Episode Summary

Mark Leslie Lefebvre returns to share more industry insights on the Self-Publishing World. We deep dive into some stats and trends in the industry you should know about!

Episode Notes

Draft2Digital has the best vantage point in the business for seeing trends in the self-publishing industry. And we want to use that insight to help indie authors and publishers do more to build and grow their publishing business.

This episode of Self Publishing Insiders continues a recurring segment, featuring Mark Leslie Lefebvre, discussing the current state of the self-publishing industry and where we see things evolving from here.

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Mark Lefebvre, Kevin Tumlinson, Jim Azevedo

Mark Lefebvre 00:01

Hello, and welcome to Self-Publishing Insiders with Draft2Digital. Today, the day that we are doing broadcasting this live is September 29, 2022. My name is Mark Leslie Lefebvre and I am the Director of Business Development with Draft2Digital. And if you’re a longtime listener or watcher of this program, you may remember Jim Azevedo from a previous episode, but, Jim, let’s make sure for anyone who doesn’t know who you are, your title, what do you do at Draft2Digital?

Jim Azevedo 00:39

I’m the Corporate Communications Manager at Draft2Digital, having come from the Smashwords acquisition.

Mark Lefebvre 00:47

You’ve been at Smashwords almost from the very beginning right? So that is like well over a decade?

Jim Azevedo 00:52

Yeah, not well over, but almost. Well, just past a decade. Since 2011, so 11 years.

Mark Lefebvre 00:58

11 years doing that. And so you performed a role very similar, you would go and talk to authors. I think we met the first time in, oh my god, 2013.

Jim Azevedo 01:10

2013, down in the dungeon of the Javits Center in New York.

Mark Lefebvre 01:15

Yeah. So you were at the Smashwords table. I was at the Kobo table. So that was way back ancient history in New York.

Jim Azevedo 01:24

I think the D2D guys were there as well.

Mark Lefebvre 01:27

Yeah. And I’m sure that’s when I must have met Dan for the first time as well, way back when. So ancient history. But we just got back with several of our awesome colleagues, we just got back from, and thoughts and prayers to all of our friends in Florida who we just left. I mean, because just where we were at the Trade Winds, at Novelists Inc, I think they just got walloped yesterday, and I’ve heard from a few people who are safe. But yeah, we were there last week.

Jim Azevedo 02:00

Right. And it was terrifying to see that cone of the of the hurricane’s path approaching that area where we just were, yeah, so many friends back there still.

Mark Lefebvre 02:08

I know. I know. So we’re keeping an eye on our friends. We’re sending them well wishes and hopeful everyone is doing okay. But last week at Novelists Inc we reconnected, you know, met for the first time as colleagues along with several other awesome Draft2Digital folks. But I think before we get into that, there were some trends. There were some things that we picked up from talking to the authors at Novelists Inc.

Jim Azevedo 02:37

Yeah, absolutely. I mean, it’s so nice to go to a conference and be an attendee and just soak up all this information that’s coming at you versus worrying about presentations, and other things. But as anybody knows who’s gone to lots of conferences, when you go to a conference, and you’re taking in all this information, you start to worry, like, what am I going to forget? But then over the next few days, the things that are really impactful or really important start to bubble up to the top of your brain. And one of the things that stands out to me, Mark, was how much talk there was about direct sales and how important it is.

Mark Lefebvre 03:11

Yes, that’s definitely been a growing thing. Which is why, I mean, that is an important development that we’re going to be adding to Books2Read, the ability to add additional links and additional stores. But so I had, and I picked this up from our colleagues over at Kobo, it’s a nice little pocket notebook that I could just keep right here nice and handy. So yeah, so I could have my hands free to shake hands and have a coffee in one hand, because that’s all I drank when I was there was coffee. But I have I think, honestly about 60 pages of notes from Novelists Inc, which is just amazing. And like you said, there’s so much to digest, so much to digest. But also, I’ve been going through the stats. And I know that’s potentially why some people are tuning in is, I’ve been going through the stats for Q1 and Q2 of 2022. So basically sales from January all the way to June. Did I do the math right? That’s six months, right? To the end of June. And we do have some stats beyond that. But I just wanted to look at a snapshot because what I was doing was looking at what were the sales? Now, the systems, because our systems at Smashwords and Draft2Digital are not yet merged. I want to compare apples to apples. So if I go back and compare sales from last year to this year, obviously when you bring in the Smashwords sales, it’s gonna change them. It’s like way, way up, right? So I was trying to compare apples to apples. So I was looking only at the Draft2Digital sales, so I can have that ring fence of Q1 and Q2 of this year compared to last year compared to the year before. But Jim, do you remember something odd happening in Q2 of 2020, the first quarter of 2020? Anything strange happen in the world?

Jim Azevedo 04:48

Let me think. There was this virus, I think.

