not a clear cause and effect of price changes to increased sales

• Quite possible authors who change prices frequently are also promoting their books more actively

Impact of Price Changes

Q:

If ebooks are immortal, how do sales develop over time?

How Sales Develop

• This set of data looks at aggegrated “Classes” of all titles published in a certain month, are still published, and how their sales developed from month one to month two to (etc…)

• Key findings:

• Strong overall growth as ebook market develops and some titles achieve viral word of mouth

• A lot of randomness: Different classes, even separated by one month, exhibit dramatically different growth patterns

• Could speak to the outsize influence of a small number of breakout hits in each class

Smashwords Class of June 2009

Smashwords Class of July 2009

Smashwords Class of August 2009

Smashwords Class of January 2009

Q:

How might an individual title develop at a retailer?

How Sales Develop: Single Retailer, Single Title

• This set of data looks at individual titles at the Apple iBookstore

• Key findings:

• Different books develop differently over time

• Sales rise and fall, then rise and fall again, based on various factors (randomness, luck, author promotions, new title releases, retailer promos)

• If authors don’t maintain persistent presence across all retailers, they miss the spikes and miss opportunity to harvest the benefit

• Unlike print books, which quickly go out of print, ebooks are immortal and can yield income for years

Slow boil, breakout, slow boil, breakout

• This title was selling relatively well (5-10 copies a day) then benefited from major national press coverage (spike #1) then feature placement in Apple email promo (spike #2). After each spike, sales settled at higher level than previous.

Slow boil, slow build, breakout, slow boil

• This title did nothing for a month, but then started growing organically through word of mouth. This book is likely to enjoy many many years of solid performance as new readers discover it.

Slow boil, breakout, slow boil, smaller breakouts

• Another title that did nothing at first, but then spiked, dropped, and spiked again. Titles like this are likely to continue selling well, and will often break out into their genre bestseller lists many times.

Quick build, breakout, slow boil

• Sold well right out of the gate, then built, then spiked before dropping back to slow boil. This title is also likely to experience future breakouts as the author releases new titles, does promos, and as new groups of readers discover the book.

Quick breakout to slow steady boil

• Another title that will yield the author significant income over time. Books like this that sell copies every day usually earn solid reviews. Titles like this are primed for breakouts if author takes right steps.

Slow boil to breakout

• This is the chart for Ruth Ann Nordin (the only author for which I obtained permission to reveal her identity) and her book, An Inconvenient Marriage. This book had already been a bestseller at Kobo 12 months before it suddenly broke out at Apple to become the #1 romance title in the store. The Apple spike was prompted by a new title release, price changes, and possibly also a free promotion for a separate title on her list. More discussion in my “Secrets” book.

Q:

What’s the ideal word count for ebooks?

Do Readers Prefer Longer Books?

• For the average book, yes. Clear pattern that longer books dominate our bestseller lists

Do Readers Prefer Longer Books?

• This looks at bestseller bands. Trend is even more prominent. Ebook buyers prefer longer form.

60% of Top 20 Bestsellers Longer than 100K Words

53% of Top 40 Longer than 100K

Q:

Do Romance Readers Prefer Different Lengths?

Yes. 90% of Top 10 Romance Bestsellers under 100,000 words

78% of top 40 Run under 100K

Romance Readers Prefer ~80,000 Words

Q:

Do erotica readers prefer longer or shorter?

Average Word Count for Bestselling Erotica

Q:

What price moves the most units?

FREE

• FREE moves more ebooks

• ~100X more downloads on average

• Powerful platform builder

• Powerful sales catalyst for series or deep backlists

Q:

What impact does price have on unit sales?

Impact of Price on Unit Sales

• This set of data examines how price impacts unit sales

• 1.0 = normalized reference point. For example, books priced in $2.00-$2.99 price band sell 6.2 times more units than books priced $10.00+

• Key findings:

• Low prices sell more units

• $1.00-$1.99 price point underperforms

How Price Impacts Units Sold

Q:

How are Smashwords authors pricing their books?

Prices are slowly trending downward

Source: http://blog.smashwords.com/2012/03/does-agency-pricing-lead-to-higher-book.html

Q:

What are the most common price points?

How Many Books are Priced at Each Price Point?

Q:

What prices earn the author the greatest amount of money?

What Price Earns the Author the Greatest Yield?

• We know low price yields more unit sales, but what price yields the greatest profit for the author?

• Key findings:

• $.99 to $1.99 underperforms, about 60% below average

• $2.99 to $5.99 appears to be sweet spot for indie authors and small presses

• Data indicates that some authors are probably underpricing their works, and might want to experiment with slightly higher prices

What Price Yields Highest Earnings?

Q:

How many books sell well?

How Many Indie Ebooks Sell Well?

• Sales distribution is a “power curve” not a “bell curve”

• Key findings:

• Most books do not sell well (very important for authors to set realistic expectations, and take long term approach to platform building)

• Sales distribution characterized by small minority of titles selling extremely well, thousands of moderate sellers, and then a long tail of poor sellers

• Authors should implement best practices (read the Secrets to Ebook Publishing Success for ideas!) to drive their performance to the left of the curve

• As books increase sales rank and move to the left of the curve, their actual sales increase quickly, especially in top 5,000

Sales Distribution Across Smashwords Network (Normalized to

1.0 = average)

Slice: Top 100-10,000

Slice: Top 100-20,000

Romance Sales Across Smashwords Network

• Romance, on average, sells 2.2 times better than the average indie ebook at Smashwords (interesting!)

Erotica Relative Sales Performance

Q:

What’s the optimal price per word?

~ 3.5 cents per 1,000 words

• The outlier is a 27,000 word ebook priced at $2.99. Indicates that some authors might have ability to price popular works higher

Final Thoughts

• Data-driven publishing decisions are irrelevant without a great book

• Numbers provide hints at reader preferences

• Don’t write a longer (bloated) or shorter book unless that’s what the story demands

• If your story demands 200,000 words, go for it!

• Information, properly applied, can become a viral catalyst

• Read the Secrets to Ebook Publishing Success for other viral catalysts

Free Ebook Publishing Resources

• NEW! Secrets to Ebook Publishing Success (best practices of successful authors)

• Smashwords Book Marketing Guide (how to market any book at no cost)

• Smashwords Style Guide (how to format and publish an ebook)

Thank you for listening!

Connect:

Twitter: @markcoker

Facebook: facebook.com/markcoker

Web: www.smashwords.com

Blog: blog.smashwords.com (offers email

subscription option)

HuffPo: huffingtonpost.com/mark-coker