Amazon (NSDQ: AMZN) isn’t exactly lacking for praise these days, and much of it is deserved. The company has revolutionized digital publishing: Its Kindle sparked the e-book boom, its e-bookstore has the widest selection of titles online, and its easy-to-use publishing platform has made self-publishing a legitimate and lucrative option for some authors.
Recently, though, Amazon has been getting credit for things it hasn’t achieved yet.
Amazon, which made its fortune selling other publishers’ books, is now pushing hard into the business of signing up and publishing its own authors, in both digital and print. Since 2009, it has launched six new imprints (see chart) and hired publishing industry veteran Larry Kirshbaum, the former CEO of Time Warner (NYSE: TWX) Book Group (now Hachette) to head up a seventh. All of this has led to a spate of breathless headlines, especially following a recent New York Times piece about Amazon’s publishing program. “Wake up and smell the disruption,” Mathew Ingram wrote at GigaOm. “Amazon is coming for the book publishing industry. And not just the e-book world, either,” wrote Noah Davis in a Business Insider post under the headline “Amazon Invades The Publishing World, And Publishers Are ‘Terrified’.” And Glyn Moody at Techdirt called Amazon’s efforts “a fully-integrated global publishing strategy.”
Yet beyond these bullish prognostications, there’s been little effort to gauge the success of Amazon’s nascent publishing efforts. The company has published about 150 books since 2009, ranging from literature in translation to romance and thrillers. Many of the authors had previously self-published their books; others left traditional publishers to work with Amazon.
Piecing Together Sales Data
How have these books sold? It’s not an easy question to answer. While Nielsen BookScan tracks print book sales, it hasn’t yet begun tracking e-book sales, at least not for public consumption (it began providing data for the Wall Street Journal‘s new e-book bestseller lists just last week). The books’ authors know how many copies they have sold, but they sign non-disclosure agreements when they sign up as Amazon Publishing clients. And Amazon is notorious for providing very little in the way of sales figures for its books — or its Kindles, or anything else it sells.
So I decided to try to piece some of this information together on my own, through the book product pages on Amazon.com. Using Books Advanced Search, I found all of the titles available from each Amazon imprint. I entered those titles into a spreadsheet including title, author, imprint, publication date, print book price, e-book price, number of reader comments and average star rating.
I found that Amazon Publishing has released 149 titles across its first six imprints since 2009, with an additional 114 slated to be released between November 2011 and October 2013. Meanwhile, Amazon told me it will release “more than 100 titles” this fall, which suggests that some planned titles aren’t yet on the website. The 263 titles I tallied, though probably not the complete list, still provide a fairly comprehensive look at what Amazon has published so far and where it is headed. Here are some of my findings:
» 261 of the 263 titles are available as print books as well as digital books.
» Print almost always means trade paperback. I found just 13 titles available in hardcover.
» The average sale price of an Amazon Publishing paperback is $9.92. (The average price of a trade paperback in 2010 was $10.14, according to publishing research firm R. R. Bowker.)
» The average price of an Amazon Publishing e-book is $6.91. (The average price of an e-book in 2010 was $5.75, according to Bowker.)
» The books are heavily reviewed by customers (more on that later). Amazon Publishing titles have, on average, 47 reviews, with an average star rating of 4.09.
» Publishers have long built up their backlists (and their profits) by buying the rights to out-of-print titles — and Amazon is doing the same. At least 49 Amazon Publishing titles were previously published by other houses between 1953 and 2009: Avon, Ballantine, Bantam, Delacorte, Dutton, Harcourt, Henry Holt, Houghton Mifflin, Little Brown, NAL, Random House, St. Martin’s and William Morrow. As far as I can tell, the only publicized deal of this nature was Amazon’s agreement with Toby Press: In 2010, Amazon acquired the print and digital rights to 121 of its literary fiction titles. (I found 20 of those titles currently for sale.)
