April 10, 2008

Washington State Attorney General and Amazon

Posted in Amazon Sales at 2:38 pm by laurie979

For those who are following the situation with Amazon, I received the following link which provides information on the state of Washington’s investigation of claims against Amazon that relate to anti-trust issues and monopolistic practices.

http://www.atg.wa.gov/amazonpod.aspx

My guess is that nothing much will come of this particular investigation because Amazon’s reach is national (and international) as opposed to being confined to Washington state. It still may be that the Washington State attorney general will see fit to refer the matter to national organizations for investigation.

Anyway, the link is here for those who are following developments.

Currently Black Velvet Seductions is using the same printer and distribution channels that we have always used. Sales through the printer’s distribution channels are as strong, if not stronger, than they have ever been. We do not at this time see this hurting Black Velvet Seduction’s sales.

April 2, 2008

More on Amazon

Posted in Amazon Sales, BookSurge at 6:22 pm by laurie979

There isn’t much news to pass on in regard to the Amazon/Booksurge maneuver. There have been quite a few more blogs, and other sites picking up on the debate that is raging. However, there is not a lot that is new. If you’ve read the links I sent previously you are pretty well informed on the subject.

There are a few more links, one of them being an open letter from Amazon explaining their reasons for the maneuver. Here are the links for those who are interested in following this.

Amazon’s Open Letter to Interested Parties

Several other links with commentary on the maneuver:

http://www.paidcontent.org/entry/419-amazon-does-damage-control-on-its-print-on-demand-demands/
http://www.mediabistro.com/galleycat/bookselling/amazon_puts_the_muscle_on_pod_printers_81271.asp
http://www.theregister.co.uk/2008/03/31/amazon_booksurge_ultimatum/
http://www.publishersweekly.com/article/CA6546490.html?desc=topstory

I have received a statement from our printer, Lightning Source. Unfortunately, the letter doesn’t say a lot. Mostly that Lightning Source will continue to monitor the situation, and will continue to offer the same distribution channels that they have always offered.

Black Velvet Seductions has still not been contacted about any of this directly. As of this afternoon our books still had their buy buttons turned on.

I am continuing to monitor the situation and will keep you posted as things change.

April 1, 2008

Amazon’s Debacle Continued…

Posted in Amazon Sales at 9:49 am by laurie979

Good Morning Again,

Yes, I am trying to get caught up! Though, I think that might be a hopeless endeavor.

I did have an opportunity to chat with Lightning Source (our printer) about the situation with Amazon and BookSurge. According to Lightning Source, everything is going on as it always has between Lightning Source and Amazon. Amazon is still a distribution partner of Lightning Source. Nothing has changed (that Lightning Source is aware of) in that relationship.

Sort of leaves me at…wait and see what happens…but I don’t foresee changing printers in any case.  

March 29, 2008

Black Velvet Seductions & Amazon — The Sky is Not Falling!

Posted in Amazon Sales, BookSurge at 7:02 pm by laurie979

Good Afternoon,

By now most of you have probably heard about Amazon.com’s move to force print on demand (POD) publishers to use Amazon owned BookSurge in order to sell books directly through Amazon. For those who haven’t yet read about it, here is a link to a Wall Street Journal article which sums it up well.

I am sure that everyone is concerned about how this will impact sales and royalties at Black Velvet Seductions. I will share as much as I know with you now. However, this is written before I have had a chance to talk with our current printer to obtain their insight and to see whether they have any plans in place which might offset this move by Amazon. 

The idea of BookSurge printing our books is not a new one. We initially started out with BookSurge as our printer. At that time our books were small and paperback size. Fool Me Once, Bound by Fate, and Contract Bride were all first printed by BookSurge. Toy’s Story was submitted to them for printing but in spite of their submission guidelines saying they printed books that long, when it came time to actually DO it, they couldn’t. They never printed Toy’s Story because we elected to dissolve our relationship with BookSurge and use Lightning Source as our printer at about that time. Our move at that time was motivated by several factors. We were not happy with the service offered by BookSurge. It was not possible to reach their offices by phone. One either had to call and leave a message or email and it would sometimes be a couple of days before there would be a response. We were also not happy with the turn around time (the time between submission of book files and arrival of finished books) offered by BookSurge. The company advertised two days from submission of files until they would have a printed book. Turn around times were more like three to four weeks in most cases. Although we were not satisfied with the services offered by BookSurge our decision to use Lightning Source for our book printing was based largely on the fact that Lightning Source offered many additional channels of distribution that BookSurge did not. BookSurge offered predominantly Amazon and listing with a few other online venues. They didn’t include listing with either of the big distributors in the US (Ingram’s or Baker & Taylor). They didn’t offer listing with Ingram’s at all, and listing with Baker & Taylor was an additional fee. They did not have any relationship at all with distributors outside the US, other than Amazon.

