The Secrets of Amazon’s First Self-Published Million-Seller

Donovan Creed e-book author John Locke

It’s hard not to find this inspiring. Amazon’s only had seven authors who have ever sold one million e-books in their Kindle store. But last week Amazon announced an eighth author had also achieved that milestone — and this time, it’s a little different. Instead of working through a major publishing house, Amazon’s latest million-seller is a self-published author!

As of last week, John Locke has sold 1,010,370 Kindle books, Amazon announced — and he did it using Amazon’s own Kindle Direct Publishing platform. Locke said (in Amazon’s press release) that the platform “has provided an opportunity for independent authors to compete on a level playing field with the giants of the book selling industry. Calling it “the greatest friend an author can have,” he said “Not only did Kindle Digital Publishing give me a chance, they helped at every turn.”

It’s always exciting to see someone strike it rich, seeing all of their dreams coming true. Last week the Associated Press asked Locke if he’d want to sign a deal with a major publisher, but Locke casually
insisted that no, “It just wouldn’t be fun for me.” Instead he said breezily that he liked the idea “of being able to walk away from writing if it stops being fun.” And he’s just published another e-book offering the secrets to his success — called “How I Sold 1 Million eBooks in 5 Months!”

Yes, five months — if the book’s title is to be believed. “John Locke has sold more than 1,000,000 eBooks by word of mouth!” reads an announcement on the author’s web site. “All this was achieved PART TIME, without an agent, publicist, and at virtually no marketing expense!” he adds in the description for a new book. And in its introduction, Locke lists out some equally impressive accomplishments.

For example, he’s the first self-published author to reach the #1 spot on Amazon’s best-seller’s list — and the first to hold both #1 and #2 at the same time! In fact, at one point he had four books in the top 10 — and he’s also had seven books in the top 34 simultaneously, and eight books in the top 50. “These numbers are not positions within a category,” John writes in his new book. “They are positions that include all Kindle sales including fiction, non-fiction, magazine subscriptions, and game apps!” Locke writes that by the middle of March, “it had been calculated that ‘every 7 seconds, 24 hours a day, a John Locke novel is downloaded somewhere in the world.'”

Ironically, his book opens with a boilerplate disclaimer. (“Names, characters, places and incidnets are either the product of the author’s imagination or are used fictitiously.”) But it’s an exciting story for anyone who’s ever considered writing an e-book. Between September of 2010 and March of 2011, Locke’s monthly Kindle sales went from 63 e-books…to 369,115. And when he released “Vegas Moon,” it jumped to the #3 spot on Amazon’s best-seller list within just two weeks.

But the numbers aren’t the real story, and it’s even more inspiring to read Locke’s perspective about how the world of book publishing is changing. He describes the publishing industry as “high school on steroids” — where beautiful people hold the upper hand over everyone else. (In this case, through expensive newspaper ads promoting their books, along with in-store book displays and carefully-arranged promotional reviews.) “As a self-published author, I’m boxed out of these marketing opportunities,” he notes. “Worse, I can’t afford to offer my my print books as cheaply as they can…! I’d like to complete, but it’s hard to beat the home team on a playing field that’s hopelessly slanted against you!”

“eBooks allow a guy like me an opportunity to level the playing field.”

Maybe it’s more proof that the world really is changing — already — due to the popularity of the digital readers like the Kindle. It seems like more and more authors are now starting to cross that magic line: one million e-books sold. Three more authors joined the “Kindle Million Club” in just the first week of June, and within two weeks Amazon was announcing that this fourth author had joined them. Maybe there’s just more people this year who are finally able to buy e-books.

Last week, the signs seemed pretty clear. Amazon’s Vice President of Kindle content even issued a statement, saying “It’s so exciting that self-publishing has allowed John Locke to achieve a milestone like this. We’re happy to see Kindle Direct Publishing succeeding for both authors and customers and are proud to welcome him to the Kindle Million Club.” But meanwhile, Locke himself continues writing away on his personal blog on the internet, sharing a peek into the mind of one of the eight most-successful Kindle authors of all time. His latest slogan?

“You only notice the ones who are breaking the rules!”

E-Book Sales Have Tripled in the Last Year!

Stack of books graph shows ebook sales

Today the Association of American Publishers finally released their estimated sales statistics for February. It’s conclusion? E-book sales have more than tripled from where they were just one year ago!

