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Codex-Group © 2014 Proprietary and Confidential 1
Peter Hildick-SmithCodex-Group LLC16 W. 16th St.NY, NY [email protected]
Digital Book WorldJanuary 14, 2014
The Author BrandOpportunity
Codex-Group © 2014 Proprietary and Confidential 22
Three Pillars of Initial New Book Sales
Availability
Conversion
Discovery + Conversion + Availability = New Book Sales
Discovery
BuyerTarget
Do I Knowthe Book Exists?
Do I Knowthe Book Exists?
Is the Book Idea Interesting
Enough to Buy?
Is the Book Idea Interesting
Enough to Buy?
Is the Book Available to Buy Whenever,
However I Want It?
Is the Book Available to Buy Whenever,
However I Want It?
1
2
3
Codex-Group © 2014 Proprietary and Confidential 33
Three Pillars of Initial New Book Sales
Availability
Conversion
Book Conversion Driven Most by Author “Brand” and Book Topic/Message.
Discovery
ReaderTarget
Is the Book Idea Interesting
Enough to Buy?
Is the Book Idea Interesting
Enough to Buy?
2
Author “Brand”Topic/Message
Codex-Group © 2014 Proprietary and Confidential 4
“Brand Author” Defined
A “Brand Author” = 500,000 Fans or More.
500,000 Fans
1% of Frequent Book Buyers50,000,000Adult Frequent
Book Buyers
Codex-Group © 2014 Proprietary and Confidential 5
Why Author Brands
Matter
Codex-Group © 2014 Proprietary and Confidential 6
Brand Author Bestseller Placement – 1/19/2014
Brand
Brand
Brand
Brand
Brand
Brand
Brand
Brand
Brand
Brand
Brand
Brand
Brand
Bestseller List Dominated by “Brand” Authors.
Codex-Group © 2014 Proprietary and Confidential 7
13%
24%
29%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
All Books Bought Last
PersonalRecommendations
Book Topic/Message
Favorite Author/Series
New Book Purchase Decision Factor Share: Last Book Bought – 11/2013
Most Influential Purchase Decision Factor: Last Book BoughtMost Influential Purchase Decision Factor: Last Book Bought
When browsing for new books, which of the following factors influenced your decision most when choosing [your last book bought]? (pick one)
“Favorite Author or Series” Single Biggest Book Purchase Decision Factor.
BookBought Last
Codex-Group © 2014 Proprietary and Confidential 8
11%
19%
43%
14%
18%
32%
15%
32%
17%
14%
35%
8%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Genre Fiction Literary Fiction Narrative Nonfiction Utility Nonfiction
Recommend
Topic/Message
Favorite Author/Series
New Book Purchase Decision Factor Share: Last Book Bought – 11/2013
Most Influential Purchase Decision Factor: Last Book BoughtMost Influential Purchase Decision Factor: Last Book Bought
When browsing for new books, which of the following factors influenced your decision most when choosing [your last book bought]? (pick one)
“Favorite Author or Series” Dominant Factor in Fiction, Major Potential Force in Narrative Nonfiction.
GenreFiction Literary
FictionNarrative
Nonfiction UtilityNonfiction
Codex-Group © 2014 Proprietary and Confidential 99
20%
62%
25%
53%
33%
42%
43%
31%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Genre Fiction Literary Fiction Narrative Nonfiction Utility Nonfiction
“Brand” Authors Most Purchased in Fiction – Unknowns Often Avoided.
Book Buyer’s Author Opinion BEFORE Discovery – 11/2013BEFORE you first discovered [the book you bought last] -- what was your overall opinion of its author or series?
Very Good/Favorite Author
Not Familiar Author
Author Rating BEFORE Book DiscoveryAuthor Rating BEFORE Book Discovery
GenreFiction Literary
FictionNarrative
NonfictionUtility
Nonfiction
Codex-Group © 2014 Proprietary and Confidential 10
3%
45%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
Not Familiar Author Favorite Author
Author Equity Brand Impact on Book Sales – Purchase Propensity – Fiction
Author Brand Equity is Book Sales Multiplier!
15X15X
Not FamiliarWith Author
Author“Fan”
Codex-Group © 2014 Proprietary and Confidential 11
449
228,116
0
50,000
100,000
150,000
200,000
250,000
Robert Galbraith JK Rowling
Author Equity Brand Impact on Book Sales – Initial 8 Week Print Unit Sales
Author Brand Equity is Book Sales Multiplier!
500X500X
April 302013
July 142013
Codex-Group © 2014 Proprietary and Confidential 12
33%
54% 55%58%
73%
82%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Undisputed Truth A Wanted Man Simple Dreams Storyteller Dust Sycamore Row
Fan Contribution to Total Book Demand
Author Fan Sales Contribution: % Book Purchase Demand From Author Fans
Fan Contribution: Major Authors Depend on Fans for 50-80% of Sales.
CelebrityBiography
Y
Codex-Group © 2014 Proprietary and Confidential 13
Retail Price Expectation: Impact of Author Brand Strength – 6/2013
$18.36
$14.49
$19.84
$5.63
$7.49
$9.36
$5.00
$7.00
$9.00
$11.00
$13.00
$15.00
$17.00
$19.00
$21.00
Not Familiar with Author Name Very Good One of My Favorites
Hardcover: Thriller
eBook: Thriller
Book Buyers Expect to Pay Significant Premium for Their Brand Authors.
