Business Model For Publishing And Selling Ebooks

I think I promised a couple weeks ago to write more about ebooks, and it turns out to be a timely subject for me. Ebooks, despite robust growth, have remained the poor relation of print and audio books. For the record, when I talk about ebooks, I really mean any document of length that is published electronically. Whether it's a PDF, an HTML file, a Word file or some special format for a proprietary hardware reader makes no difference. I've seen a lot of ebook publishing efforts founder on the rocks because the publishers tied themselves to a particular format or piece of hardware that never won meaningful market share. I'm going to narrow down today's discussion a little further by limiting it to ebooks that are intended to be read on computers. While I'm aware that five of the top ten bestselling novels in Japan last year were initially published as cell phone texts, the troubleshooting book I'm planning to release as an ebook in a couple weeks is locked into a reasonable display size by the full-page flowcharts.

Having settled on the universal PDF format for publication, the remaining questions are limited to Digital Rights Management (DRM) and the selling platform. Foner Books has sold ebook versions of our paper books since 2004, and during the years they were carried by Amazon, our average net was $500 per month. That sales level, a little less than two copies a day, was enough to keep two of the ebooks pretty steadily in the top 100 on Amazon, which said something about their overall ebook volume. Those ebooks were sold with Adobe DRM that was intended to prevent copying and which limited printing to a few copies a year. However, there were occasional problems with that DRM, and I gave away more than a couple books by way of compensation. These issues were most famously documented by J. Wynia who described the ebook version of my book about Print on Demand as "filet mignon served up on a dirty garbage can lid". I tried to talk him into my point of view as a publisher, but I thought his views were valid then and I'm even more inclined to follow them now.

There's also a world of difference between shovelware ebooks, collections of whatever stuck together and shoveled out by anybody with an efficient sales platform, and ebook versions of printed books. I've noted that proponents of various "free" and "trust" based business models often have a salaried job. When a full-time self publisher commits a year of time and resources to publishing a new book, the gamble of trusting to the good side of human nature carries a potential loss exceeding that of pie-in-the-face. My current inclination is to publish the ebook with no traditional DRM, no copy protection or limitations on printing, but to restrict editing (not that the restriction can't be easily cracked). The editing restriction should at least remind people that that in purchasing or licensing the ebook (I'll have to ask my lawyer about which wording to choose) they aren't buying the right to freely reuse the text. I also plan to create some sort of purchase agreement or EULA describing the rights the purchaser is receiving, namely the rights to read and print the ebook for their personal use. If I find somebody selling my ebook on Ebay in the theory that having paid for it, they can now sell it second hand, I'll pursue them to the gates of Hell. The reason second hand ebooks don't "work" in the publishing sense is that there is no reduction of intrinsic value as they are passed along. They don't wear out, and without DRM, there's nothing to prevent the "prior" owner from retaining a copy.

Selling ebooks is a different challenge. I have the platform in place, my website, but I don't have a delivery mechanism in place, beyond accepting payment with PayPal and emailing a PDF as an attachment. I could do this initially, but I don't work on the Sabbath and don't want to force Friday evening buyers to sit on their hands all Saturday staring at a broken laptop they might have managed to repair, so I plan to set up an instant delivery system. I looked at some of the existing ebook delivery platforms, such as PayLoadz and Clickbank, but the former seemed limited to PayPal and the latter's focus was on building affiliate relationships. While building a bulletproof fulfillment platform would be a major investment, as long as I'm working on the trust system, all I really need is a way to accept payments and deliver the PDF file. If the transaction fails in rare cases (ie, I get the money but they don't get the ebook) it will be easy to remedy by email.

An interesting question, if ebook sales go well, is how that will affect my business model for the future. The intention all along has been to publish the book through the on-demand services of Lightning Source, though I've vacillated on whether to go with the 55% trade discount and try for store shelving, or go with a short discount and maximize the net per copy. If ebook sales go nowhere, I think I'll be inclined to do the trade discount and attempt to get on store shelves, because my investment in this book exceeds anything I've done since spending three years translating my great-grandmother's Hebrew publications. But if ebook sales are strong, I may stick with the short discount, or put the profits into an offset run and hook up with a distributor or wholesaler. I'd also sit down and look at the business model for my current titles, and consider re-releasing ebook versions without DRM and sold directly through my website. I'd be happy to hear from any ebook publishers with recent experience in DRM free business model.

