Q&A With Smashword’s Mark Coker On The E-book Industry

W e have an exciting post planned today. Mark Coker, founder of Smashwords, sits with Marketing Tips For Authors and answers questions related to the e-book industry. He sprinkles his advice with industry statistics for an interview packed with valuable information.

If you’ve been to this blog before, you’ll notice that I changed the look and layout of the blog. The old template was a classic Blogger template that had major limitations. I found this one that gave me more flexibility that I needed. I’m sure I will be tweaking it over the next few days, but I hope you find it much easier to locate the great content hidden away in close to 400 past posts and counting. Go ahead, poke around and let me know what you think.

Now, on to our interview with Mark Coker…

Mark, thank you for taking time out of your schedule to sit with the readers of this blog and share your thoughts on the following questions:

1. E-books are getting a lot of attention. Where do you see their place in the industry as this technology starts to settle?

According the data from the Association of American Publishers, ebooks accounted for about 8% of the overall trade book market here in the US in 2010, up from 3% in 2009, 1% in 2008 and 1/2 of 1% in 2007. These numbers are the best around for trending information, yet they understate what’s really happening with ebooks.

The data only includes reported results from about 12-14 large publishers, so it doesn’t include data from the hundreds of thousands indie authors and the thousands of smaller independent publishers.

Some of the larger, more progressive independent publishers like Sourcebooks are already reporting 1/3 of their revenues coming from ebooks based on January 2011 sales.

Many of our best selling indie authors are selling hundreds of ebooks for every print book they sell.

The AAP data understates the true market share of what consumers are buying, since ebooks are generally priced less than print. This means the unit share for ebooks is much, much higher today than people realize.

I think the overall book industry will see ebook sales eclipse print sales within three or four years, and we’ll see that happen faster for self-published authors if it hasn’t happened already.

It’s really difficult to predict when these tipping points will hit, and in the end the date doesn’t really matter. All authors should know now is that they need to release their books asap as ebooks, and if they’re selling well in print then by all means continue to sell in print as well.

2. As an author begins to look into publishing in the e-book formats, what do you recommend they consider; what should they avoid?

Back in October I wrote a post and presentation over at the Smashwords blog called The Seven Secrets to Ebook Publishing Success. Here are the five most important tips:

  1. Write a great book – If you don’t honor your readers with a great read, they’ll either give you negative reviews (an instant book killer) or they’ll punish you with the worst fate any author can experience – they’ll ignore you. Readers are in control here. If they love your book, they’ll talk it up to their friends and that will drive sales.

  2. Write another great book – Each book you publish affords you the opportunity to reach new readers, earn their trust and admiration, and introduce them to your backlist. Make sure at the end of every book you provide a hyperlinked summary of where fans can discover your other books (Most of our authors link back to their Smashwords author page. Click here to see my author page).
  3. Maximize distribution – Get your book in as many retailers as possible. Retailers spend millions of dollars to attract readers to their stores, and all the majors, including Apple, Sony, Barnes & Noble, Kobo, Amazon and Diesel, welcome indie ebooks. Don’t limit your distribution to only one or two.
  4. Have patience – It can take months or years to build a readership and build sales. In the old traditional print world, if your book didn’t immediately sell through within a few weeks, it was forced out of print. With ebooks, you never go out of print. Your book is immortal. We’ve had authors who experience very slow sales at first, but then they increase over a period of years, and then suddenly their book pops into the best-seller lists at a retailer. Often, these books will pop at one retailer but not another.
  5. Marketing starts yesterday – Don’t wait until your book is published for the marketing to start. Instead, start your marketing with social networking the moment you decide to write a book. Build your social network, and most importantly, contribute to the network. If you add value to your networks, and if you help your fellow authors succeed, they in turn will help open doors of opportunity for you. Authors need to help authors. Your fellow authors are not your competition, they’re your partners.

The accompanying presentation can be found here at Slideshare: http://www.slideshare.net/Smashwords/the-seven-secrets-of-ebook-publishing-success

We spend a lot of time at Smashwords creating free resources to help guide even novice authors down the path to publishing success. In our FAQ at Smashwords, we even provide a glossary of common ebook terms because if you don’t know the language of ebook publishing, it makes it more difficult to learn.

