Creative Tools Of Small Publisher Destruction

Some recent encounters and old memories have got me hot under the collar on the subject of startup costs for small publishing businesses. I've seen more new business ventures fail from having too much capital or credit when they started than too little. The availability of excess cash or credit is at best a distraction and at worst a steam shovel to help you quickly dig a really deep hole. So this post is intended for those readers who haven't started spending yet. If you're being pulled in different directions by friendly advice from successful publishers, just remember that they've already forgotten whatever it was that really worked to get their businesses up and running. They're just telling you stuff that they won't have to spend a lot of time explaining.

Economists have grown fond of the term "creative destruction" to find a silver lining in vanishing jobs and industries. In some instances they may be correct, but in most instances they are only half right - the "destruction" half. Unfortunately, small publishers and self publishers alike are particularly vulnerable to the lure of spending money on creative productivity tools, pushed upon them by peer pressure and salesmanship. But those very productivity tools often sow the seeds of financial destruction. The worst mistakes are made when publishers fall for the promise of future efficiencies, misapplying the advice of that prototypal American publisher, "A penny saved is a penny earned." A penny potentially saved in the future isn't saved unless the future arrives, and most new publishers don't last that long. And even if the future does arrive, a penny saved is a penny saved, not a penny earned. Earnings require sales. Savings require comparison shopping or doing without. The two concepts are closely related in managing personal finances, not in managing a publishing start-up.

The Wall Street definition of "small business" generally includes companies with up to a hundred million dollars a year or more in sales. Companies with a hundred million dollars a year in sales are correct to focus significant efforts on efficiencies and tax savings. Small publishers and self publishers with less than a hundred thousand dollars a year in sales are insane to spend money on anything that doesn't directly result in more sales. The only investments that make sense for small publishers are publishing more quality books and content and building their market presence.

So what are the productivity tools that start-up publishers need to avoid? I'll start with an integrated accounting product, no matter how inexpensive. It's not the $99 or $129 dollars for a QuickBooks or Peachtree license that wreaks havoc. It's the time invested in setting the software up for non-existent sales, and then the loss of intimacy with your day-to-day business operations that results from turning yourself into a key punch operator. Spending some time every day entering little numbers into nice boxes on a computer screen is no more valuable that putting all the carrots with the other carrots on your plate and making sure they don't touch the peas. Don't you know there are publishers in New York City starving while you're playing with your books?

If you have less than a dozen titles in print and you need to check an accounting package to see how they are performing, you just don't have a head for business. What exactly do you see as your job function if not staying on top of how your titles are doing? The last time I talked to the IRS, they were fine with small publishers using cash accounting unless their sales are over a million dollars a year. Cash accounting means you don't have to associate each expense with each title for tax reasons as in accrual accounting, and can take expenses and sales as the money moves. An integrated accounting package will lead you in the accrual direction for no reason other than it shows off all the bells and whistles. Do you really need to know how much you spent on postage sending out review copies of title A vs title B? Should you be spending your time and money sending out review copies at all?

I've spent a dozen winters in the city of Jerusalem, where little neighborhood grocery stores called Makolets (derived from Kol, meaning all) feature twelve or fourteen foot ceilings, stacked from bottom to top with grocery goods. The stores are often 100 square feet or less, the size of a small room, with barely enough space for the counter stacked with newspapers and pastry. The owner, or the owner's spouse or offspring work all of the open hours, and they know their regular customers by name. I can just imagine a slick salesman convincing a Makolet owner to install a point of sale terminal (complete with a barcode scanner) to track the inventory and make it possible to hire a minimum wage employee to handle the money. What do you think the result would be?

Instead of the owner knowing every customer and hearing every bit of feedback on what's good and bad, it all gets filtered through software and an unmotivated hourly employee. The new breakfast cereal with the big shiny box sells like hot cakes because of the big shiny box, but the owner isn't there to hear all the complaints about how awful it is. The computer software doesn't know that. It just records that the cereal is selling, so the owner orders more and drops the old brands. The customers start shopping at the Makolet around the corner where the owner's family continues to ask, "How are you today, Moshe? How was that new cereal?"

