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TEDxNaperville Visits Sourcebooks

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A TEDx Adventure at Sourcebooks. Presented by Dominique Raccah on November 7, 2014.

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TEDxNaperville Visits Sourcebooks

  1. 1. The Book in Transformation: A Publisher Vision for the Future TEDx Adventure 2014 Dominique Raccah Sourcebooks, Inc.
  2. 2. A Publisher Vision for the Future 1. The ebook transformation  who is the ebook customer?  are print books dead or dying? 2. How book retailing is changing 3. Different authors’ career paths 4. Creating new revenue streams
  3. 3. [ 1. The ebook transformation ]
  4. 4. Data is from BOOKSTATS
  5. 5. Benefits of e-reading devices BISG — US 2010 data
  6. 6. Why consumers purchase ebooks instead of print books © 2010, the Book Industry Study Group, Inc.
  7. 7. who is this customer?
  8. 8. who is this customer: reader who reads a lot In US, converted our most voracious readers first
  9. 9. [who is the power buyer]
  10. 10. Who is Today’s Core Trade E-Book Buyer (in the U.S.)?  Woman (66%)  ~44 years old  HH Income ~$77K Yr  Predominantly Fiction (58% of all ‘e’ sold)
  11. 11. Device Use – Overall 0% 20% 40% 60% Kindle e-reader iPad Kindle Fire iPhone Android tablet NOOK Color NOOK e-reader Power Buyers Other respondents
  12. 12. [ 2. How book retailing is changing ]
  13. 13. The Continuous Momentum Towards Online Shopping
  14. 14. DISTRIBUTION: How purchased? e-commerce skill set FORMAT purchased? Device centric skill set eBooks PRINT Brick and Mortar Retail Online Retail
  15. 15. The billion-dollar shift in trade retail -194 52 1,111 Online Retail Other Channels Retail Stores (Total)
  16. 16. The billion-dollar shift in Trade $3,000 $2,500 $2,000 $1,500 $1,000 $500 $0 Chains Unclassified Indie stores Specialty stores Mass merchants College stores 2010 2011 2012
  17. 17. Where are we today? Combination of online convenience, plus long tail plus digital transformation has put real pressure on our brick and mortar/physical book retailers  In U.S., physical book retailers need to learn to be great online merchants (of physical as well as digital books)  The bar is Amazon. That’s the expectation customers have of an online retailer.
  18. 18. Where are we today? Consolidation and monopoly in the U.S retail space  Amazon majority of online book retailing  Barnes and Noble majority of brick and mortar retailing But Amazon and Barnes and Noble are very different…
  19. 19. [what does this mean for authors?]
  20. 20. Today, it’s become much easier to publish a book in the US
  21. 21. When you lower the barriers to entry, more enters
  22. 22. Every day in America 3,500 books are published* and only a handful will be considered successful by any criteria *Bowker 2013
  23. 23. “In a tsunami of content like this one, you’ve got to write your best book. Let me say that again: Nothing but your best writing has a chance.” — Jon Fine, Amazon Speaking at a writers’ conference
  24. 24. Decline in price of traditionally published ebooks $25.00 $20.00 $15.00 $10.00 $5.00 $0.00 E-Books Softcover Hardcover 2008 2009 2010 2011 2012
  25. 25. In the era of the Kindle, a book costs the same price as a sandwich. Dennis Johnson, an independent publisher, says that “Amazon has successfully fostered the idea that a book is a thing of minimal value— it’s a widget.” —The New Yorker, Feb. 2014
  26. 26. I actually disagree with Dennis… Amazon uses books in a different way than other book retailers do. For Amazon media (books, audiobooks, movies, etc.) is the method via which they attract and hook customers into their ecosystem. So the value is the customer relationship.
  27. 27. Where are we today? 1. Converted our heaviest users to digital books first 2. Creating far more options for authors 3. Enormous number of ebooks being published  Steep declines in ebook pricing  The use of ebooks as ecosystem builders. loss leaders or giveaways fosters a continuing devaluation of ebooks  Kindle Unlimited continues this trend  More content being published is affecting total unit sales for everyone overall  The overall market for books (in units or $) is not growing as quickly as the amount of content is growing.