We also go out of our way to remind authors that the path to success is not easy. Many authors don’t sell a single book. Keep your expectations realistic. I wrote two free guides that between them provide a crash course on ebook formatting, production, marketing and distribution. The first is the Smashwords Style Guide. It’s the formatting bible here at Smashwords. Even if an author doesn’t publish and distribute with Smashwords, it still provides a good overview of how ebook formatting and distribution works. The second resource is our Smashwords Book Marketing Guide. It provides authors over 25 marketing ideas they implement at no cost. For both of these guides, I tried to explain everything in clear simple language. I talk about not only what you should do, but also the thinking behind it. This context behind the recommendations helps authors truly internalize the knowledge.

In terms of what to avoid, avoid spending money. Ebook publishing and distribution is available to every author at no cost. At Smashwords, for example, all our publishing and distribution services are provided at no cost. We earn our income by taking a small commission which works out to 10% of the retail price for sales through our retail distribution network.

Expense mitigation is important because you, the author, are running a business. The fastest way to go out of business is to overspend and have expenses exceed your revenues. Keep your sales expectations low and realistic. For most authors, sales rarely meet expectations. Most best-selling authors today toiled in obscurity for years before they broke out. Don’t break your bank to run your publishing business, and by all means never borrow money to finance your book publishing.  

3. Right now, e-book prices vary considerably from title to title. What advice do you have for authors when considering the pricing of their book?

Ebook customers expect ebooks to be priced lower than print. $2.99 to $4.99 is a good price range for many authors. If you’re just starting out, consider pricing your first book at FREE, if even only for a short period of time so you can gain your first readers and reviews. Readers are hesitant to take a chance on authors they don’t yet know and trust, so sometimes you need to drop your prices to reduce the reader’s risk.

Price is one of the most powerful marketing tools for indie authors. Some of our best-selling authors write series of full-length books (see my second secret to success above), and they give the first series-starter away for free. This is what Brian S. Pratt does. His first book, The Unsuspecting Mage: Morcyth Saga Book One is over 140,000 words. He gives it away for free. Many readers then return to buy the other five books in his series for $5.99 each. This strategy only works if you’re honoring the reader with a great book.

Amanda Hocking, who has sold over 1 million ebooks, prices her series starters at $.99 each, and then prices her other books at $2.99.

The quality of your book is more important than price. If your book is a horrible read, you’ll get hundreds of downloads with FREE but you won’t get many readers.  

4. Is there any special marketing activities that you find especially effective for e-books?

In addition to experimenting with low prices as I mentioned above, I’d encourage authors to participate in the online communities and message forums where their target readers congregate. Another of our best-selling authors, Randolph Lalonde, has found good success by participating in online message boards that reach his target readers (he writes fantasy). But he’s not there flogging his book. Readers don’t want that. Instead, he joins in discussions and participates in the community. In the signature of his profile, he lists his books. It’s a very subtle, respectful method of marketing. Each time he posts, he’s advertising his book. Each of the major ebook retailers operate their own message forums.

Let’s say you wrote a book about growing tomatoes. There are probably dozens of online forums frequented by gardeners who could benefit from your knowledge and expertise.  

5. As the leader of an e-book distributor, what would you say is important for authors to look for when they are considering a company to help distribute their e-books?

Look for a distributor that doesn’t charge setup fees or conversion fees. Inspect their online publishing platform. Is it self-serve, easy to use and well-documented? Do they give you full control over pricing and metadata? Is it free to update your book if you make changes in the future? Do you know other authors who have used them? Does the distributor offer broad reach? Is there a large satisfied community of fellow authors who use them?

At Smashwords, we’re publishing over 40,000 books from over 17,000 authors. We have a large online community of authors from around the world. It’s easy to get help from these fellow authors. Our official Smashwords Facebook page launched about a month ago and has already become a thriving community where thousands of authors and readers congregate to share tips and talk about Smashwords ebooks. It’s all about authors helping their fellow authors.  