Mark Lefebvre 04:53

Yeah, and it was a computer virus that people clicked on, right?

Jim Azevedo 05:00

Human virus this time, but the world started to shut down as the apocalypse started taking over.

Mark Lefebvre 05:07

Oh my god. Yeah. So we saw across the board, we saw digital book sales see the most ridiculous growth since the Kindle cold rush days, right? 2009 to 2014 was triple digit growth for ebooks. But back then the numbers were small, so triple digit was … But for the first time since then, in March of 2020, our growth was ridiculously high, it was back to triple digits on big numbers.

Jim Azevedo 05:42

Yep. So because everything was shut down, you couldn’t go out to stores and people I think started either discovering the joys of digital downloads for the first time or started rediscovering the convenience and the flexibility of just sitting on their couch, in their pajamas, browsing for a book and downloading that next book in a couple of minutes.

Mark Lefebvre 06:03

Exactly. I remember the fear of getting a physical book from the library or the bookstore, and maybe it would have something attached to it that would make us sick. I do remember bleaching things when you brought them out to the house. Put them in the staging area so they can sit there for two days, right? But I remember picking up my phone and I had the Libby app and Libby is how you would get access to Overdrive. So we distribute to Overdrive, which goes to the libraries. And so you connect your library card, and I could get ebooks instantly. And we saw huge library growth sales. Again, that was unprecedented library sales growth. So I’m saying this to set the stage, because we’re in an environment right now, September of 2020 to two years plus, to almost two and a half years since the world changed dramatically. And we’re looking at sales. It’s challenging when you see that significant growth between 2019 and 2020, when you compare, and 2021 was also a year of growth, right? Not quite as dramatic as 2020. But there were lock downs, people were stuck inside reading, hey, what am I going to do by myself? Well, I’m going to read. I’m gonna do screen things. I’m going to do TikTok and I’m going to read. So we did see that that growth. So what we’re seeing is, and I’m going to share some data that’s going to show that, year over year, when we actually look at Q1 and Q2 from last year to this year, we’re actually seeing a slight decrease. But that is compared to 2022. So what I did is I went back to normal times, because here’s something that happened this year, roughly around the same time, between the beginning of March, maybe the middle of March and April, we saw something else happen. We saw isolation, lock down, crossing the border between the US and Canada and other countries, the restrictions were suddenly being thrown out. So no more were people stuck at home having you know, hey, reading is a great option. Suddenly, everyone was pent up with two years of I’m gonna run around Free Willy and have a really good time. Go lick everyone’s faces, all the things I wanted to do, anything but my books. So Q1 started off really strong. And I’m going to share some of the numbers. But then towards the end of Q1, and beginning of Q2, we were having what we call the pandemic relapse, we’re having that rebound effect of, okay, I can go do other things. Now I can go actually sit in a restaurant, I can go hang out with friends, get on an airplane, instead of purchasing books. So we did see, and this is not just in indie author sales, this is across the board, we saw a drop in sales compared to that. So that’s why I’m going to take a look at Q1 and Q2 of 2019 compared to now so we can kind of feel, okay, now that we’ve stabilized after this giant spike, where are we? And just so you know, we still are way ahead of where we were in 2019. But when we compare it just to those periods, you’re gonna see some dips.

Jim Azevedo 09:25

Interesting. So is that like a new normal, Mark, would you say? So like the numbers from the pandemic, we were all isolated, books started to take off, it kind of went like this. And then we started hitting a bit of a plateau, we started coming out of isolation. So is this a new normal that we’ve reached that’s still a bit higher?

