Earnings From Traditional v. Indie-Published Books

I get a lot of questions about whether a writer can earn more with a traditional publishing deal or by publishing indie.

That depends on a lot of factors, as I wrote about in Do You Need A Publisher, Part 3: Money, but this week a great opportunity presented itself for a concrete comparison.

On the Sell More Books show Jim Kukral talked about his book contract with traditional publisher Wiley and posted a link to it in the show notes.

The contract was for his non-fiction book Attention! This Book Will Make You Money: How to Use Attention-Getting Online Marketing to Increase Your Revenue, but the terms are similar to contracts for fiction.

For comparison, I'll share the 2017 numbers for the third book in my Awakening series, The Conflagration. I published it in May 2016, so it's fairly recent and was available all of 2017.

While I'll talk about my personal impressions of Jim's contract and views, this article is not legal or financial advice. If you need legal or financial advice, you should consult a professional about your own particular situation.

The Traditional Publishing Contract

In the contract, the publisher agrees to pay a $15,000 advance against royalties. An advance means that until the advance is earned back through royalties, no additional amounts are paid to the author.

Royalties vary by type of publication and number of copies. 

Mass market paperbacks have a 7.5% royalty. Hardcovers have a 15% royalty for the first 10,000 copies, 17.5% for the next 10,000, and 20% after that.

The royalty is based not on the price the consumer pays but on the publisher's “dollar receipts,” which are defined as the U.S. dollars the publisher earns less any discounts, bad debts, book returns, or other credits.

Even before discounts or returns, the publisher doesn't receive the price the consumer pays but rather receives whatever the retailer (such as Amazon or a local bookstore) pays the publisher.

What does this mean in actual dollars?

Most books don't earn enough to cover the advance, so it's likely that from August 2010, when the hardback was released, through now the $15,000 was the total paid to the author. (For more on the royalty calculations, read on.)

That's an average of about $2,000 per year.

Self-Publishing Dollars

Now to The Conflagration (Book 3 in The Awakening Series) which I published myself.

In 2017, I earned about $2,600.00 in royalties, the bulk of that from e-books, but some from paperback and audiobook. If you multiply that by 7.5 years, about the amount of time Attention! has been out, it looks like I earned more: $19,500.

But I spent money on a cover and on having the book converted to e-book format (something I now do myself on Vellum), and on advertising. Also, though sales of the series have been pretty steady, there's no guarantee The Conflagration will earn the same amount each year.

Taking off $700 the first year for costs and assuming a more conservative $1800 a year to account for a possible drop in sales and future advertising, my total for 7.5 years would be $13,600.

From a pure royalty and cost perspective it's a toss up which approach is better financially, but there are a few other factors to consider.

Beyond The Royalties
  • When the author gets paid

The Kukral/Wiley contract provides an advance on royalties, so even if the dollars came out the same overall, having the first $15,000 up front is better than spread out over 7.5 years.

On the other hand, beyond the first $15,000, the publisher is only required to pay royalties every 6 months, with amounts under $100 held until the next period.

Most platforms through which I published pay 60 days after the royalties are earned and there's no minimum (or a $10 one).

  • Transparency

The publisher sends a statement every six months showing royalties, but many traditionally-published authors have told me it doesn't seem to them the publisher figures match up with their books' ranks or what they believe was sold.

The sales figures I see are almost in real time or at most a day or two behind.

Occasionally there are system glitches, but I more or less feel I've got a pretty good sense that what I'm getting paid matches actual sales.

  • Marketing And Advertising

In the Attention! contract, the publisher has the right to both set the price of the book and market or advertise it as it deems appropriate.

Most traditionally-published authors find that they must do most of the marketing themselves, just as I do, yet they are unable to offer limited price discounts that might jumpstart sales the way that indie-authors can. (I had my best sales numbers ever for The Awakening Series and doubled my earnings when I made the e-book editions of the first book free, yet that's not something you'll see a traditional publisher doing.)