Another killer application for small publishers is contact management software, more commonly known by the acronym CRM, Customer Relationship Management. By killer application, I mean it will kill your self publishing business dead. The idea behind CRM software is that you can capture all of your customer information so you can harass them on a regular schedule to buy more stuff from you in the future. It's gotten so bad that I recall one publisher telling me that he didn't really care about selling a book to somebody, he cared about capturing their information for his CRM software. Hello? Books aren't toilet paper, or at least, good books aren't. If your customers are impressed by your books, they'll search you out for the sequel, or choose your titles over a competitor's the next time they shop at Amazon or a store that stocks the books. They'll favorite your website and tell their friends, online and off. Small publishers have no business trying to "manage" a customer's personal information, you should respect your customer's privacy and be thankful for the business.

Then there's the omnipresent tax software, or the fallback position of an accountant. Your tax software can't explain to you what goes on behind the scenes and your accountant isn't your mother to tell you if you're being a fool. In fact, I've heard horror stories about accountants encouraging clients to buy stuff right after Christmas to get the deduction in the current tax year. There's never a good reason to buy stuff you don't really need for your business, and a deduction doesn't equal a savings. In fact, if you aren't making a decent profit, the sum total of the "savings" you'll realize from your tax deductions is the amount of self employment tax you would have paid on the money you spent, 15.3%. If you think that spending $100 to get $15 back is smart, spend it on carrots and don't let them touch the peas.

Small publishers shouldn't pretend to be large publishers. If you're wasting money on a postal meter in a desperate attempt to convince reviewers that the books are being shipped by a big publisher, you're way too sensitive to be in business. It doesn't take money to make money unless you're in the money business. In the publishing business, it takes books, ebooks, or other published content to sell, combined with the market presence to attract customers, who pay you money for your products. The sum total required to set up a small publishing business can run from a few hundred to a few thousand dollars depending on your starting point, but it's not "money" in the sense of requiring a Small Business Administration loan, mortgaging your house, or going hat in hand to your friends and relatives.

And remember, buying goods and service isn't "doing business" for you, it's doing business for the people who sell you the stuff. I don't begrudge them their living, but let them earn it from people who can afford to support them. You should only have two things in mind when you go into the publishing business: How to write or acquire content that people will be interested in buying, and how to reach those people. You can acquire manuscripts by writing checks, but you can't buy customers, you have to win them.

Website Plus YouTube for How-To Author Platform

I've barely touched my experimental new website in the last three or four months, but it passed a milestone this weekend all the same. After eight months, the YouTube videos that are embedded in the IFITJAMS.COM how-to website pages have passed 100,000 views. That compares with less than 50,000 views for my self publishing videos which I started publishing more than sixteen months ago. The simple how-to videos currently average over 600 views per day, while the much more time intensive self publishing talks average 100 views a day. Yes, there are three times as many how-to videos, but they are much shorter

About the only thing the self publishing videos have going for them is more subscribers. On the other hand, the how-to website gets less than 5% as many visitors as this website. Looking at it another way, the how-to videos have drawn more a few more views on YouTube that the how-to website has drawn visitors in its entire exisitence! On the other hand, the FONERBOOKS website draws more visitors most weeks than the self publishing videos have in their entire existence. So which approach is better for your author platform?

It depends. The reason the how-to videos are so successful isn't because they are particularly well done or because the website is making them popular. It's because how-to videos of all sorts are incredibly popular on YouTube. And it's not a youth movement, most viewers were in the 35 - 54 age range, with more senior citizens than kids making up the remainder. The vast majority of the viewers find the how-to videos by going to YouTube and searching on key words. So if you are writing a book on a how-to subject, or a subject you know generates a lot of interest on YouTube, you should invest serious time building a platform there, in addition to building a website. The two will reinforce each other.

Views of the self publishing videos, on the other hand, are driven almost entirely by this website. There just aren't that many people going to YouTube and looking for self publishing advice. I could try changing the video titles and keywords to see if it would generate more views, but based on the work I've already done I doubt it would make much difference. The main take-away from this experience is that you need to experiment with which platform works best for your work and the audience you are trying to reach. And while the self publishing videos aren't doing anything in terms of helping my business, I like to think they are helping somebody, so here's a double helping:-)

And the original:

Erotic Ebooks Sink On Amazon Kindle Rankings

There's been a big hullabaloo in the news over the weekend about Amazon suppressing the sales ranking of certain erotic or adult oriented books. There's nothing new about this, Amazon has been trying for years to keep their website kid and family friendly by not popping up adult oriented titles in casual searches. Back three or four years ago, when Amazon was selling ebooks supplied through Ingram distribution, I wrote about the cover art used to market erotic ebooks books online. They used to dominate (double entendre intended) the top sellers in ebooks, especially at night and on weekends.

