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Stats Are Often Hard to Interpret

BY MIKE SHATZKIN

Stats are often hard to interpret in our business. The reported data comes, of course, after the fact (you can’t report things before they happen) and is often aggregated in ways that don’t tell us what we really need to know. So I tried an exercise last week of asking a few agents for their impressions of the evolving ebook marketplace. I wanted to get a handle on two things: where we are now in terms of books sold in stores versus books sold other ways and whether the transition from print to digital consumption is slowing down.

The picture I got from nine smart and well-informed agents seems to confirm that:

  • sales of ebooks for fiction more often than not top 50% of the total sales, in both the hardcover life and the paperback;

  • sales of ebooks for immersive non-fiction are at something like half the percentage of fiction;

  • illustrated books do a lot less in their digital editions, which usually struggle to reach 10% of the sale;

  • while the marketplace data seems unambiguous, the agents have not formed a consensus that the print-toebook switchover is slowing down.

Perhaps we can attribute that to the fact that the data presentation which most shapes the agents’ impressions is provided in royalty reports. This past year, and especially this past season, have not yet been delivered in the data they study most intensively. But it was still useful to check with them, if only to confirm that fiction ebook penetration is double nonfiction and that illustrated books lag far behind.

If 50% of fiction is selling now as ebooks, it is likely that only about 35% of it is selling as print in stores (because 25-30 percent of the print sale is online). Considering that number was more like 90% ten years ago and 80% five years ago, that’s all the explanation anybody needs to understand the reduction of shelf space we’ve seen. Every year when stores are interviewed about traffic and sales, they cite the presence (or absence) of “big books” as a key driver. The “big books” are most often big fiction. This year, the Fifty Shades family of titles may have provided that lift, which may be why stores (other than B&N) are anecdotally reporting a strong Christmas.

But what the industry should be most interested in, which will be reflected in the next round of royalty statements agents see, is that ebook sales growth appears to have damn near stopped. As Michael Cader pointed out on Lunch, Random House UK indicated a 13% increase this year over last, which mirrors Barnes & Noble’s reported rise of 13% in ebook sales in December.

Thirteen percent is a big increase in a stable marketplace.

But if you consider the heavy activity in the device field—the new iPad mini, Kobo devices being sold by independent stores, and B&N turning progressively their stores into NOOK showrooms (and not to mention the always-growing ebook title base, still adding backlist and formerly out-of-print books and small press and self-published books)—the rise in ebook sales seems like no rise at all. So perhaps we really have hit the point of resistance from print readers and a new stability in division of sales across channels.

The consequences of only about a third of fiction being bought in stores—and not all in bookstores—are still to play out. If it is true that independents did better than B&N this past Christmas, could part of the reason (as I speculated in a prior piece) be B&N’s prior success selling their customers NOOKs? Is the indie store customer somewhat less likely to have bought a Kindle or NOOK previously and therefore disproportionately in the marketplace for printed books?

It is quite possible that the disappointing B&N results could be a more accurate indication of the world we’re now living in than the reported success of the indies.

Under the heading of data being ambiguous, note that the reported big rise in sales by independents in 2012 appears to have taken place in the first part of the year so that sales at Christmastime might not have been as much better than B&N’s as first impressions on the data could lead us to believe. (Once again, thanks to Cader for doing some in-depth analysis of the raw data to lead us to see that possibility.)    Continued on page 17    

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