  28. 28. [are print books dead or dying?]
  29. 29. $14,000,000,000 $12,000,000,000 $10,000,000,000 $8,000,000,000 $6,000,000,000 $4,000,000,000 $2,000,000,000 $0 2008 2009 2010 2011 2012 eBooks Combined Print © 2013, the Book Industry Study Group, Inc. Print lives
  30. 30. But e-books continue to grow… $6,000,000,000 $5,000,000,000 $4,000,000,000 $3,000,000,000 $2,000,000,000 $1,000,000,000 $0 2008 2009 2010 2011 2012 eBooks Hardcover Mass-market Softcover © 2013, the Book Industry Study Group, Inc.
  31. 31. [are print books dead or dying?] digital doesn’t affect every content category in the same way
  32. 32. 2013 YTD Sales by Units 3500000 3000000 2500000 2000000 1500000 1000000 500000 0 Adult Fic Adult NF Kids (ALL) Kids (not YA) YA eBooks Print 63% 35% 14% 10% 38%
  33. 33. Are print books dying? NO. Print lives. Absolutely.  Book market is BIG, varied market  Lots of types of books (textbooks, professional, art, children’s books, etc)  In U.S., ebooks are replacing/displacing our cheapest formats (particularly mass market)  So BIG impact on fiction sales  Ebooks are about storytelling  Less impact on other categories of books  Appears to also be some stabilizing of ebooks growth
  34. 34. Today’s US Market:  Explosion in the amount of books available  Increasing pressure on brick and mortar bookstores  Value of discovery in the brick and mortar retail space  Corresponding challenge of discovery in the online retail space  Marketing is becoming more fragmented and more expensive  Continued pressure on pricing
  35. 35. [ 3. What can authors be doing? ] Different authors’ career paths
  36. 36. Author A (Romance)  Started out at an independent publishing house in 1990  Began publishing new titles with Sourcebooks in 2012 (had already published nearly 50 books in 30 years)  Now writes 1 new book per year 86% 2% 6% 6% Author A Mass Trade Libraries Ebooks
  37. 37. Author B (Women’s Fiction)  This author today sells well in every channel 7% 14% 1% 78% Author B Mass Trade Libraries Ebooks
  38. 38. Authors can have very different career paths and as a result, different career needs
  39. 39. Even when authors are just starting, their debut titles and audiences can create different career directions
  40. 40. 3 debut authors at launch (both P+e) Author A W-M & Target B&N library ebook Amazon Author C Author B W-M & W-M & Target B&N library ebook Amazon Target B&N library ebook Amazon All launched within 60 days of each other
  41. 41. All authors must figure out what they need and what really works for them by talking to their agents or publishers or writing groups about their goals, their strategies and building their careers brick by brick…
  42. 42. Some examples of personal goals  “I want to be a New York Times bestselling author”  “I want to sell a million books”  “I want to make as much $ as possible”  “I want to quit my day job and write full-time”  “I want to reach as many readers as possible”  “I want to focus on my writing and have strong support with marketing and sales”  “#1 on the New York Times bestsellers list in next couple of years”  “I want to win a RITA”
  43. 43. Susanna said, “I want to win a RITA!”  Susanna publishes paranormal timeslip women’s fiction/romance  To achieve her goal, Susanna used her readership as a resource  She asked fans which category to submit in:  Historical  Paranormal  Contemporary  They told her paranormal …
  44. 44. Susanna said, “I want to win a RITA!”
  45. 45. One of the dangers: the compulsion to compare oneself to others I have a publishing deal, but they have marketing. I have completed a manuscript, but they have an agent. I write, but they write better. I have an agent, but they have a publishing deal. I have marketing, but they have a publicist. Dryden, Emma D. Our Stories, Ourselves. http://emmaddryden.blogspot.com/2014/10/i-want-what- shes-got-disastrous.html
  46. 46. [ 4. Creating new revenue streams together ]
  47. 47. What is the value you’re adding… Authors and Agents Retailers Publishers Provide More Value
  48. 48. experiment relentlessly
  49. 49. our goal has to be to increase the probability that an author, a book, a series, or a program will be successful and to increase the revenue that we provide our content partners
  50. 50. enhanced ebooks How can we serve readers better? online platforms (mobile) apps online communities ebooks user-generated content
  51. 51. enhanced ebooks How can we serve readers better? online platforms (mobile) apps online communities ebooks user-generated content
  52. 52. Experimentation and Scale Thousands of ideas Hundreds of experiments Test relentlessly around what your customers actually want. Agile. Lean Startup. Handful of trials Dozens of experiments will prove successful enough to go into rigorous trials. Can we build a viable program or business here?
