Richard Nash, Mark Sarvas, Scott Hoffman on Book Pricing for Literary Fiction

Over the next two months, we will be examining publishing practices for literary fiction from various angles here on LitKicks. We’re studying the question of hardcover vs. trade paper original book publishing in particular, and I’ve solicited responses from publisher Richard Nash, author Mark Sarvas and agent Scott Hoffman to some questions about this topic.
— Levi Asher

* * * * *

RICHARD NASH, Publisher of Soft Skull Books

Q: Can you describe the trade-offs a publisher considers when deciding whether to package a book as a higher-priced hardcover or a lower-priced paperback? For instance, Soft Skull published Matthew Sharpe’s Jamestown as a $25.00 hardcover original, but also published Alain Mabanckou’s African Psycho as a $13.95 paperback. Can you help shed any light on why these types of decisions are made, and can you share your own thoughts on the future of book packaging and pricing?

Richard: The numero uno factor isn’t consumers, it’s libraries. You get solid reviews in Kirkus and Booklist and Library Journal and the NYTBR and you’ve all but guaranteed yourself a close-to-non-returnable sale of 1,500 units. If you can get those 1,500 copies at a hardcover margin, then you’ve made some close-to-guaranteed cash, and there are SO few sure things in this business.

However, you want to do that with a writer who has a pretty strong existing reputation, such that you’ve a reasonable shot at getting a solid sell-through to consumers. Selling 1,500 copies to libraries is good for the bottom line, but it ain’t building a readership. Which means you ain’t building a career for the writer, and building ongoing backlist sales for the author’s books on an ongoing basis.

Retailers LOVE trade paper original. Borders loves ’em, Barnes loves ’em, Prairie Lights love ’em. It is not unusual for a book to start the publishing process as a hardcover but, through relentless pressure from the retailers on the sales reps, and the sales reps back on everyone else, to have it go to paper.

That’s why you’re seeing fewer and fewer hardcover debuts. There is virtually no existing audience for that writer. So a great review could come through, and you could break even on the hardcover from institutional sales to libraries, but 500 human being have read that book, and when the next one comes you, you’ve 500 fans, not 5,000.

So, Sharpe sold 25,000 trade paper original copies of Sleeping Father. That creates a fan base, allowing us to achieve a reasonable level of sales to consumers, while grabbing more margin. But that book will REALLY sell when Harcourt does it in paperback some time next Spring.

Alain Mabanckou. Well, it would be lovely to grab some high-margin hardcover love given the costs of translation, but African Psycho wasn’t that widely reviewed. Borders took 1,200 in paperback. In hardcover, they might have taken…100. Or none. Who is Mabanckou? Why shell out $25? The hand-sellers at the independents just don’t try to hand-sell hardcovers very often. Paul Ingram at Prairie Lights is a huge Lydia Millet fan but he only sold a few Oh Pure and Radiant Hearts, while he’s selling 5, 6 copies of My Happy Life a week!

So that’s the crude story.

Now, I happen to think that it would be rather good if we could engage in a far more sophisticated level of price discrimination, much like the airlines do. Signed limited edition for one price ($100), regular hardcover at another (maybe as a subscription), high-end trade paperback (maybe with flaps) at another ($16, $17?), cheap borderline mass market on 35 lb. paper at another ($9, $10), and electronic at yet another ($5, or also as a subscription). There are so many levels at which a given person might be willing to commit to a book, I feel it behooves us to try to get more of the the dollars that lie below that Economics 101 price elasticity curve. That would sound crass in a business where we’re minting money, but that’s hardly the case in publishing! Plus, it gets more readers.

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MARK SARVAS’s first novel, Harry, Revised will be published by Bloomsbury Books in May, 2008

Q: Is your first novel going to be published in the traditional hardcover-first/paperback-later arrangement, or will it be a paperback original?