The Long Tail Of Search For Self Publishers

You might think that being #1 in Google for the phrase "Self Publishing" would be the making of a business. While I've never had the number one site in Google for that phrase, I've been in the top ten for the last couple years, and I don't see more than a half dozen visitors a day from it. A quick look on Google Trends tells us that it's a less popular phrase than "Computer Repair", and if you're wondering what the one has to do with the other, my website was #1 on Google for computer repair a couple years ago. That phrase rarely brought in more than 100 visitors a day, and now that a lot of SEO activity by competing sites has almost pushed me out of the top 10 for it, my overall traffic for the same group of pages is higher than ever. The reason? More and more visitors arrive on long tail queries.



I'm going to go over the principal numbers I used in the video above just to make the point in print. Of the 672 visitors who arrived on this website last week after making a search that contained the word "publishing", 521 of them used a unique phrase - unique for the week in any case. The title phrase of this blog only drew 27 visitors in the course of the week, just under four a day. That's a little down from when the blog showed up "above the fold" in a Google search, but it doesn't have any impact on the overall number of visitors. I read somewhere that 25% of all Google queries are first timers, queries nobody has ever made before, and based on the examples from my server statistics, I believe it.

The great thing about long tail search, from the standpoint of book publishers, is we have lots of good content that tends to do well as long as the site builds some authority in the field. Somebody with more money, more time or more SEO knowledge than you can often knock you off your place for a two word phrase, but your only competition on the six and seven word queries will be from automated scraper type sites, which the search engines work hard to weed out. I'm not a strong advocate of SEO, though I believe it's important to do the basic things right. Your focus as publisher should be on producing great books, and by their very nature, the same content can be great for a website. Provided, that is, it includes material that people search for.

In the video I give a few examples of long tail search phrases that brought visitors to this website on the publishing subject last week. Here, I want to give an example of the opposite, a search on a single word that resulted in visitors to the publishing section of the website. While not the only single word my site draws traffic on, I'm going with "Amazon", because it's illustrative of how poorly some people utilize search engines. You have to go down to the fifth or sixth page of Google results to find my page about Amazon sales ranks, yet every day, somebody does just that. The fact that they click through to my site after finding it down around 50th or 60th in the results implies that it's just the result they were looking for, but didn't know how to ask. Add a couple words and tell the search engine what you want, for Pete's sake.

Interview with Thomas Huynh

For a change in pace, today's interview with Thomas Huynh is the one that got away. Thomas is the founder of the Sonshi.com website dedicated to Sun Tzu's Art of War, and seriously considered self publishing before signing with a trade publisher.

1) Your popular website put you in an excellent position to self publish, but you chose to go with a trade publisher in the end. What were the chief advantages you saw in becoming a trade author?

As you know from my many emails to you when I first looked into this matter, it wasn't an easy decision at all. There were many restless nights. The issue comes down to what you just said: we had a great platform at Sonshi.com to work with and felt that the marketing part that would attract most authors to trade publishers is much less of a factor for us. Why share the profit, right?

In the end, it came down to third party representation. It also came down to professional editing. Looking back on it, I would make the same decision again. The representation aspect is an intangible and cannot be put down in dollar terms but I believe it gives us more credibility to say that we indeed went through a gatekeeper" and that there was validation from another entity willing to invest in us. The reputation of our publisher, Skylight Paths, was impeccable; we researched them and went as far as asking their former employees. So what you have are great people backing your work. That means a lot to me. The editing was invaluable as well. The book would be quite different without my editor's feedback, and in many ways, would be much less valuable to the reader. So the quality of the work improved.

2) What was the strongest attraction the self publishing route held for you?

Money. As you have demonstrated on your website, the difference between the profit margin from selling a trade book and a self-published one is staggering. Again, the concern of whether we can sell enough books is greatly minimized because of our Sonshi.com platform. We usually receive requests from trade publishers once every quarter asking us if we wanted to publish our work with them. I turned them all down until Skylight Paths came along. Skylight Paths' mission fits perfectly with ours at Sonshi.com and as I mentioned before, we did a background check on them. This due diligence paid off. Maybe I'm lucky but I had pretty good independence as far as what I want to say in my book. Anything that was deleted or changed happened only with my approval. Perhaps this is not a big problem with trade authors but I'm just glad it wasn't a problem for me.


3) What did you see as the biggest downside of self publishing?

Being on your own. You can get around the editing part by hiring freelance editors but I don't think you can substitute being represented by a third party. Maybe this doesn't mean much to some people but it does for me.