Amazon discontinued selling ebooks in the UK soon after acquiring the French ebook company Mobipocket back in the summer of 2005, and the next year, they discontinued selling Ingram (Lightning Source) distributed ebooks in the U.S. After a hiatus of a little over a year, they introduced the Kindle, and in my capacity as an ebook journalist and not as a voyeur (disclaimer about protesting too much:-), I kept checking to see if adult oriented ebooks, or out-and-out porn, would come to dominate the Kindle bestseller list as well.

That never happened for several reasons. First, Kindle was launched with wide availability of frontlist bestsellers and leading newspapers all ready to go. Second, Kindles aren't cheap, and $400 would pay for a lot of subscriptions to hard core adult websites for the full length raincoat in the summer crowd. Third, I'd estimate that the majority of Kindle buyers are women, and while women consume lots of erotic fiction, it tends more to the romance or the NYT bestseller variety than to the kidnapping co-eds and locking them in the basement theme. To put it bluntly, I just checked the Kindle bestseller list for erotica, and the cover images all appeared to be male models with ripped abs, as opposed to young women in cages with ripped clothing.

Fourth, and to the point, Amazon eliminated the sales ranks from the adult oriented books, which prevented them from coming up in general bestseller sorts and searches that use the sales rank in determining the results. This isn't something new, the sales ranks for erotic ebooks on Amazon were missing from the day Kindle launched, and as a friend just reminded me, Amazon had begun the practice of reducing the general visibility of adult oriented books even before then. In today's Kindle store, Amazon may be censoring the cover art of the more graphic ebooks, those with full frontal nudity and photographic depiction of bondage and sadism, but it's hard to prove something from its absence. Those books are still for sale, but you'll have to go to Mobipocket or Google search to see the cover image.

I know that some free speech uber alles advocates find all of this hard to swallow, but Amazon really is a family site where your kids go to search for books, in order to make you buy them. Nobody wants some kid's search on "I want to be a math teacher" to bring up a title like "What Boys Want From Sally the Math Teacher", including a cover image making it clear for anybody who couldn't guess from the title what it was that the boys wanted. You may think that's all good fun and part of a child's educational process, but only if your idea of summer fashion is a long raincoat with shoes and black socks.

I recently recorded an unscripted 40 minute interview on the subject of ebook publishing and sales with Jon Reed, which is now posted on his Free From Corporate America Website. I haven't listened to it yet, so let me know if I shouldn't have it linked:-) And yes, I could have used a two word synonym for "sink" in the post title, but it would have been too cheap a shot.

Of Plagues, Publishers And The Angel Of Death

Publishers around the globe are hunkering down this Passover, trying to outlast the season of plagues and hoping the Angel of Death will pass over their publishing house. Rather than painting the blood of the Paschal Lamb on the doorposts with a sprig of hyssops, the modern peoples of the book are covering their websites with strange hieroglyphic symbols: Feedburner, Twitter, Facebook, Kindle, LinkedIn, YouTube, ePub, Atom and Podcasts galore. Does anybody truly believe that the grim reaper of business models will spare their imprint because they've leapt for (and usually missed) the latest social networking or technological trend?

The plagues visited upon publishers are hardly Biblical in proportion, with the possible exception of the stygian darkness under which so many labor. Most of the plagues publishers face are truly in the eye of the beholder, and could easily become blessings if the publisher could only remove the consultant from his eye and read the changing landscape. So unless you're counting on Manna from Washington, learn the five plagues of publishers and how to transform them into blessings:

The Five Plagues (CADEG): Customers, Authors, Distribution, Editors, Google

Aren't customers just awful? So demanding and so disloyal. Why can't they all just sign up (with a credit card) to purchase every book you publish? They shop online for the cheapest edition of your books, often buying them used so the publisher doesn't earn one red cent. To add insult to injury, they post one star reviews on the Amazon product page of the new edition, complaining that it's out of date! Customers are fickle. Just when your business model reaches maturity, customers decide they don't need the 16th book in your Homegirl Knitting series, or your latest title about the latest trend that never quite caught on. And then there are those bloggers who complain about your ebook efforts, chastising you for being too proprietary, too expensive, too platform specific or just not free. How can a publisher keep up with a customer's ever changing tastes and interests? Surely customers are a plague.