6. Regarding Smashwords specifically, what formats do you help authors publish their books in? How much technical knowledge does an author need to work with Smashwords?

To publish at Smashwords, an author formats their book as a Microsoft Word .doc document, per the instructions in our Smashwords Style Guide. Next, they upload the book and a separate front-cover image to our site. We then take those files and automatically convert the book into nine different ebook formats. These formats include PDF, EPUB (what we ship to all retailers), MOBI (for Kindle), two text formats, LRF, PDB and two online browser formats.

Authors need no technical knowledge other than what’s covered in the Smashwords Style Guide. When I wrote the Style Guide, I was very careful to avoid technical jargon. Everything’s explained in clear, simple words, and I provide a lot of pictures. I understand that Microsoft Word is a frustrating mystery to most of us normal human beings, so the Guide walks the author through the formatting process step-by-step.

So bottom line, all you need is a word processor and the patience to carefully read and implement the Style Guide. For authors who don’t have the time or patience to implement the Style Guide, they can hire one of the formatters on our official Smashwords list – it’s called Mark’s List – by sending an email to list@smashwords.com. They’ll receive the list via instant autoresponder. All the formatters are fellow Smashwords authors. We don’t earn a commission or referral fee.  

7. I read that you offer your services for free and you even give an option for authors to acquire ISBN numbers for their books at no cost. How can Smashwords do all this for authors at no cost?

We earn our income by taking a commission on all sales. If we don’t help an author sell their book, we don’t earn anything. The ISBNs cost us thousands of dollars, but we make it up through book sales.  

8. Where do you see the ebook publishing industry heading in the next decade?

10 years from now, ebooks will be the dominant format for book publishing and consumption. There will be more published authors and more published books than ever before. It’ll be a great time to be a reader, because readers will have instant, low-cost access to virtually every book ever published, and access to incredible authors they never would have been able to discover were it not the ebook publishing revolution.

Ebooks shatter the traditional economic and geographic barriers of print publishing. Ebooks are cheaper to produce, distribute and sell, and their lower costs mean that the authors and publishers can sell them for lower prices. Lower prices, combined with the magic of instant digital distribution, means that more books will become more available and more affordable to more readers.  

9. Are there any new technologies or services on the horizon for Smashwords that you can share at this time?

We’re constantly evolving our publishing and distribution services. We’re always asking ourselves, “how can we make the publishing process faster, cheaper and easier for our authors?” So you’ll see non-stop incremental updates to the platform over time.

Our Smashwords Coupon Manager feature, which allows authors to generate their own custom coupon codes for marketing purposes, is a good example of the type of new marketing tool we’d like to develop for our authors in the future. We’re also going to spend a lot of time improving the discovery of our books so readers can more easily find what they’re looking for, not only at Smashwords.com but at our retail partners as well.

We have over 400 items on our development roadmap for new features and service enhancements. Our challenge, as a small but fast-growing company, is to constantly reevaluate our development priorities so we’re focusing on those issues that give the greatest number of Smashwords authors and publishers the greatest benefit.  

10. What parting advice do you have for authors who are looking to begin the e-publishing process with their books?

Ebooks will usher in a new renaissance in book publishing. It’s a very exciting time to be an author. The opportunity for authors to reach readers has never been greater than it is today, and the opportunities will only increase in the months and years ahead.

My biggest piece of advice is to get out there now and release your book as an ebook. The rules of ebook publishing and marketing are being written today by the early pioneers. Everything is changing so quickly. The authors who are out there now experimenting are the ones who will be most successful in the years ahead. Get out there and publish, learn, share and experiment. Take chances, make mistakes, learn from your experiences and grow.

Above all, don’t fear the change. With change comes opportunity for those who learn to seize it.

——–

Mark Coker is the founder of Smashwords, an e-book publishing and distribution company, and the coauthor with his wife of the novel, Boob Tube. He also wrote the Smashwords Book Marketing Guide and the Smashwords Style Guide. You can keep up with the publishing industry by following his Huffington Post column.