Mark: Harry, Revised was sold in a standard “hard/soft” deal with the hardcover presently scheduled for a May 2008 release. Not sure when the paperback would follow but I’m sure it’s noted in my contract somewhere.

Q: Can you fill us in on how this decision was reached, and on the part you played in making this decision?

Mark: I fear my answer isn’t going to be very illuminating. The offer was negotiated between my agent and my editor and I played zero role in the process, other than gratefully accepting the offer Bloomsbury was kind enough to make. I suspect – and this is only a guess because, to be honest, I know a good deal less about how all this works than people assume and so I’m wary of opining without all the facts – that it only becomes a discussion factor with the author if a paperback original were to constitute the publishing house’s entire offer. Then, I expect, there would be a back and forth on whether to accept that we didn’t have to have. (Surely, there are exceptions to this, though, witness the whole recent Sherman Alexie/Rocky Mountain Post affair).

Q: As a soon-to-be first novelist, do you feel concerned by and involved with decisions regarding the packaging and pricing of your book?

Mark: I suppose I’d need to know what you mean by “packaging” but if we if we agree to define that as encompassing all the various marketing decisions from cover design to publicity to everything in between, then no, I’m not concerned. I have a spectacular, top flight, experienced agent in Simon Lipskar and the truth is I trust him implicitly to guide me through the thicket. And the folks at Bloomsbury have been terrific and enthusiastic. So, no, no concern because I know I’m in good hands.

As for involvement, well, I certainly hope I’m going to be involved and I expect that I will be within reason. But this is the first time and I’m not entirely sure what lies in store, although I know that Simon will prepare me as each critical path item comes my way, and he’ll make sure that I’m involved where I need to be, and mercifully removed from the things that I have no control over.

Q: Where do you stand on the larger debate over whether or not our literary book publishers need to reconsider their packaging/pricing practices?

Mark: I’m not sure, Levi. The honest answer is that I hadn’t much considered it before you brought it up. To be honest, I don’t feel much outrage when I see twenty-five dollar books — a night out at the movies with my wife costs me more than that (nearly double if I hit the concessions — Have you seen the price of popcorn? Now THERE’S an outrage). Given the lasting value the experience of a great novel imparts (and the fact that you get to, you know, keep it on your shelf forever) versus the dismayingly ephemeral effects of most movies today, well, novels look like more and more of a bargain to me.

I think there are a few things to consider that I hope your subsequent interviewees will take up, that I’m not qualified to expound on, because my answer would depend on understanding more about the business decisions that drive these models. For example, I imagine that the risk is probably lower (so perhaps chances can be taken) but I also imagine that you’d need sell more paperbacks than hardcovers to recoup your costs – the margins are probably quite different. And publishing is a business. Still, it’s worth considering the success of Home Land whi
ch did quite well as a paperback original when it couldn’t find any other takers. And I understand that a book like The Nimrod Flipout has also performed better than expected. I think perhaps one factor worth considering is the audience — if you have a book that skews younger, for example, you might be more likely to get a twenty-something to experiment for twelve bucks than for thirty.

I also think a question that is worth asking has to do with writer’s egos. There’s an undeniable cachet in a hardcover book and, whether or not a paperback might potentially sell more copies, I wonder how many writers would be comfortable going that way, wouldn’t feel somehow diminished. I suppose if I’m wholly honest, I can say I would probably have been disappointed if my debut had been a paperback original. But that’s ego and nothing more and, in fact, it could represent a great business call. I’d need to defer to the experts on that one.

Which is exactly what I’m going to do.

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SCOTT HOFFMAN is a literary agent and one of the founding partners of Folio Literary Management.

Q: When you are representing a novel, do you typically play a key role in determining the publishing format (paperback original or hardcover) and/or basic pricing strategy for the novel? If so, can you please describe what factors come into play when making this determination? And, could you share your thoughts about the effectiveness of hardcover or trade paper publishing for literary fiction?

