On making money in publishing

Writing an article for Business Live, Brendan Peacock asked me for some thoughts on making money in publishing today. He had four questions, and I enjoyed thinking through some short answers.

BP: First, the easy and simple question: how do you make money as a would-be author today, and how do modern-day publishers make money?

AA: It’s as hard as it ever was. That’s because to make money you have to be good at selling, and most authors are bad at selling. Or rather, they think they’re bad, so they don’t try. Many publishers are the same: they hire mediocre salespeople because they don’t believe they need or deserve or can afford great ones.

As an author, you might be selling copies of your work, or your services as a speaker or writing coach, or custom-written pieces of copy for corporations. Whatever you write, you have to sell. In Rich Dad, Poor Dad (a somewhat obnoxious but indispensable book for writers), Robert Kiyosaki tells the story of meeting a journalist who wished she could make money from her creative writing.

“Do you see this?” I said pointing to her notes. She looked down at her notes. “What?” she said, confused. Again, I pointed deliberately to her notes. On her pad she had written “Robert Kiyosaki, best-selling author.” It says “best-selling author,” not “best-writing author.”

Publishers are just the same. The process of making a book is a craft that any team of freelance professionals can do well, hence the apparent rise of self- and small-scale publishing. But the process of selling a book is a separate art and science. You have to learn to sell. Take a course. Read books on selling. Don’t feel it’s beneath you because you’re a ‘writer’.

BP: How have writers and publishers had to adapt and come to terms with the digital age and how can they make it work for them – what are the new skills and challenges they’ve had to acquire and master in order to become successful (over the certain level of talent and ability which we assume as a given)?

AA: Since so many customers are spending time online, that’s where they get most of their reading recommendations: friends on Facebook, reviews on Amazon, adverts in Google Search, blog posts, and so on. So selling has moved largely online. This means two things: you have to be able to sell online, and your customers have to be able to buy your work right there, instantly, on impulse. That may mean an ebook sale or, at the very least, availability on major print-book online retailers. My new venture Paperight lets you sell through copy-shops anywhere. Half of sales is making it really easy for people to hand over their money.

BP: How do you control copyright and deal with piracy/loss of potential revenue, and what are the costs involved with all this admin?

AA: You don’t try to ‘control’ anything, your job is to enable. If you try to control the whole selling-vs-piracy ecosystem you’ll end up spending vast amounts of time and energy chasing ghosts. As publisher Tim O’Reilly says, most people who pirate your work weren’t going to pay for it anyway – so it’s not ‘lost’ revenue. The more pirated you are, the more popular you are, great! Now, just make it so easy for people to find and buy your work through legit channels, so that they find those faster than they find pirated versions. It’s much faster to find a book on Amazon than it is to find a reliable copy on The Pirate Bay. Amazon Kindle has 80% market share in ebooks because they’re easy and fast to buy from.

BP: What are you expecting to happen in the future, with regards to income streams and the way the publishing industry is evolving?

AA: I actually think income streams will stay much the same as they’ve always been: small for authors, and channelled through large companies that publish most of the best-selling books. Increasingly, those companies might be technology companies or retailers (think Amazon, Google, Apple), and not only the Big Six publishers (Macmillan, Penguin, Hachette, HarperCollins, Random House, and Simon & Schuster).

In editorial and marketing there are very few economies of scale. This means anyone can make and market a book as well as anyone else – this should lead to a growth of smaller, niche publishing enterprises. But big companies can afford to cross-subsidise books, allowing successful books to pay for losers. There are always losers, maybe as many as 8 of 10 books lose money for publishers. So that makes it possible for them to attract top talent by making better financial promises to authors.

But while the income streams will stay much the same, the people and companies earning them will change a lot, based on who gets better at selling online: marketing, building trusting communities of customers, and making it easy to buy.

2 thoughts on “On making money in publishing

  1. Thanks Arthur for an interesting article. Am curious as to exactly why RIch Dad Poor Dad is indispensable for writers? It is an obnoxious book, and the financial advice a little dodgy –
    Regards
    Siobhan

    • Hi Siobhan. Well, indispensable was too strong a word, I guess. I’ve known so many writers (myself once upon a time) whose careers and financial lives are hamstrung by their naivety or ignorance about money. Rich Dad, Poor Dad is a cheap and nasty way to get your head around the basics. I certainly wouldn’t call it a solid financial guide, but anyone who aspires to be self-sufficient from their creative work needs to know the difference between and importance of assets and liabilities, and to see the ego-drive it can take to make enough money to live comfortably as a writer. That said, there are better books no doubt. You have any favourites?

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