 ——– Tony Eldridge is the author of The Samson Effect, an action/adventure novel that Clive Cussler calls a “first rate thriller brimming with intrigue and adventure.” He is also the author of the Twitter marketing book, Conducting Effective Twitter Contests.

16 Responses to “Q&A With Smashword’s Mark Coker On The E-book Industry” Subscribe

  1. L. Diane Wolfe April 4, 2011 at 4:44 pm #

    Great interview and spotlight on Smashwords!

  2. Christopher Wills April 4, 2011 at 5:14 pm #

    Enjoyed the interview. Good to hear from Mark; he seems to know what he’s doing. I’d be interested in a couple of things. Does Mark see Smashwords as a publisher, distributor or ebookseller? Related question; how does he see the future if companies like B & N are starting their own epublishing arm? For the future
    I would like to see Smashwords develop their selling side, because I think there is room for them. To do this though I suggest they would need to do three things. The first is revamp their website so the selling bit looks a bit more user friendly for readers who are not authors; Amazon need a bit of competition. Secondly, I think he needs to talk to ereader manufacturers like Sony or whoever to get closer ties. Thirdly, I would like to see more of an effort at building a brand name for Smashwords. This is more of a long term investment but it will pay off in the end. Maybe he could highlight some authors and find his own Amanda Hocking or J K Rowling. There is a lot of affection for Smashwords at the moment but as the competition increases Smashwords needs to move on too, to stay ahead of the field. Just my thoughts. I think Mark has and is doing an excellent job.

  3. Tony Eldridge April 4, 2011 at 5:15 pm #

    Thanks for your comments, Diane. And thanks for finding the commenting bug in my new blog template. No matter how much you test and prepare, nothing does a better job at finding all the kinks in a new design more than going live.

    I loved Mark’s interview. I’m a new Smashwords author myself and I am fascinated at what he has been able to do with e-books. My experience so far with Smashwords is, well… smashing! It’s an easy and intuitive platform for publishing your ebook. Now I’m anxious to see how the distribution experience is.

  4. Tony Eldridge April 4, 2011 at 5:25 pm #

    Christopher, you bring up some interesting observations from a business standpoint. I know that one of the things I am excited about that he mentions in his Q&A is this:

    “We’re also going to spend a lot of time improving the discovery of our books so readers can more easily find what they’re looking for, not only at Smashwords.com but at our retail partners as well.”

    It will be interesting to see what Smashwords is like in April of 2012. Maybe the presidential candidates will be using it as a platform to get out their message right before the elections!

  5. Mark Coker April 4, 2011 at 6:43 pm #

    Hi Christopher. Great questions. I’ll try to answer them one by one:

    I see Smashwords primarily as a distributor. We consider our authors the publishers.

    Although we operate our own retailing platform at Smashwords.com, and although it’s growing quickly, ~80% of our sales are coming from our retail partners, so we’re keen to support and expand their sales success with our books.

    Re: retailers offering their own publishing platforms, a large percentage of authors and publishers appreciate the time-saving benefits of working with a distributor. Just because an author has the power to play the role of ebook converter, distributor and accounting back-office, doesn’t mean it’s in the best interest of the author to play all these roles. It takes time to manage multiple retailer-specific platforms. At Smashwords, an author can upload the book to us once, or make a single metadata update, and the book and its updates automatically propagate out to retailers. We aggregate payments and sales reporting for our authors, so this is a big time saver as well. So the author or publisher needs to ask if their time is better spent building and managing their own distribution systems, or should they spend their limited time focused on developing their next books, or marketing their existing books? The answer is different for every author. The author only gives up 5-10% of the retail price to us, compared to going direct at some of these platforms, and in many cases they can earn more through Smashwords, especially for price points under $2.99 and over $9.99 (where we pay 60% list for sales through retailers).