Lightning Source by contrast offered listing with Amazon, listing with Ingrams, Baker & Taylor, and several UK distributors. We saw an increase in book sales in the “through the printer’s distribution channels” part of the business with the move to Lightning Source. Figures are not available for how many of the books sold through the printer’s channels are Amazon sales and how many are sold through Ingrams or Baker & Taylor orders.  Books sold through Amazon and distributors like Ingrams and Baker & Taylor are reported to us via a statement from Lightning Source which includes the number of sales, without details of whether the sale was through Amazon, BN.com, BAM.com, or a brick and mortar bookstore. 

Though I have just learned about this move by Amazon today, and haven’t been contacted by Amazon, BookSurge or Lightning Source at this point, I can say at the outset that Amazon will will have to do more than not include us in their free shipping offer to make us switch to BookSurge. The BookSurge experience was not a good one…and we were with them at the time that they were owned by Amazon, so the argument that it is all changed and is better now doesn’t really float.
 
As far as I can tell from everything I have read, this new tactic by Amazon would not remove our books from Amazon. They would continue to be there. The book pages would continue to have all the information they currently have, but when it was time for the buyer to buy they would not be able to buy direct from Amazon. Instead they would have to buy from another Amazon store.  The interface for the customer isn’t much different and is like that we see when we buy a used book rather than a new one at Amazon. From the customer’s perspective it still looks very like an Amazon transaction. The big downside is for those customers who qualify for free shipping. Our books would no longer qualify for Amazon’s free shipping. Would it cost sales…maybe a few…  Would it cost as many as giving up all of the brick and mortar distribution channels, which is what we would be giving up if we gave in to Amazon’s arm twisting? I don’t believe so.

We also need to consider that most of our competitors will also be facing this same issue unless they already use BookSurge.

For us, and for our authors, I don’t see this having a huge financial impact or meaning a large loss of sales. For most of our authors Fictionwise is still the single site responsible for most sales, especially in early release. In general sales through all of the printer’s distribution channels account for a very small percentage of author royalties. This is because 1.) The amount we are paid for books that are sold through Amazon and other distribution channels managed by the printer is small. Each middle man along the way gets a piece of the pie and by the time we are paid the piece of pie we get is pretty small. We are paid a little less than $4 for books that sell on the Amazon site for $20. That means that rather than being paid royalties on the $20 sale authors are paid royalties on the $4 that Black Velvet Seductions is paid for the sale. The royalty has shrunk by about $1.60 BECAUSE the book was sold on Amazon instead of through the Black Velvet Seductions site, where the author is paid on the whole $20 sale. 2.) We do not sell a large number of books through Amazon and other printer managed distribution channels. Most authors receive less than 30 sales per month through those channels. 3.) Black Velvet Seductions is purposely not dependent on any single distribution channel. We have worked hard to make our books available through many different channels and to promote sales through all of them so that we would be hit less hard if a channel closed its doors, dropped us, or otherwise ceased to be viable for us.

Since authors are paid on a percentage of what we are paid they will continue to be paid the same percentage of what we are paid that they have always been. The question for me and for authors is, will us not being included in free shipping deals hurt our sales with Amazon enough to warrant returning our business to a company that didn’t live up to half of what it promised?

It’s possible (though I don’t think likely) that the drop in sales would be so large as to warrant that kind of change, but I rather doubt it as sales increased when we began using Lightning Source. I expect to some measure that sales through brick and mortar establishments that can order through either Ingrams or Baker and Taylor in the US or several distributors in the UK makes up the difference between larger sales after our switch. I expect that sales will remain pretty steady through this. If we do see a drop in sales then it will perhaps be time to begin sending our readers to sites other than Amazon to purchase our books. I understand BN.com offers free shipping, and Black Velvet Seductions has always offered free shipping in the US, Canada, and the UK.

At this point I am not advocating any action, other than perhaps writing to Amazon to voice disapproval of this action.

I am not in favor of ANY company twisting arms the way that Amazon/BookSurge is. The fact that they need to twist arms to make publishers use BookSurge seems pretty indicative that what they are offering/have offered in the past is not up to par with what others in the industry are offering. They might be better served to improve their service so that we will want to change, to earn our business rather than to demand it, but that seems to not be the course they’ve chosen.

I will take a wait and see attitude. If my arm gets twisted I will likely not give in. If I see a huge drop in sales when our books are removed from the free shipping part of Amazon’s program (which is really what seems to be being discussed) I will perhaps reconsider. However, it will take a lot to convince me that returning to BookSurge, a company that took 3-4 weeks to print books that were supposed to be printed in 2 days, is a good idea.
 
I will be contacting Lightning Source on Monday to find out what their take is. I will also be writing to Amazon to voice my displeasure at their tactics and to voice the reasons I would not be pleased to go back to BookSurge. Beyond that, we will wait and see what happens and make decisions based on what does transpire. We will of course be making decisions which we believe to be in the best interests of our authors and our company. The company is structured such that we succeed only if our authors do.

In short, nothing is really expected to change much at Black Velvet Seductions as a result of Amazon’s demands, which have not been presented to us at all thus far. If demands are printed they will in all likelihood remain unmet. The royalty structure will remain the same, as it was originally devised to weather exactly these kinds of changes, and in fact, did weather them with the initial switch from BookSurge to Lightning Source.

Please feel free to post any questions you might have. I will do my best to answer them.