Mark Lefebvre 09:42

Yeah, that the plateau is higher now compared to Q1 and Q2 last year, they’re down compared to last year, but they’re still up in general. So you’re still up at a much higher rate. Because the other thing you have to remember is there are people who, let’s be honest, and we will look at industry stats. And I know it’s hard for indie authors to believe this, they probably like scoff at it. No, that can’t possibly be true. But this is why we believe that, you know, large traditional publishers, we believe they don’t know what’s going on. They’re not even looking at ebook sales, because ebook sales are roughly 20% of what they make. In general, most people still have never read an ebook, right? Even though we had this great opportunity in 2020. March 2020 was a great opportunity to discover the magic of ebooks. And still, even though it was triple digit growth, I bet you if you ask the average person who’s not part of the author community, obviously authors know about ebooks. But if you ask the average reader, they’re probably gravitating towards print. And I’m going to share some stats from traditional publishing so we can kind of set the stage. You ready to hear some of that? All right, I only have about eight pages of notes here. And I do have visuals, I have some slides. So it’s not just going to be looking at me reading off a page. So again, we’ve had the opening up of lockdown and stuff. So BookNet Canada, so I’m in Canada, and I’m the token Canadian on the Draft2Digital team. BookNet Canada is kinda like a Nielsen BookScan made up of just book nerds. And we love data analytics. So think about people like Dave Chesson, and Alex Newton, people like that all work there. And they’re big, giant book nerds. Alright, so. BookNet Canada collects sales data from independent bookstores, chain bookstores, Walmart, Target, there is no more Target here. But Costco, all the major book retailers in Canada. But it’s only print book sales, because the only retailer that was willing to give them data was Kobo, and none of the other ones wanted to. So they can’t. They can’t share the data because it’s not meaningful if it didn’t come from at least three different sources. So and just to reiterate, the data I’m sharing is going to be from sales reports from the Draft2Digital system. And that is going to include data that comes from pretty much every major retailer except Google Play, in terms of ebooks, that comes from our library. And it comes from our subscription services. So it comes from the collection. So it’s not just one source. It’s a variety. And I’ll share a little bit of that. So BookNet Canada, this is from a report that was published on September 23. Okay, so the first six months of 2022 were relatively stable. Sales were up 2% over the first six months of 2019. So again, they went back to 2019. So they’re up 2% over 2019, because again, the sales were down compared to last year. And one of the things we saw, both in the US and Canada and probably in other countries, were independent bookstore growth. And BookNet Canada talked about that, that one of the key trends that was fueling book sales was the opening of new independent stores across Canada in the US. And so that meant more stores entering the market. And what I found is people champion local bookstores.

Jim Azevedo 13:04

I mean, that alone is so interesting, because when the when the pandemic first started, everyone thought oh my gosh, what’s going to happen to the indie bookstores?

Mark Lefebvre 13:12

Yeah. And you would think, you know, grocery stores, restaurants, people need to eat, stuff like that. I mean, people love to read, but people just got behind these small businesses. And imagine the growth of independent bookstores during the pandemic, the worst time to start a business. And yet people rallied behind them. They were doing curbside pickup, they were doing deliveries, home deliveries, all kinds of great innovative things. I mean, yes, obviously, Amazon sales went up because The Everything Store ships the next day. But that was an amazing thing to see. So now the interesting stat from BookNet Canada is frontlist sales are lagging. Now for our listeners. What is a frontlist title?

Jim Azevedo 13:56

A frontlist title is a book that’s released today or tomorrow. Or from a bestselling author.

Mark Lefebvre 14:05

Yeah, frontlist would be new books that are published and backlist are anything else. And usually in the industry, it’s usually six months. So anything really six months ago, within the last six months is considered frontlist. And then previous to that is backlist. So what BookNet Canada tracked is that frontlist sales were lagging, and it says BookNet data shows that starting in 2020 online book sales eclipsed sales in physical bookstores. Now, I was in Canada. And I know that that’s been a trend in the US so you’re seeing some slightly varying. Now let’s be honest, The Everything Store in Canada is not nearly as efficient as it is in the US. So it’s easy to get stuff. But online now accounts for 55% of overall book sales, and sales in physical stores represent 45%. Now online sales favor backlists says Noah Genner, who is the CEO of BookNet Canada, says which along with inflation may account for a slight drop in the market share of frontlist books, which fell to 24% in the first six months of the year, and they were 27% for the same period in 2021. And it reminds me of something I like to remind authors, is that a book you have not read before is a new book. And backlist sales on online, especially when you have series, and we will be sharing some series data. That’s a major thing. You put out a new frontlist book. And let’s be honest, so I put on a new book in my series, let’s say it’s book six in a series. And I sell that, okay, I’m selling that, maybe I’m not selling as many as I would have a year ago. But I have five other books that are backlist. And so when my frontlist sales are up slightly, my backlist sales grow dramatically. And the more you keep adding, the more your backlist is going to grow. And that’s what we have seen with authors you talk to at NINC, right? Like how many of them were writing in series?

Jim Azevedo 15:55

Absolutely. And even for some of those best-selling authors, there are still, even if you’re a best seller, there are still millions and millions of readers who still have not yet discovered your book.

Mark Lefebvre 16:04

Yeah, yeah, that is true. And that’s the beauty of this, especially since most people haven’t read an ebook yet. So we got to convince them how to get on a little digital-only diet of books. How can you get more of those ebooks into your diet?

Jim Azevedo 16:20

We have some tools to help them with that.

Mark Lefebvre 16:24

So Lou Ronica, who is a figure at NINC, a popular figure who always does a summary at the end. I know Dan and I stuck around the extra day so we could listen in and participate and chat a little bit more and learn a little bit about the summary and just get some updates from Lou. He’s a publisher. He’s a small publisher, very adept, dynamic publisher, comes from decades of traditional publishing experience, but he also is one of those rare people in traditional publishing who really gets and understands indie. So he doesn’t poopoo, like often indies will poopoo traditional publishers and traditional publishers will poopoo indie authors. He gets both sides. So I really like love his opinion. So he was doing a bit of a talk. And he said, so the APP, the American publishers, Association of American Publishers, I’m forgetting what the second P stands for.

