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Commoditization

When a product can be easily and quickly price-shopped and compared apples to apples, the consumer is more likely to select the same product for the cheaper price. This process is called commoditization. When a product is first introduced, the novelty and scarcity drive up the demand, the supply is slimmer because it’s not yet in mass production, and the producer can charge higher prices.

Books have been undergoing the commoditization process for the last decade. While an individual work is not, perhaps, a commodity, books as a whole are, and must be considered as such when developing a marketing plan. Your book, if you are an author, might seem like something unique, and special, and a novelty on the market, but to a reader, this is not usually the case: you are competing for a sale not with another author who writes similar books, but with the mass of books in that genre (or for the voracious reader, the mass of books in general, but that’s another topic).

Indie Authors saw the commodity market opening up with Smashwords and Amazon, and they dove in exuberantly. By pricing their products lower than the rest of the market, they appealed to cost-conscious readers. Amazon, riding this wave, furthered the movement with Kindle Unlimited, opening a vast pool of reading material to consumers who shelled out a low monthly fee.

Much weeping, wailing, and gnashing of teeth ensued from writers and publishers. The problem is that as nice as the old system was in terms of profits, this is hardly the first time that cheap books have upset the market, and it probably won’t be the last (although looking at the trends, it’s hard to see how we can make it go much lower, which means that I predict a pendulum of the trend: cheap reads, but beautiful books that are more art than simple entertainment). Mass market paperbacks, and the pulps of yore, did it first. Ebooks are the children of the cheap paperbacks in the drugstore racks.

The internet, and the ability to cheaply transfer files, and then the advent of handheld digital devices that could snatch a book from the aether in seconds, all those things made ebooks a cheap and constant companion for the devoted readers. Audiobooks convert non-readers to readers. The commoditization of books, for readers who consume those books, has been a very good thing. And unlike, say, the mass production of, um, tee-shirts (to pick a quick example) books can’t just be outsourced to another country where the living wage is pennies on the dollar (no matter what publishers seem to think about authors). In the tee-shirt market, the consumer can walk into Walmart and pick up a plain tee for, say, $3. Or, if that consumer is particularly fond of fun geeky tees, they can flit online to TeeTurtle and grab one for $20, or if they’re shopping frugal, on sale for $12. That same geeky consumer can habituate cons and buy superior tees with designs you just can’t find elsewhere from folks like Mystik Waboose Clothiers, and they will happily pay the premium price of $24 for that shirt they can wear to fly their geek flag with pride. Books can reach across that same spectrum – only they can do that with a single title. A consumer can borrow the book through KU (nets the author roughly 0.90$), can buy the ebook (3.50$ to the author), can buy the paperback (gosh, this is variable. Say $5 to the author), can buy the hardback (urm. Let’s go with $6), can go to a con and have that book signed (Out of hand sales, so a higher profit of $7). Those numbers can vary wildly, obviously, i’m working off my experience with my own books for pricing and length. I’ll admit the hardback is pulled out of thin air – that’s not something I’ve done although I plan to with the next book. That is how the commoditization of books can actually help the Indie Author.

Somewhat obviously, books becoming commodities hurts the traditional publisher. They have fought this tooth and nail – even entering into highly illegal price-fixing schemes in a desperate attempt to prevent the process from altering the market. With higher operating costs than the nimble Indie, they have been falling back into two approaches: trying to sell their books as ‘better’ than Indie titles, and cutting costs by reducing what is paid out to authors.

Writers are not interchangeable widgets. Unlike the tee-shirts I used as an example above, the writer can produce a product that isn’t like other writers. Which the reader appreciates. And readers are willing to purchase books that are known commodities: i.e. written by an author they trust to produce a quality product. Readers are willing to pay higher prices for those books. However, the author cannot take advantage of this principle unless they are able to write fast enough to keep their current readers happy and buying (and no one can, not even the mass-production authors who can put out ten books a year) or unless they are able to lure in new readers with a loss-leader. Jim Baen, a pioneer of the ebook market, and worth studying for his ideas on that which are still fresh and relevant, seized the bull by the horns and offered readers the first hit for free. The Baen Free Library still contains many first books in a series, free, in multiple formats, and many readers have spent a lot of money with Baen because they found those books, found them good, and read the rest of the series. Then, being voracious readers, they bought everything else they could find by that author.