I’ve updated this post because originally I hadn’t realized just how much the sales had increased. “According to AAP’s monthly sales estimates, e-book sales jumped 202.3% at the 16 publishers that reported results, hitting $90.3 million,” Publisher’s Weekly reported this morning – and a 200% increase means the sales are triple where they were from the year before. Again, these are the official statistics from the official trade association of the U.S. book publishing industry, which reported that e-book sales “have enjoyed triple-digit percentage growth, 202.3%, vs February 2010.” And they also acknowledged today that people really love to read e-books.

“The public is embracing the breadth and variety of reading choices available to them,” announced the association’s president, adding that while the reading public maintains an interest in printed books, they’ve “made e-books permanent additions to their lifestyle.”

It’s nice to see that book publishers are aware of the changes rocking their industry, and that they’re approaching it with a sense of history. The association’s president noted today that “publishers are constantly redefining the timeless concept of ‘books,'” and identifying new audiences they can serve in new emerging technologies. “Publishers have always strategically expanded into all the markets and formats where readers want to find books,” he added enthusiastically, “whether it was Trade Paperback, Mass Market or now digital.”

But the statistics tell an unusually compelling story. Publishers are selling more e-books than they are books in any other format, according to a larger survey of over 84 different publishing houses. And in fact, nearly every kind of printed book has shown a decline in sales from the sales they reported just last year. For example, in February hardcover sales dropped a massive 43% from the year before, and they’re now earning the publishing houses just $46.2 million.

And mass-market paperbacks didn’t fare much better, dropping 41.5% in February (down to just $29.3 million) from their sales figures a year ago. In fact, combining every category of printed book, you’d still see a drop of 24.8% in their February sales this year. There was only one kind of printed book which showed any increase in sales this year: religious books, which sold 5.5% more in February than they did in February of 2010 (earning $48.5 million). But no matter how you approach these figures, e-books still come out as extremely popular.

So what’s their explanation? E-books apparently got a big boost from the people who received a Kindle (or another digital reader) as a gift this Christmas. There’s not only more reading devices to choose from, but now there’s also more digital titles available, their report noted today. And people may even be reading more once they purchase a digital reader, the report seems to suggest. “Additionally, trade publishing houses cite e-books as generating fresh consumer interest in — and new revenue streams for — ‘backlist’ titles, books that have been in print for at least a year. Many publishers report that e-Book readers who enjoy a newly-released book will frequently buy an author’s full backlist.”

This may be the year that everything changes — when digital texts really start to replace the printed book as we know it.

Magazine Publishes First E-Book List in 100 Years

Publisher's Weekly

It’s a fascinating moment in time. For more than 100 years, Publisher’s Weekly has compiled an annual list of the year’s best-selling books. But for the first time ever, this year they felt that they also had to include e-book sales. “We asked publishers…to submit e-books with sales of more than 10,000 last year,” they reported yesterday. (Though they focused this question only on publishers who’d had a least one best-seller in print that sold more than 100,000 copies.)

Their annual list is an important tradition in the publishing industry, and it looks like this change encountered some resistance. “The response from the houses was mixed,” they noted. “Many declined to share this information, others only submitted selected titles.” In the end they were able to gather statistics about 275 e-books, which they felt were “enough to underscore that the publishing model has indeed changed and that what is available in e-book format is ubiquitous.” In fact, at least two of the year’s best-selling books achieved nearly 30% of their sales in the e-book format!

The first was The Girl Who Kicked the Hornet’s Nest (by Stieg Larsson), which dominated the top of Amazon’s best-selling e-book list for most of 2010, and sold 775,000 e-book editions (vs 1.9 million printed editions). And the second was John Grisham’s new thriller, “The Confession,” which sold 550,000 e-book editions and 1.36 million print editions. Publisher’s Weekly declares them to be the #2 and #3 best-selling books of the year, respectively, when you combine their print and e-book sales, behind only former President Bush’s biography Decision Points. Interestingly, the president’s book sold many more of its copies in print — nearly 90% — with just 10.3% of its sales coming in the e-book format. When you consider only e-book sales, the former president’s book drops down to the #3 position.

But other books ended up with a very small percentage of e-book sales, including Life, the biography of The Rolling Stones’ guitarist, Keith Richards. Its combined sales made it the sixth best-selling book for all of 2010, but just 4% of its sales came in the e-book format — 34,467 copies — compared to print sales of 811,596. And even fewer people bought the e-book edition of Bill O’Reilly’s Pinheads and Patriots. Though it sold 662,950 print copies — making it the #10 best-selling book of 2010 — it sold just 26,290 e-book editions, representing just 3.8% of all its sales.