Jim Azevedo 17:22

Isn’t it the AAP?

Mark Lefebvre 17:24

I wrote it down wrong, the AAP, the American Association, something like that. All of these acronyms, at least I know what D2D stands for. It shows a .08% decrease in units over last year. And again, most of these sales are print. So they’re focused, that’s where traditional publishers live. But one of the things he pointed out that I made a note of, is that based on, and I’m not an economist, and neither are you and neither is Lou. But based on all signs, and all of the things we’re hearing from the experts is that we’re probably close to experiencing the very first meaningful recession that we’ve had since the streaming era began. And here’s why this is important. Historically, when you look back at history of book sales, books are one of the only products that are recession proof. That is the first time we’re going to be going into a recession, most likely, where we have streaming. And what is the competition for reading? Or as we saw, streaming lead to book sales. Queen’s Gambit is a perfect example, a book published in the 70s and 80s suddenly became a best-seller because of streaming. Kate Bush, Running up that Hill, how many decades later became a number one bestseller? Again, smart note to indies, she kept her rights. She was able to keep that money. So that’s an interesting thing to think about. So one of the things Lou reminded us of is that people who love books, don’t just like books. They don’t just love books. They LOVE books. And that’s like giant capital letters exclamation point up the wazoo. They define themselves as book people, as book lovers. And they may even double down.

Jim Azevedo 19:24

Yeah, it goes beyond a want or desire, it becomes a need.

Mark Lefebvre 19:27

Yeah, I mean, I have that sickness. I love it. I’m either going to buy something to eat or I’m just going to, you know, nourish myself with this great book that I just bought. I nourish myself with books more often than not. So it’s going to be interesting to see what happens. But I suspect that, and I’m just saying that because when we were looking at the trends, typically September through December is the strongest for book sales, when in traditional book selling, you know, having managed bookstores, we would operate in the red, we would lose money, we’d be spending more on rent and employees and all that utilities than we would make. And we would make all of our money for the year between September and December. So that’s kind of a pattern that you see in, that’s a kind of a pattern that you see in online sales and ebook sales, you do see the trend of sales going up. So we’re likely to see, to start to see those sales go up. However, as we’re going into potential recession, and interest rates and things like that are going up, that could have an impact. But I’m still very optimistic that we’re going to see those sales increase based on 30 years in the industry.

Jim Azevedo 20:43

Totally agree, I could not agree more.

Mark Lefebvre 20:46

So that’s kind of an interesting thing. And again, Lou reminds us that traditional publishers only make about 20% of their revenue from ebook sales. So here’s the thing that I think about as an indie author, when you think that, and we had some dramatic … I’ve always said, you know, when talking to people about ebooks, is an ebook does not have to be 300 pages bound between two pieces of cloth. Ebooks can be so much more, they can be shorter or smaller. They can be whatever, they’re very dynamic. Every book is a large print book. And all the things that a lot of indie authors know already, traditional publishers ignored, because they were busy shipping dead trees around and storing them in warehouses, right? March of 2020 was the opportunity for them to actually open their eyes to the possibilities, if they stopped thinking that ebooks were going to cannibalize print sales. And my fear as an indie author is, if they ever actually, and they didn’t get their act together, they didn’t get their smarts together then. But they’re going to one day figure this out, especially as we are seeing print, the price of print increasing, the cost of paper shortages are very, they’re still a major issue. The shortages for print supply, publishers may one day have no choice but to get with the ebook program. And that means us indie authors need to be that much more adept. Because we’ve kind of had the playing field to ourselves, right?

Jim Azevedo 22:11

Yeah, and, you know, take notice indie authors, as you listen to what Mark saying here, like you have this huge competitive advantage, especially in terms of your pricing, because the largest traditional publishers in the world cannot compete with you on the price of your ebooks, you have so much more flexibility than they ever will have.

Mark Lefebvre 22:29

Exactly. So I want to make sure that indie authors are positioning themselves to be able to compete. And that’s I think where potentially direct sales is a great opportunity. There’s other options to earn more margin, they can still compete on price, but also maybe not necessarily so low. And I’m going to share some of that with some of the stats. So are you ready, Jim, to hear some of the … Hang on, I gotta pop up the banner. This is exciting. Here we go, we’re gonna go into 2022 Q1 and Q2 Industry Insights.

Jim Azevedo 23:01

I felt like we need a button for some kind of sound wave or something.

Mark Lefebvre 23:05

Yeah, and actually, before I get into our Draft2Digital stats, I think maybe one of the things I forgot to mention is when we were at Novelists Inc last week. Did you sit in on the session that Will Dages from Findaway Voices did?

Jim Azevedo 23:20

Missed that one. No.