On the other hand, for those books the traditional publishers truly get behind, such as The Girl On The Train, it's hard to argue the author would have been better off being able to discount.

  • Future Sales

This factor is where it gets interesting.

Jim Kukral is on a quest to get his rights to his book back, suggesting he's not expecting a lot of future sales and believes he can do more with it than the publisher can or will.

As an indie, I keep all the rights and, as noted, I can try whatever marketing and advertising I like. Unlike traditionally-published books that publishers usually ignore after the initial sales push, I'll keep promoting the series.

While there's no guarantee The Conflagration will continue to earn as it has, there's also a decent possibility it could or might earn more.

Why?

For each e-book I sell at $3.99, my royalty averages $2.60.

In contrast, traditional publishers typically focus on paperback, not e-book. Under the Wiley/Kukral contract, the trade paperback royalty for the first 10,000 copies is 10% of what the publisher receives.

So if the retail price is $9.99 and the publisher gets $6.99 from the bookstore, that's $0.69 per book.

Not only are the earnings for the indie author nearly $2.00 more per sale, it's easier for a relatively unknown author to sell an e-book at $3.99 than a paperback at $9.99.

  • Long-term v. Short-term

The clearest conclusion here is that, for most authors, publishing is a long-term effort.

Because of that, if you have one book on a topic about which you care deeply, if you can get a traditional deal, from a financial perspective it might be the better way to go.

You'd get money up front and be free to move on and focus on other things in life.

On the other hand, if you don't absolutely need the money up front, you might rather retain control so you can keep promoting your book and getting it into other people's hands from now through infinity.

A Career v. A Book

If you hope to make a career at writing, there are no easy answers.

When I looked at the numbers, realizing it would take 7.5 years for one of my books to earn what Jim was paid up front for Attention! was a little discouraging.

But I reminded myself that I never expected to earn a living with one book, which is why I've published a four-book supernatural thriller series, am launching a new mystery series this year, and also publish non-fiction.

Right now, I have many streams of income that range from minimal (my first $2.55 from a Kobo subscription service just this month) to smallish (about $9,000 from Amazon last year).

Also, last year my writing gross income was about double the previous year. If I could do that every year for the next five years, I'd be turning cartwheels. Even every other year would reach six figures in six years.

I hope this comparison was useful.

We all owe Jim Kukral a debt for sharing his contract. If you get a chance, check out Attention! This Book Will Make You Money: How to Use Attention-Getting Online Marketing to Increase Your Revenue.

Until next Friday–

L.M. Lilly

Using Discovery To Make Your Novel More Layered (And To Write It Faster)

I’m a planner when it comes to novel writing — no surprise if you’ve read Super Simple Story Structure.

Once I have my overall plot in mind, I first draft pretty quickly. But finishing a novel always takes longer than I expect.

I think I finally know why.

I tend to forget about the time and effort needed to go from the initial idea for a novel to figuring out the plot.

There’s a name for this phase of writing a novel (or other type of story).

It’s called discovery. Until recently, I was mostly unaware I was doing it, so I failed to set aside enough time for it.

What Is Discovery?

I first heard the term “the discovery phase of writing” a year or two ago. I had a bad reaction to it because in law, discovery is a process that can be drawn out, frustrating, and stressful.

In litigation, discovery means asking the other side to give you information about its case and evidence. Attorneys argue a lot about what needs to be handed over to the other side.

That type of conflict is only fun for people who like to argue and make life difficult for everyone. (Not all attorneys like that! Seriously.)

In fiction, the discovery process is much more fun because you’re finding out about and expanding your characters, settings, themes, and story.

When I was practicing law full-time, I didn’t realize I was engaging in discovery for my fiction because it happened in odd moments.

At court while waiting for my case to be called I'd scribble notes about my character on a legal pad. Later, standing in line at a Corner Bakery, I might look at the people around me and imagine what they were thinking.