Writers learned from this, and from the success of snippets, where the first chapters of a book were published online free to access by anyone. Hooked readers lined up not just to buy the book as soon as it was released, but clamored for a high-end product that could be consumed early, the original E-Arcs, which still sell for $15, an astronomical price for fiction ebooks. Books sell, if they are good books. Fans will buy books in multiple formats if they really love them. Fans will also give books as gifts, hoping to hook their friends and families on the authors they love. Making the book market more accessible to fans through commoditization will keep it alive in this era of cheap, easy, multi-media entertainment. Cheap books are not killing the market. Inexpensive reads are going to be what keeps it alive.

26 Comments
  1. Been following a lot of this as I get stuff ready. Have to go back over one book now and see what needs to be changed and modified before pushing it out the door. I have seen a lot of discussion about where to publish and how to publish indie. Some hard decisions to be made soon for me.
    I agree with all the pricing stuff. Being stuck here in Canada it was especially infuriating with paper back novels. Costs were about 30% more then in the USA. Even when the dollar was trading near par. For some reason it was more “expensive” to sell or ship the product to us. Go figure. I loved Baen for their e-book pricing because it made the books more affordable for me. Pocket library also helped.
    I also like Dean Wesley Smith’s take on an authors catalog being a “Magic Bakery”.
    Starting to ramble again. Sleep and me have been distant acquaintances lately for some reason. :/

    January 27, 2018
  2. Storybundle is also a great way for folks to get a lot of books, okay, ebooks, but cheap. And I think it’s a good deal, for a bunch of good reads.

    January 27, 2018
    • Yes, like Baen’s Webscription bundles.

      January 27, 2018
      • jreader #

        And that wonderful Baen CD page at The Fifth Imperium

        January 27, 2018
        • Yes, although that’s an example of enthusiastic fan, not direct marketing. But fans like that are what make a brand!

          January 27, 2018
          • Harry Russell #

            The CDs themselves though were a straight-up, & blatant, marketing ploy… (Blatant because, IIRC, like the Free Library they were pretty much labelled “we think these will get you to *buy* more of our books”).

            January 27, 2018
            • Oh, those marvelous cd’s and all those free books. *slurp*
              Oh, and how much money I expended on purchasing more of those books as well. Mind you, I had read over half of the books as well before they were e-books.

              January 27, 2018
            • Oh, certainly! And they got me to buy a few hardbacks that way, at a time when I was only buying fiction in ebook.

              January 27, 2018
              • Dorothy Grant #

                Heh. Yeah. Who’d have thought Baen could pull off selling a limited edition hardcover leatherbound edition of a book they’d had out and available for free for years?

                Of all the publishers, only Baen would try that. And thus, only Baen made a good extra chunk of change on it!

                January 28, 2018
  3. I see a lot of marketing advice that is based on the idea of books as interchangeable widgets. How to produce a book that looks just like other books in a similar genre, that is the same word count, has comparable story beats, and so on.

    January 27, 2018
    • Publishers have taught readers to expect a sweet romance to do THIS and a political thriller to do THAT, and so on. Sort of like clothing makers and sizes. Except… at least some catalogues now offer a 12 curvey, 12 straight, and 12 trim, and we now see more cross genre.

      The trick is to find a way to tell readers that this sweet romance has some SF/Fnal elements without turning them off before they open the cover.

