This article is the 6th in my publishing series for new authors. I’ve already discussed Copyright, Publishing avenues, contracts, editing, and price. If you aren’t interested in publishing as a topic, check back in February when I get back to more general topics.
Distribution is, perhaps, one of the most debated facets of self-publishing. In my experience in the various author groups I belong to, it is certainly more debated than any of the other facets of publishing.
There are a lot of different ways to get your book “out there”. There’s Amazon, GooglePlay Books, Book Shop, Apple iBooks, Nook (Barnes & Noble), Kobo, OverDrive, Copia, Gardner’s, Baker & Taylor, Scribd, Smashwords, IngramSpark, and many, many others. All have ups and downs – advantages and disadvantages. The question is choosing what’s the right method of distribution for your book. At the end of the day, this is a numbers game. It is entirely about getting your book in front of the largest group of people that might potentially buy it. Note that the last half of the sentence is the most important part: people who might potentially buy it.
Part of the question of distribution will be answered by the format of your book. Are you doing a physical book? Are you doing an ebook? Or perhaps an audiobook? Maybe the answer is “yes”, and you plan on doing all of the above. If that’s the case for me, and I’m publishing a book in multiple formats, then I will inherently exclude single-format distributors from my list of consideration. It’s not that there’s anything inherently wrong with them. It’s simply that for my own sake, I generally like to keep all of my products through the same distribution channel because it’s easier to calculate royalties and payments that way.
Let’s talk about ebooks first. They are the most common form of publishing for indie authors, so I want to start there. I’m also going to focus on English language distribution only. If you want to look at distribution in another language you may have to do some digging on your own.
One of the first questions you should ask is: what is your intended market-base? Are you looking primarily at sales within the US, or are you looking at sales all across the globe? You might be asking “why does this matter?”, but I’ll tell you. Certain distributors and retailers have different segments of the Profit Pie, depending on how you are looking at it. For example, Kobo claims to have approximately 20% of the revenue for ebook sales world wide. But they have only 3-4% of US based sales. This means that within the US Kobo is not a mega profit monster, but in other countries (Canada, Japan, and the EU) Kobo is pretty huge.
If you hear authors talk about distribution they will often use terms like “wide” or “exclusive”. What this is referring to is the number of distribution channels the book is distributed through. Now, the initial reaction you might ask is: wouldn’t it make the sense to distribute the book as wide as possible in order to maximize the number of sales? Well, no. Not necessarily.
Let’s say that I have an ebook novel that I’m selling for $4.99 list price. Now let’s assume that I “go wide” and distribute the book to every possible channel. For the purpose of this exercise I’m going to use the different retailer’s market shares to estimate the number of sales. I’m also going to be generous with the sales and assume that the total sales are 1125 books (mostly because it’s easy math and I’m being lazy, but it works out to the same ratios no matter what number you use).
Starting with Amazon, they give me as the author 35% ($1.75) of the profits and I’d sell about 650 units based on Amazon’s market share. Total profit would be $1,135.23. Barnes&Noble/Nook gives me 65% ($3.24) and I’d sell about 200 units. Profit would be $648.70. Apple’s iBooks (assuming that I have the Mac computer and software needed to do it), would give me 70% ($3.49) and I would sell 150 units ($523.95). Kobo would give me 65% ($3.24) and I would sell about 50 units ($162.18). Gooogle Books would give me 52% ($2.59) and I would sell about 50 units ($129.74). And Smashwords would give me 59.5% ($2.97) and I would sell 25 units ($27.97). All told, the combined profits from all of these distributors would be $2,627.76.
There’s one figure that is important to note here: Amazon, by itself, sells 65% of all ebooks sold in the US. It’s basically the 2/3rds majority shareholder on the book market in the US. Why is that important? Because Amazon wants to attract more authors they offer perks for exclusivity. The biggest of those perks is doubling your royalties. Instead of 35% for your books, if you have an Amazon-exclusive book, you get 70% of royalties.
What does 70% royalties look like? Let’s take our same $4.99 novel. Let’s take the same total number of units sold (1,125 – very unlikely for first-year Indie Authors, I know. It’s just an example). 70% of $4.99 is $3.49. Take that times the number of books sold and we arrive at $3,929.63 in profits. To recap, that’s $1,301.87 more in profits than if I had decided to go wide.
So, it seems like KDP exclusivity is the way to go, right? Mostly, yes. But there are some other important factors here. While the markets fluctuate and change, there is only a finite number of customers available. By keeping the book in KDP exclusivity forever you are loosing out on the customers who only have Nooks or other readers that don’t use Kindle. The best approach that I’ve found for broaching this method is to evaluate the book’s lifespan, not just the here and now.
For me, I start books out as a KDP exclusive, and then, some point down the road (typically about 2-3 years), I do a big web promotion, create a bunch of hype, and move the books “wide” so that I can tap into the previously untapped Nook, Google, and Apple customers.
If the book is picking up on Amazon at the 3-year mark I might not push it wide. Conversely, if I push it wide and it doesn’t do well I can always return it to exclusivity.
The last thing that’s worth mentioning is that just because your ebook is exclusive to Amazon, doesn’t mean that your paperback and audiobooks have to be as well. In general I mentioned that I like to keep things in one place for the sake of convenience. But if moving a paperback to a different distributor or making it wide will net me a few hundred dollars, I’m going to do it.
Look carefully at all of the distribution models for the format that you are offering, what their royalty payout is, and the market share each retailer commands. That will give you a better idea how to proceed.
I hope this was helpful. Join me next week when I talk about Publishing Cost and ROI.