How much do you normally expect to pay for a new or recently released book by (the author of the book you bought last) -- in each of the following formats?BEFORE you first discovered [the book you bought last] -- what was your overall opinion of that author?
Hardcover
eBook
+66%
+37%
Unknown AuthorUnknown Author
“Brand” Author“Brand” Author
Thriller AuthorsThriller Authors
Codex-Group © 2014 Proprietary and Confidential 14
Author Fan Base vs. Initial 8 Week Unit Sales – Jodi Picoult
42,000
105,000
206,000
251,000
0 50000 100000 150000 200000 250000 300000 350000 400000
July 2004
April 2006
March 2008
April 2010
0.8%
5.7%
8.7%
9.4%
0% 2% 4% 6% 8% 10% 12% 14% 16% 18% 20%
July 2004
April 2006
March 2008
April 2010
The Bigger The Fan Base – The Greater The Sales Potential.
AuthorEquity
Initial 8Week Units
Codex-Group © 2014 Proprietary and Confidential 15
MakingAuthor Brands
Work
Codex-Group © 2014 Proprietary and Confidential 16
34%
53%
66%
87%
95%
95%
0% 20% 40% 60% 80% 100
%
Lee Child
Jodi Picoult
PatriciaCornwell
LindaRonstadt
John Grisham
Author Y
A Famous Name Is Not Enough.
RecognizeName
Name Recognition Measurement – U.S. Past Month Book Buyers – 11/2013
CelebrityBiography
Y
Codex-Group © 2014 Proprietary and Confidential 17
7%
6%
8%
4%
21%
1%
0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0%
Lee Child
Jodi Picoult
PatriciaCornwell
Linda Ronstadt
John Grisham
Mike Tyson
34%
53%
66%
87%
95%
95%
0% 20% 40% 60% 80% 100
%
Lee Child
Jodi Picoult
PatriciaCornwell
LindaRonstadt
John Grisham
Author Y
Author Equity is Measurable – Fan Loyalty is The Key.
% Book Buyer Fans
Author Equity Brand Measurement – U.S. Past Month Book Buyers – 11/2013
RecognizeName
Codex-Group © 2014 Proprietary and Confidential 18
Author Audience Strength
1%
21%
7%
4%
6%
0.6%
8%
0%
5%
10%
15%
20%
25%
30%
35%
0% 20% 40% 60% 80% 100%
% Familiar with Author
% R
atin
g A
uth
or
as F
avo
rite
GROWTH FRANCHISE
MATURE FRANCHISEDEVELOPING
DIAMONDIN THEROUGH
Net Equity Score% of all book shoppers
rated as author fan
Jodi Picoult
Stephen King
Author Y
John Grisham
Linda Ronstadt
Author X
Lee Child
Patricia Cornwell
Invest in Author Brand Development.
Author Equity Matrix: Book Buyer Audience Strength
FanLoyalty
FanLoyalty
Platform Size
Acquire/GrowAcquire/Grow
ManageManage
FixFix
AvoidAvoid
Codex-Group © 2014 Proprietary and Confidential 19
Author Fan Fulfillment: % of Author Fans Who Own/Plan to Buy Book
15% 16%21%
41%
48%50%
70%
0%
10%
20%
30%
40%
50%
60%
70%
80%
Self-Help P Self-Help L Simple Dreams Sycamore Row The Storyteller Dust A Wanted Man
% Author Fan (VG/Fav) Fulfillment
Fan Fulfillment – Does the Book Connect with its Author’s Fans?
Over Half of Fans Want Book
Less Than Half of Fans Want Book
Average: 45%
Self-HelpP
Self-HelpL
Codex-Group © 2014 Proprietary and Confidential 20
705,000
238,000 223,000
93,0000
100000
200000
300000
400000
500000
600000
700000
Self-Help W Self-Help P - Self-Help F Self-Help L
Initial 8 Week Unit Sales*
“Brand Author” Fan Fulfillment Impact – Initial 8 Week Unit Sales
Miss Your Fans – Miss Your Sales.
*Source: BookScan initial 8 week unit sales
- 467,000units
- 130,000units
Self-HelpP
Self-HelpL 16% Fan
Fulfillment
15% Fan Fulfillment
PriorSelf-Help
Title
PriorSelf-Help
Title
Codex-Group © 2014 Proprietary and Confidential 21
Author Brand Sales Impact
Multiple Author Brand Sales Growth Avenues.
Author Acquisition
Fan Fulfillment – Topic & Message
Price Premium
Category Expansion
Marketing
Greatest Impact
Moderate Impact
Relative SalesImpact
Codex-Group © 2014 Proprietary and Confidential 22
Author Brand Growth Opportunity
Codex-Group © 2014 Proprietary and Confidential 23
Author Brand Growth Opportunity
FAN LOYALTY DRIVE SALES: Primary Sales Source
SALES MULTIPLIER: #1 Conversion-to-Sales Factor
PRICE PREMIUM: Loyal Fans Value Their Authors
CONSISTENT BOOK-to-BOOK GROWTH: Fan Fulfillment
PARTNER CHALLENGE: Author, Fan, Agent, Editor, Publisher