      January 27, 2018
      • Ben Yalow #

        It was a romance publisher, Harlequin Books, that carried that to the extreme when they tried to start their SF line — Laser Books — back in the 70s. All the books were essentially the same length (between 189 and 192 pages, so the same size, except for one book that, no matter how it got padded, was still only 173). And Freas did all the covers, and they all looked alike (the covers had the author name in small type, in the upper left corner, then, underneath, a large title, and a head shot in the lower right corner). If a book was too long, then Roger Elwood (the series editor) just cut out enough stuff that it would fit in 192 pages.

        There were some good stories, some really bad ones, and a bunch that were much better when submitted then they were when cut down to 192 pages.

        The line folded after 58 books. For some reason that the romance publisher couldn’t figure out, the SF readership wanted things not quite so cookie cutter.

        http://www.isfdb.org/cgi-bin/pubseries.cgi?3530

        January 27, 2018
    • Harry Russell #

      I’m not any sort of writer, but I suspect those “write as if it were a widget” books actually do offer valuable advice.

      Those elements that make something an “interchangeable widget” are also what I generally refer to (not knowing if there is more correct accepted term for it) as a “Common Language”, where what you’re writing is communicated in such a way that the reader actually understands what you’re trying to communicate, because you’re using accepted conventions that have a defined meaning, rather than having to realise you’re not actually saying what they might expect from similarities between your usages & those they’re used to, & then work out what you actually meant (like how in anime set in modern Japan a character with yellow hair, especially a female with dark skin, signifies they will be percieved as a “Delinquent” by those around them, even if they don’t act like one, & also often that they will act like one)…

      Which is not to say I think you should be *bound* by those conventions, but if you know what they are, you will know when you are stepping away from them, & may be able to turn that to your advantage in communicating what you mean to communicate, rather than something else.

      January 27, 2018
  4. C4c

    January 27, 2018
  5. Re: art books and beautiful books — We would probably see more, if the big 5 publishers hadn’t offloaded all that kind of printing to China.

    January 27, 2018
  6. And here all along I thought “Commoditization” was the process by which SJWs write their shite sci-fi….

    January 27, 2018
  7. I’m running amok on your comments because it’s late, and I need to hit the rack and I don’t warn to forget to tell you folks this.

    Y’all need to take a listen to Geek Gab wit Nick Cole and his discussion of Amazon.com’s algorithm. This is your bread and butter, and I truly want you folks to Get Paid.

    I also wish I could find a way to talk to you all about your covers without being spergy or combative, or making you feel bad. I want you to succeed, darn it.

    Let me help.

    January 28, 2018
    • Are you talking to the MGC writers, or the commentariat in general? Slightly curious, as I design covers professionally and personally.

      January 28, 2018
      • The General. You are a shining star of good design sense

        January 28, 2018
        • Glad to hear it, since I’ve written up several posts on design and covers over the years. I do try not to lead people astray.

          January 28, 2018
    • mrsizer #

      Look up The Human Chronicles Saga on Amazon (don’t want to link it, since it’s not by one of y’all). I can’t decide if the covers are awful or perfect. They accurately signal, but something screams “ugh!” at me.

      January 29, 2018
      • I see what you mean. I think some of them have font size issues. I prefer the covers from the series that has a slightly slimmer, neater font. The cover art by itself is fine, but the text is too fat.

        January 29, 2018
      • Um. Well, without reading them, I have to intend if they mean to signal comedy. Because that’s a comedy font, strongly. The art signals straight-up SF, though.

        January 29, 2018
    • *curious* got a link to that Geek Gab on the algorithms?

      January 29, 2018
  8. George Phillies #

    There are paths to inhibit some bits of commoditization, such as Digital Rights Management. They do not affect romance novel commoditization as described above. Then there is DRM that is not DRM. Amazon Kindle is reportedly doing something that encodes new releases so that they can only be read on Amazon gadgets or software. However, if you are the Stratemeyer syndicate turning out Tom Swift novels, Amazon commoditization is not yet a challenge to Stratemeyer commoditization.

    January 28, 2018
  9. Relevant to MGC, and the discussion at hand. Slightly old news, but I just ran across it myself and thought y’all should see it.

    http://archive.is/wT0CX

    January 29, 2018

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