Publishing is Changing—Why? And how to we take advantage of it

This is the distillation of an email sequence we ran to our Writer MBA subscribers between July and August of 2023 to explain our vision of the future of publishing. Several people asked us to put it together so it could be read at one time. So, we did. This was heavily edited to work as an article. If you are a paid member, you can read How Substack fits into the future of publishing, How to fall in love with book marketing, and How to survive as a writer in a capitalist dystopia for more information about our thoughts on book marketing.

If you are not a paid member, you can read everything with a 7-day free trial, or give us a one-time tip.

I don't think anyone in the industry would disagree that publishing is changing right now.

• Competition on retailers is increasing.

• Production costs are increasing.

• Pay-to-play and CPC advertising costs are increasing.

• Generative AI is changing how books (and all creative works) are produced.

Publishing is currently following natural business model trajectories that can be predicted from other similar industries like music, film, television, blogging, podcasting, and more. Every creative industry either has or will go through the same cycle.

We live in an attention/engagement economy where attention and engagement are more valuable than most other things.

Attention and engagement drive spending, which is directly related to money in our bank accounts. As these factors reach a fever pitch, attention and engagement fracture.

But there is hope.

Years ago, the best place on the planet for authors was Kindle Unlimited (KU).

As a new author, you could get your name out there, readers could read at no risk, and you could find an audience quickly. As a veteran author, you could quickly monetize your back catalog, feed hungry whale readers, and rake in the Author Bonus dough.

More recently, neither of those things are as true. But there is still plenty of opportunity in publishing. You just have to stop playing the only game any of us have been taught to play, and start playing a new one that you can stack in your favor to win.

What is that game?

• Going where there's no/low competition.

• Increasing sales price in line with increased production costs.

• Building a deeper funnel that can withstand advertising increases.

• Becoming more human and doing things that only humans can do.

Many will not like us saying this, but the KDP Select program is broken for the majority of authors in the industry right now—even if it once worked really well for them and paid all their bills, or even made them millionaires.

We were at a conference last year filled with the kinds of authors that KU has always worked for, and when asked how many of them were considering going wide, at least 80% raised their hand. We would be surprised if 5% would have raised their hands even a couple of years ago!

And the bonkers thing is, none of them are failing because of anything they did wrong, but rather because the nature of KDP Select is built on rank and competition. Aside from a small group of blockbuster books, most books are going to be up sometimes and down most of the time. And the ups are getting fewer and further between, plus more expensive.

When you throw in:

• Decreasing pageread rates

• Massive changes to how categories work (that have cut many authors' royalties by 50% or more)

• The KU subscription increasing for readers (while somehow paying authors less per page—hmm, okay)

• Random account shutdowns for no reason

It's pretty easy to see that KU gets less and less favorable to authors with every passing year.

Meanwhile, people are making up that lost revenue on wide platforms and direct sales avenues like Kickstarter, subscriptions (Patreon, Ream), and website stores. All of these hold infinite opportunities that KU simply doesn't anymore.

Russell wrote about the choice between Kindle Unlimited and wide sales some time ago, but this choice becomes even more important for authors every day.

Bottom line: the future of publishing is pretty much everywhere but Amazon right now.

It's so obvious, don't you think? If you want to learn more we hosted a 2 hour livestream where we broke this all down for you.

That's not to say to get off of Amazon, because it is still a critical platform to have your books. But it is to say get on to wide and direct sales. We call this going aggressively wide. 

More and more authors are wising up to this shift in the industry, as both wide retailers and direct sales grow.

But the challenge is that most of what works at Amazon simply doesn't work on these other platforms.

• Other retailers have very different algorithms that require different marketing.

• Direct sales is reader-focused and personalized in a way that demands more humanity and creativity from authors than ever before.

• Retailer sales focuses on discoverability, but direct sales focuses on building superfans—a completely different skill set

What works on these platforms where all the opportunities are is often the opposite of what works on Amazon, which means that most authors need to build some new skill sets in this department.

How do we do that? We’re going to break down the roots of how publishing is changing, and how to take advantage of the future of publishing.

***Warning: this is a long article and your email provider will truncate it. In order to read the whole 6,000-word article without interruption, I highly recommend reading it at this link for the best experience.***

Catalog Sales vs. Direct Sales

We are especially passionate about direct sales because we believe direct sales is the key to every author being able to make a living and hit their personal and financial goals with writing.

This is something that has driven Monica forward at her core and is the reason she’s spent 9 (!!) years writing books for and trying to help other authors.