If publishers could only produce books without authors, what a paradise publishing would be. How can people who work with words for a living not understand what "deadline" means? Can authors be so twisted that they think that "dead" is something pleasant? The endless arguments over contract terms, always asking for more like a gang of musical pickpockets. Confusing their facts, or even worse, confusing another author's work with their own. Submitting their Word files without ever running a spell check, and fighting over every correction the copy editor makes. And then, "Why isn't my book selling?", "Why isn't my book selling?". Publishers would be better off buying parrots, at least they don't eat so much. Truly authors are a plague unto publishers.

Distribution was invented by the Devil. First the distributors want discounts ranging from 55% to 75%, and then they want to return the travel worn books! What do they think, that dust jackets grow on trees? They promise to get your books into stores when in reality, you're lucky if they warehouse them without charging extra fees. And they're so pushy about exclusivity, locking publishers in contractual prisons and then screwing up on filling the Amazon orders that the publishers could have handled themselves at twice the profit! If by some chance the distributor succeeds in getting your titles onto store shelves and ordering more, they're almost certain to go out of business, leaving you to fight for pennies on the dollar. Verily distributors are a plague upon publishing.

The only thing worse than an editor who jumps ship to another publisher and steals your star author is an editor who stays on indefinitely, demanding raises and promotions. After a few years, editors start thinking that they're somebody! And they get confused over which side they're fighting on, as if the authors and the agents pay their salaries. Not to mention their artistic integrity and hunches about markets. How about reading the book sales data we pay for every month! You'd swear that editors only talk to other editors for all they know of the public taste, much less what's going on in the world. Editors pay too much attention to publishing pundits and bloggers focused on insider technologies, turning red herrings into whales. Certainly editors are a plague on publishing.

Then there's Google, with their damn search and destroy engine, breaking down the monopoly on information long held by publishers. Next they go and scan millions of books, threatening the whole back-in-print and classics business. How could they possibly put those insipid Wikipedia results above a publisher's pages in the search rankings? After all, publisher websites have such beautifully conceived advertisements for their books! First they came for the newspapers, next they came for the music companies, now they're coming for the movie studios. When they finally come for the publishers, we won't have any media partners left to throw under the bus. Indeed, Google is a plague on publishers.

The Five Blessings (GEDAC): Google, Editors, Distribution, Authors, Customers

Google won't fail publishers because Google is too big to fail. If Google hadn't figured out how to print money, the government would be printing money for Google instead of for the banks, car companies, and everyone other business failure on steroids. Google IS the information economy, and the information economy is one of the few things we have going for us these days. Google has freed publishers from the tyranny of book reviewers, talk show booking assistants and print advertising. For the first time in history, any publisher who is willing to listen to reader feedback can watch their mailbox runneth over, before even committing to print. Don't obsess about Google Books, it's Google Search that matters. Indeed, Google is a blessing on publishers.

There has never been a need for editors like today. The Internet has turned every monkey with a keyboard into the authors of sonnets, or at least, random words thereof. It takes a skilled editor pick out the seeds that will germinate and grow in commercial titles for the publisher. The irony of having so much information about authors at your fingertips (look, he has a blog, she tweets, his name comes up a million times in Google) is that it takes more research than ever to figure out if the exposure is significant from a publishing standpoint. Publishers need to find editors who understand the Internet through the experience of running their own websites rather than relying on social networking butterflies and crackberry twits. But a knowledgeable editor is worth her weight in rubies, or at least a monthly salary equal to her monthly unique visitor count in dimes. Certainly web savvy editors are a blessing on publishing.

