Thursday, February 24, 2011

The Changing Business Model of Self-publishing - eBooks and POD

Quite a bit has changed since I published my first book several years ago. I had no real business model planned for my fledgling publishing empire and that was a mistake. Now I find myself rethinking how my limited capital will be spent in the upcoming future for the two new titles I have in the works.

Upon realization self-publishing was an actual business and had to be treated as such, I quickly developed a business plan centered around the POD model as advocated by Morris Rosenthal and Aaron Shepards. Essentially this plan is to use either LSI or CreateSpace as my POD printer, drive all sales to Amazon who handles all the sales and collections and having my profits deposited in my account at the end of the month.  I will readily admit I do sell books directly and to retailers in my niche market, but the bulk of my sales come from Amazon.

This model has worked well for my tiny empire and while I still have more to learn, I do not plan to eliminate this successful model from my business plan. I have found however that the plan must be modified to include the production of ebooks, both as Kindle versions and ePub for the Nook.

There are additional costs involved for producing a book in both a POD and ebook version and while these combined costs are still significantly lower than a press run using off-set printing, they begin to add up for a tiny enterprise such as mine.

Why would I change my model and incur the additional capital expenses? Simple profit motive. I have converted to of my POD titles to ebook titles as well. For one book the Kindle sales are essentially out numbering the POD sales by 10 to 1. The second title has seen a huge increase in the POD sales, in part I believe, due to the large number of Kindle sales. The Kindle sales are out numbering the POD sales at a 5 to 1 rate for this title. 

In the case of one title, the creation of the Kindle version led to sales when none were taking place. The second title, which was selling slowly as a POD version saw an explosion in sales when the Kindle version became available and the Kindle version is selling briskly by my standards.

Given the increase in sales due to making both versions available, it makes sense to offer most, if not all, of my titles in both versions. It also makes sense to slowly, as funds become available, convert all of my back list into ebook versions as well. I will pick the ones I think have the best chance to sell as ebooks and invest the money in those versions initially.

Authors who are considering making the leap into self-publishing need to plan for both POD and ebook versions of their titles. Some might even consider launching just an ebook version first depending on the type of book and its genre.

The times they are a changing.