Retailers are awesome for discoverability and finding an audience. But direct sales is awesome for building deep connections with readers and increasing the lifetime value of a customer (with special editions, merchandise, bigger bundles of books, and more).

As authors, we need both. But for a decade+, we've only been feeding one side of that equation regularly. We’re feeding catalog sales everything while letting the direct sales side of our business starves.

Before we move on, let’s define catalog sales and direct sales below:

• Catalog (Retailer) Sales - You participate on a platform that owns the customer data, sales funnels, product funnels, and more

• Direct Sales - You own the customer data, sales funnels, product funnels, and more

Understanding catalog sales versus direct sales is going to be key to understanding how to market your books differently based on where you are trying to sell them.

In working with authors on direct sales through Kickstarter, at live events and signings, and through their websites, one key finding we noticed is that there’s a huge gap between how authors think about sales on retailers (catalog sales) and how authors need to think about sales when they start to sell direct to their readers (direct sales). Let’s dive deeper into these two opposing concepts:

#1 - Catalog (Retailer) Sales

When you are preparing your product for catalog sales, you are trying to get your product to fit the aesthetic of the catalog. You have to make your catalog page (your product page) look like all the other pages in the catalog. The catalog itself curates the information on each page so that the catalog can look cohesive, uniform, and branded.

The great thing about being a part of the catalog is that the catalog brings a lot of buyers to you. They handle huge chunks of the sales process, like:

• Helping you build your product page

• Fulfillment

• Customer support

If they’re good, they also handle huge chunks of the marketing process, like:

• Finding new leads

• Algorithmic visibility to their current audience

• Email outreach and followups

• Cart abandonment

• … and more

But the challenging thing about being a part of the catalog is you must follow their rules and regulations. You can only upload certain products in a certain way, and those may not be your most profitable or easiest-to-sell products—you don’t usually even know!

On book retailers, there are so many products that we as independent authors still can’t even list through regular publishing programs like Kindle Direct Publishing, BNPress, and several others. A few that stand out to me:

• Book bundles (ebook) - you can’t offer five different ebook files as one sale on any of the platforms (the closest thing is that there is a “buy all” button on Amazon’s series page or creating an omnibus as a single book listing)

• Book bundles (print) - you can’t offer several print-on-demand books in a bundle, much less in a boxed set like traditional publishers do

• Book bundles, (multiple formats) - You can’t offer the ebook, print book, and audiobook as one

The only way to do several of these things is to sell them through an FBA (Fulfillment by Amazon) setup, where you get a seller account, ship the item(s) to Amazon, and pay warehousing fees. You can do the same through a company like Printful, too.

Once you are selling direct, there are other fun offers that usually make more sense to not offer on retailers, including:

• Autographed copies

• Personalized copies

• Character names (tuckerization)

Finally, in order to make any real money and scale through advertising, most authors agree that you must have read-through from book #1 to the rest of your series.

You specifically have to count on each retailer’s mechanisms for getting readers through the individual pieces of your bundle of books. This varies from retailer to retailer and is getting better, but many retailers will still happily sell someone else’s book to your readership if it converts better. This makes it impossible for all hardworking authors to do well on retailers...It’s a natural competitive environment and, at times, winners-take-all environment.

As you can see, there are benefits and downsides to retailers, which is why your business will be stronger if you counterbalance that with...

#2 - Direct Sales

When you are preparing your product for direct sales, you have a blank slate and the possibilities are endless. The greatest things about direct sales are:

• You can sell anything you want - You can sell low-content journals and planners (not usually allowed on retailers), sell the same book with different titles or branding, sell your friends’ books in bundles with yours, sell book boxes and other merchandised bundles, sell your time and energy through coaching or reader chats (for fiction authors), sell something you’re going to deliver on later (preorders), sell your Substack subscription, and so much more. If readers have been asking you for something that you can’t set up as print-on-demand, direct sales is the way to go.

• You can price any way you want - You can charge $0.57, offer free downloads, price bundles at $89.99, charge extra for personalization, offer buy one, get one or free (BOGO) or gift with purchase (GWP), give away free shipping on $50 or more, set up pay-what-you-want...The possibilities are truly endless. What fun things can you offer that your readers might be interested in?

• You can set any policies you want - You set the policies around returns, refunds, and so much more, so if there is something you want to do that is legal and ethical but that isn’t allowed on other platforms, your website store is a great place to house it.

• You can build any product, sales, and marketing funnels you want - You have the data to do sophisticated things, like send a follow-up email to push your 10-book bundle to anyone who downloads your free first-in-series. You have the ability to offer a small upgrade to the ebook and audiobook editions when someone puts the print edition in their shopping cart. You can drive your marketing traffic and actually figure out what converts to sales for you, so you aren’t wasting money.

