March 27th, 2012, 10:41 AM
NYT Bestseller Shares her Financials
Some of you may already have read this article, but here it is for those who have missed it.
And the follow up article . . .
Last edited by Carlyle Clark; March 27th, 2012 at 10:48 AM.
March 27th, 2012, 01:36 PM
Hadn't seen that one. Her figures I think are insightful, but there are a few things to be aware of:
Viehl writes paranormal romance and is published by Onyx and Signet, divisions of NAL that do romance, suspense and other mass market paperbacks. As such, she's in a different category market than SFFH and the procedures, types of sales and accounting are somewhat different, especially as romance has all sorts of systems in place that are different from other forms of fiction.
So to be clear, foreign sales are done less for category romance because the romances usually don't fly too well, are in mass market paperback and foreign publishers, doing their own romances, don't want them. However, Viehl is probably at the stage now that she is actually having foreign sales which is a significant amount of money, potentially more than she'll make on domestic sales in some cases. (See fantasy author Jim C. Hines' breakdown of his numbers for more info on this.) In category romance, it's usual that the author will license World territory to the publisher, as the publisher does a lot of export sales to other countries and may place the rights. The net monies from foreign licenses sold by the publisher are then split between author and publisher according to the contract. At this point in her career, however, Viehl probably is no longer giving the publisher World territory and instead licenses only U.S. and Canada rights, with her agent selling foreign rights. This is much more common in SFF as well from the get-go if the author is agented or wants to sell foreign rights, unless the author and the publisher are making a multi-country launch deal, like say U.S. and U.K. at the same time.
Viehl was already a bestseller when she did Twilight Fall; she just didn't think of herself as one. No one in category romance gets a $50,000 advance if you're not already a sales bestseller for them. Viehl was what is called a category bestseller at that point with her series; she was a lead title in sales and was already at lower levels of the NYTimes list with previous titles. She was undoubtedly higher on other lists like USA Today, etc. Twilight Fall was simply where she broke into the top level. She is, as are most bestsellers, a slow burn bestseller. Her next series, Kyndred, was promptly started off in a hardcover edition, because she had reached those sales level where a hardcover that was not a book club edition is a good market expander. This would also increase interest in foreign sales and get her solidly into libraries. She would have also had a substantially increased advance for that new series.
Viehl did not have to do conventions and book signings to help get her name out (although she could have if she wanted,) because again she's doing category romance. SFFH is the only area of fiction that really has an extensive convention system that is of much use to authors. The bulk of romance sales are through the wholesale system -- shipped to distributors and Ingrams to be sold in grocery stores and other places, rather than the heavier reliance on bookstore sales (including Amazon,) that other types of fiction have. These amounts tend to be somewhat set at basic levels, so many shipped to accounts for a starter title, mid-level, lead, etc., and then the hope is that returns are not high for the particular title/author. These wholesale accounts don't require author contact and signings. Again, since moving to hardcover and higher name visibility, it's likely that Viehl is actually doing more promotion in the last three years than she did when she wrote this article and doing more book signings with her hardcover pubs.
Viehl's publisher did more publicity than she was aware of, since she wasn't out beating the streets herself. This is because as a category romance author, Viehl is marketed as part of the publisher's whole paranormal romance line and a key lure for that line as a lead title. In-store displays, in-store promo items and special newsletters and clubs promos bookstores run, special offers to subscription romance readers, co-op advertising with bookstores for a clump of romance titles, group ads in targeted publications, promo displays in stores like groceries, targeted reviewers and bloggers and romance media, online ads, targeted radio spots for several books together, etc. promoted Viehl and promoted her as a lead title. Nonetheless, she is correct in that the main driver is word of mouth of her building audience of fans. The higher her sales level, the more promotion works to spread awareness of her name, and so as she's climbed these last five years, they've done more and more promotion efforts because it becomes more cost effective.
It is not "now common" for publishers to pay the last part of the advance on publication of the book. It's always been common. The advance is money given in anticipation of author royalties. The bigger your advance, the more extended the pay-out they'd like to have. If you're lucky, you can negotiate half on contract signing and half on delivery of ms., but in category romance, with a big advance, splitting the advance into thirds, with the last bit on publication, has never been unusual.
The reserve against returns is not held for 1-3 years. The reserve is released each six month accounting period. A new, lesser reserve may then be held. What she meant was that the publisher will keep holding some of the sales earnings in reserve for 1-3 years. In Viehl's case, as she was publishing in mass market paperback at that time, a one year reserve would probably be sufficient. Her initial reserve was around 30% of net sales, which is about as high as you want it to be, and not an unusual figure for mass market paperback where returns are high. Overall, publishers take a loss on mass market returns, which are not returned to inventory.