There were also at least 12 different e-books that were authored (or co-authored) by James Patterson among the best-selling e-books in 2010, according to Publisher’s Weekly. Five of Patterson’s suspense stories even made it onto the more select list of the top 30 best-selling e-books.

I, Alex Cross (#6)
The 9th Judgment (#13)
Private (#16)
The Postcard Killers (#17)
Don’t Blink (#28)

But publishers are even reporting high e-book sales for perennially-popular “back list” titles like The Great Gatsby and Gone with the Wind. So it seems like this once-a-year event has provoked some thoughtful analysis about what lies ahead for the world of publishing — and what lies ahead for the book. Publishers Weekly remembered the day when Stephen King published the first e-book — Riding the Bullet — back in March of 2000. At the time, a spokesperson for Simon & Schuster announced “This could change the model of publishing.”

But then Publisher’s Weekly turned their attention to an insightful blog post by Mike Shatzkin, a consultant and analyst who has more than 50 years of experience in the publishing industry. He likens the new popularity of e-books to the days when publishers first began producing cheap paperback editions shortly after World War II. “Much less expensive editions, combined with access to audiences for authors that couldn’t get past the gatekeepers in the established houses, can create millions of new readers,” Shatzkin writes — and Publisher’s Weekly optimistically admits that now the same thing is true today.

“Anything that creates more readers is a boon for all kinds of publishers.”

Are Publishers Illegally Fixing the Prices of Ebooks?

Dr Evil vs the European Union and European Commission

A startling announcement came out of Brussels last week. The European Commission suddenly issued a statement that they’d “initiated unannounced inspections at the premises of companies that are active in the e-book publishing sector in several [European] Member States.” They’re “searching for evidence that they had acted illegally to keep prices high in the nascent electronic-book market,” the Wall Street Journal explains — and it’s not the only such investigation.

In both Texas and Connecticut, state officials have been investigating e-book pricing, and there’s also a new investigation that began in England earlier this year. “The U.K and the Connecticut investigations center on pricing arrangements between publishers and the retailers who sell electronic books,” the Journal reported earlier, adding that Connecticut “has said it is looking at Amazon.com Inc. and Apple Inc.” In Europe, the commission’s officials inspected the publishing premises accompanied by “competition authorities” from the appropriate nation, according to their press release. And they made a point of adding that “The Commission has reason to believe that the companies concerned may have violated EU antitrust rules that prohibit cartels and other restrictive business practices…”

Of course, it’s important to remember that this is just an investigation, and “The fact that the Commission carries out such inspections does not mean that the companies are guilty of anti-competitive behaviour,” they warned in their press release, “nor does it prejudge the outcome of the investigation itself.” But there’s still been a lot of activity and excitement. The investigators “descended like cowboys,” according to one publishing company’s president. Another Journal article quotes his interview with a French technology site, where he also reportedly alleged that “This operation is masterminded by Amazon.” (That seems unlikely, but the investigation is definitely making some big headlines in the European business press.) And when the stakes are this high, maybe there’s enough pressure to go around.

So who’s being investigated? Not Random House (according to the Wall Street Journal.) Their reporter actually contacted the top publishing houses in Europe, and a Random House spokesman indicate that they had not been approached by the commission. Several other publishing houses declined to comment (Flammarion and Albin Michel) or didn’t return the call (Gallimard SA). But interestingly, one company did confirm that they’d been contacted by investigators: Hachette Livre. What’s fascinating is that Hachette Livre is a publishing house that goes all the way back to 1826.

They’ve published everything from Charles Darwin’s “On the Origin of Species” to Catcher in the Rye, according to their web site, and even Stephenie Meyers’ Twilight books (which have now sold 85 million copies in 40 countries). They’ve also publish Flaubert’s Madame Bovary, John Le Carre’s The Spy Who Came in from the Cold, and even the famous children’s picture book, Babar the Elephant. “In more than 170 years, the publishing houses that now make up Hachette Livre have produced many a masterpiece…” their site brags.

“They have entered Hachette Livre’s ‘hall of fame’ and serve as a constant reminder of the standards Hachette Livre publishers are expected to live up to, today and in the future.”