All of this is incredible and easily powered by technology solutions that are already available. The challenging thing about direct sales is that you are in charge:

• You have to be strategic about setting up these product funnels and marketing/sales funnels

• You have to be willing to connect the dots and take the reader down the buyer journey you have crafted for them

• You have to pull and study your data regularly so you can refine your automated systems

You have to do the work that retailers normally do for you...And that’s where many authors struggle to make their website work and scale. This process requires more complex marketing, sales, and product efforts than most authors are doing to get retailer sales.

The Three Major Areas of Direct Sales (for Authors)

Direct sales as a phrase gets a lot of buzz in the author community, but one thing that has surprised us is how different the viewpoints are on direct sales within the publishing community—starting with the definition. So many “gurus” try to confine direct sales to one or another platform, but by doing that, they are doing the author community a disservice.

Direct sales simply means selling outside of retailers, directly to consumers—or in this case, direct to readers.

In the publishing world, we see direct sales as fitting into three major categories:

• Website sales

• Crowdfunding

• Live events and signings

While each of these categories involves tweaked strategies, the core of the marketing and sales principles that would apply to these direct sales efforts is the same.

Here's how we would break down these three categories into their component parts:

• Website sales

  • Landing page offers

  • Web stores

• Crowdfunding

  • Launch crowdfunding (Kickstarter, IndieGoGo)

  • Subscription and membership crowdfunding (Patreon, Ream, Teachable)

• Live events and signings

  • Tabling or vending on the con circuit

  • Speaking at live events and “selling from the stage” (or in conjunction with tabling)

  • Vending through other avenues (festivals, farmer’s markets, craft fairs)

  • Book signings

Three years ago, when Monica branded her Substack “aggressively wide” (its former name), she was specifically talking about direct sales. That’s what going “aggressively wide” or “wider than wide” means!

Together, we've made over a million dollars in direct sales during our careers (It's much more than that but we're 100% sure of that number). On top of that, we've helped authors raise more than $1.2 million dollars with direct sales since January 2021 through our Kickstarter Accelerator and Direct Sales Accelerator programs (again, that number is much higher, but we can 100% confirm that amount).

We’ve also been co-writing and publishing a series on aggressively wide (wide + direct sales) since 2020 called Book Sales Supercharged, which covers nearly a dozen wide topics (including a book on each of the Big 5 retailers) along with nearly a half dozen direct sales topics. Here’s the lineup on the direct sales side:

• Website sales - Get Your Book Selling on Your Website (January 2022, with a new version coming out in a month or so!)

  • Landing page offers

  • Web stores

• Crowdfunding

  • Launch crowdfunding (Kickstarter, IndieGoGo) - Get Your Book Selling on Kickstarter (November 2021)

  • Subscription and membership crowdfunding (Patreon, Ream, Teachable) - Get Your Book Selling with Subscriptions and Memberships (release date TBA)

• Live events and signings - Get Your Book Selling with Live Events and Signings (November 2021)

  • Tabling or vending on the con circuit

  • Speaking at live events and “selling from the stage” (or in conjunction with tabling)

  • Vending through other avenues (festivals, farmer’s markets, craft fairs)

  • Book signings

And, as many of you know, we’re coming out with a new book that crystallizes our direct sales framework and concepts into a clear system. That book is called Get Your Book Selling Direct to Readers and will share all of our best stuff in more detail than we’ve ever been able to share before, including incorporating our Author Ecosystems framework into the mix.

Retailers go for the easy "yes"

Russell comes from a direct sales background dating back nearly 15 years. One thing he noticed when starting to work with Monica was that retailers only go for the easy sale. We call that the 1 in 5 sale.

Why?

Imagine five people sitting in front of you. Out of those people, there is one who will buy from you even if you give them a mud sandwich. Then, there is another one who won't buy from you even if you handed them a bag of gold.

Retailers are really great at parsing people who will definitely buy from you or will never buy from you. However, it's terrible at talking to the other three people.

Do you know what we call somebody in sales if they only convert 1/5 leads? Fired.

That’s a bit ruthless, but anyone can convert 1 in 5 people. They will literally always buy from you. The difference between a good salesperson and a great one is how many of the other leads they convert. One of the best ways to convert more leads is with customer-centric selling.

Retailers are great at getting that 1 in 5 sale, but they are absolutely terrible at the three things above.