4) How did you apply the teachings of the Art of War in making your final decision?

Excellent question! The most important concept in Sun Tzu's The Art of War is making your decision free of emotion. (It prevents a general from waging war in anger.) That's why it took me so long to decide whether I wanted to sign the book contract. Not that I had concerns about the publisher. Rather, I didn't want to make a decision based on a momentary feeling instead of doing what is best for all concerned.

The Grinch That Blessed Self Publishing

I just spent an hour or so manually updating my sitemap (don't ask) with blog posts from 2007 and 2008. It turned out to be a surprising stroll down memory lane, surprising, because I thought I'd written most of those posts years ago. I was also surprised to see that I haven't been writing enough cautionary tales about self publishing lately, when I swear it used to be every other day! So I thought I'd put on my Grinch suit and remind newcomers of the downside of self publishing. My last real lecture on the subject came complete with a self diagnostic test for potential self publishers.

But sometime during the last year, I turned into a real softy. I realized this the other day when I was cleaning up some broken links on the website by using the Windows search tool to find mistyped file names embedded in web pages. Well, that helpful little dog almost had me in tears. There he was pawing away at the screen, wagging his tail, looking up with a puzzled expression when he couldn't find the file, then going back to work. After a couple minutes, I couldn't take it anymore. I began feeling like the jerk who pretends to throw a dog a tennis ball, but really hides it behind his back. I decided it was my fault he couldn't find the a file, I was just asking too much, and now I'm afraid to go back and look that puppy in the eye.

It turns out that many of the aspiring self publishers who contact me see self publishing as a kind of a journey. Selling a lot of books isn't their real goal, they don't even care about breaking even. Self publishing isn't a business decision for them but an experience to be enjoyed. This includes some authors who set up their own publishing business, but also some who paid a subsidy publisher to put their book into print. And I have to admit that if you see self publishing with print-on-demand as a form of self expression that just wasn't available a decade ago, nobody has any right to bring you down. Of course, nobody is forcing you to read my blog either:-)

Over the next couple months, I think I'll stick with bringing on a guest publisher interview every third post, and try to get my video production going again. I'm going to the On-Demand Conference in Boston in two weeks, so I should get a little insight into what's coming up on the technological side of the business. I just hope nobody has any dogs working as salesmen or I'm likely to come home with a $100,000 machine.

Designing Large Format Book Interiors

Designing a large format book is a lot trickier than designing mass market paperbacks or the smaller trade cut sizes. The problem with large format books, especially when you get up to the size of a sheet of typewriter paper (8.5" x 11") is that a single text block starts looking like a typewritten page or a handout, rather than a book. There are a number of ways you can minimize this effect, the easiest of which is not to choose a large format unless you have to. Unfortunately, I'm working on a book that includes a number of 6.25" x 9" illustrations, and shrinking them isn't a good option for reasons of legibility.

Perhaps the most common way to cope with large page sizes is to move to a column format, with two columns being the norm. I have seen books designed with three columns, but these are usually pure reference books, or coffee table sizes. One of the pluses of a two column format is it allows for a variety of different illustrations to be used in a natural looking way. Some illustrations may span two columns, others may placed in the outside column, effectively making that column wider for the page. I show a few examples of large format designs in my scruffy looking video, which goes to show what happens when you don't work for anybody:-)



One trick that the major trade publishers have been using for years in designing larger format books for the sake of creating a substantial shelf presence, is to fill the borders with elements. Not useful elements like navigation or calculations, but rather annoying comments like "Note: This is important!" or "Reminder: Have fun while you're working." But now that I find myself stuck producing an 8.25" x 11" book for the sake of fitting my illustrations, I regret my own position on the silly elements issue. Nothing could be easier than filling in some of that white space with harmless little notes, and the book would probably look better for it. But for the time being, I'm going to stick with URLs giving links to color illustrated procedures on my website that I couldn't use in the book.

Most people do like the look of large outside margins, which first time book designers may find counter-intuitive. After all, a large inside margin would make the book easier to read without breaking the spine open. But for whatever the reason, large outside margins are more aesthetically pleasing, perhaps because peripheral vision combines the inside margins of facing pages. In many Victorian and earlier novels, margins were huge in quality printings, and the text block looked more like a newspaper column that had been pasted on a blank page. I was referring to this in the video when I mentioned the "last century" and misspoke 1900's for 1800's. But 2.5" or 3.0" margins carried on for dozens of pages start looking a little strange as well.

