Wednesday, May 16, 2012

Ads in eBooks

Ads in Ebooks
By Scott Nicholson
(Originally posted at Murderati)

I’ve gotten out of the “writer babble” business for two reasons: (1) I don’t know as much as I thought I did, and (2) it’s all changing so fast that even the boldest predictions of digital evolution quickly become laughable.

I don’t even use traditional publishing as a reference point anymore, because that is so far removed from most writers’ realities that it may as well be Shangri-la or Hollywood. The indie vs. trad debate is now only meaningful for a small group of people, and they are all making way more money than you or me.

So you are in it, and if you are lucky, you made a nice little nest egg back when everyone was standing on the sidelines deciding whether indie was the way to go. Hopefully, you shook off the intellectual shackles that chained us to the agent speed-dating sessions at writing conferences and were hammered and locked into place by “publishing experts” with 20-year writing careers in the old system. You know the mantras: “Get an agent,” “Only hacks self-publish,” and “You can’t produce and distribute a book without the advice of publishing experts.” Basically, ego affirmation. Of course the experts didn’t want to lose their position of authority (and in the agents’ case, the intermediary status of being the first in line to get checks.)

But the gate was left open and the horses all got out of the barn, or something like that (come up with your own gatekeeper metaphor; I am writing this for free!) So now we have a market where the 99-cent ebook had a year’s run, and the pool was finally beginning to find stratification (crappy books sinking, good books nailing stable plateaus) when Amazon unleashed the latest version of indie roulette—the free ebook.

I'm on record as predicting the flat-text e-book era has an outside range of five years, at least for fiction—specialized non-fiction and manuals will continue to be valuable for their content alone. I believe e-book sales will continue, but certainly not with expanding profits for all involved. Now that there are thousands of free Kindle books available every single day, how long before readers come to expect and even demand free books exclusively?

Freebie roulette. Great for readers. Good for Amazon (maybe in the short term, but it is hard to figure the long term). Terrible for authors.

The market is diverse enough to support many different price tiers, but writers who want to survive in 2015 will need to make money off of free books, or they will soon quit writing.

I only see one outcome: ad-supported or sponsored books. At first blush, you'd think N.Y. has an advantage, since Madison Avenue is right there. But can corporations, with their large structures, be able to compete when indie or smaller entities can react more quickly to present conditions instead of protecting some imagined status quo?

J.K. Rowling can inspire a Pottermore built around her brand, and James Patterson, Tom Clancy, and Clive Cussler have already built factories around their names (and, yes, V.C. Andrews, you can roll over in your grave two or three more times for all I care, because this is all your fault). But most of us are not factories or we wouldn’t have to indie publish.

This points out the new era of the branded writer. And not just "writer," but "content creator" and even mere "idea marketer." A personality is more suited to building brand identification and audience than a publisher is. I say "James Patterson" and you get an image. I say "Random House" and what do you get? Randomness. We've seen it here locally: "Ray's Weather" is where you check the weather and "Todd's Calendar" is where you click to find what's happening in the region—and both are ad supported. You can get the free content elsewhere but you don't get the human personality attached.

I'm already experimenting with the ad model because I believe it is viable. I am counting on Idea Marketing being one of my foundational pillars. I am not quite sure what it all looks like right now, but I look at it this way—you don't need NY in order to give away tons of free e-books or to spread an idea or to build a social platform. You are the idea you want to spread.

Other authors will say “I’ll never sell out.” (Ironically, those are usually the authors who have given most of their incomes to agents and publishers…) I don't blame people for sticking with what worked in the past. It all goes to how invested you are in a certain system and how the alternative looks, and, of course, the turf where you’ve staked out your ego. Publishing-industry talk on e-books uses phrases like "managing risk" and "cautious adaptation." That is why those of us in the trenches knew Barnes & Noble was in serious trouble when most in the “publishing industry” only realized it recently when BN’s horrifyingly bad third-quarter reports came in. They are working off of old data while I work off the data I got an hour ago.

And my data says this may be the very peak of the Golden Age of digital publishing. The $9.99 novel may be dead this year, since three-quarters of the current bestsellers are low-priced indie books. As fast as major publishers yank their name-brand authors out of digital libraries, 10 new indies cram into that virtual shelf space. Maybe forever. James Patterson’s factory can’t run on $2.99 ebooks, but mine can.