I thought of what I was doing as “daydreaming.” It didn’t seem like part of the writing process. It was a way to entertain myself when I was bored.

It also was a way to feel I was making progress on my novel despite having little time to put words on the page.

What I didn’t realize was it wasn’t just an illusion to make myself feel better. I really was making progress on my novel.

How To Do Discovery

Now that I’m devoting most of my time to writing, the discovery process is more purposeful and I’m more aware of it.

Some things you might do in discovery:

  • Read Non-Fiction

This reading is different from research on specific topics. It's about big picture topics and themes that might or might not help generate more ideas or prompt turns and twists in your story.

For my second mystery in my new series, I've been reading websites aimed at immigrants to the U.S. from various countries and paying attention to newspaper articles about immigration. A missing woman in the book is an immigrant who overstayed her student visa.

(For more on the creative pluses of reading rather than watching the news, check out Reading The Newspaper Can Spark Ideas For Your Novel.)

I’m also reading books about causes of death (the photo at the top of this article is from a recent trip to the library).

  • Images

Before so many images were available on the Internet I used to page through magazines and tear out photos of people who either looked like my characters or whom I found striking for one reason or another.

On the right is a photo of a magazine page that inspired the character of Erik Holmes, a wealthy CEO with an obsession about the end of the world and obscure religious cults in my Awakening series.

I also saved photos of outdoor and indoor scenes that evoked strong feelings.

Now I do the same thing but online through sites like Instagram and Pinterest. These sites also allow me to post and organize photos I take that relate somehow to my novels.

  • Documentaries

Watching documentaries is also great for prompting ideas and scenes.

Though I had no plan of including snake handling in my Awakening series, I happened to see a documentary on it. It solved an issue I had, which was how to put my protagonist in great danger without it being clear who was behind it. I chose a setting where snake handling was still practiced and plunged her into an underground cavern filled with rattlesnakes.

  • Music

Many writers create collections of songs that fit their stories or characters.

It doesn’t mean that these songs would need to be played as a soundtrack if your book were a movie, though you can create a soundtrack if you like. But they are songs that suit a particular mood or character.

Choosing them helps figure out how the characters feel and what's happening in their lives.

Free Writing/Talking

I like to scribble in a notebook or on scratch paper, or type quickly into a document, random thoughts about my story and characters. Often I never look at these notes again.

The thoughts might or might not be directly related to the story. It's a way to hang out with my characters or explore how possible twists and turns might affect them.

Sometimes rather than writing, I pace and talk.

Attending Events

Concerts, art exhibits, garden or city walks, sporting events, and just about anything you attend that stimulates your mind and helps you relax can also be part of the discovery process. All trigger emotions and set your mind free to wander.

It doesn't matter if you love the event of not. Some of my best ideas for characters and plot developments came to me while sitting through a concert that bored me nearly to tears.

Why Do It

Embracing the discovery process can save you a lot of time later.

With my first mystery I had what I thought was a pretty solid first third of the book finished and a rough draft of the rest.

To my surprise, when I sent it to my story editor, her main response was that the mechanics of the plot seemed fine but, basically, who cares? Why does your main character do what she does and why does it matter to the reader?

Had I allowed myself more time for discovery, I likely would have developed more layered and engaging characters before plotting the book and writing the draft. But I didn't, so my rewriting process took three or four times as long as I'd expected.

Taking time to read and daydream and look at photos (or anything else from the above list) pushes me to really get to know my characters and consider different plot turns and twists I might have otherwise overlooked.

Though “push” is really the wrong word.

When I let myself spend time in discovery I don’t feel pushed at all. Instead, I feel relaxed and happy to be spending time with my characters in a place that isn’t about hitting word counts.

It reminds me of how I feel when I’m reading a novel I really love. It’s as if I am living in another world that’s amazing, fascinating, and heart wrenching.

If that’s the experience I want my readers to have, and it is, I need to be able to go there myself first.

I started this purposeful discovery process about two weeks ago for my second mystery novel (working title The Charming Man).