Scott: Apart from determining which publisher is most appropriate for a client’s work and negotiating an advance, the decision as to the format of a novel is one of the most important ones a literary agent can make.

In the distant past, the choice was easy, particularly for literary fiction — if a book didn’t come out in hardcover, it wouldn’t get review attention from trade publications or the national media. If it didn’t get review attention, it wouldn’t sell. And with a plurality of copies of literary fiction selling through independent bookstores, buyers were less price conscious, and more likely to take a chance on a new author who was recommended by a trusted bookseller.

From a market standpoint, the decision was clear: new literary authors had to be launched in hardcover to have any chance of making the big-time. All of this was fine with agents and authors; after all, the royalty on a hardcover book is three to four times larger than the royalty on a paperback.

As the retail environment changed, however, the calculus also changed. With the demise of the independent bookstore and handselling, and the rise of Borders, Barnes and Noble and Amazon, the landscape shifted. In recent years, dramatically cost-conscious retailers — in particular Wal-Mart, Sam’s Club, and Target — have become more and more important sales outlets, and have changed the way agents, authors, and publishers view the issue of hardcover vs. trade paperback originals.

My most recent experience with this dynamic came last year in connection with a book I sold in 2005 for one of my first time authors, Pam Jenoff. Pam had written a fabulous novel called The Kommandant’s Girl, which I had marketed to publishers as literary fiction.

We had originally planned for hardcover publication of The Kommandant’s Girl in October of 2006. Everything was on track for an auspicious debut — a starred Publisher’s Weekly review generated a fair amount of buzz, the publisher’s sales force was extremely enthusiastic, and we were planning on shipping close to 15,000 copies. Not at all a bad number for debut literary fiction.

In August, however, I got a call from Pam’s publisher, letting me know that they were considering publishing the book as an original trade paperback in the United States. (We had already planned it as a trade original in the UK, where the literary audience and reviewers are much more comfortable with the idea of first novels coming out in a format other than hardcover.)

When I asked what had changed, the publisher told me that while B&N, Borders, and Amazon were enthusiastic about the book as a hardcover (in fact, B& made the novel their online book club pick in March), but that Wal-Mart and Target also wanted to stock the book but would only take copies in trade paperback format.

This makes sense; casual book buyers-the type who buy their books outside of book stores-are much less likely to take a chance on an author they’ve never heard of if her book costs $24.95 than if it costs $14.95.

For us to accede to the format change, however, the publisher had to make a fairly compelling economic case, since the format change would have delayed the book’s publication by about six months.

They did.

While we would have been able to ship 15,000 copies of the hardcover, we were able to get out more than 40,000 of the trade paperback original. Once the accounts saw what the finished books looked like, they ordered another 10,000 more. And while there’s no hard-and-fast relationship between the number of books shipped and the number of books sold, there’s a definite correlation.

The decision turned out to be the correct one; The Kommandant’s Girl has gone back to press multiple times, and has become an international bestseller. Pam now has a devoted following of tens of thousands of readers waiting to buy her next book, The Diplomat’s Wife, when it hits the shelves.

In the long term, the strategy is to build up Pam’s fan base to the point where we start publishing her in hardcover; many of those book buyers who weren’t willing to spend $25 on an author they’ve never heard of will have no compunction doing so for an author whose work they adore. Publishing as a trade original was clearly the right choice for this book.

Outside of literary fiction, the landscape is quite different. In the worlds of mystery, science fiction, fantasy, and romance, the demand for hardcover books from unknown authors is so small as to be virtually nonexistent. Almost all new authors in genre fiction are launched in trade or mass market format at present. Only after an author develops a following do publishers even consider putting his or her work out in hardcover.

(The Kommandant’s Girl itself does a good job of straddling the line between literary and genre; while many readers, myself included, think the characterization and prose put it firmly in the literary category, the fact that a romantic relationship between a man and woman is at the centerpiece of the novel causes many to call it a romance. For Pam’s take on this issue, you can read her guest blog entry at Booksquare.)

