EBook Distribution Options

Is Free eBook Distribution At An End?

Everyone knows that the publishing industry is experiencing massive changes and at the center of that is ebook distribution. For a long time (as measured in the rapidly changing self-published market) Smashwords dominated ebook distribution. Soon enough though, the growth of the industry attracted competition. Some were reputable and some fell on the other side of the ethics coin.

I’m not going to talk about the companies I can’t recommend, but that still leaves room to discuss more than a few players. Bookbaby is one of them.

Bookbaby’s New Strategy

Bookbaby entered the market with a bang, and a very slick website complete with promotional opportunities and a strong list of retail channels. Their initial offering was a ‘fee-based’ service and I suspect that they found it difficult to gain traction. After all, Smashwords was the dominant player and their service was free.

Soon afterward, Bookbaby added a free option to their services, and they even tacked on a few promotional goodies. I was pleased with this option for indies, but I still had a few complaints—like charging for making changes, and slow response times to price adjustments. When Steven Spatz took over earlier this year as president, I was optimistic that positive things were going to happen. A few new channels followed, accompanied by a few new ‘goodies’. All looked good…

Until Today

Bookbaby announced that as of December 9, the free option is gone. So is the “standard” option. And the cost for distribution is going up to $299[1]. I spoke to Steven about this and he feels strongly that new services and benefits will more than offset the cost. I was skeptical about that—I’m not one who likes a fee for ebook distribution—but I was willing to listen to what he had to say.

What’s In Store For Bookbaby?

Steven was excited about the new offerings and, after hearing about them, I can’t blame him. Here’s a brief rundown.

1. Added more than 50 new retail stores, though additions like ePubDirect[2], Ciando[3], and additional stores on Kobo’s network.
2. Added Ebsco[4]
3. Added new marketing tools.[5]
4. Greatly expanded and improved customer service.[6]
5. Guaranteed, high-quality file conversions to both epub and mobi.
6. Improvements to their BookPromo™ Package.

After hearing what Bookbaby had in mind, and their philosophy on moving forward, I was impressed, but I also wondered…

Will that be enough to justify the price?

That’s always the question. Authors are reluctant to try new things, and they are even more reluctant to pay for them. I think that Bookbaby might be facing an uphill battle and in more ways than one.

My Analysis

• I love the channel expansion, particularly Ciando and ePubDirect, which will add depth to the international markets. Ebsco is also a nice addition.
• The customer service improvements are critical to keeping satisfied authors, and having phone support for extended hours will make a big difference.
• BookPromo™ getting the Amazon keyword tool is fantastic. I think that will help a lot of authors.
• And high-quality file conversions being included in the price will be a welcome relief to many authors.

Bookbaby added a lot of nice ‘extras’ but have they pursued the right ones?

Visibility and promotion are the keys to an author’s success. They might be the number one and two factors affecting sales. I don’t care how good a book you write, if no one knows you’re there, you won’t sell many.

A great book with no visibility will not sell nearly as much as a bad book with great visibility.

That’s not a quote by a famous person, but that’s my opinion and I think a careful study of book sales will prove that true. So what does that have to do with Bookbaby?

Examples:

• Smashwords and Draft2Digital both have pre-orders as options.[7] You can sign up with Nook, Apple, and Kobo.
• You can offer your books free on Nook with them.
• Smashwords offers a Series Manager Tool which helps with visibility.
• Both Draft2Digital and Smashwords have implemented a rapid upload and change system, where changes to price happen within a few hours in most cases. (Fantastic for promotions)
• Some of the other things they are working on[8] could mean a lot more to authors than new channels.

Changes Are Coming

The market for ebook distribution is getting more crowded by the day, and it’s attracting a lot of competition. Like any industry before it, only a few will thrive—in fact, only a few will survive. While some people think the publishing industry is ripe for picking, with money hanging from trees, the truth is not so glamorous. Margins are slim and competition is fierce. There simply isn’t enough profit in it for anything else.

We’ve already seen consolidation in the print market, and I’m convinced there will be a shakeout in the ebook distribution market, and to a lesser extent, in the ebook retail market. What that means is that there are too many companies chasing too few profits when it comes to services for independent publishing. With that in mind, is free ebook distribution at an end?

I don’t think it is. In fact, I believe that we’re just now seeing the peak of the service companies whose goal is to profit from authors who are naive, instead of profiting from authors based on sales. It’s not going to be an easy road for either authors or service companies, but the ones who stick to the basics will make out all right–both authors and companies.

The best companies will survive, and they’ll end up doing well. The question is what will those companies look like?

Profile of Successful Distributors

I believe that the companies who will come out of this ahead and profitable are the ones who align themselves with the author’s interest. The ones who not only can get your books into great retail channels, but who can also help you promote (or get promoted), and help you become discoverable. These are the keys to selling books.