But what happens when the $2.99 and 99 cents drop to permanently free? Where’s your sponsor? Are you willing to go there? It's not going to be as clumsy as an image of a refreshing Bud Lite popping up when the main character enters a bar (though it's not unthinkable at some point.) Can you see Jack Reacher with a favorite brand of soft drink, or Bella Swan wearing only Calvin Klein? At what point is your willing suspension of disbelief shattered? At what point do you realize the ad is the only reason the book can exist at all?

My informal polling on ad-supported ebooks yields statements like: "I'll quit reading before I put up with that." I also remember saying I'd never carry a cell phone, or be on Facebook, or give up my vinyl albums, or start thinking that maybe nuclear energy is the best short-range answer to our energy addiction. Or that I’d ever read an entire book on a screen.

I don’t know the answer, but I am deeply invested in the question. So, ads in ebooks. As readers and writers, what is your opinion?


James Roy Daley said...

Smart post, Scott. I've been trying to fight a decline in sales for the past 6 months now. I'm not sure how to stop it...

James Roy Daley said...

Now that I've had a chance to think about it, some of what you are saying I touched upon here:

Steven Bone said...

I admit that I am a sucker for a free ebook. Why? Exposure to new authors? Nope. That is almost the same excuse as the people who download pirated music and videos make. If that were the truth, would have had an IPO rivaling Facebook instead of being owned by some domain name squatter.

There is simply too much cheap content out there, much of it is at least decent, some that really pops to the top. It turns out that I just really like certain types of stories. Even the genre of stories changes based on my mood. I don't mind testing the waters, especially when the risk is so low. I can toss a book after 50 pages and not feel bad. When I DON'T toss the book and read it through I feel guilty and want to PayPal the author some dough. But man, no one makes it easy to do that. Perhaps that is something to ask Amazon to add when you are done reading a freebie - ask the reader to donate to the author.

This sort of thing was tried before with SK's The Plant. I downloaded each part, read it, and paid my $1. Happily. Easily. Some folks paid several times to make up for those that did not. Idiots. Some read it, liked it, and didn't pay. Also idiots. SK did not continue that experiment and left the story hanging which makes him the biggest idiot of them all. Am I likely to be a repeat customer of this model? Nah.

I did like SK's serial novel that preceded the above experiment. Perhaps you heard of it - The Green Mile. There was a guaranteed finish to that one and it turned out well. Like my freebie ebooks, I can give up at any time with no further obligation, albeit with a small sunk cost. Perhaps this is an interesting model for freebooks - like the crack dealer, the first one is free, man. Have a guaranteed ending so you don't Plant one, but stretch it out longer or shorter based on the demand for the followup books. Amazon doesn't provide (to my knowledge) the ability of an author to do a one time follow-up email to the purchaser. If they did, perhaps this model could hold up so the reader can be notified that the next serial is out.

Ads in a book? Nope. That is like interrupting a Doors song more than twice for hourly newscasts. A commercial at the start and end, sure, but then I don't feel guilty for not paying, knowing that you made exactly 12 cents on that.

My therapist as well as any halfway decent cross-examining lawyer would impeach me as a witness - I have to admit that I followed Iris Johansen's Eve Duncan series to the bitter end, so take what I said with as much salt as you can find. After the light winter here in the northeast its going for cheap.

Author Scott Nicholson said...

Steven, thanks for your comments-- there are many ways the ads can be done that are opt-in, not interrupting the narrative flow. I think it's wide open at this point--exciting opportunities. I do agree with everything you said about The Plant--I think King got scared by his own power and responsibility for some weird reason. He would have earned more on that than any of his other books.

James, I think it is about more than "sales," I think we are reaching the content tipping point Steven described--so much stuff, so little time. How many people have jumped into the ebook game this year, including a lot of people who aren't really even writers?

Jamie D. said...

This is a very interesting I've been mulling for awhile now. I don't generally offer my finished, edited books free anywhere, with the exception of occasional holiday free downloads from my own business site. I do offer nearly all of my initial drafts for free as I write them in serial format on several blogs, and that does seem to attract buyers for my polished work.

