Think Outside the Floppy
I need to tip my hat to the Atomic Robo team, who are coming off a wildly successful Tesladyne Recruitment Drive, a Kickstarter project to fund (but mostly SELL) a whole lot of cool Atomic Robo related merchandise and schwag. The project racked up $135,820 in funding, wildly exceeding their $7,500 goal. By all accounts, it was a textbook Kickstarter campaign, and one to study if you’re looking for a template for how to do a great crowdfunding campaign.
Watching the success the Atomic Robo guys had here, has made me want to discuss a larger point when it comes to building a thriving comics business…and that’s the importance of thinking outside the floppy.
As comic creators, most of us started as fans. And our fandom started with that first comic book — 32 pages of four-color glory, complete with staples! As we move from fan to creator, the first time you see your work in print as a real-live comic book is inevitably a highlight of your budding career…even if it’s only a ten copy print run that you give away to friends and family.
We fetish-ize the floppy, hence the long-boxes we’ve had for 25 years and moved six times since college. So it’s not surprising that once we start making comics ourselves, we think that the main thing we need to do to succeed is simply make and sell a lot of comic books.
And I’d agree with you. In an ideal world, that would make sense. But for the independent comic creator/entrepreneur (not talking to the hobbyists out there…though I have much love for all of you), relying solely or even primarily on the floppy as your main source of revenue, is problematic.
What the Floppy is Good For
Now, don’t get me wrong. I LOVE the floppy. I love the size of the standard American comic book. It’s the perfect length for a short read before settling down for a night’s slumber, or while eating a bologna sandwich on your lunch break, or while doing your necessaries on the can.
And it is a good sales product. Some 50% of most comic book retailers’ weekly revenues come from the sale of floppies. And for the independent creator setting up at conventions, the floppy is a good, relatively low-cost product that complete strangers are often willing to take a chance on if you hit them with a decent pitch.
So, yes, the floppy has its place, and as long as I make comics, I’ll likely be churning out floppies. But for my business, it’s important I recognize…
What the Floppy is NOT Good For
And that’s profit.
For independent creators, by and large, the floppy is a low-profit margin item. For you non-business type people, a profit margin is the percentage of selling price that turned into profit. Let’s look at some examples, and here I’m going to assume a 32 page full color, staple bound, standard American comic book :
1) The POD Floppy
What is it: Most of the comics you see in artists alley by relatively new independent creators are of the print-on-demand variety. POD is great for seeing your work in print for a very low absolute cost. You can have a real-live comic book in your hand for under $10…and that really is a remarkable thing. However, the profit margin on that floppy is going to underwhelm you significantly when it comes time to make sales.
Print Cost: $3.00 (~per book cost including shipping, and probably with one page devoted to the POD printer’s advertisement.)
Selling Price (Direct): $4.00 (pretty much what the market will bear for this product at present.)
Profit (Direct): $4.00 – $3.00 = $1.00
Profit Margin (Direct): 25% (profit as percentage of selling price
Selling Price (Retail)– $2.00 (Retailers generally buy product at 50% off cover price.)
Profit (Retail): $2.00 – $3.00 = -$1.00*
Profit Margin (Retail): -25%*
*POD floppies and direct retailer sales generally do not mix…you will lose money doing it.
2) The Offset Floppy at Diamond Minimums
What is it: Okay, you’ve clawed your way up and built a fan base and retailer connections large enough to push your print runs past the 1000 copy threshold that makes an offset print-run economically feasible. In most cases, this means you’re putting your books into retail, and in most cases, that means you’re going through Diamond. For the sake of this discussion, we’ll assume you’re just barely meeting Diamond minimums (no easy task) on your $3.99 priced book, and doing a 25% over-print, so you have books to sell direct to fans at shows and online. In other words…pretend you’re where ComixTribe is at right now.
Print Cost: $0.95 (Cost per book, based on an offset print run of about 2000 copies.)
Selling Price (Direct): $4.00
Profit (Direct): $4.00 – $0.95 = $3.05
Profit Margin (Direct): 76% (As you can see, the profit margin of floppies sold directly to consumers go way up when you do an offset run. However…)
Selling Price (Retail)– $1.59 (Diamond buys product at 60% off cover price.)
