Tell us a little bit about why you created Smashwords and the philosophy behind it.
Smashwords grew out of my experience as one of the hundreds of thousands of authors each year who are rejected by a publisher. My wife and I wrote a novel about the soap opera industry a few years back and, despite representation from one of the top New York literary agencies, every major publisher rejected it. They rejected it because – as they told our agent – previous soap-opera-themed novels hadn’t performed well in the marketplace. They were reluctant to take a chance on it.
As you might imagine, it was heart breaking to have a publisher crush our dreams of publication. After licking our wounds, I considered our options. The first option – the one selected by most authors six years ago, back in the dark ages of publishing – was to accept defeat, admit we were failed authors, curl up in the fetal position and give up.
The second option, which sounded eminently more appealing to me, was to try to do something about the problem.
I came to the conclusion that the traditional print publishing industry was broken. I decided that publishers were actually harming the future of books by measuring a book’s worth based on perceived commercial merit. Here’s the big problem: Publishers can only guess which books will be successes, and most of the time they’re wrong anyway. All along, they’re rejecting hundreds of thousands of books each year, some of which would have gone on to become bestsellers and future classics if only they had been given the chance to find an audience.
I decided the solution to this problem was to create a free ebook publishing platform that would allow any writer, anywhere in the world, to instantly self-publish an ebook at no cost. That’s what we launched in 2008 with Smashwords. That first year, we published 140 books. Today, we’re publishing over 200,000.
You’ve said that ‘there has never been a better time to be a writer’. Tell us more about what exactly you mean by this.
The opportunity for writers to reach readers with their words has never been greater.
Although I love print books, and am a collector (hoarder?) of thousands of print books, the print format is a horribly inefficient medium for delivering words to a global audience’s eyeballs. Print books are expensive to produce, distribute and purchase. Even middle-class consumers must think twice before shelling out $30 or more for a book.
Because books are expensive to produce and expensive to distribute and display at retail, their distribution is severely limited. The growth in literacy around the world is taking place in developing countries, yet most print books aren’t available in developing countries. If your book has a potential audience of 100 readers in Botswana, it’s simply not cost effective to publish in print there.
Ebooks, thanks to the wonders of digital distribution, can be efficiently distributed to every corner of the globe at little cost, and can be priced affordably for all readers because the incremental cost of printing a new digital copy is zero. Any time you make a desirable product more available and more affordable to more people, you sell a lot more product.
Because physical shelf space is expensive and limited, brick and mortar bookstores can only sell a small fraction of all available books. Books that don’t sell well immediately after release are shipped back to the publishers after only a few weeks for a full refund. Most print books are forced out of print before they’ve had a chance to reach readers.
With ebooks, the virtual shelf space is unlimited, and the book never goes out of print. The ebook is immortal. Even if it only sells one copy a year, the retailer will still want to keep it in stock. Digital book retailing enables the long tail.
Another big trend that excites me is the mobile opportunity. Today there are over one billion smart phones in the hands of consumers. In the next few years, smart phones will become entry-level phones, so there will be billions of smartphones in the pockets of potential readers. For each of the consumers, especially the readers in developing countries, your ebook is only a few clicks away from being discovered, sampled and purchased.
The final exciting thing about the digital book opportunity is that it allows authors and publishers to easily target niche audiences that it wasn’t economically feasible to reach in the dark ages of print publishing. Online marketing allows authors to target and aggregate a global audience of niche readers. It doesn’t matter how obscure your book’s category or genre is – there are reachable readers out there.
Bottom line: digital books eliminate multiple points of friction that prevented print books from being ubiquitously available, discoverable and affordable to readers.
Many commentators are suggesting that the stigma once attached to self-publishing is steadily disappearing. With this and the increased support and services available for authors looking to self-publish, do you think writers will begin to question the value of traditional publishers?
Definitely. It’s already happening. Indie authors are now in the cool kids’ club. More and more authors are aspiring to self-publish as their preferred option. Authors are self-publishing without even bothering to shop their books to agents and publishers.
At the same time as the stigma of self-publishing is disappearing, we’re seeing an increased stigma attached to traditional publishers. Writers are beginning to realise that thanks to ebooks – and to democratised distribution, where every major ebook retailer wants to carry all self-published ebooks – publishers are no longer necessary to connect with readers.
Just a few years ago, publishers had a chokehold on the business of reaching readers with books. They controlled the printing press, the access to distribution, and the knowledge necessary to produce, package and market books professionally. Now these three legs of the stool are democratised and available to all writers at little to no cost.
Authors are starting to ask two dangerous questions (dangerous if you’re a publisher):
1. What can a publisher do for me that I can’t already do for myself?
2. Since publishers are pricing their ebooks too high, and paying such low royalties, might a publisher actually harm my career as an author?