Viehl's publisher also didn't make the money on her in gross revenues that she's guessing. Publishers have to sell gross sales at highly discounted prices for mass market. If the discount is very steep, as it can be for wholesale, then on those sales, Viehl's royalties may be slightly reduced or calculated on net revenues instead of units sold, depending on her contract. But for price discounts less than 50%, Viehl's royalties are calculated on the invoice price, which is slightly below the retail price, not the discounted price that publishers actually get from the vendors. So the publisher makes a good bit less off her than she thought. But clearly she's an in the black author for them and they are quite happy with her, which is why they did her new series in hardcover and in fact, must have planned to do that before Twilight Fall came out in paperback.
Nearly all of Viehl's books are still in print and for sale and for sale in electronic editions. Every time she comes out with a new book, her backlist titles sell more and can be restocked in wholesale accounts, libraries, etc. (Bestsellers make more from their backlist on average than their frontlist.) So Twilight Fall has sold over four years possibly double the numbers she had in the first two accounting periods. With her Kyndred books being in hardcover and any new Darkling novels she's doing -- she has two of those out this year -- likely to be kept in print much longer than the average mass market, she has a longer time window to sell and to sell her backlist.
None of this is to negate the reality of what she's saying, which is that book publishing is a much smaller market than people realize, especially because the online selling market and as yet the electronic market have not replaced the loss from the shrinkage of the wholesale market in the 1990's. Romance is a wholesale-heavy market with its own media and the only area of fiction to be successful with subscriber readers. It has high returns and earnings are steady but bottom level on advances until you really become a big name, at which point you can earn quite a lot, especially if you're prolific, which romance has no problem usually with authors being. In category SFF, the set-up is a bit different, though since it is mostly mass market, it is also wholesale dependent. But it has different marketing and word of mouth channels, it has a convention system but not a subscription system, it has a strong bookstore and online bookstore market, and mid-listers can get a larger increase in advances. SFF authors are usually more prolific than other fiction authors, but with the increase in the hardcover market for SFF, they've often been discouraged from writing more than 1-2 books a year, unless the publisher is doing and the author can provide serial publishing of a series, often to establish the author with bookstores and readers.
March 27th, 2012, 08:21 PM
Net sales of 61,000. Would anyone who understands the publishing industry -- at all-- think sales like that would make you rich?
Generally when I think of best-sellers; I'm picturing millions or at least a few-hundred thousand books sold. Selling millions of copies is the only time an author becomes 'rich'. Mega famous = mega dollars.
It's no different in the film industry either, with indy films -- unless done extremely well -- making almost nothing. Sure, doing your full length Indy film about an alcoholic father who beats up his wife and kids, before killing himself might be an interesting film, but it doesn't sell as well as a Hollywood: comedy/romance, action or drama (with big name actors).
If you want to be rich, you need to produce sell-able content, which means lumping yourself with all the other people who are looking to do the same thing. I guess what these sort of things tell us is; writing is not about the money and should never be. No one here writes solely for the money. I don't see why that would change, even if you do start making money from it. The money is a bonus, because when you break it down, you're doing what you love.
March 28th, 2012, 07:39 AM
If she sells 65,000 at $2.99 on Amazon (as an indie writer), she would earn $2.04 for each sales.
65,000 x $2.04 = $132,600
March 28th, 2012, 12:40 PM
-- Ah, that's the hard part, right there. At this point, Viehl might be able to sell 65,000 on the Web to just her electronic audience, depending on what her e-book sales are, but that means losing a lot of her audience that she's built who don't buy e-books for future sales and hoping the e-book audience remains high. In 2008, she was not in that position and the e-book market was just getting started. If she goes indie now, she has to do a lot more production, marketing and business management than she's doing now. Some authors like that stuff and can do it well. I find the authors who worked in advertising tend not to have a big problem with it. Other authors find it exhausting. That's one of the reasons Amanda Hocking went for a publishing deal. The other was that she wanted to be able to reach readers she couldn't reach with e-books alone. A lot of authors are experimenting with doing shorter works, collections, reprints of older titles, anthologies and funky projects on e-books independently, in addition to their contracted works in print and electronic.
Originally Posted by BigNaruto
March 29th, 2012, 09:37 AM
Yeah. Selling even one book on your own is tough...I don't blame Hocking at all.
March 29th, 2012, 11:15 AM
Man of Ways and Means
Thanks All for this info and thread!
March 30th, 2012, 12:54 AM
Writer, Artist, Beeyotch
Well... nobody "blames" Amanda, since nobody is in a position to do so.
Indies can make those numbers, but the big numbers for indies are new. I was trad published and now indie. Right now she has a machine behind her that is valuable. But it actually puts her in a wonderful position to do something new on her own, which I am seeing a LOT. Established writers are taking backlist, rejects they believed in, etc.
I made a nice chunk of change on a 99 cent novella last year, and then made it free to get a bump. And nobody promoted me but me. I think a lot of the assumptions about direct publishing are no longer accurate, and very few people outside the community know as much as they think. Because it's changing so fast you can't know.
That said-- I blogged about this today because I just thought it was a gutsy and generous act on her part.