Two of these companies are Smashwords and Draft2Digital. They are already way ahead of the game and improving continually. The other companies—the ones who dip into authors’ pockets before sales—are not going to make it. They’ll last a while. They’ll likely even make some quick profits off the unsuspecting authors who buy into their spiels, but they won’t be able to sustain it for the long haul.

Bookbaby is another one of the companies who will make it, although they are taking a different approach than Smashwords or Draft2Digital.

My Thoughts

I think it’s clear that Bookbaby is going after the “hand-holding” market—those authors who don’t have the technical experience, or don’t have time to mess with multiple vendors. These are authors who would rather pay a few more dollars and have a reliable partner do the work for them.

I think Bookbaby could be that reliable partner.

The other segment of authors who might find Bookbaby attractive are the ones who sell a lot of books—but it all depends on how many you sell and where you sell them. Look at the breakdowns below; they should help you decide if Bookbaby is right for you.

An Analysis Of Bookbaby

Change can be good or bad, but the one constant is it always seems to confuse people. With that said, let’s take a look at Bookbaby’s new distribution options.

Average Earnings

I averaged earnings based on market share. I used 20% total market share for B&N, 15% for Apple, and 5% for Kobo. I realize this might not reflect the worldwide market, but based on different channels represented this was the best way to do it. (If the percentages aren’t right for you, simply plug your numbers into this equation.)

Remember, Amazon is not included, so under the first column it represents 1,000 books sold on the three channels mentioned. Using market share statistics, out of those 1,000 books, 500 would be on B&N, 375 on Apple, and 125 on Kobo. Here’s what the chart looks like. (Number of books sold on top and dollars earned in the table below.)

As you can see, if the numbers I used for market share are correct, you would earn the same amount of money across all three distributors. The difference is that BB Premium costs money. So, am I saying don’t go with a premium service? No. I’m simply presenting the data, as I understand it. Each author has to decide what to do based on where they sell and how much they sell.

The next chart shows how many books you’ll have to sell to break even.

Bookbaby:

Since the big three retail channels (not counting Amazon) came out equal in earnings, in order to justify using BB’s premium service it’s simply a matter of identifying the channels either not available for free elsewhere, or where BB has a royalty advantage, and then comparing those channels.

The table below shows approximately how many books you need to sell at several price points to break even. And remember, this is per book, and only on the unique channels. If you have 3 books, you need to sell 3x that many.[12]

Channels include: Ciando, Copia, Ebsco, Epub Direct, Gardners, Page Pusher.

When you look at these numbers, you might think—damn, I can easily sell that many books. And maybe you can. But please remember that this is with the above channels only. This is not counting books sold through Amazon, or Apple, or Nook, or Kobo, or anywhere else you sell books. This might be a lot more difficult than you think.

You also need to add to this, the difference in percentage/royalty you would receive from retail channels Bookbaby has in common with others. Example, you would earn 10% more on Scribd and Oyster, and 15% more on e-Sentral.

My Wish List

I’m pleased to see an increasing stream of distribution options open up to indie authors, and Bookbaby has been at the front of this expansion, along with Draft2Digital and Smashwords. There are some areas where I think Bookbaby still needs to improve. Here’s my list:

• I’d like to see them spread out the sign-up fee over a few years. Three would be fair, I think.
• I’d like to see them really work hard on implementing fast response times, similar to what Draft2Digital and Smashwords have.
• I’d like to see pre-orders go live sooner rather than later. In other words, prioritize it.
• I’d like to see all distributors bring about territorial pricing.
• I’d like to see charges for content changes be eliminated.

I understand that BB’s premium service comes with other benefits. Each person will have to determine whether those services add enough value to make the difference. You can look at what is included here.

I hope Bookbaby is successful, and I hope they reconsider their decision on how they charge for services because I’d like access to some of those channels.

Bottom Line

I think Bookbaby is a class act with a lot going for them. But they are at a crossroads where much will hinge on how they continue to develop their programs.

If they realize that they need to get down in the trenches with authors and help us fight the battle for visibility—and assuming they implement well—then they definitely have a place in the distribution market. But if they take the other road, and push only for paid services without the right support, then I believe their future will be relegated to the group of authors who need hand holding, and that’s a group that is diminishing as opposed to growing thanks to organizations like the Alliance of Independent Authors who help educate authors on a daily basis.

Stay tuned next week for some more fantastic news on the distribution front. You can sign up for the newsletter here.

NOTE:

There are ways to get around some of these “hard” numbers I cited, and I’ll be covering those in future posts. It will also be covered in Alli’s book, Choosing a Self-Publishing Service. Don’t forget to pick up a copy—and don’t forget to leave a damn review!

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