In a result which was far from expected, the latest monthly publisher revenue report from the Association of American Publishers showed a continued decline in ebook revenue and a simultaneous slight rise in print sales.
Publishers' total trade revenues were up a half percent through August 2016. eBooks revenues were down 18.9%, while revenues from hardback books grew 4.1% and revenues from paperback books grew 8.8%.
You can read the press release below, but I have a couple details to share before anyone starts celebrating that print is back.
Data Guy pointed out in a presentation a couple weeks back in the second half of 2015 Amazon started heavily discounting print titles, a practice which they phased out in the second half of last year.
Amazon discounts the retail price, affecting the number of units sold. A smaller discount off the list price means a higher sale price, fewer sales, and thus leads to lower publisher revenue.
The stats shown below detail publisher revenue, not retail sales, and publisher trade revenue was up slightly through August 2016.
Curiously, publisher trade revenue was down slightly through July 2016, and the print formats showed a lower growth in that period than if you add in August 2016. Also, ebook revenue through July showed a greater decline than if you add in August's revenue data.
If deep discounts increase publisher revenue, and shallow discounts decrease it, then why are we seeing the opposite result?
The change in Amazon's discounting policies may not be having the expected impact.
August marked the fifth consecutive month of growth in publisher revenue for trade books, helping the category earn a slight growth from Jan. to Aug. 2016 of 0.5% vs. the same timeframe in 2015.
While July 2016 showed a tremendous increase in the Childrens and Young Adult category of 31.1% compared to July 2015, that trend did not continue in August, and sales were down 1.3% vs. Aug. 2015. Instead, trade books growth came mostly from Adult Books, which was up 10.3%. Within Adult Books, all print formats saw double-digit revenue growth in Aug., including hardback (35.4%), paperback (12.5%) and mass market (22.5%), while eBooks continued their decline (-14.2%).
Overall publishers’ revenue for all tracked categories (Trade - fiction/non-fiction/religious, PreK-12 Instructional Materials, Higher Education Course Materials, Professional Publishing, and University Presses) were down 2.8% in Aug. 2016 vs. Aug. 2015. The revenue decline primarily occurred because of lower sales of educational books and learning resources.
Overview of Publisher Revenue
- From Jan. to Aug., sales in all tracked categories were down 6.7% to $9.7 billion vs. the same time in 2015. Tracked categories include: Trade - fiction/non-fiction/religious, PreK-12 Instructional Materials, Higher Education Course Materials, Professional Publishing, and University Presses.
Trade by Category
- From Jan. to Aug. trade sales were slightly up (0.5%) to $4.25 billion:
- Adult Books had $2.94 billion in sales, down 1.5%
- Children’s/YA Books had $1.02 billion in sales, up 5.0%
- Religious Presses had $284.3 million in sales, up by 6.7%
Trends for Trade by Format
- From Jan. to Aug. 2016 vs. 2015:
- Paperback books grew 8.8%
- Downloaded audio grew 28.9%
- Hardback books grew 4.1%
- eBooks were down 18.9%
Educational Materials and Professional Books
- Educational Materials had a revenue loss of 7.0% for K-12 Instructional Materials and 14.3% for Higher Education Course Materials from Jan. to Aug. 2016 vs. 2015.
- Professional Publishing was down 20.8% from Jan. to Aug. 2016 vs. the same time in 2015. These categories include business, medical, law, scientific and technical books. University presses were down 4.2% during the first eight months of 2016 vs. 2015.
image by ansik