Publisher Secrets: Startling New Statistics

Charles Darwin says shh

What are publishers saying behind our backs? I discovered some startling information from a little-noticed trade association meeting in New York City. The once-a-year meeting of the Book Industry Study Group took place on September 24 — and reading about their event felt like peeking into insider secrets.

What percentage of book sold are ebooks? 5.8%, one presenter announced (matching my own recent back-of-the-envelope calculation). And just 32% of Kindle owners are men, according to their statistics (from April to June of this year). Between January and March of 2009, they’d calculated that 42% of Kindle owners were men — suggesting that this year saw a huge surge in new Kindle purchases by women!

The statistics came from Kelly Gallagher, who’s the Vice President of publishing services at a publishing-industry reference publisher called Bowker. And he’d uncovered another strange anomaly: only 46% of the people who own Kindles and other digital readers actually purchased the device for themselves — while another 47% had received them as gifts. But the industry is definitely growing. He also reported that 44% of the people who are now buying ebooks only acquired their digital reader within the last six months…

In fact, the President of Kaplan Publishing announced results from a startling experiment. Last month they took 95 of their e-books — one-third of their total e-book catalog — and offered them for free for one week in Apple’s iBookstore. The results? Their downloads for that week were 25% of their total print sales for one year. Her conclusion: there’s a big untapped demand for ebooks. (My conclusion? People love free ebooks.)

Kelly Gallagher reached the same conclusion. “[R]eceiving e-books for free is one of the largest motivators for people to pick up and buy e-books,” he told the group, “whether it’s a sample chapter or another promotional approach.” But there’s more to learn besides that it’s easier to sell ebooks when they’re cheaper. The Kaplan publisher argued that there’s “a large population of readers who are almost our customers.” And Kelly’s actual slideshow of statistics turned up elsewhere on the web, showing that free promotional chapters are still what’s most likely to influence someone to buy an ebook — between 34% and 36% of respondents.

But I also learned something else: what the best-selling books were for each generation. For example, among readers born within the last 30 years, the top five best-selling books are all from Stephenie Meyer’s Twilight series. And even if you’re between the ages of 31 and 42 (the so-called “generation X”), four of the top five best-selling books are still by Stephenie Meyers. (The non-Meyers book is Dan Brown’s The Lost Symbol.) For the “Baby Boom” generation — 43 to 61 — there’s just two Stephenie Meyer titles in the top five, plus The Lost Symbol, along with The Shack and Stephen King’s Under the Dome. And for people over the age of 61, the most popular books were The Lost Symbol and The Shack plus John Grisham’s The Associate, and then two political books — Glenn Beck’s Common Sense and Sarah Palin’s Going Rogue.

But the most exciting part of the report was the closing keynote speech from the president of Ingram Content Group. He announced to the assembled audience that “the market for books is not fixed. I believe the whole publishing pie can grow.”

Here’s how his speech was covered by a publishing-industry news site called “Shelf Awareness”.


The print book will coexist with the digital book “for years” and will survive because of its “portability, flexibility and durability,” he maintained… ” Among other qualities, the book has “a limitless power source, can be read in the sun, can be read on a plane on the tarmac, looks good on the shelf,” and more. Many people “are like me and want it both ways,” Prichard said. “I love my iPad, but I still look forward to reading that relic of the past, the good, old-fashioned book.”

He concluded: “Let’s stop looking admiringly to the past, let’s stop handwringing about the present and let’s start creating the future.”

Click here to read their full report.

Are Publishers Lying about the cost of eBooks?

Pinocchio is lying - when he lies his nose grows
Last week the Wall Street Journal ran a controversial opinion piece about ebooks. A former book editor and a business professor argued that publishers needed to sell advertisements in ebooks in order to offset their shrinking profit margins. “[A] digital book is far less profitable than its hardcover cousin priced at $25,” their article argued. But according to responses on the web, there’s a problem with that argument. It isn’t true.

“Baen, a publishing house that specializes in fantasy and sci-fi, mostly with a militaristic bent, says that they’ve found that e-books significantly increase profits,” responded one commenter at a technology web site, even though that publisher sells DRM-free versions of their ebooks “for substantially less than they sell dead-tree versions.” And then another commenter backed up their skepticism with actual data provided by the New York Times.

Publisher’s Profits Before Overhead
On a $26 hardcover: $4.05
On a $12.99 ebook: $4.56 – $5.54
On a $ 9.99 ebook: $3.51 – $4.26

This isn’t speculation. The Times based their statistics “on interviews with several publishers and consultants who work with the publishing industry.” eBooks eliminate many of the costs associated with stacks of hardcover books, including printing costs, storage fees, and the cost of shipping books (and then shipping back the unsold copies).