Distribution is moving online for all electronic content, and given the growing dominance of Amazon in the printed book sector, it can be argued that the outlook for traditional book distributors is grimmer than ever. Their struggles to stake a position as electronic media distributors will rest on their ability to convince publishers and customers that their file management and DRM solutions are relevant, an increasingly difficult argument to make. Online distribution systems tend to move in the direction of lowest cost, allowing publishers who don't want to purchase or create their own file handling and payment systems to use packaged solutions, like PayPal and E-Junkie, for pennies on the dollar. And for offline distribution, as Amazon continues to grow their marketshare, distributors will be forced to give up their exclusive contracts and bookstores will learn to accommodate publishers who can provide books that sell. Verily online distribution is a blessing upon publishers.

No single group of individuals is better suited to leverage the Internet to promote their work than authors. An author who can deliver customers is the publisher's best friend. For all the audio, video, and who knows what to come, text is the driving force behind Internet search and is likely to remain so for the foreseeable future. Nobody does text like authors, if only they can get it online. Publishers who eschew non-compete clauses and give authors the flexibility to use their work online will only benefit from the results. Direct feedback on an author's work in progress could entirely replace market research for publishers and ensure that every book published has an audience waiting to buy it. And when it comes to finding new gems amongst the pebbles of the wreckage strewn shores, what publisher could hope for more than an author already polished by endless friction with readers? Truly authors are a blessing unto publishers.

Customers face a serious problem when it comes to selecting and buying books. So many titles are drek dressed up with graphical elements and sold through cram-down marketing. Perhaps the most overlooked factor in the problems facing the superstore book retailers is that the books they sell so often leave the customers disappointed. With over 100,000 titles in stock, a large share are derivative “me-too” books rushed out by unqualified authors and crafted for a look, page count, cut size, deadline and ROI - not to deliver a solution to a customer. Even though Amazon buyers risk being taken in by fake or opt-in reviews, they have a much better chance of finding the book that’s right for them than going with the face-out bookstore displays driven by co-op dollars, or counting on the spine text and back cover promises. A customer looking on Amazon for an investing book would have to be a very bad shopper to accidentally leave the store with a title that promises an unending bull run in stocks or real estate, but that happens in brick-and-mortar bookstores every hour of the day. Publishers who listen to their customers and serve their needs have a tremendous advantage over their publishing brethren who mainly don't. Surely customers are a blessing.

Literary Writers Need ALT LIT Tags

"Evelyn had looked forward to the hall at Knaresdean with feelings deeper that those with usually inflame the fancy of a girl proud of her dress and confident of her beauty."

That line is taken from Lytton's "Alice", the top of the page where my bookmark happened to be. It would be very unlikely to attract any potential readers from search traffic, especially since the proper name "Knaresdean" isn't a real place. It's also a proxy for the problems that literary writers face online. Literary writers use words to paint scenes and evoke emotions in order to engage their readers, not to attract search engine traffic. But in a world where search engines are out competing bookstores as traffic cops for words, literary writers are left more dependent than ever on bookstore shelf placement and reviews. There aren't a lot of ways literary writers can raise the profile of their work online without becoming social networking phenoms, so I've been working for months on a solution.

Introducing, the HTML innovation that will no doubt earn me honorary PhD's across the globe - the literary ALT tag.

<ALT LIT="Plain English description of what's going on">

The idea of the ALT LIT tag is to translate literary passages into the lingua franca of the Internet, broken English in most cases, so that search engine users have a chance of discovering high art along with the "art photography" they so avidly seek. Imagine Google sending you to a page starting:

"It was the best of times, it was the worst of times..."

In response to the query:

"What time is it"

Instead of the boring:

My ALT LIT tag would make this and more possible if only poor Dickens had the foresight to heavily annotate his text with tags like:

<ALT LIT ="What time is it">
<ALT LIT ="How far is it from London to Paris">
<ALT LIT ="What is a guillotine">

or, if he was really clever:

<ALT LIT ="Cliff Notes for Tale of Two Cities">

Wouldn't that be a good joke on the kids. Of course, the ALT LIT tags are only a start to allow literature to exist on an even playing field with bad prose writing. The next trick for literary writers will be getting good contextual links, so that the content of their ALT tags could be competitive. I believe this can be addressed very simply by organizing university professors to link each other's work the way they assign each other's textbooks. In fact, they might accelerate the process if they forced students to go out and generate links as part of the educational process. At least that way, students graduating in a deep recession would have a marketable skill.

My only worry is that I have the syntax wrong. I'd hate to see somebody come up with the <LIT ALT> tag and get all the credit!