Success With E-Books
An industry tracking service for e-book sales does not yet exist. I asked Dan Lubart, principal of Iobyte Solutions and owner of the blog eBook Market View, to track how many Amazon Publishing titles hit the Kindle bestseller list this year. (We don’t know how many copies a book has to sell to become a Kindle bestseller, but the list provides a gauge for success.) Of the 149 titles Amazon has published since 2009, 30–about a fifth, not a bad hit rate–were Kindle bestsellers at some point in 2011, at positions ranging from 1 to 98. Most of the books became Kindle bestsellers when Amazon sold them at promotional prices. (The average price of an Amazon Publishing book that made the Kindle bestseller list was $2.77, compared to the average Amazon Publishing e-book price of $6.91, as mentioned above.)
What About Print?
I used Nielsen BookScan to drill down deeper on the print side of Amazon’s publishing business. Amazon got where it is by being a thoroughly digital business, but it still can’t ignore print books–for all the growth of e-books and e-readers, print still makes up at least 80 percent of trade book sales.
BookScan tracks about 75 percent of hardcover and paperback sales, and sales figures were available for 111 of Amazon’s 149 titles. Here’s the title breakdown by print copies sold:
Amazon’s most successful book so far has been The Hangman’s Daughter by Oliver Potzsch, translated from the German and published by the AmazonCrossing imprint. Traditional publisher Houghton Mifflin Harcourt bought the trade paperback rights to Hangman’s Daughter, and the book was Costco’s August 2011 featured title. It has sold 25,657 copies in print, according to BookScan. (This number includes Costco sales.) That is a lot of copies: The book hit the New York Times paperback bestseller list. As an e-book, though, it sold 250,000 digital copies, according to the New York Times. In other words, while The Hangman’s Daughter was a success in print, it sold a tenth as many copies in that format as it did in digital form. And Barnes & Noble refused to carry the book in its stores because Amazon would not sell the e-book version on the Nook platform. (For more on the importance of Barnes & Noble, see below.)
After The Hangman’s Daughter, the most successful print titles I tracked were both from Seth Godin’s imprint, The Domino Project: Poke the Box, by Godin himself, which has sold 23,436 copies in print, according to BookScan, and Stephen Pressfield’s Do the Work (publication date: 4/2011), which sold 8,288 copies in print. Another Domino Project book, Anything You Want by Derek Sivers (6/2011) was Amazon’s fifth bestselling print title, with 5,702 copies sold. Sales of 5,000 to 10,000 copies is hardly spectacular in the traditional publishing world, but it’s not bad either.
Why The Domino Project Works…
Seth Godin is clearly doing well with Amazon Publishing-but he was also doing pretty well before he signed up with them. He operates his imprint “99.7 percent independently,” he told me. “Sometimes I ask [Amazon] for their insight, but then I make my own insights about what I want to do with the info I got.” For example, Amazon was able to tell Godin that people often bought his books in bulk, which gave him the idea of selling Domino Project titles in multi-packs.
I asked Godin if Amazon has helped him with the marketing of the Domino Project books. “Most of what people think of as marketing has been done by us, The Domino Project,” he said. “By far the biggest tool we’ve had in selling the books is our blog, which has 50,000 subscribers.” The Domino Project also sends copies of its books to word-of-mouth marketing company BzzAgent.
…But Other Print Books Don’t
With the exception of Godin’s books and The Hangman’s Daughter, print sales for Amazon Publishing’s books appear mediocre. That may be due, in part, to Amazon’s historically poor relations with booksellers. Both chain and independent bookstores see Amazon as a competitor (which it is). Amazon didn’t really have to worry about that before it became a publisher. But the fact that it has released nearly all of its titles in print (via offset printing, which means multiple copies of a book are printed at a time and in advance, rather than through print-on-demand) suggests an investment in the format.
