E-books' Impact on ROI
After several reboots, e-book publishing is seeing signs of growth. Recent sales figures compiled by the Open eBook Forum (OeBF) have given publishers an indication of what the future holds.
And that future might be now. For the first quarter of 2004, e-books posted double-digit growth (28 percent), and though revenue is projected to be a modest $13 million for the year, sales are rising, and the OeBF, an international trade and standards organization for the electronic publishing industry, began tracking sales of trade titles via a monthly bestseller list in March. Given all the optimism, publishers have taken a harder look at their e-book programs and are putting better marketing campaigns behind them.
"E-books have been strategic tools for a lot of publishers for the past four or five years," says Steve Potash, president and CEO of Overdrive.com, a provider of inventory and rights management to online booksellers. "As we look at the life cycle of an e-book, it is a very valuable tool for publishers. It's valuable as a galley, [for] sharing with potential buyers and with reviewers."
But, in the long run, can publishers really rely on e-book publishing as a surefire moneymaker? Or will e-books sales detract from print sales, hurting the tried-and-true business model? E-book publishing is still too new to really know the answer, but opinions vary.
"It's pretty standard across the industry in that there's still no one winning model for e-books," says Patrick Durando, director of media technology with McGraw-Hill Professional. "[E-book] publishing was back to square one a couple of years ago. I think there's good growth, but the total market is still very small compared to other parts of publishing. That said, there's a lot of opportunity with e-books, if done the right way."
And there's no better starting point than with what's already a hit, as it seems what sells in print sells online. According to OeBF's May best-seller list, the top selling e-book was "The Da Vinci Code," by Dan Brown, a print title that still tops The New York Times best-seller list.
Other recent top e-book best sellers include "Van Helsing," by Kevin Ryan, Brown's "Angels & Demons," "The Da Vinci Code: Fact or Fiction," by Hank Hanegraaf and Paul L. Maier, and "The Rule of Four" by Ian Caldwell and Dustin Thomason—all of which reflect what's selling in print. Pushing what sells well in print is the strategy for most publishers, says Nick Bogaty, executive director of OeBF in New York.
"It's clear that what people read in electronic form is what they would read in print, so obviously publishers are going to market electronic books to reflect what's selling [on the hardcover best-seller list]. There's a real sales-based focus in the e-book industry. In past years, everything was new, and people were trying a lot of experiments. We're at the point in our industry where things are selling."
To Publish Or Not To Publish
Durando says it's a good sign that "The Da Vinci Code" is selling well, as it shows that e-books are not a specialty item.
"Another thing that drives e-books is promotion," he says. But, "there are still relatively few outlets where one can access or purchase an e-book. So certain types of promotion could drive an e-book to become a best seller, but still not as much as general demand would."
Although a best seller generates interest in its e-book counterpart, Potash suggests the decision to publish an e-book is no longer dependent on whether it's a best seller, and titles are often released as hardcovers and e-books simultaneously.
"Publishers have the ability to market their front lists as both a hardcover and an e-book, so they're publishing everything as an e-book now," he says. "Most of them have services or the capability within their workflow to kick out an e-book as an extension of their production."
Also gone are the days when publishers feared e-book sales would steal sales from hardcovers and paperbacks. Most have come to realize that those who buy e-books wouldn't ordinarily buy the printed version.
"Publishers have always feared e-book sales would cannibalize print sales, but I've seen little evidence of this," Durando says. "It's just another format that suits a customer's need better, so in most respects e-book sales supplement print sales." He adds, while there are few e-book-only products, it is the future, as there will be more opportunity to develop and market "e-only" products as production costs drop and product creation becomes more flexible.
"Ten years ago there was [fear among publishers] that digital versions of titles would detract from print sales," Potash says. Today, however, he adds, "Everyone knows that e-books add to the ROI. There's no dilution of their print brands, and by publishing e-books, they introduce their authors and titles to a new audience."
Bigger Plans Ahead
While the OeBF's best-seller list tracks the progress of e-books in the trade genre, it doesn't keep track of sales in special-interest markets such as educational, reference and professional publishing.
E-book publishing reportedly serves those markets well, as e-books tend to sell briskly in 'niche' genres.
"Sales of e-books to libraries is a growing market, and the same can be said of the education market," says Bogaty. "Our best-seller list and the numbers the industry has released so far are strictly from the consumer retailer. We haven't collected any data, but it's pretty clear [it's a growing market]."
"I have seen reference materials in academic library channels do well, particularly some of the larger texts, like medical or engineering books," says Durando. "That's where e-books fill a specific need. If you're doing research and you access an e-book through an interface like NetLibrary, you're going to be in and out of that e-book in 10 or 15 minutes."
"The market for reference- and information-based publishing in print is small and getting smaller," Potash says. "We are seeing [the use of those materials] migrating to online and
With double-digit growth and sales of e-books rising each quarter, it's safe to say many publishers are displaying a strong commitment to e-books. And the number of devices that can be used to read e-books—from handheld computers to smart phones have increased, and new digital ink devices improve the experience for readers. These are all positive signs that the future for e-books is now.
- Warren Chiara