Mark Lefebvre 23:23

So just a reminder that Findaway Voices is a partner of ours. We distribute ebooks, we distribute print books, and we have a great partner for audiobooks. And that partner is Findaway Voices. And you can click your button over, when in your ebook, for example, to say “make an audiobook,” and what we’ll do is we will put you into Findaway’s system, set up your book to save you having to rekey in that information. And they have ways you can either upload your audio files or there’s multiple ways to get access to narrators if you’re looking for audiobooks, so I wanted to share this, because a lot of authors are thinking about audiobooks. So here’s some of the stats from Findaway Voices, courtesy of Findaway Voices. And again, I’ll pop up, where’s my little courtesy of Findaway Voices banner right there, courtesy of Findaway Voices. And this is just sort of a look at the industry, this is just a high level summary from Will’s really amazing presentation. And he was very nice to allow me to share this here. So I’ll get rid of the banner because I don’t think you can see the full slide, but this is kind of what’s happened with audio. So this is audiobook sales from our partner Findaway Voices, and they distribute to 53+ library and retail platforms. This is global. This is all the places, right? So the library sales, 26.59% And this is without promotions. This is just generic sales, retail subscriptions, so subscription meaning you know platforms like Audible has a subscription program. I think Barnes and Noble launched one this year. So subscription is about 37%. And a la carte, so ala carte is you don’t pay a monthly fee to get like a credit, but you just buy the audiobook. And isn’t it interesting that a la carte sales are almost equal, like 36.65%, as opposed to 36.7%? So it’s almost, I mean, not quite a third, but look at the library growth has been dramatic for them, because the library was not that high that long ago. So you’re seeing it starting to be almost coming to like, thirds, for all three platforms. Meaning, it’s smart for authors to be in as many platforms as possible, subscription services, a la carte services, library. And I say that because Spotify just opened up, Spotify now owns Findaway. And they opened up with a la carte. And a la carte with a discount that’s one of the most generous, it’s on par with what you get from B&N and stuff like that. So it’s a decent, I think it’s 50% when you look at the contracts there.

Jim Azevedo 26:06

And that speaks to the advice we constantly give our authors, which is you know, put your books in all the places where readers go to find books, all the places.

Mark Lefebvre 26:15

All the places, why not? You never know, you want to be there to ride the wave when it grows. And then with promotion. So this is with Findaway, you can set price, you can control your price of most of the places except Audible. And you can set price promos on various retailers. So with promotions, you’ll see that the retail a la carte jumps dramatically, almost to 50%. Because that’s obviously where the price promo happens. Because libraries, it doesn’t really change that much for them. And subscription, you’re going to just go through the program as normal, so they kind of stay relatively the same. But with promotion, you see the retail ala carte jumps up, which is kind of interesting to see. The other thing that I think is important when you compare, and this is another slide from Will’s deck, the average promo pricing and discount. So this is just a look at, if your retail price is between zero and $2.50 US, you know with an average discount, you’ve just kind of seen what those numbers are, in terms of the promo price, the average discount. So obviously, if your retail price is like $2.50, the promo price on average is going to be .67 cents. And so this is kind of like with audiobooks, the price is going to be dramatically higher anyways. So obviously, these are just some of the different discounts. But this is the most interesting stat that we found was, this is the pricing based on the length, right? So short stories, and novellas and stuff like that, in 2 to three hours. And 10,000 words of text is roughly an hour of audio. And so you’re looking at, this as the average pricing based on length, and this is across both. And the thing I love about Findaway is that they’re not just sharing independent authors’ data, because Findaway, the mother company, and Findaway Voices is also, as you hear the storm of the dogs running out the door right now. So what you’re actually seeing is Findaway’s sharing database, not just indie author titles, but titles from major publishers that they distribute for as well. So we’re actually getting a wonderful mix. Like when I share the data later from Draft2Digital, it’s pretty much indie author titles we’re sharing. This is including the big publishers.

Jim Azevedo 28:35

This is super interesting. Because if you think about all the work that goes into an audiobook.

Mark Lefebvre 28:40

Yeah, all that work. And so you got to sell a lot, right? Yeah. So that was the stuff from Findaway Voices, are you ready to dig into our sales? Okay. Let’s dig in here. So again, 2020 was dramatically higher than 2019, 2021 was also very healthy growth over 2020. And we thought, okay, it can’t sustain, we can’t keep growing like this.

Jim Azevedo 29:08

Double and triple percentage points forever.