Profit (Retail): $1.59 – $0.95 = -$0.64
Profit Margin (Retail): 40%
Now, clearly, the profit potential for floppies raises considerably when you go offset, have a Distribution partner in Diamond, and can sell through your over-print with direct to consumer sales. In the scenario described above, you would end up with:
Diamond Sales Revenue ($1.59 x 1600 copies sold): $2,544
Direct Sales Revenue ($4.00 x 400 copies sold): $1,600
Total Sales Revenue: $4,144
Cost of Print Run: $1,900
Net Profit: $2,244
Profit Margin: 54%
Okay, so looking at the numbers above, here are a few things to consider:
- Some of my small-press warriors out there might look at the above numbers and be encouraged. Hell, if you’re a one man show, the idea of clearing a couple grand in actual profit from a print run might look a hell of a lot better than what your current sales are showing.
- On the other hand, if you’re a creator who just shelled out $4,000 in production costs (not including printing) on a decent creative team, you may be having a bit of a panic attack right now, seeing how difficult it may be to ever recoup that investment on the floppy.
- For a product like comic books, the size of your profit margin is directly tied to the size of your print run. For an “independent” book like The Walking Dead, with print runs in the 75K range, and black and white, the cost per book is likely around $0.10. With a $2.99 cover price, Image gets $1.20 per copy, making the profit margin on Kirkman’s opus a whopping 92%. Now, you probably didn’t need to be told, but that’s good money right there.
So, my point is not to make the absolute declaration that a floppy can never be a good profit generator…it’s just that for most independent creators working their way up the ranks and trying to build a sustainable comic based business, doing it and relying solely on the floppy is going to be a tough road. The math is not in your favor.
So, It’s All About the Trade, Right?
Something I hear a lot in the independent circles (and I have been known to catch myself in these same thought pattern as well) — is the idea that, “Well, I haven’t made any money on these here floppies…but if I can just make it to the trade collection, that’s when the dollars will start rolling in.”
After all, the brilliant thing about the trade collection is that it’s collecting work that has already been produced…there are usually very little costs associated to making a trade besides print and marketing. So, dolla dolla billz, y’all?
Umm…not so fast there, ace.
While it’s true that the price points on a trade are higher (most soft-cover trade collections are sold from $9.99 to $19.99), they represent a far bigger investment on the part of the creator, and enter a whole lot more risk into the equation. Some things to consider:
- The margins on POD trades are in some cases worse than they are on floppies, as every additional page adds cost to the print run…something that is actually not the case with offset.
- A $10-$20 trade is harder to sell to potential new customers than a $4 floppy, and your sales volume will go down.
- Likewise, retailers are much more likely to make a small investment in a new creator on a floppy, than a big one on trade collection. The bottom of the Comichron monthly sales report for graphic novels is usually in the mid three digits…that’s right, only a couple hundred copies of trades.
- You still need to hit that 1000 copy print run threshold to make offset printing of the trade economically viable…and yet, as I’ve explained above, selling 1000 copies of a trade is much harder than a floppy.
- There are other costs associated with floppies, such as increased storage and transportation costs. Your wife might let you get away with storing 1000 copies of floppies in your office. For 1000 copies of a trade, you’re gonna need a big garage.
Again, I love the trade nearly as much as I love the floppy. But here at ComixTribe, we’re not about pie in the sky, and rose-colored, yet foggy as hell glasses. We’re about helping YOU make better comics…and better decisions about how you build your comics business.
It’s important to recognized that hoping that a trade will dig you out of the pit your floppy sales have left you in, is likely just going to make that pit deeper.
If Not The Floppy, or the Trade…Then What?
Then what indeed.
The short answer is to compliment your lower margin floppy and trade sales with premium book products and high profit margin merchandise associated with your brand. What sort of merchandise is going to work well with your books is a question only you (and the market) will answer. But now is probably a good time to take another look at that successful Atomic Robo schwag campaign.
Notice that every single product that they created reinforces the brand of the book. Now that’s good merch right there! There are branded products including books, hardcover limited edition books, prints, t-shirts, cups, stickers, lab coats, etc. And I’m willing to bet that nearly everything they’re offering has a higher print margin than Atomic Robo floppies and trades.
