Smashwords’ Mark Coker on E-Publishing
by Susan Johnston on Feb 20 2012
Mark Coker: Founder of Smashwords, an ebook distributor. Also angel investor, gardener, hiker, battler of squirrels, dreamer, doer, co-author of Boob Tube.
Ebook publishing presents a tremendous opportunity for writers with an entrepreneurial spirit, those who are willing to not only write the book but market and distribute it. One of the many distribution options is Smashwords, which distributes over 100,000 ebooks on behalf of 37,000 indie authors, publishers, and literary agents.
Ebyline chatted with Mark Coker, founder of Smashwords, about where the self-publishing world is headed.
What are the pros and cons of journalists self-publishing an ebook vs. signing with a traditional publisher?
MC: With self-publishing, journalists have the ability to out-publish, out-distribute and out-sell the large publishers.
The primary benefits of self-publishing are immediacy, control, flexibility and economics.
Immediacy: At Smashwords, a journalist can upload their completed manuscript and ebook cover image and within 5 minutes it’ll be made available for immediate worldwide discovery, sampling and sale from Smashwords.com. Within two weeks, we’ll distribute that book to most of the big retailers, including the Apple iBookstore, Barnes & Noble, Sony, Kobo and others. With traditional publishing, most books appear. Most traditional publishers take 12-18 months to get a book out.
Control: Self-pubbed authors retain all rights to their works, full editorial freedom and can price their content more competitively than traditionally published books.
Flexibility: Self-pubbed ebook authors are not constrained by the typical word counts of print books. Journalists can write to the word count that makes the most sense for each piece. They can publish short form content of only 1,000 words, or longer form content of 250,000 or more words. The author has the freedom to update and iterate their content at any time. If they don’t like their cover image, they click a link and upload a new cover. If they want to experiment with pricing, or a revised book description, they simply click a link. At Smashwords, we give the author full control over every aspect of their book from their Smashwords Dashboard, and the changes they make at Smashwords automatically propagate out to our retailers.
Economics: A self-published book will earn the journalist between 60 and 80% of the list price as their per-unit royalty. Journalists have the ability to earn nearly same per unit selling a self-pubbed $5.99 ebook (earn $3.60 at 60% list) than they’d earn selling a $25 hardcover ($3.75 at 15% list). A traditionally published ebook priced at $12 would earn the author only about $2.10 (17.5% list, assuming a best case) from a traditional publisher.
The immediacy and flexibility of self-published ebooks allows writers to quickly respond to reader trends and interests, and also quickly monetize their writing.
How has the e-publishing landscape changed over the last few years? Has it become more mainstream?
MC: Four years ago when we started Smashwords, self-publishing was seen as the option of last resort. Self-published authors were considered the black sheep in the writing community. Today, self-publishing is becoming the option of first choice for many professional writers. It has definitely become mainstream. Our authors are scaling the bestseller lists at every major bookstore, and in the process they’re inspiring the next generation of indie authors. A few weeks ago, one of our authors, Darcie Chan, was the #1 bestseller at the Apple iBookstore. Self-pubbed authors are also landing in the New York Times bestseller list for ebooks. The few who’ve made it there have become indie celebrities. In the next couple years, indie authors on the NYT list will become commonplace.
Any recommendations on setting prices for ebooks? We’ve seen prices over all the map.
MC: There’s no general rule, other than perhaps to price lower than print. We publish over 100,000 books ranging from FREE to over $100.00. The average price of purchased books is $2.95 for us, and for any mathematicians out there, the median is about $2.90. Keep in mind the author retains 60-80% of that.
The best-selling, highest-earning authors at Smashwords are publishing multiple full-length books, and they use a range of pricing to simultaneously build platform and harvest sales. Lower prices are good for platform building. A price of FREE is an incredibly powerful platform building strategy.
If you publish multiple titles, at least one should be priced at free, and then you can use that to generate reader trust as well as demand for the other works that carry a price. Use the free and low cost titles to generate readership and reader trust( two essential elements of platform building), and then price others in your catalog higher to harvest income.
There are multiple other factors to consider beyond price, most of which I summarized in a guest post over at The Savvy Book Marketer titled, Pricing Strategies for Ebooks.
What are the biggest mistakes that self-published ebook authors make? Not polishing their manuscript, using an amateur-looking cover, something else?
MC: Those are excellent examples. I wrote a blog post at Smahwords titled, The Seven Secrets to Ebook Publishing Failure in which I documented the most common mistakes of self-published authors.
Where do you see epublishing headed over the next several years? Will we start to see more interactive or multimedia ebooks, cheaper e-readers, and so on?
Mark Coker predicts:
Market Growth: According the research from the Association of American Publishers, ebooks account for about 20% of the overall book market in the US today, up from about 8% a year ago and 3% a year before that.
Obviously, this exponential growth cannot continue forever. We’ll see the growth rate slow, but I think we’ll still see impressive growth over the next few years. There’s a larger macro trend at play here: Reading is moving to screens. Screens are the new paper.
For 2012, ebook will probably approach 30% of dollar sales, and maybe 40-50% for 2013. From a unit consumption basis, ebooks will probably eclipse print by early next year since ebooks are priced less than print books. If you include downloads of ebooks priced at FREE, it’s possible that consumption curve has already crossed over.
The market for ebooks outside the US is about 3-4 years behind us, so those markets are now just entering the most rapid phase of their exponential growth. With the next couple years, the market for English-language books outside the US will eclipse the US market. Already, we’re seeing this trend at Smashwords. We distribute over 70,000 ebooks to Apple, who operates in 32 different countries. Nearly 50% of our sales are already outside the US. As Apple opens more international stores, and as these new markets proceed along their growth curve, international will open up in a big way.
Interactive: I’d estimate that 90% of book sales are probably simple books, primarily straight reflowable narrative, and narrative plus images. They don’t need interactivity, nor are readers clamoring for it.
Sales of interactive books have been disappointing for most publishers, and it’s not a category we currently distribute. These books are more expensive to produce and they can’t yet be distributed across all platforms. In the next couple years, we’ll see better, cheaper tools for creating these books, yet I’m not terribly enthusiastic about their potential outside of non-fiction instructional materials and education. If you want to learn how to change an oil filter in your car or crack an egg open with one hand, an embedded video could be quite valuable. If you’re trying to learn a foreign language, interactive audio would be great.
For fiction, however, I think any attempt to add multimedia will likely fail because the magic of fiction is that it happens inside the reader’s mind. The sights, sounds and smells within great fiction are much more vivid than reality because fiction happens inside the reader’s imagination.
Cheaper E-Reading Devices: I think we’re only 12 months away from some smart e-reading device maker offering readers a free e-reading device in exchange for a monthly subscription plan. For example, I could envision a $9.95/month plan that would entitle the customer to select one book a month from a list, kind of like an ebook of the month club, and then the customer could use the e-reader to discover, sample and purchase other media. I’m really surprised someone hasn’t done this yet.
The Future for Writers: Without a doubt, the opportunities for professional writers to reach readers with their words have never been greater. Most professional writers are sitting on unpublished or reverted-rights works. They should get their content out there asap as an indie ebook, build their catalog, experiment, iterate and start building a modest, long term revenue stream. Getting your work out there is half the battle. Readers will find great content.