This is where direct sales shines. I have nothing against retailer sales, but when people tell me their book is a failure, they generally mean it's a failure on retailers because it doesn't look or sound like everything else.

That's the reason why people tell you to make your book look like everything else after all, to sound like everything else, and to highlight the same tropes as everything else is because retailers are looking for the easy sale. They are looking for books that look just like the book that somebody just bought.

Conformity is their business.

Direct sales is not about that at all. It's about converting the other three people. This is why on Kickstarter we tell people to use a lot more words than on Amazon. You aren't trying to convince somebody that your book is like everything else. You are trying to showcase why it is different. You are trying to highlight what makes it unique. You're telling a story.

You might think you are a terrible marketer, but I guarantee you know how to tell a story. You might not be able to tell somebody in a short, pithy sentence why your book is like everything else, but I've never met an author who couldn't tell me why a book was special to them or why it was unique.

This is why we consider direct sales to be a huge part of the future of publishing. It's not the only part, though. Retailer sales are extremely important to the future of publishing. In fact, direct sales can significantly boost retailer sales.

It's just really, really hard to win on retailers because there are only so many easy sales. However, everyone can win with direct sales because you're going deeper with people. You're trying to persuade the other 3 in 5 reader who need more information to develop a stronger connection with you.

Retailers + Direct Sales in Building a Healthy Publishing Business

We've talked a lot about how you need both retailers and direct sales to create a healthy business model for your author career. Now it’s time to show you why getting your books on direct sales platforms can be a big part of strengthening your business.

Hopefully, by now we all agree that readers go on a journey to find us, purchase from us, read us, and become fans of us.

For the last decade+, Monica has taught the reader journey as the 10 Stages of Audience:

If you’ve followed Monica’s work for any length of time, you’ve probably seen the above graphic. However, while writing the Book Sales Supercharged series she started to see an emerging pattern and created this graphic detailing the reader journey.

You see, retailers were exceptionally good at converting readers through the first 5-6 stages.

But they are not amazing at converting readers through the last four stages of the reader journey, which creates true and loyal fans as well as evangelists for our books and brand. (Hey, we can't excel at everything!)

That's why we see authors climb to the top of the algorithms on retailers, then plummet in ranks and lose a large chunk of their readership on the way down. It's scary stuff and can happen to any of us!

In contrast, direct sales has the opposite problem. It's usually terrible for discoverability. While you can build cold audiences, a portion of those audiences will still gravitate toward a retailer when they can.

But it's great for building true fans and evangelists for your brand and books, and the platforms themselves are designed to do this very thing.

These two graphics demonstrate exactly why wide + direct sales is so important right now, and why this framework can really solidify your publishing business.

Casual Readers vs. True Fans

In general, casual readers are mostly found on retailers. Casual fans are incredibly important to your author business. They help fill the funnel with new readers, and retailers are amazing at finding casual readers.

The downside to casual readers is that they often don't join an email list or follow on social media, so our main relationship with them is through the retailer itself.

That means if the retailer decides to mess with that relationship, bye bye casual readers.

We all need true fans, too

In general, true fans are mostly found on direct sales platforms. We see our readers engaging on crowdfunding platforms like Kickstarter, Ream, Substack, and Patreon, coming to see us in person at events and signings, and buying regularly from us through our website stores.

True fans are valuable because you don't need that many of them. They spend significantly more money than a casual reader from a retailer, and they become repeat customers, keeping your business flush across the seasons. You also have their data (or can easily collect their data) and can contact them directly to let them know about new opportunities. (Russell calls this "money on demand.")

We strongly believe that author businesses need both.

If authors are just on direct sales channels, it can really be hard to find enough readers to keep our businesses running. The build to profitability can be slower than we want.

If we are just on retailer channels, we have so little control over the relationship, and it can start to feel like a hamster wheel in which algorithms are controlling our spin speed. The churn can be exhausting and demoralizing!

When we are on both, we find lots of readers and keep more of them as lifelong readers. In my opinion, at least 10% of our total audience should fall into the buckets of fan, true fan, or evangelist. And this rarely happens if we are only on retailers.

Positive Feedback Loop vs. Negative Feedback Loop on Retailers

At any given time, every single book on a retailer is either in a positive feedback loop or a negative feedback loop at a retailer.

If the book is in a positive feedback loop, that means that it is getting enough sales that the retailer thinks it will predictably get more sales, so it puts it in front of its audience more. You can tell a book is in a positive feedback loop because it either stays at its current rank or increases in rank.