    We think we’re also providing a lot of value to our retail partners. It’s more cost-effective for a retailer to source a book from a distributor than from their own platform. This is why the brick and mortar bookstores work with distributors and wholesalers. I think in the years ahead, we may see a shift back toward that model as retailers realize that a Smashwords-sourced book can be more profitable than one sourced through their own platform (because it costs money for them to operate that platform!). I think some retailers (Sony, Kobo, Diesel, Apple) have already realized this, which is why they actively encourage authors and publishers to go through us or one of the other distributors.

    re: revamping the SW website: Agreed. Much opportunity for improvement here.

    re: highlighting our successful authors. We’ve done this at our blog, such as the profile interview with Brian S. Pratt in December, with more planned. Amanda Hocking has been a Smashwords author for a long time. Honestly, though, I’m hesitant to take credit for the success of these authors. We’re simply a tool the authors use. They deserve all the credit for writing great books, mastering the tool and building their own success.

    re: ties with ebook device manufacturers. We focus mainly on ties with the ebook retailing arms of the manufacturers since the biggest ebook stores are operated by those with devices.

  6. Nathaniel Matychuk April 4, 2011 at 7:16 pm #

    This strikes me as all great advice, especially on the series starters being either free or priced very competitively. The problem for me is I am not writing any of my projects in series form, most of my stories are one and done… I may have to go back to the drawing board on some of them to make them longer and perhaps come out in trilogy form.

    And best of luck to Mark who seems to be a cutting edge entrepreneur. I hear the name Smashwords a lot when I am doing research on e-books. I am sure that his endeavors will continue to be successful.

  7. Linda Pendleton April 4, 2011 at 8:22 pm #

    Mark’s Style Guide is an excellent resource for formatting ebooks. I have a number of ebooks now at Smashwords, and plan to add more of my books and my late husband, Don Pendleton’s books.
    Nice interview.

  8. the-time-capsule.com April 5, 2011 at 6:58 pm #

    Fantastic information. I’m feel privileged to be a part of this change in the publishing industry. It’s truly a great time!

  9. Anonymous April 6, 2011 at 12:14 pm #

    This, like all the other sources of information from Smashwords, is fantastic!

  10. Anonymous April 6, 2011 at 12:22 pm #

    I also think it’s important the work is presented in a professional manner. Although Mark is keen to avoid spending money, I think it’s very important to have someone edit your work before you publish online. If you want to become a serious writer this gives you a certain degree of credibility.
    I’m sorry I post as anonymous, but at the moment it is the only thing I can go under to get a comment posted – I do not mean to hide at all.

  11. Bonnie Rice April 7, 2011 at 10:37 pm #

    If you don’t have a series, but a collection of short works, you can still underprice some of your earlier work or your shortest pieces to get people interested.

  12. Anonymous April 8, 2011 at 8:33 pm #

    Can some one tett me who to get ‘Mark’s List’.
    I have send around 10 emails asking for the list no response.

    Can someone help me?

    thanks

  13. Tony Eldridge April 9, 2011 at 8:28 pm #

    Hey Anonymous, I’m working on getting an answer for you. As soon as I do, I will post an update.

  14. Anonymous April 14, 2011 at 7:59 am #

    I think Smashwords is great site and huge community service for writers and readers. I have distributed two books with them. However, even after following the guide advice to a tee, some of the formats, including Mobi and even RTF, are buggy. The Mobi crashes my Kindle for PC, but works fine on the Mobi reader.. I’ve written customer service twice and after six weeks, have received no answer.

  15. Mark Coker April 23, 2011 at 5:45 pm #

    @Anon – the list can be obtained by emailing list at Smashwords dot com

    @AnonII – if ever you don’t receive a reply on the “Comments/questions” link within 48-72 hours, email me personally at first initial second initial at smashwords dot com

  16. J. R. Tomlin October 3, 2011 at 6:13 pm #

    Much as I respect Mark Coker, and believe me I do, I can not agree with his comment to not spend money on your books.

    Good editing costs money. Covers cost money. Promotion at venues such as Pixel of Ink and Kindle Nation Daily cost money (and have a record of being effective). Certainly one has to be careful in not spending more than one can afford, but the most successful of the authors HAVE spent money.

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