But I'd certainly be open to exploring an ad-supported free model...I doubt the main ebook distributors would be happy about that (and I won't give any one retailer exclusivity), but I'd be willing to post free versions of my books in my own digital bookstore for people willing to put up with a few small (2-3 lines max, or a smallish image) ads within (beginning, end, and perhaps a few chapter breaks in the middle). Obviously this would require continued ad support from advertisers to be viable...and I don't really have the sales to entice them, at least not yet. Catch 22, and all that. Although my erotic romance might, if I target the right companies...

Perhaps I should see if I can find a few advertisers who would be willing to let me use their ads for free for a few months, just to test the waters...then if the ad-"supported" downloads seem to catch on, the nominal fee to the advertiser could kick in...

I'll have to think some more on it. Anyone else doing something like that?

Jamie D. said...

Wait a second though...offering my ad-supported versions for free on my own site would violate the Amazon TOS for not selling ebooks less expensively elsewhere, I think. So there's another issue, unless I have that wrong. I'll have to go check the various e-tailer terms again...

Dang it.

Jamie D. said... isn't a sales price. It's no price. So in reading the TOS again, I don't think that could be an issue.

I need more caffeine.

Kate Madison, YA author said...

I think you are right, Scott. It seems to be either ad supported or 'enhanced' ebooks, both of which have room to grow. But I think ad supported would be more readily adopted as we are all used to seeing commercials and product placement hundreds of times in our daily lives.

Just to be clear, you mean like having a company pay the author money for either a product placement (Jane sips her refreshing Coca-Cola as she ponders her love for Dick) or an actual ad separated out but in the middle of the story--like Amazon is doing now with their ad kindle?

As far as enhanced ebooks-- I don't see video catching on but I definitely see a sort of dvd extras type of thing happening like Konrath did with Origin (?) where he includes a previous version of the manuscript. There could also be author interviews (with ourselves!) and outlines, research, and alternate endings included as extras should the would be fan want it. But instead of that extra packed ebook being special, that stuff will be the norm--for a paid ebook, that is.

Scott, you are definitely an innovative thinker with regards to fiction as well as publishing. It always nice to 'hear' your thoughts.


Kate Madison, YA author said...
This comment has been removed by the author.
Author Scott Nicholson said...

Jamie, yes, there are plenty of challenges, including most indies' dependence on a handful of online distributors and their terms of service. And I have no doubt Amazon is heading in this direction themselves. So anyone able to make it work will not be able to depend on other outlets...

Kate, I just don't see much future for enhanced ebooks--once you put so much junk in there, it's something else--and the price of more than $20, people would rather buy a movie or game. Yes, Amazon clearly has the ad mindset in it plans. The way the ads are placed can be as innovative as people can imagine--from straight ads to interactive elements to product placement.

Sharon Stogner said...

I think it's okay if authors want to include ads. It would be a smart marketing decision. I have an ad for my blog in someone's ebook . In return the author has an ad on my site.
Isn't that how newspapers and magazine survive, using ads.

MaryLynn Bast said...

Scott, I am a new author and I actually have a few ads in the back of my first novel. I for one as a reader to glance through the pages of ads at the back of the books to see if there are any books coming out that I might be interested in.
I think this is opening up a ton of opportunities.

Pamela K. Kinney said...

I had a free eBooks for a few years--under my pseudonym, Sapphire Phelan, for paranormal romance. Now I didn't put it in the pdf and the cover done by them, but All Romance eBooks did it. They only ask authors if willing, to give a short story (not a novel). Lets readers knowhow you write and helps me and ARE sells my eBooks that are on their webstore for sale (mainly the publisher, Phaze Books).

I even got my own copy and upload on CDs to hand out at signings and conventions. My eBooks have been selling on ARE and elsewhere and lately, even more so, as my royalties are going up. I don't think any author should give readers a free eBook of their novels or novellas. Yes, use a short story, letting them know how they write. I worked for years in the pastry department of a supermarket and we also gave out samples. If a person didn't know how something tastes, this way they would and nine times out of ten they bought the product. Costco does that and sell alot of the product sampled. Even if I couldn't afford to get it that day, I would come back and buy it later.

There will be those that all they care about is free eBooks. Why for years authors of eBooks have been fighting those forum where their eBooks were put as a download on sites for anyone to download it free. I even seen print books not even out as eBooks then up then, obviously scanned and given away. Most of these come from places like India or China, countries with no understanding of our copyright laws. I am sure that there were Americans doing that too. I have even found my nonfiction ghost books on place like these and they’re not on eBooks and I am not sure whenever Schiffer will do them this way in the foreseeable future.