I’ve been shifting between creating a rough outline and doing more reading, meandering, and discovering. We’ll see if overall this results in less rewriting than I did for the first one.

That’s all for now.

Until next Friday —

L. M. Lilly

P.S. For help on developing your characters, you can download my Free Character Creation Tip Sheet.

3 Ways To Create And Distribute Your Audiobook

One of my goals this year is to release my non-fiction books on writing in audiobook editions.

I created and released my Awakening Series through ACX, an Amazon-related company. I used the royalty-share option, which means all four books are exclusive to ACX for 7 years, and I split a 40% royalty for each book with the narrator/producer.

Now I feel less sure about committing to 7 years with my audiobooks distributed only through ACX.

Audiobooks are growing in popularity due in part to how many people now have devices like the Amazon Echo that will play audiobooks at home. Also, more vehicles now incorporate technology that will play books and other content.

These changes mean more potential income from audiobooks, so I see a greater possible downside to an exclusive deal.

Below is what I learned based on reviewing the websites of three companies:

A few things to keep in mind (a/k/a disclaimers):

  • I've only worked through ACX before, and I have no direct experience with the other two.
  • You should read the sites and information yourself, as I'm not perfect (though I wish I were!). Also, I've focused on what's most relevant to me. You may have other interests or concerns.
  • The narrator typically produces the audiobook. When I refer to “narrator” below, I mean a narrator/producer.
  • When I refer to “author” below, I'm assuming you as the author hold the rights to your own book. Most of the information below technically refers to the “rights holder,” not the author.
Producing/Creating The Audiobook

Author's Republic is a distributor, so it helps you distribute an audiobook that's already produced.

But if you don't already have a finished audiobook, and most of us don't, its website offers a lot of information on how to produce an audiobook, as well as resources to find producers and narrators.

Author's Republic's website indicates it accepts audiobook submissions from authors and publishers in all countries.

Findaway Voices will help you produce your audiobook.

You can work with a narrator you suggest, if the narrator is willing, or Findaway Voices will help you find a narrator. Findaway Voices is also available to authors and publishers in all countries.

ACX provides an exchange through which you can find a narrator. The narrator produces and uploads the audio.

Note, however, that on one of its help pages, ACX indicates it is only “currently open to residents of the United States, United Kingdom, Canada or Ireland who have a mailing address, valid local Taxpayer Identification Number (TIN), and banking details for” one of those countries.

Paying For Your Audiobook Production

There are three ways to pay a producer/narrator to create your audiobook:

  1. Paying the narrator up front
  2. Sharing royalties when the book sells, or
  3. A hybrid deal of the first two options

Because Author's Republic is a distributor, the cost will depend upon what deal you work out with your narrator or producer. 

If you pay up front rather than by sharing royalties, you typically pay a narrator per finished hour of the audiobook. 9,000 words of text usually comes out to one hour of finished audio. (For more on costs generally see The Cost To Create An Audiobook Edition Of Your Book.)

If you produce and narrate yourself, you obviously won't need to pay a narrator, but you will need to pay for recording time and expertise if you don't have your own studio and lack production skills.

When working through Findaway Voices, the author pays the narrator/producer up front per finished hour.

Findaway Voices says the range is typically $150-$400 per finished hour of audio.

Further, according to the site, “Findaway Voices charges a $49.00 fee to cover project management and ongoing administration.”

On ACX, you can pay your narrator through a royalty share, by paying up front per finished hour, or through a hybrid of the two.

ACX also offers narrators (not authors) a stipend–an additional payment above the royalty share–to produce certain books. Presumably these audiobooks are ones that ACX believes will sell well enough to earn back the stipend and then some.

How You Earn Money

The Author's Republic website says the author receives 70% of what the “audiobook earns across over 30 channels, including all major distributors such as Audible, Audiobooks.com, and iTunes.”