Mark Lefebvre 29:11

Yeah, it was just ridiculous. So we figured it’s going to have to come back to normal, which we talked about so. So unit sales were down about 1% year over year, no, actually, sorry. This is unit sales in Q2 versus Q1 of this year. So the second batch of three months compared to the first three months were down 1%. This is just ebooks, this is our ebook sales through Draft2Digital. We’re down about 1%. So again, we started off doing okay, and then as the world opened up, and people stopped buying books as much, they’ve gone down 1%. But interestingly, 1% still puts us way ahead. Now, revenue was down 4.82% again between Q1 and Q2. So again, we’re seeing that dip. We’re hoping to see that come back up for Q3 and Q4 of this year. But this is the interesting thing, which is why I wanted to set the stage about that growth in 2020. So when I’m looking at 2019, compared to 2019, our units have grown by 3.98%. So we’re still ahead, right, which is really, really good. And revenue, this is a cool thing. So that’s about 4%. Right? Revenue has grown by 9.9%. So let’s round these up. Units have grown by 4%, revenue has grown by 10%. What does that mean? It means authors are pricing higher, authors are getting more money for their products. So they’re selling more units, right, they’re selling 4% more units than before, but they’re earning 10% more. So this is exciting, what we have seen a little bit more of is, there’s the authors who are doing box sets. And they know that when they publish their box sets that go north of $9.99, everywhere but Amazon, they can make that full 60% that they would get through Draft2Digital, and that’s on all of our major retail platforms. So that’s an exciting thing, more margin in your pocket dear author, that’s something I get excited about. Right, the next set is, and this is interesting. So when we look across the board across all of the different channels, with the exception of some growth that we’re continuing to see in libraries, which is very, very minimal growth this year. Overall, we’re seeing a drop at a lot of a lot of the places, and a drop of just a few percentage points. Very similar to that 1% that we saw across the board. But you know, Jim, do you know where the only place that we saw a growth? And we saw growth of get this, 4.2%, and this is January to August of 2022. This year, compared to January of August 2021. Any ideas where we saw that growth? Almost like you know, 4.26% growth? It’s an ebook platform. It’s a retail ebook platform. Let me give you a hint. It is the world’s largest repository of indie author books out there.

Jim Azevedo 32:22

Let me see. Could it be Smashwords?

Mark Lefebvre 32:24

Oh my God. Ding ding ding, he wins the prize. Yes. Smashwords. And here’s the thing I love about this. Smashwords, how much do authors earn when they sell through Smashwords? 80% of list. 80%, 20% more. They make 80% of list. Jim, we have plans. Yeah, we have plans that will be coming up in a future D2D live, but we do have some merchandising plans. Megan will be involved heavily in getting more merchandising space for authors. So think about that, more margin for authors on one of the only retail platforms that saw significant growth compared to a drop, which is really, really, really exciting. So there you go.

Jim Azevedo 33:09

Sorry, Mark, did you know that Smashwords is on its sixth consecutive year of growth year over year?

Mark Lefebvre 33:15

This is its sixth consecutive year of growth year over year? And so Smashwords is seeing growth even after we’ve set the stage that 2020 was a ridiculous year.

Jim Azevedo 33:25

Right? It’s bucking an overall industry trend.

Mark Lefebvre 33:28

And we haven’t even put the Draft2Digital titles in there yet. I know. Oh, my goodness me. This is going to be so exciting year.

Jim Azevedo 33:35

Can you see why we’re so excited?

Mark Lefebvre 33:37

Right now I’m sticking on ebooks. Now, it should be no surprise to anyone who has been paying attention to the book world since the inception of reading. But romance is the worst selling category. No romance by far, it’s actually almost unfair to include romance, because it takes such a big piece of the pie. But romance sales counted for the majority of our sales again, 55% of units and 55.06% of revenue. Now the thing about romance is, you know that the voracious readers are reading like three books a day. So you’ve got to keep your prices low, so you can just keep feeding those awesome awesome, we love our romance readers. We love our romance authors. We love them both. We love putting them together. So that’s more than half the pie, right? It’s going to be romance. So I don’t write romance. I don’t want to be depressed. So I wanted to look at, so okay, we know romance is number one, what are the other categories? And I have another visual. Isn’t that exciting?

Jim Azevedo 34:41

Fantastic. Bring it up.

Mark Lefebvre 34:42

Yeah, let’s bring up the visual. So romance, obviously number one, but then the next highest categories are actually mystery and detective and fantasy. So these are sort of like the subcategories. So fantasy. And again, when I have fantasy it’s the high level, just like romance, and I’ll dig into romance and a little bit for romance authors to see what those subcategories are. Then women’s fiction, right, number five, that’s kind of cool. Science fiction, action adventure, so you get a lot of the genres up top right? And then business and economics.

Jim Azevedo 35:17

Dipping into the nonfiction titles there.