Interview With Publisher Kim Greenblatt

1) You've published several books about poker. Have you seen any benefits from having a "list"?

Yes and it has been extremely educational. I started publishing my first poker book, "Practical Low and No Limit Texas Hold'em Ring Games" back about 2-3 years ago when the poker fad was peaking - that was the year at Christmas when you had poker books in the windows of Barnes and Noble, poker chips were the hot item at the holidays for sale, electronic poker handheld machines made a come back, etc. I had my book out earlier in the year and "rode the wave" - more like a puddle for me-but I was happy with the sales I was getting. It inspired me to try to see if I could position myself in a niche that was not explored (or exploited) too much. My Practical Low limit book sold well initially (several hundred copies) and then has since been consistent with a few copies a month. By the way, if you honestly talk to most poker writers, they average about the same though they may have their scale up by a slight factor because they may have shelf space. Then again, if you peruse the sports/gaming sections of Barnes and Noble you will see a dearth of poker books that were also trying to cash in on the craze. I suspect these days a LOT of them are due to be sent back to the publisher or sold off at remainder fire sale prices.

The biggest complaint was that there was too much limit and not enough no limit poker in the book. I rectified that later on with my Forty Dollar No Limit book. Research from my end indicated that there was one book on Crazy Pineapple and it was out of print. I figured, "Wow, I can have the goto book for Pineapple and the book will sell." My rationale was that the United States was cracking down on worldwide internet play (something I got out of early on) and I figured people would be interested more in home poker games, home variations of poker, etc. Based on readings in usenet, people playing home games, the fact that Crazy Pineapple is played in a variation in a television championship I figured - how could I lose on this? I figured wrong. So, yes, despite the speed bump with the Crazy Pineapple book it seems that having a list has helped. I noticed after I came out that there are other books by more seasoned pros self published etc out there and I suspect that their sales may not be as high any more than mine - and may be even less - because some of them don't offer online free content. Basically, I am building small amounts of sales on growing titles and that is how I plan on building my publishing business. That and trying to give my readers what they are asking for.

2) Have you made a push to sell to specialty stores, or are you strictly counting on direct and online sales?

I am pretty much online and special order through the major chains. I distribute through Lightning Source/Ingram. Because I do not take returns and short discount, I generally don't occupy shelf space. I have been picked up by online specialty book stores (depending on the title) and I get most of my orders from online sales (Amazon, Barnes and Noble.com, etc) as well as direct sales. I do slow but steady UK sales as well - maybe 1-4 titles a month. I do get some other international sales I guess but those are direct order usually. Interesting note - my poker and Rett Syndrome book pdfs still generate some sales now and then even though Amazon does not carry electronic books unless it is through Mobi.

3) You've released a few Kindle titles. Do you see Kindle contributing significantly to your business in the coming years?

That is an great question. I would love it to be the case but it is too early to tell. I think we are starting a resurgence of the ebook format wars with the ebook reader now being developed in a VHS vs Beta kind of format war. I like the Kindle for what it has to offer and the ease of setting up books for it (if you are patient). My end result format is still a tad clunky but the content is out there. My tax book on Kindle is okay but I think the number of Kindle sales would have to grow (or the cost to buy a Kindle has to drop like a rock) to make a huge contribution in coming years. It would be nice to do color electronic books on a Kindle and I suspect the next generation device or two will offer that or some other device might. Also, the initial distribution/royalty pricing model favors Amazon. I suppose it isn't bad but I am spoiled by self-publishing. I wish the terms would be more in line of something I can set up like I have done by myself now.

4) How has your publishing business evolved since you started, and has it met your expectations?

My publishing business is evolving into a nice, slow and growing business. It has met my expectations and as corny as it sounds, is only limited to the amount of time that I spend making it grow. I originally got into publishing because my daughter was diagnosed with Rett Syndrome and I wanted to have a book for parents out there that addressed feelings, what you need to do, some of the things that my wife and I had to deal with, etc. The book ended up being rather short but I made the decision that parts of all sales from my books will go to Rett Syndrome research. Rett Syndrome affects one out of every 15000 girls at birth. Boys born with the Rett gene die at birth. This disease is the same one that one of the current American Idol contender's daughter has. I researched your site, read a bunch of books on self publishing, remembered back when I was writing articles and unsold novels pre internet and dove into self publishing whole-heartedly.