My understanding of this term as to Audible, for instance, is you as the author would get 70% of whatever Audible would pay the author. So if on an Audible book created through ACX you'd get 25% of the retail price for a non-exclusive deal,  you’d be getting 70% of that 25%.

Through Findaway Voices, the author keeps “80% of all royalties Findaway Voices receives, which varies by distribution partner, channel, and business model.”

Findaway Voices indicates royalties from its partners vary, but are usually within the range of 25% to 50% of the list prices.

Through ACX, if you (1) do a royalty-share deal with your narrator and (2) your audiobook is exclusively distributed through ACX, you'll be paid 20% of the retail price (another 20% goes to the narrator).

If you (1) paid the  producer up front and (2) your audiobook is exclusively distributed through ACX, you earn 40% of the retail sales price.

If you (1) paid the  producer up front and (2) your deal is non-exclusive, meaning other companies can distribute your audiobook, you earn 25% of the retail sales price.

ACX also offers a $50 bounty (to be split with the narrator if you have a royalty-share deal) if yours is first audiobook an Audible Listener purchases.

Who Sets The Retail Price

For Author's Republic and Findaway Voices the author sets the retail price (though there's no guarantee all distributors will agree to sell the book if you set the price too low or too high).

Being able to set your own price can be an advantage because if you have control, you can run and promote sales or adjust your regular price based on the length of the book or how well it's selling (or not).

On ACX, ACX sets the price, and that price may vary over time depending upon several factors, including whether the buyer already owns your ebook and whether the book is bought with an Audible credit.

Exclusivity

If your audiobook is exclusive, it means you can only distribute it through that company.

Author's Republic: No exclusivity requirement.

Findaway Voices: No exclusivity requirement.

ACX: Your choice.

If you do an exclusive deal with ACX, right now you'll earn 40% (split with the narrator if you do a royalty share deal).

If you choose a non-exclusive deal, you'll earn 25% (but will need to pay your narrator up front).

If you have an exclusive deal, you agree that for 7 years your audiobook will only be distributed through Audible. (If non-exclusive, you still need to keep the book on Audible for 7 years, but you can distribute it through other companies.)

Distribution

Author's Republic states it allows you to sell “your audiobook through over 30 major retailers, library providers and distributors, with new channels added monthly.”

According to its website, Findaway Voices has “the world's largest distribution network — reaching customers in more than 170 countries.” 

ACX distributes through Audible, Amazon, and iTunes.

It'll be fascinating to see how the audiobook world changes over the next few years. At the moment, I'm leaning toward using ACX again but choosing a non-exclusive deal. While that means paying a narrator up front and potentially earning less, I like the flexibility to try distributing through additional channels.

If you have experience with any of the audiobook companies, please share in the comments.

Until next Friday, when I'll write about Using Discovery To Make Your Novel More Layered (And To Write It Faster)

L.M. Lilly

P.S. Producer/narrator Shiromi Arserio (who narrated Books 2-4 in my Awakening Series) tells me Spoken Realms is another audiobook production option. I have not yet had a chance to research that company, but it's another one you can check out, particularly if you live in a country where ACX is not an option.

Create Your Own BookBub

It's hard to find an image of e-newsletters.

As I noted in The Worst Ways To Spend Money On Book Promotion and Experimenting With First In Series Free the best e-newsletter I’ve found for generating sales of ebooks is a featured deal on BookBub (which often boosts audiobook sales as well).

It has a huge subscriber list and is very selective about the books it lists as featured deals.

BookBub, though, rejects most applications for featured deals, so that's not always an option.

If you can’t get a BookBub deal when you want one (or at all) I found the next most effective technique is to schedule a series of ads in similar e-newsletters around the same time.

Cost vs. Benefit Comparison

For Supernatural Suspense, the genre in which I usually advertise Book 1 in my Awakening Series, BookBub charges $224 to advertise the book as a featured deal if the book is free.

My other ebooks in the series are priced at $3.99, and I make an average royalty of $2.65 for each sale. That means I need to sell at least 84 ebooks to break even.