It’s easy to say that brick-and-mortar stores are dying and Borders is bankrupt, so who cares about bookstores anyway? But physical bookstores are still the main place book shoppers discover new titles, Kelly Gallagher, VP of publishing services at Bowker, told me. “When you walk into a bookstore, you’ve got about 15,000 choices within eyesight. [But] the most images or books I’ve ever been able to find on a single page on Amazon is about 33 items.” Beyond the bestseller lists, he says, the main way readers find out about new authors and midlist authors (i.e., pretty much all the authors currently published by Amazon) is through impulse purchases, most of which take place in brick-and-mortar bookstores. “About half of all titles sold in a chain bookstore today are impulse purchases,” Gallagher said.
Discoverability even matters for shoppers who eventually intend to purchase a book in digital format. In a recent study of children’s e-books, Bowker found that the number-one way customers became aware of the title was in a physical store. They went there to look at the content, then went online to purchase the e-book.
Getting Books Into Stores
So how do books wind up in bookstores? Traditionally, book publishers send lots of information to booksellers, including advance review copies and other sales materials about their upcoming titles. They also send out sales reps to talk about the new books; these reps often have longstanding relationships with bookstore buyers. Booksellers can place orders with their sales reps or through the big wholesalers, Baker & Taylor and Ingram.
It is unclear how much of this work Amazon is doing. “We have an in-house team calling on accounts,” an Amazon spokeswoman told me. “Our books are also available from Ingram and Baker & Taylor. We are working on expanding these capabilities.”
I spoke with several independent booksellers who said that Amazon had not sent reps or sales materials to their stores. Otto Penzler is the owner of the Mysterious Bookshop, a well-known New York City bookstore that specializes in mysteries-one of the categories that Amazon has expanded into with its Thomas and Mercer imprint. Penzler had not known that Amazon was publishing mysteries. When I told him about Thomas and Mercer, he said, “I’m surprised that [Amazon books] are available as trade paperbacks, and that we haven’t heard from them.” He also said that he would be “reluctant to support them by carrying their books” because “they want me out of business, the same as every other traditional bookshop.”
Mark LaFramboise, owner of leading independent bookstore Politics and Prose in Washington, D.C., said he had not heard anything from Amazon about carrying its books. “So far, anyway, the books they’ve signed up aren’t ones we expect much demand for,” he said. “If a customer comes to us and wants us to get a book for them, we’ll do everything we can to get that book, but so far that hasn’t happened with any Amazon titles.”
Barnes & Noble is taking a harder line with Amazon. The country’s largest bookstore chain, and an Amazon competitor, it has said it will only carry Amazon titles in its stores if it can also sell them as books in the Nook store. As mentioned above, it refused to carry The Hangman’s Daughter in its stores. “We will not stock physical books in our stores if we are not offered the available digital format,” CEO William Lynch told Publishers Weekly in August. “Given Amazon’s recent push for exclusivity with agents and the authors they represent, we feel it’s important to be very clear about our position on content going forward.” (Books published by Amazon are still available on Barnes & Noble’s website.)
Getting The Word Out
Amazon’s marketing and publicity efforts for its titles, in general, appear to take place mainly on Amazon’s own website. The company did not answer my questions about its marketing and publicity campaigns, but Amazon’s Vine program, which gives free copies of books to readers in exchange for reviews, is a large part of its marketing push. (Other publishers can use Vine, too.) Amazon has also featured Kindle versions of its titles frequently as Kindle Daily Deals and in its monthly “100 Kindle Books for $3.99 or Less” promotion. Since Kindle Daily Deals launched in August, Amazon has featured its own titles 13 times. November’s “100 Kindle Books for $3.99 or Less” promo includes 19 Amazon Publishing titles.
Amazon Publishing’s biggest test is still to come. This spring, the first books from Larry Kirshbaum’s imprint will be released. The imprint will publish general fiction and nonfiction, and with those kinds of titles come higher print sales expectations, especially given Kirshbaum’s background in traditional publishing.
It will be interesting to see if Kirshbaum can use his connections to woo a major fiction author from a traditional publishing house-someone like David Baldacci or Nicholas Sparks. Beyond that challenge, Amazon will have to increase its outreach to bookstores and also solve its Barnes & Noble problem.
Sure, it’s the digital age. But Amazon Publishing hasn’t killed print yet.