Three “Outside the Floppy” Products You Should Incorporate
1.) The “Artist Edition – Sketch Cover Variant”
Note: I wrote an entire article on these bad boys already, so follow the link above for more on these. And for writers, check out what Jamie Gambell did that let him add these to his product mix.
2.) Prints
11 x 17 prints, or even smaller mini-prints are a tremendously high margin item. At conventions, I usually sell 11 x 17 prints at the price point of 1 for $10 / 2 for $15 / 4 for $20. This pricing strategy generally puts my prints at or below the average cost of prints at most shows, making them a good deal for attendees. As a result, the average price of the prints I sell usually comes out to around $7 a piece.
I can usually get prints at a cost of about $0.75 per print, making the average profit on a print sale about $6.25, and the profit margin a very nice 89%. Put another way, you’d have to sell 7 POD floppies to equal the profit you’ll make from selling just one print.
3.) The Premium Product
Joe Harris’ Great Pacific, one of many books in Image Comics “Under $10 Trade” program
Image Comics has an “under-$10 first trade” program going that has been popular with retailers and fans. Basically, they’re selling the first story arc of ongoing series for $9.99, and often releasing those in conjunction with the first issue of the second arc coming out. It’s a great little program, that’s selling a lot of trades, and probably picking up a lot of new readers.
And if I tried it with ComixTribe books…we’d get SLAUGHTERED.
A $9.99 price point means a $4 sale price to Diamond. While the average Image $9.99 Vol 1 trade sells around 2,500 copies in the direct market plus additional sales at cons and in book stores. At present, ComixTribe would be lucky to crack 1,000 copies of the trade through Diamond, with more likely numbers in the 600-800 copy range. Unfortunately, with a print run of only 1000 or so books, we’d be looking at a print cost of between $4-5 per book…again, this is a “losing money through retail” scenario that we want to always avoid.
Independent and small-press creators need to recognize that one of our biggest challenges is VOLUME. We simply do not have the infrastructure and marketing support in place to move thousands and thousands of books like the bigger players in the industry. So, we need to make every sale count.
Tomorrow Girl Premium Hardcover from Aaron Diaz
Instead of the discount trade, we should be looking at the premium product. I’d put the OXYMORON hardcover in this category. Aaron Diaz’s Dresden Codak book would be another wildly more successful example. These books aren’t meant for massive audiences and intended to move thousands upon thousands of units to succeed. Instead, they were designed to be a beautiful product for a loyal group of fans willing to pay a little more than average for a great addition to their book shelves.
And while many of these types of products are popping up on the Kickstarter platform, it’s clear that other pubs have taken notice. Check out what IDW has been doing recently…promoting limited edition, premium versions of their top sellers over at IDW Limited. Clearly, this move was a reaction to the success of Kickstarter projects for premium, limited products, and their very lucrative high-margin Artist Edition Series of books that are full-size reproductions of art from classic artists and storylines.
All That Said…It Still Starts With the Floppy
So, I hope I made my point that for the independent creator/entrepreneur, you need to look outside the floppy to drive profits to keep your publishing dreams afloat. But, before you abandon those sequentials to get in the lucrative plushy game…I need to reiterate this:
It all starts with the floppy.
Yes, the Atomic Robo schwag Kickstarter was an eye-opening success. But that success was not built simply on the products they had to offer there. Rather, it was built on the six years of publishing history Brian Clevinger and Scott Wegener and Red 5 Comics have established. It was built on the Eisner-nominated floppies, and trades, and the stories and adventures that captivated a loyal fanbase contained therein.
The comic comes first. Your first task is to create a great comic. That’s step one and until you’ve completed it, there’s little reason to think about anything else.
But once you have that great comic, it’s important to be realistic about your prospects of profiting from it. Margins matter. MATH matters.
The Tesladyne Recruitment Drive is a great example of thinking outside the floppy.
Keep Reading!
If you found this article useful, you may want to read one of these three articles next:
Offering Sketch Covers
Everything You Need to Know About Small Press Distribution
What is the Ceiling on DIY Distribution?
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Category: Comix Counsel