The last time I had a BookBub deal like that, on the first day I sold 140 ebooks (of later books in the series) and 231 audiobooks.

That means on the first day I earned money on the BookBub even if you assume 20% or 30% of the sales would have happened without it. (That’s why BookBub is able to charge so much.)

Most other e-newsletters haven't made back the money the first day and some don't earn back the dollars spent at all. The best ones usually generate enough sales, though, that over the following 1-3 weeks I come out ahead.

This February I’m running a series of 5 e-newsletter ads. The total cost is $170.

At that price, I need to sell 65 ebooks to break even. I’m hopeful that will happen within the first couple days and that I will see increased sales for at least a month or two afterwards. (I’ll do results post a few weeks after the last listing runs.)

Making The Submission Process Easier

Scheduling multiple e-newsletter ads means filling out multiple forms, which is time-consuming.

To make this process simpler, I keep a list of product links and product ID numbers (such as the Amazon ASIN) that I can easily copy and paste into the forms. The ID numbers matter because some forms ask for those numbers rather than product links.

Here’s how my list for The Awakening looks:

I also keep a variety of descriptions saved.

That's because some e-newsletters ask for longer descriptions, others limit you to 50 words or a certain number of characters. In addition, you may want to appeal to slightly different audiences, as not all e-newsletters will offer the same genres.

Below are a few of my descriptions for The Awakening, which are all a lot shorter than what appears on its product pages on sites like Kobo:

Though you'll use them over and over, be sure to review the descriptions before you submit them each time.

You’ll catch typos you may have missed before. Also, once in a while I have come up with much improved ways to describe my story or my characters.

Tracking Your Schedule And Results

It’s important to track which e-newsletters you scheduled, how much each one cost, when each listing will run, and what genre you chose. You may think you’ll remember all of this, but when the dates roll around you probably won’t.

I use an Excel spreadsheet.

Once the ads run, I also keep track of how many free downloads and sales I have of each book each day by platform. That’s how I’m able to determine later which e-newsletters are most effective for my books and for particular sites. (For example, some are more apt to generate Kobo or Nook sales than others.)

While you can research the results that other authors get, what works best for your books will not necessarily be the same.

There are e-newsletters that other authors rave about that generate few sales for my Awakening Series. Similarly, I’ve had great results with e-newsletters that others find to be a waste of money.

Paying For The Ads

I personally like to pay with PayPal. That way I’m not giving my card number to an online vendor.

Even if I trust an e-newsletter, I find PayPal quicker and easier. I don’t need to reenter my credit card information and I can easily sign on and look at my payment history. (You can also input your credit card into PayPal if you prefer that to having money withdrawn from your checking account.)

As always, though, you should do your own due diligence regarding which sites you trust or don’t, including Paypal.

Before You Start

Before you spend anything on advertising, though, you should make sure you have a strong cover that fits your genre, a solid sales blurb, and good opening pages, as readers often check those before buying.

If you’re missing any of those things, you will probably be throwing advertising dollars away.

If you think you have all those elements but haven’t tried advertising in e-newsletters yet, try one or two of the less expensive ones. If the results are pretty good, then try scheduling a batch of ads.

It's also important to try e-newsletters one at a time first so you can get a better sense of which ones work best for your books.

Keep in mind also that e-newsletter advertising is most cost-effective when you have at least three books to sell.

If you only have one or two, you may still want to advertise, but it’s less likely to pay for itself even in the long run. (What it can do is help you get some initial sales so that people start reviewing your book. You also may want to include incentives for readers to sign up to your email list within your book.)

If you try scheduling a batch of ads, good luck, and please let me know how it goes!

Until next Friday, when I'll write about 3 Ways To Create And Distribute Your Audiobook

L.M. Lilly
 P.S. If you want to increase your chances of getting a BookBub featured deal, check out this Kobo Writing Life Podcast episode interviewing Carlyn Robertson of BookBub about exactly that.