There are some areas of publishing in which trade paperback originals clearly aren’t a good idea. In the world of nonfiction business books, for instance, the audience is much less price-conscious. Publishing a big business book as a paperback original would be leaving a significant amount of money on the table for both publisher and author.

But when it comes to fiction — particularly debut literary fiction — the benefits of building a broad fan base for an author often outweigh the drawbacks.

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After three responses, it’s clear how complex and multi-faceted all these issues are. Let’s keep the discussion moving forward with responses from three more industry professionals on Wednesday. Soon after, I’ll be inviting a panel of critics, bloggers and readers to help summarize and evaluate our findings. So please keep checking the project landing page for updates. And, if you wish, please contribute your own responses to these questions below.

7 Responses

  1. Question for Scott HoffmanI’m
    Question for Scott Hoffman

    I’m curious as to how it works when stores return unsold books – I believe the term I’m looking for is “remaindering” – do they pay for the books up front and then you have to pay for the ones they don’t sell? I’ve heard that in some cases, those books are simply moved to other markets, like “outlet” or special discount stores. How does all that work?

  2. Bill, I believe
    Bill, I believe “remaindering” is a big part of this whole formula, and I really hope somebody familiar with how this process works can help us understand it as part of this discussion soon …

  3. Selling In, Selling OutI
    Selling In, Selling Out

    I think Levi’s original point was that readers are missing out on great literature due to pricing. And while many publishers and literary agents steadfastly claim that a love of great literature forms the basis of their work, this point was somehow left out.

    I still believe Richard Nash and Scott Hoffman when they talk about their deep feelings for literature, and I’d like them to have the opportunity to add that on to this discussion of profit margins and bottom lines.

    Imagine if all writers took the former stance first – “ah, I’ve written something very fine, but now to change it all to make it more saleable, more market-specific, more trendy. Ah yes, now for the re-write.”

    Is that really what this discussion is all about?

  4. not actually
    not actually hardcovers

    Something which is rarely mentioned in this debate is that the “hardcover” books in question are not actually hardcovers- they are simply paperbacks with cardboard glued on. They have the same glued bindings as a paperback and fall apart nearly as quickly. The wikipedia article on bookbinding defines this type of binding as “cardboard article.”

    Nice hardcover books, for example from Everyman’s Library or Library of America, may cost more than a paperback but you are getting a much better book. $27 for a glue-bound “hardcover” compared to $15 for the paperback rarely seems worth it.

  5. Debut authors in
    Debut authors in hardcover

    Scott comments that a genre author needs to establish a following before a publisher will print them in hardcover. I understand this isn’t a hard and fast rule, but what are the risks when a publisher runs a hardcover print run of 200K with a debut author like Chelsea Cain and HEARTSICK? What factors would prompt this decision?

  6. But Cain isn’t really a debut
    But Cain isn’t really a debut author since she’s already published three or four books. Doesn’t she have a pretty big following because of that Nancy Drew book?

  7. UK PricingPart of the greater
    UK Pricing

    Part of the greater acceptance of Trade Paper originals here in the UK may well be attributable to the dysfunctional pricing in our own market. The pricing in the hardback sector can safely be described as insane with average hardback prices hovering just below the $40 mark and regularly coming in at nearly twice their US equivalent. The UK edition of On The Road: The Original Scroll has a cover price of 25 Uk pounds (approx $50) compared to $25.95 in the US. These prices are set with the expectation of deep discounting by the chain and others, while independents are increasingly left out in the cold.

    Paperback prices are much more closely matched. US paperbacks, if anything, are more expensive but superior in quality, so that I will go to the trouble of ordering a US paperback over its UK equivalent and I know book sellers who do the same. This is a particular problem with back catalogue books and classics — some I have seen recently have had such poor print quality that they are barely readable.

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