Monday, March 7, 2011

Taking Back the Marketplace

Acres of fruit boxes filled with books
 For far too long, big-box bookstores and major publishers have gobbled up more than their fair share of the book industry pie. Now, with Borders filing for bankruptcy protection and Barnes & Noble and Amazon focusing more heavily on e-book sales, marketing whiz Blaine Loomer says it’s time for authors, small publishers, and independent bookstores to take back the marketplace.

“Essentially this is a changing of the guard for an industry that no longer operates to meet the needs of today’s consumers,” says Loomer, who recently launched a new book fulfillment and distribution service.


Blaine Loomer
“A comparison could be made to Southwest and Walmart. Both companies had successful runs at dominating old industries by redesigning the old school business model—Southwest by limiting themselves to one type of plane, using less expensive gates, and eliminating seating-based reservation systems, and Walmart by going after rural markets, controlling labor costs, and controlling capital outlay for real estate and construction.
“Now the book industry is changing,” he says. “And with that change comes the opportunity for authors, small publishers and independent bookstores to adapt their business models to better fit their needs and bottom lines.”

Consider this example from an author who recently contacted Loomer. Her book had a price of $14.95, a print-on-demand print cost of $10.75 (which reflects a 100 percent markup), and a retail commission of 55 percent of the book’s price or $8.22. The author was losing $4.02 every time she sold a book—and that’s without shipping or publishing costs factored in. (Online publishing with print-on-demand usually costs between $1,500-2,500 to set up.)

“The troubles at Borders and the changes at Barnes & Noble and Amazon are leaving a hole in the marketplace,” says Loomer, who created Wubbit.com, an e-commerce platform that connects customers, authors, and bookstores all in one place.

“There’s a way to compete with companies like Amazon or big publishers that are fighting for their own place in this rapidly changing market,” he says. “By thinking creatively and teaming up, authors, small presses, and independent bookstores, we can fix the problems that caused the little guys to be pushed aside. They can create a niche in this new world of book selling that is all their own.”

He says that when its time for publishers to decide on distribution, they focus on big-name retailers like Barnes & Noble and Amazon, rather than going to those small businesses that make the book business great. He points out that every day independent bookstores are forced to close their doors because they’ve been excluded from big-name publishers’ marketing plans.

The online forum isn’t much better, he says. The vast majority of book selling websites are supplied by the same old distribution structure—dominated by distributors, wholesalers, and book dealers—as the one used in pre-Internet days.

Loomer suggests that one solution is to bypass these middlemen by leveraging the Internet to reduce distribution costs and provide a direct line from the book manufacturer to the retailer or the end consumer. He proposes a distribution model would allow small presses to sell their books at a more competitive price and maintain higher margins.

The reason most bookstores don't sell titles from self-published or independent authors/publishers is simply because they can't afford it. Independent bookstores do not have the time or the resources to do business with thousands of authors on a one-at-a-time basis. Most bookstores will deal with local authors because it’s easy. If they need to restock your book or order a copy for a customer they call and you bring the copies to their store. But, that won’t work if you want to reach a national market for your books.

“You can have a great book and a great marketing plan, but if a bookstore cannot find your title and order it within a few minutes (at a re-seller price) they will not be interested in selling it,” Loomer said. If you register your book for sale on Wubbit.com, he says any independent bookstore across the country can locate your title and order it. Wubbit processes credit cards and purchase orders for you.

Registration costs $36.00 US per title. On direct consumer sales the Author/Publisher will receive 65% of the sale price of the book. On bookstore sales the Author/Publisher will receive 45-55% of the sale price of the book depending on quantities ordered by the bookstore. Payments are sent to the author electronically each month. And, selling on Wubbit.com does not prevent you from selling on other sites.

“It’s time to start paying authors fairly,” says Loomer. “They put a lot of blood, sweat, and tears into the book writing process. It is time consuming and tedious, and they do it knowing they may never be fully compensated for the time they’ve put into their books. A business model where the primary contributor gets gypped every time is not a good business model. It’s time to implement important changes so that this is no longer how the industry does business.”