Mark Lefebvre 35:19

Yeah. Nonfiction, which is great news for authors who write nonfiction. Then you’re getting to thriller, so thriller is different than mystery and detective right? Those are domestic thrillers, etc. And then crime, so crime is a category that’s more like a police procedural. A lot of what you might call a thriller in the US, people might call crime thrillers in the UK. Then YA, obviously, because YA has a great crossover? Then you get into, so this is interesting Christian fiction, self-help, body, mind and spirit, health and fitness. So I was shocked to see cooking so high on the list, because you would think that you’d want that as a physical book, but no, I guess people are putting them on their ebook readers and just hanging out in the kitchen and doing more cooking. Then fairy tales, folktales, legends and mythology and LGBTQ, well it’s called LGBT in the biotech standard, but it’s that category. Then that goes on and on off the screen, family and relationships, fiction family life, fiction historical, I mean, it just goes on and on and on. There’s 3600 categories, but those are the top ones that we saw. So that’s kind of hopefully giving some hope. Do you want to see some of the breakdown, like dig into romance a little bit more? Alright, this one’s a little prettier. This is unit sales. So amongst the romance, within romance, contemporary romance represents about 35% of romance. And then I mean, there’s about 46 or 47 subcategories of romance. The rest, and I just lumped them into the rest, because they’re all like roughly 1% or less, but there’s so many of them that it adds up to 16. So that’s where you’re seeing that but then so within romance, you’ve got contemporary is huge. You’ve got suspense. You’ve got new adult, which is continuing to grow. You’ve got action and adventure, paranormal shifters, billionaires still doing really, really well. Clean and wholesome, still growing, and theologies. So anthologies and collections would be when authors get together, you know, hey, you buy book one of this series, book, one of that series, get them all together, where authors are collaborating. And again, we have that great payment splitting that you can use at Draft2Digital. And so you’ll even notice like so you’ve got paranormal shifters is 4.31%. But paranormal general is 2.49%. So I mean, really paranormal at the higher level would be, I can’t do the math in my head. But that’s going to be a bigger number, right? It’s going to be 7-odd percent, which would actually put it close to suspense, like romantic suspense. Just quickly, and let’s see, is there anything else that’s jumping out at you here?

Jim Azevedo 38:07

Well, one thing that’s kind of jumping out at me is, you know, I hear authors saying, well, where should I write, what market should I write to? I love romance. That’s what I know. Maybe I should write toward contemporary because that’s where it seems like the audience is, that’s where the market is. But it looks to me if you look at these numbers, that maybe the opportunity is not so much where everybody is, but maybe in some of these other more niche categories, where that’s growing, so you don’t have to compete with thousands and thousands of other authors, the playing field is a little bit more level for you. That’s more of an opportunity. What do you think?

Mark Lefebvre 38:42

Yeah. Because yeah, like, oh, I’m looking for military romance. There I am. And you were hanging out with M.L. Buchman there, right? At NINC?

Jim Azevedo 38:55

For a little bit. Yeah, that’s right. So many people,

Mark Lefebvre 38:59

Matt writes military romance, and I know Matt’s making a pretty penny. So here’s the thing, it may look like 2.5%. And LGBT, may look like 2.14%. But that is a big number. Because you got to remember that romance is still half of our sales. So even if it says billionaires is only 3.59%, 3.59% of 55% of our sales is a way bigger number than some of the other categories. So I’m going to flip it over to revenue. So this is unit sales, and revenue is going to be pretty close, right? But you see a little bit higher revenue in contemporary, for example, the rest goes down a little, suspense goes up a little. So it’s very, very similar. You’ve seen a very similar pattern, but it’s just to show that the prices are pretty close in terms of the volume. So that was an interesting thing that I wanted to share. Other stats, other stats. So let’s go back into the high level stats that I think are pretty compelling. Pretty exciting. So series units. You know, Jim, I’ve been in the industry for a long time. And for 10 years I’ve been telling authors write in a series, but I only started to follow my own advice in 2020. Ironically, I somewhat knew what I was talking about. So for this quarter, for the first half of 2022, series units represented 75.48% of unit sales at Draft2Digital. And 75.94% of revenue. So I’m guessing series works, because if somebody finds something they like, they want more of it. And, well, let’s go back to romance for one second. Why do you think people like romance? Why do you think people need romance? Why do you think they love romance in their lives?

Jim Azevedo 40:52

So many reasons. But everybody loves a happy ending.

Mark Lefebvre 40:55

Happy endings. Oh, God, have we ever needed happy endings in the last two years, right? So think about it, it’s like, okay, everything’s scary, I don’t know what’s going on. I can open up a book and know that they will get together at the end. And will be in love at the end. So, again, so that’s the other thing that happens with series books is, I’m gonna go hang out with people I know, people I like. Sometimes in series, it’s not the same people. It’s a world, right? You think of romance series as okay, this book is focused on this couple. And then book two is focused on couple B, and couple A has cameos, or walk on roles. So you know, it’s the same town, I think of Ganset Island, for example, it’s all set on the same island, and there’s different couples. But you get to see the happy endings, and you get to return to the people you love, you get to return to Virgin River, for example.