“That, obviously, is exactly what logic would tell you,” one commenter concluded. And the Times article suggested the publishers’ real motive might be simple self-preservation — they’re trying to keep up the demand for printed books. In a future with even more digital readers, lower ebook prices would mean “print booksellers like Barnes & Noble, Borders and independents across the country would be unable to compete… if the e-books are priced much lower than the print editions, no one but the aficionados and collectors will want to buy paper books.”

One publisher’s consultant even tells the newspaper point-blank that “If you want bookstores to stay alive, then you want to slow down this movement to e-books. The simplest way to slow down e-books is not to make them too cheap.”

So are publishers being honest about the costs of publishing a book? It’s a hotly-debated mystery, even to those people who are most affected by it: the authors who are actually writing the books! At the end of their article, the New York Times tracked down best-selling author Anne Rice, who admits that “None of us know what books cost. None of us know what kind of profits hardcover or paperback publishers make.”

Most of Rice’s books are available on the Kindle — though not her most famous book, Interview with the Vampire But as the publishing industry faces historic changes, it was nice to see that Anne Rice still remains firmly committed to the future of the ebook. “The only thing I think is a mistake is people trying to hold back e-books or Kindle and trying to head off this revolution by building a dam.

“It’s not going to work.”

Will Amazon put ads in Your eBooks?

A vintage print magazine ad for Campbells soup. Are ads coming to ebooks?

It’s a horrible thought, but the Wall Street Journal suggests that ads in ebooks “are coming soon to a book near you.”

It’s an opinion piece, rather than a piece of technology reporting, so the evidence is a bit skimpy. For example, the article notes Google already displays advertisements beside the results of searches on Google books. (“It’s a small step to imagine Google including advertisements within books.”) But they also note that last year Amazon filed a patent for advertisements on the Kindle. The article is written by a former book editor at Houghton Mifflin (William Vincent), who’s presumably given a lot of thought to the future profitability of the book-publishing industry. And his co-author, Ron Adner, is a professor at the School of Business at Dartmouth College.

They focus on the future, arguing that the ads-in-ebooks model just makes sense. One suggestion is to include ads in an ebook’s free sample chapters. (“Because not every consumer who reads a sample chapter will buy the book, it’s reasonable for the publisher to extract some additional value.”) Another suggestion: offer a book without advertisements — for a price. “Seeing ads in the sample may also convince a reader to pay for a premium, non-ad version of the full-length book.” I’m envisioning a massive boycott of the first book that attempts to include advertising — but there could be one silver lining. If the publishers earn enough money on the advertising in a book, they might consider reducing the book’s price, or even giving away new books for free!

In fact, Amazon used to sell ebooks at a loss, according to one analyst, earning its profits by selling the Kindle. But now Apple’s new iBookstore lets publishers sell their books at a higher mark-up. The competition pressured Amazon into offering offer their own publishers the same leeway, and ironically, Apple “has now forced Amazon to turn an estimated 30 percent profit on each book it sells.” It seems like Amazon prefers selling their ebooks at a much cheaper price, and the publishers are the ones who are resisting. But publishers might be willing to finally lower their ebook prices dramatically — if they could make up the difference on advertising.

Ironically, then publishers then have an interest in whether the reader finishes the book. “[W]ith advertising in the mix, a book downloaded 100,000 times but never read…may be worth less than one downloaded 50,000 times and read cover-to-cover.” Suddenly an author who writes an irresistible page-turner is more valuable than the author of a massive tome that takes forever to finish, the article argues, suggesting that in a future where there’s ads in ebooks, “Unread books suddenly become less profitable to a publisher.”

But it’s not clear to me who earns the profit in this scenario — the publisher of the ebook, or the digital bookstore who sells it. After all, advertisers would be thrilled for a chance to “target” their ads to readers of a specific kind of book — and would probably be willing to pay extra for this. But as a technology company, Amazon seems much more likely to deliver these customized ads than, for example, Houghton Mifflin. And hypothetically, Amazon could keep updating the advertisements displayed in your ebooks whenever you sync to their server. Advertisers would love the idea of delivering same-day announcements — so Amazon could charge a high premium for their in-book advertisements.

It’s may all come down to a single question. Would you accept advertising in your ebooks if it meant that the ebooks were free?