If the book is in a negative feedback loop, it is not getting enough sales to justify the visibility the retailer is giving it in the storefront. You can tell a book is in a negative feedback loop because it drops in rank.

The challenge with positive feedback loops is that the market is saturated and it is harder and more expensive to create a positive feedback loop on a retailer than ever before.

You sometimes cannot even pay to get into these loops at the highest levels.

For example, you can bid high on Amazon ads until you are blue in the face, but your Amazon ads are not going to show if there's a proven book that is bidding high as well—even if you technically have the highest bid.

Relevance is built into every algorithm, as algorithms try to balance pay-to-play and customer experience.

This means that time, luck, and more money are three factors that can play an oversized role in algorithms.

To answer the question, "Do you know why a book takes off (or doesn't) on retailers?" you really only need to realize that there are too many good books to be at the top all at once.

Yes, you need a good book, but you can have a whole catalog of good books and still feel stuck in those negative feedback loops at retailers.

Personally, we’ve stopped playing this game completely.

We don't leave our success to luck, and we don't think any author needs to, especially when we can create multiple revenue streams and have a more direct relationship with our readers that is not so algorithmically driven.

This actually means that everyone who feels called to this business and industry can actually build a business here. There's room for everyone when we are not all competing for the same visibility on a single retailer.

This is not a knock on retailers at all—on the contrary! Expanding into direct sales tends to make our books more successful in general, which makes them more successful on retailers too. There are two advertising strategies—one where you track CPC and one where you focus on brand awareness. The latter is why this works!

We've spoken to multiple authors who have poured tons of money into advertising to their direct sales stores who have confirmed that this was, in fact, the only way they were able to break into higher and higher positive feedback loops and increase their rankings at retailers.

Why should you care about the future of publishing?

For most authors, the system is broken. The way we have always made reliable money (KU/retailers almost exclusively) is working worse for fewer authors with every passing year. If you're reading this, then there's a pretty good chance that you're burnt out, approaching burnout, or growing discontented in the way people say your author business should work. There's an even better chance you are making less and putting in more effort than you ever have in your career.

Maybe this isn't you, but if not then more power to you, because somewhere between 50-70% of authors at burnt out or recovering from burnout right now. At least half of all authors will experience burnout in their careers.

That is bonkers...but there are also people thriving in this climate. We know thousands of authors and peeked inside many of their businesses. What we found out is that they run things very differently than the orthodoxy teaches. In fact, none of these authors runs their business the exact same way, and yet they are all succeeding.

We could put together case study after case study about these authors (and maybe we will one day), but the thing that helps us the most as authors is sitting down across from successful authors and talking about how our businesses work. Every time we do, we learn something from them that leaps our businesses forward exponentially.

That’s why we created The Future of Publishing Mastermind.

To us, that's the true value of conferences. The talks are great, but we learn the most from having a drink with friends and the spontaneous conversations that come from having brilliant people in the same place together.

That is the experience we're facilitating with the Future of Publishing Mastermind. It's not looking into the future and seeing how AI will affect us (though that's part of us). The future of publishing is finding a business that works for you, and working through the biggest problems in your business with the smartest people in the world.

We have spent time with nearly everyone who is coming and the amount of information they have about publishing is staggering. The Future of Publishing Mastermind is set up to facilitate those interactions for the whole conference. Imagine going to 20books and meeting with the smartest speakers there and being able to engage with them for hours every day. How would that move your business forward?

However you parse the future, you can't put a price tag on that kind of interaction and knowledge exchange. We've been to masterminds before and we always come out of them with ideas that revolutionize our businesses. Russell recovered a whole series and started a book club based on one of our mastermind events. Monica has been in masterminds for years and credits them with launching and sustaining her career over the years.

Literally, hundreds of thousands of dollars have come into our business through what we've learned at masterminds over the years. On top of that, it's so nice to be in the same place with people on the same journey as you. It lifts you up in a way that's indescribable and enriching.

So, why should you care about this right now? Because there are hundreds of other ways for your publishing career to work, and we can help you find a more sustainable path forward, not because we are particularly smart but because we are surrounding ourselves with the smartest people we know to chart the future together.

If you’re ready to take your career to the next level, I hope you’ll apply to join us in New Orleans next February at our Future of Publishing Mastermins event.

If you aren’t a paid member, please consider becoming one to help support more in-depth articles like this one. If you are a paid member, you can read How Substack fits into the future of publishing, How to fall in love with book marketing, and How to survive as a writer in a capitalist dystopia for more information about our thoughts on book marketing.

If you are not a paid member, you can read everything with a 7-day free trial, or give us a one-time tip.