Jim Azevedo 41:44

So these readers are not just investing in the book, they’re investing into those characters, into those stories, into those worlds that the authors have built. I mean, they’re invested into this.

Mark Lefebvre 41:55

And I think from the author’s point of view, the author’s worked really, really hard at developing real characters with heart and passions and souls and settings. And they can really leverage that IP. Well, that cousin I introduced in book one, I’m going to talk about their love story, or their murder mystery, or their thriller adventure, or whatever it is. Their romantic comedy adventure. So series is really, really cool. Subscription units in this year, the first half of this year compared to 2019. I went all the way back to 2019. Because it’s just been consistent slow growth. But sometimes you know, how you have a friend of the family, they have they have a child, and you haven’t seen them in five years. And suddenly they’re like, oh, my goodness, you’ve grown. How did that happen? And the parent goes, what? Because they’re seeing like, you know, millimeters every every day, or whatever. So when you look at subscription units, the lucky number 6.66% of subscription units for overall 4.24% of revenue, but back in 2019, subscription units were under 3%, it was 2.62% and 2.4% for revenue. So, you know, we have seen subscription growth from two specific platforms I can think of, would be Scribd and Kobo Plus, is they have dramatically expanded. And one only has to wonder if a company has dramatically expanded into, what are they in nine different countries for Kobo Plus? Because it’s not working?

Jim Azevedo 43:35

And Scribd is a fun subscription service to play with. They’re very good about putting new titles in front of you. We saw that you read this, check this out.

Mark Lefebvre 43:45

Exactly. And I’m thinking, I was talking to the folks at Kobo at Novelists Inc last week, and they were noticing that it’s not cannibalizing their sales so much as its new customers, who’ve never read an ebook, but are used to subscription services. They’re used to whatever, like Netflix or whatever, they pay a fee, and they get, it’s all you can read. And so they’ve seen a new customer come on board that says, oh, I can pay a monthly fee. And I can read all these great books.

Jim Azevedo 44:16

We’re getting used to it because subscriptions go across so many different industries. It’s not just streaming.

Mark Lefebvre 44:24

And library sales are up 9.82% of units, and I realized, oh my god, I was going on and on and on. I forgot to share one of the most dramatic and exciting things. You ready for it?

Jim Azevedo 44:34

I’m so ready.

Mark Lefebvre 44:35

You mentioned print earlier, Jim.

Jim Azevedo 44:37

I did. I think I was getting ahead of myself. I’m just so excited.

Mark Lefebvre 44:41

Okay, so Draft2Digital has seen 220% growth in this year between January and August over 2021. It’s more than three times the growth. But here’s the interesting thing. We only have 20,000 titles in print. Only 2% of our authors have print books, only 2%. And so can you imagine how much more that’s gonna grow? 2%, that’s teeny tiny.

Jim Azevedo 45:15

When we actually come out of beta.

Mark Lefebvre 45:17

Yeah, so we’re still in beta, but it’s still perfectly active and available. But right now, authors outside North America can get author copies. So if you live in the UK, you live in Australia, you live in Europe, you’re getting copies not printed in the US and shipped, you know, on a slow boat across the ocean, they’re actually going to be printed locally. So the cost savings is there. And if you’re not in the Draft2Digital beta, you can go click on one of your books, click on the beta tab and say, please accept the beta, you’ll probably be in the beta within a week, or go to draft2digital.com/printbeta or just email us at support@draft2digital. That is really exciting. We are going to close this episode with a wonderful video from our good colleague Kevin with the smooth Kevin voice. But Jim, I do want to say thank you for joining me in this medley of data that, you know, I haven’t even gotten to the top, it’s like 45 minutes in and I haven’t even gotten through the top.

Jim Azevedo 46:16

Oh my gosh, I loved it. I loved being here. And don’t worry everybody, Kevin will be back. He’s taking a vacation.

Mark Lefebvre 46:24

So be sure to bookmark D2Dlive.com so you don’t miss these weekly Thursday at 1pm Eastern episodes. You can also, if you are interested, you can follow along over at the blog where we will have some notes compiled from this posted to our blog so we can have some of those stats and pretty pictures that you saw. And again, thanks so much for joining in. Jim, thank you for hanging out with me here today.

Jim Azevedo 46:51

My pleasure Mark. Thanks for having me.

Mark Lefebvre 46:53

And now over to our good friend Kevin.

Kevin Tumlinson 46:57

Ebooks are great, but there’s just something about having your words in print, something you can hold your hands, put on a shelf sign for a reader. That’s why we created D2D Print, a print on demand service that was built for you. We have three beautiful templates to give your book a pro look, and we can even convert your ebook cover into a full wraparound cover for print. So many options for you and your books. And you can get started right now when you sign up at draft2digital.com/printbeta.