My initial approach has been to concentrate on non-fiction and write what I know. So far I have written books on dealing with Rett Syndrome, poker and income tax. A rather bizarre mix of a list and it is going to get worse - ha. I am working on a children's fiction book (finished it two days ago and am cleaning it up), have a completed horror manuscript I need to clean up when I have time (ha ha- I generally let completed manuscripts "season" a week or two and go back to review them and I STILL get TYPOS) and will get back to more non-fiction. I am a very minimalist publisher. I am in it to learn and to make money at it. With the exception of my Crazy Pineapple book and a non-fiction sex/relations book that has not taken off, my books sell and I end up in the black-though maybe not by much. I am in it for the long haul and might take on other writers later on but I would only work with people I feel comfortable with and publish books that I want to sell.

Kim Isaac Greenblatt
Publisher
www.kimgreenblatt.com

New Author Platform Book Beats Me To The Draw

Long time readers will recall that I wrote half of a draft book about building a publishing website for authors and small publishers last summer. I didn't even get to the rough editing phase for the existing chapters before I dropped the idea, which I'll get back to in a minute. In the meantime, I stumbled across a new book listing on Amazon titled "The Author's Guide to Building an Online Platform: Leveraging the Internet to Sell More Books" by Stephanie Chandler. I don't think I'll read it when it comes out next summer because whether it's good or bad, it will give me an ulcer:-)

I recently attended my first public meeting since the Cape Cod Writer's Conference, which was the inspiration for starting the draft in the first place. Again, I ended up being Mr. Popular because the meeting was well attended with people who had websites that were in search of visitors. I find I'm slowly developing a speech about why most websites are so bad at drawing visitors, despite the best intentions of the designers and the the owners - authors and publishers in our case. It comes down to a few major points. I've written quite a bit already about why aesthetics should be way down the list for authors and publishers, but I didn't quite realize how far out of the loop serious web designers are on this until I talked to several last week.

If you hire a designer who builds websites for banks, for government agencies or nonprofits, for famous actors, writers, etc, you're probably hiring a talented and honest person who can't help you at all. None of the above entities actually care about search traffic beyond showing up at the top of Google for their proper name, which is probably integrated in their domain name. They might claim they care about search, but they don't, and they couldn't tell you if they were getting it or not. Banks want secure websites that work well for their customers, governments and nonprofits want websites that flatter their employees and save on walk-in visitors. Famous people want to create fan clubs, mailing lists, push their products, and none of them do it with search. It's the difference between building Internet versions of an existing business model (what they do) and building content websites to help new readers find you, which is what authors and publishers should be doing.

Some of the most interesting correspondences I've had in the past six months have been with people who read my draft material and contacted me about SEO (Search Engine Optimization). I've held my line that I give free advice but am unwilling to start selling my time, which generally leads them to go elsewhere, but it's entirely cleared up one point in my mind. Just like most self publishers shoot themselves in the foot before they write their first book, nearly everybody who goes about the process of building a website they hope will attract search traffic gets it wrong from the beginning. SEO cannot turn a poorly conceived publishing website into an online magnet. A website designer who builds a pretty site and then asks you for some content to "populate" the pages with has done it all backwards, even if you had a dozen meetings to get to that point. It has to start with the content, around which you can design, or grow, a website.

I've been publishing online since 1995, and can count my readers over that time in the millions, probably in the low tens of millions. It hasn't made me rich, in part because I never set out to become rich and have nothing to sell along with much of my writing, but I've had a long time to analyze what works with with both readers and search engines. And I've put enough writing online to notice that my most successful pages are those for which I spent days thinking about and writing, sometimes including illustrations or photographs. It's not that every page I put a lot of thought and work into has done well, but there are only a handful of pages that I wrote quickly that get any significant number of visitors.

I've literally had web design discussions with people who have looked at my pages and said, "But that's unfair. I can't come up with that kind of content." Well, that's the whole point. Why should people tell their friends about your site and why should search engines send you visitors if you don't have great content? Because you really want to sell some books and are willing to invest in web technology to do it? Yet I keep hearing from authors and publishers who read my draft, and still come away thinking that they can hire somebody to create a successful content based website for them. They can't. It's not about the technology, the aesthetics, the interactivity or the multimedia, it's about the content. If you're an author or a publisher, you have that content, and if people aren't interested in reading a big chunk of it for free, that should tell you something about the potential market for it.

Yes, fiction is a separate discussion, so I'll save it for another day. And while I'm not going to apologize for my tone, I'll admit that I'm proofreading a technical book for the third time before sending it to the editors, and it's making me nuts!