  53. 53. At Sourcebooks: 4 trials are now in process of scaling…they will become the growth engines of our future.
  54. 54. STRATEGY: Creating New Kinds of Value Creative Content Partners Publishers Retailers Readers Direct to Consumer business Exclusive channels that provide more marketing mojo and increasing revenue in a crowded ecosystem + Grow Core Book Business
  55. 55. Put Me In The Story example
  56. 56. There have always been personalized books
  57. 57. What We Do We create a personal connection between you and the books you love
  58. 58. We create the best personalized books…  Making the world’s best books available in ways that surprise and delight  Taking personalized books to a completely new level  Each book is personalized in a way that makes sense for that book
  59. 59. What We Do We create a personal connection between you and the books you love
  60. 60. And What Really Matters …we foster a greater love of reading (sometimes even a first love of reading) + a deeper early connection to books We create a keepsake that families will cherish forever
  61. 61. What customers tell us… “These books make beautiful gifts. My daughter loves her book and I can barely get through it without crying. Love!” – Amber Helwick Thousands of testimonials "This was a great gift and keepsake....there's even a spot to put a photo of you and the loved one on the front page. I'm sure he'll treasure it for a long time." – Tru Peffer
  62. 62. How It Works Launched with iOS app with incredibly easy-to-use interface Allows you to have a special connection to the books that children love the most.
  63. 63. How It Works Incredibly easy-to-use interface… Allows you to see every page of the book as you personalize. Then we print and ship it to you with best in class turnaround times and customer support.
  64. 64. Launched in 2013 with Elmo…
  65. 65. Why It Works Great Books!
  66. 66. Our partners… …are the world’s greatest characters and favorite, bestselling books. The ones you love the most!
  67. 67. Amazing new partners keep coming…  Nickelodeon – 4 book deal. First books Q4  Sandra Magsamen  Anne Geddes  Peanuts
  68. 68. Today we have extraordinary opportunities
  69. 69. How Put Me In The Story Creates Value For Authors  Creating a new channel for picture books, illustrated books, gift books for all occasions and non-book products  Higher price point: $24.99-$29.99  Incremental sales dollar!  Some indication that our online marketing is lifting retail sales (tens of millions of impressions in Q4 2013)
  70. 70. Some observations about Put Me In The Story development 1. 5th attempt at Put Me in The Story 2. Data-driven development 3. Expensive  Tech costs $$  Operations: customer service, shipping, bundling, app & database integration 4. New ideas come from doing the work 5. Of dozens of major experiments (+ 100’s of smaller ones) we’ve tried only 4 have worked in a BIG way that is scalable
  71. 71. What matters…
  72. 72. A Publisher Vision for the Future 1. Digital has changed the future for authors and books 2. Book retailing is changing 3. Crowded ecosystem will continue to get more crowded, driving price down and making marketing more competitive 4. Look at strategically where your career is now and what next steps/growth might look like. Define specific BIG goals 5. Create new revenue streams together
  73. 73. “We should try to be the parents of our future rather than the offspring of our past.” — Miguel de Unamuno (1864-1936) Spanish essayist, novelist, poet, playwright, and philosopher
  74. 74. It’s not just the book that’s transforming. It’s the book publisher. Digital changes everything.
  75. 75. Where will Sourcebooks be in 5 years?  The most experimental publishing partner  Creating successful new models for authors  Continuing to create the future of the book ecosystem  Publishing authors, not just books in exciting, new, innovative ways
  76. 76. Let’s talk. Email: dominique.raccah@sourcebooks.com Twitter: @draccah

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