And I think if an ad is at the end, after the novel, and a company pays that author well for their ad, the author deserves that money. As for the free short story on an eBook, make sure you got paid for it before, so you had made money for it, and post ads to your for sale eBooks at the end, so readers will check them out. Though if a company is willing to pay you a good free to post their ad on one of your free eBooks. . .
It hard to say yay or nay--it's a new world that seems to change everyday with publishing books in any form, whether by publisher or indie.

Author Scott Nicholson said...

Sharon, yes, I have done that myself--I listed a lot of blogs in Creative Spirit that ran posts about the book.

MaryLynn, I used to list other books in mine, but the maintenance became too much because i had to swap the book sout every three months--plus the age of exclusivity reared its head!

pamela, I have given away about three-quarters of a million books, and it hardly cost me anything. That's a lot of free samples! I don;t know if it was the right longterm move but it worked in the short term. But I still have millions of readers whom I haven't reached yet...I don;t look at it as straight dollars and cents.

author Christa Polkinhorn said...

Ads in my ebooks? Why not? As long as they are tasteful and about something I like. My characters seem to drink an inordinate amount of espresso and love red wine. Listen up espresso bean producers and wine merchants!
Good post, Scott!

Lindsay said...

From the stats work Ed Robertson has been doing, I get the feeling Amazon is manipulating things to coerce authors back into selling at 2.99+, so I wonder if we'll actually see fewer free ebooks (at least for sale from Amazon). After all, they don't make anything on free ebooks, and I suspect 99 cents, too, is kind of a wash for them.

That said, I could see advertising in ebooks being viable. I made a good living from a small blogging empire for a while where all my money came from advertising. Giving away the content for free and monetizing it through advertising has been something of a hallmark of the internet age. Though ads in fiction might be a tough sell. They'd most likely have to be ads for other books in the genre or something linked to entertainment.

For myself, I'd be more likely to sell an ad spot or two in my monthly newsletter and throw some sponsored posts onto the blog. It wouldn't involve having to tinker with my ebooks and upload new files every month, and people are already familiar with advertising in newsletters and blogs. I could see a genre-based mailing list of X,XXX or (one day!) XX,XXX readers being an appealing market to reach. I'd drop a small pile to advertise my books on a popular fantasy author's list. Too bad most authors don't bother building one. :P

Lindsay said...

P.S. This guy on Kickstarter just made close to 100,000 from donations for a steampunk book:

That's another possible model for authors. Give away some work for free, build up a fan base, and then use Kickstarter to pay the bills (and maybe a lot more if you're like that guy!).

I did KS myself to fund the production of my audiobooks. I didn't make $100,000, heh, but I did get more than twice what I needed.

Anyway, just musing. Better get back to writing!

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Brenda Wallace said...

For me, it makes it more realistic when my character is drinking a Coke rather than a Cola, anyway, and I already add the brand names as long as it's natural to the story flow. I don't have a problem with that kind of ad placement and I definitely don't have a problem advertising great books by other authors. I know I am grateful to pay for ad placement in wonderful reads.

Author Scott Nicholson said...

Christa, yes, product placement is one of the myriad possibilities!

Lindsay, thanks for that info. Yes, I believe KS has a place, and I want to try it out for a couple of graphic novels I have stuck in midstream, once I can build the tech space to post them for free.

Brenda, detail is important in fiction--I mean, there is a BIG difference between a guy who drinks Bud Lite and a handcrafted Shock Top...

Anonymous said...

Sorry I'm coming late to the game.

Has anyone played around with Wattpad/ScribD/Hubpages as a way of serializing and monetizing their novels? These services seem to take the middle route between some of the channels that have been discussed.

All of them allow you to chunk content, which has advantages in terms of not putting all your writerly eggs in one basket. Hubpages and ScribD also act as the traffic drivers and ad optimizers, taking those burdens (albeit with a slice of revenue, as well) off the author.

Wattpad is a different model, since all content is free...but if we're moving in that direction anyway and that helps build up a fan base that then leads to, say, a Kickstarter fund as Lindsey mentioned or an author ebookstore, maybe THAT is a viable path?