When authors self-publish ebooks, they enjoy faster time to market, full creative control, broader global distribution, and they earn per-unit royalty rates that are four to five times greater than those publishers pay.
This last point is important, because the economics of indie ebook publishing will drive this trend further. An indie author can earn about $2.00 selling a $2.99 ebook. The book of a traditionally published author would have to be priced at over $10.00 in order to earn the author the same $2.00. This means indie authors have incredible leverage in the marketplace and can compete aggressively on price while still earning more per unit. This is why so many indie authors are appearing each week in the bestseller lists. They’re offering high-quality product at lower cost.
Many writers looking to self-publish see marketing and getting noticed as one of the biggest challenges they face. What are your top discoverability tips for authors?
The most important marketing you can do is to write a book that markets itself. The easiest way to sell a book is by reader word of mouth. A great book moves the reader to an emotional extreme. It makes the reader go, ‘WOW!’ It doesn’t matter if you’re writing fiction or non-fiction. If you make your reader go ‘WOW!’, they will not only recommend your book to their friends, they will COMMAND their friends to read your book NOW.
So many authors mistakenly over-invest in marketing and under-invest in writing the best book possible. If you’ve got an extra $2,000 burning a hole in your pocket, and you have the choice to hire a marketeer or a professional book editor with a track record in your genre, the editor is the better investment.
The next most important marketing secret is to create an amazing ebook cover image. Book covers sell ebooks. A great cover makes a promise to the reader on a visceral level. It’s aspirational. It’s all about the image. If you strip away the book title and author name, does the image promise your target reader what they’re looking for? A great cover makes an instant emotional connection to the target reader. Obviously, to create a great cover, you need to know your target reader, and then you need to hire a professional cover designer. Luckily, professional cover design is ridiculously affordable.
The next important marketing tool, and it’s not what most people think of as marketing, is to make the book discoverable by readers. Most of your readers are going to stumble across your book when they’re looking for their next read. To make the book discoverable, it needs to widely distributed to all retailers, and then it needs to have good metadata (proper categorization, a compelling title, an arresting book description) to help the reader find it and want it.
You’ll notice that the most important marketing tips make your book findable and desirable. A great book with a great cover, great distribution and great metadata will find readers, without any additional marketing effort.
Once you’ve got the basics covered, any additional marketing effort will serve as a catalyst to drive sales further.
I wrote two books that explore marketing and discoverability in greater detail, and they’re both available for free download at most major ebook retailers. They include The Smashwords Book Marketing Guide (how to market any book for free) and The Secrets to Ebook Publishing Success (best practices of the most successful indie authors).
There is currently a lot of debate about the price and value perception of ebooks. What are your thoughts on this issue?
In May, we conducted a comprehensive survey that analyzed the impact of book pricing (and several other fascinating factors) on book sales and author earnings. You can access the survey here.
Our survey found that readers are price sensitive, and lower cost books generally sell more units than higher priced books. However, we also found that in our survey $3.99 ebooks outsold even the lower price points, so this is encouraging news for authors. It says readers will pay more for quality, so authors shouldn’t feel like they have to price books at $0.99 to reach readers. There’s some anecdotal evidence that at least some percentage of readers won’t buy the ultra-cheap books, and some will only buy books priced over $2.99 or $3.99 or $4.99. The operative word is “some”. It’s dangerous to over-generalize. Just as there as some consumers who won’t buy books priced ultra-low, the evidence would indicate that a greater number of customers are sensitive to higher prices.
Take a look at any ebook retailer’s bestseller list. You’ll almost always see indie authors in the bestseller list, and they’re almost always at price points of $4.99 or below.
Another segment of the book-buying audience will download free books from authors they don’t yet know and trust. Only after the author earns their trust will they purchase the priced books. We found that free books, on average, get almost 100 times more downloads than books at any price. This means that authors with multiple books should seriously consider experimenting with free promotions, or even perma-free for series starters. Our experience shows that FREE is one of the most powerful marketing tools to help build readership quickly, and to help drive readers to priced series.
And finally, if you were to give just one piece of advice to aspiring authors, what would it be?
Although many self-published ebook authors are reaching thousands of readers, it’s important to understand that it’s still really difficult to reach your audience. Most self-published books sell poorly. Most bestselling authors toiled in obscurity for years before they broke out. If you decide to embark on this self-publishing adventure (and yes, I think every author should!), remember that it takes years of hard work. Readers will determine your fate. Your job as the writer is to wow them. If you honour readers with great books, and you continue writing more books, your audience will eventually find you and propel your career forward.