The Book Industry Guild of New York held its annual President's Night event at the Penguin Random House headquarters in New York on January 10. This year, the featured speaker was Hachette Book Group CEO Michael Pietsch, who spoke on his four-decade career in publishing, innovations in the industry, and what he refers to as the "great flattening," or the industry-wide struggle to keep revenues from flatlining in an era that shows a pronounced lack of industry sales growth.
Pietsch laid out for the audience his history in the publishing industry, from his start as an intern at David R. Godine in Boston to his 12-year stint as publisher of Little, Brown to his appointment as CEO of Hachette in 2013. Over the course of the address, Pietsch stressed the importance of marrying the literary side of the industry with the financial side—a lesson he first learned at Scribner in 1979.
"I remember very vividly the moment my boss said to me, 'Your credit is good here,'" Pietsch said. "And I understood for the first time that an editor is an investor who is being trusted with somebody else's money. We all think about editing as the task and interaction with the author, but you're an investor on behalf of somebody else whose money is entrusted to you."
After his time at Scribner—during which he edited a posthumous Hemingway manuscript—Pietsch spent stints at Harmony and Crown before joining Little, Brown. There, Pietsch said, he really began to understand the financial underpinnings of the industry.
Pietsch's appointment as HBG CEO in 2013 was a rarity in the industry since publishers rarely end up in that role. Pietsch noted that he believed his promotion to CEO was in part due to the unusually powerful position authors now hold within the American publishing industry, and the unique relations editors typically have with their authors. Since Pietsch took over as CEO Hachette has made a string of acquisitions,highlighted by the purchase of the Perseus publishing arm last spring. Given the flat market, acquisitions are the most effective way to grow and add scale, Pietsch observed.
Despite the turmoil in the industry caused by the explosion of e-books,Pietsch praised Hachette's commitment to the print book, which he believes is "indestructible." "We felt confident that print was here to stay," he said, in reference to Hachette's decision to invest in third-party distributors. "We made a big bet."
Pietsch also pointed to the origins of innovations in the industry, noting that the greatest recent innovations in the book business, superstores and e-books, were created by retailers—Barnes & Noble and Amazon, respectively—and not publishers. He is enamored with the increased marketing ability that comes with targeted marketing, transforming what was once a "blunt instrument" into something more precise. He also sees the furthering of global publishing as vital to continued growth, and singled out children's publishing in particular as giving him hope for the future.
When asked how he would advise young people entering publishing, Pietsch highlighted three areas: learn the financial side of the business (he is preparing a finance curriculum for his company currently); learn the full life cycle of the book, and pay attention to what those around you do to help it along; and know the basics of writing and communicating.
It would not hurt, he noted, to understand that publishing is a very time-intensive field. "It's a days, weeknights, and weekends business," he said.