In December 2010, National Book Network CEO Jed Lyons made the decision to cut back on the number of distribution clients NBN represented while also realigning its sales and marketing teams. The changes led to the departure of some NBN executives including NBN president Rich Freese, who moved to Recorded Books. Nonetheless, Lyons said the strategy to pare back its client roster has worked. While NBN cut its number of clients in half, net sales in 2011 fell by only $2 million, to $52 million.
Lyons credited the minimal sales decline to strong publishing by NBN’s remaining clients and increased sales in specialty, academic, and e-book markets. “The trade held its own in the last year,” Lyons said, “but the real opportunity is outside traditional markets.” Gourmet and gift stores along with airport stores, military PXs, and drug and food stores all had strong gains, Lyons said. The increase in specialty sales reflects the type of clients NBN has retained. According to Lyons, NBN’s focus is on “experienced niche publishers who stick to their niche. We are out of the bestsellers business and we are out of fiction.” Another trait shared by NBN’s clients is a strong backlist, and backlist sales were the major driver last year, Lyons said.
The company’s academic sales arm also did well last year, Lyons said, both in the U.S. and abroad. NBN International, based in the U.K., had sales of $46 million in 2011. In the U.K. NBN International works with a number of university presses while NBN also continues to distribute for Consortium despite Consortium’s acquisition by Bloomsbury in the year.
The final part of NBN’s year was the success of Fusion, NBN’s conversion and digital distribution service, which saw sales triple in 2011 and account for about 7% of NBN’s U.S. revenue. December e-book sales were exceptionally strong, and Lyons expects the e-book momentum to carry into 2012. Fusion distributes to over 60 e-tailers and digital wholesalers and Lyons attributed its growth in part to publishers discovering how complex digital distribution can be. While Fusion has been limited to NBN’s domestic publishers, later this year Ron Powers, who was brought on last year from Ingram to head Fusion, will roll out the service to NBN’s international publishers.
Lyons is also excited about another new initiative set to debut later this year. In March, Lyons expects to begin offering digital printing services to NBN clients in collaboration with a vendor whom Lyons couldn’t disclose at the moment. Operating from three plants, the digital printing operation will allow publishers to print from one copy to 1,000 copies of a title with a 48-hour turnaround time at what Lyons said will be very competitive prices.
The new initiatives have created the foundation for what Lyons believes will be a solid 2012 and, he added, the year has gotten off to a strong start with January sales well above January 2011 and ahead of budget.