It is undeniable that book publishing is facing new challenges, not the least of which has been adapting to the “new normal” of the Covid-19 pandemic. But what will the postpandemic world look like for publishers? Will the changes to adapt to the pandemic persist? Will buying habits and sales patterns change permanently? And what new opportunities can publishers look forward to this year and beyond?
To answer these questions, Westchester Publishing Services and Publishers Weekly convened a webinar with a quartet of top industry insiders, asking them to share their observations from the past year and make some predictions for the future. The experts were Tom Chalmers, managing director of Legend Times Group; Cathy Felgar, publishing operations director at Princeton University Press; Dominique Raccah, CEO and publisher of Sourcebooks; and Lorraine Shanley, president of Market Partners International. The event was moderated by Jim Milliot, editorial director of Publishers Weekly.
The way we work has changed
Faced with the question of what is different between the start of the pandemic and now, the most glaringly obvious difference between 2020 and today is that the vast majority of employees who work for publishers have been working remotely for more than a year. “Virtual work is normative now,” said Raccah, who runs the largest woman-owned publishing house in the United States. “We did a great job creating infrastructures that we didn’t have before and have been able to find a way to communicate in this new way.” Raccah noted that the change to remote working went best for those companies that were already entrepreneurial in their approach, those she called “the fluid and flexible.” With vaccines, some workers are returning to offices, but not full time. Many publishers have delayed announcing plans to reopen their offices, and most are suggesting that when staff begin to return later this year, most will be working in a hybrid model combining office and work-from-home plans.
Human resources is key to managing many issues
One result of the changes of the past year is that the human resources departments have become all the more important. “[HR] has had to deal with employee issues, online training, virtual onboarding and recruiting, employee well-being and mental health,” Shanley, from Market Partners, said. She added that 80% of human resources managers have said mental health issues have taken priority in the past year and are “the most important thing they do.” Mental health issues have disproportionately affected women, many of whom are mothers and have significant responsibilities for childcare in addition to doing their jobs. Shanley called HR workers the “unsung heroes of the business world.”
Another issue HR has been managing is how to implement changes inspired by the Black Lives Matter movement and the social justice movement calling for more diversity and inclusion in the workplace. “Diversity recruiting has been a key issue,” said Shanley. Raccah concurred and noted that her company had recently launched a 10-week editorial training program for BIPOC candidates.
Can the growth in sales persist?
At the start of lockdowns in 2020, book sales plummeted and the industry feared the worst. But when the final results for 2020 came in, print sales were surprisingly robust, “up about 8% to 10% depending on which metric you adhere to,” Milliot said. He noted most sales were weighted heavily in the second half of the year as sales of books on social justice jumped, political book sales rose, and Barack Obama’s A Promised Land led a strong holiday sales season. “The question is whether this upward trend can continue,” Milliot said. Sales for the first quarter of 2021 were up 28% over the same period last year, but that was before widespread vaccination made it possible for people to begin enjoying more social activities, such as eating in restaurants, shopping, and travel. Whether books will be able to compete with other forms of leisure, particularly as a sense of normalcy returns, remains to be seen.
The supply-chain crunch impacts everyone
One consequence of such robust demand for print books has been a further tightening of the supply chain. This has been exacerbated by lack of printing capacity in the U.S., something that is becoming a more acute problem every year. “There is no question that on the manufacturing side, we are dealing with longer print cycles,” Sourcebook’s Raccah said. “When it comes to printers, we are paying for some shortsightedness that we had in the past, and I am really hoping that we are going to see people invest and grow printing businesses. This is a constraint we are all operating under. You cannot have the growth we are projecting as an industry and cut back on the supply side.”
Princeton’s Felgar said the issue doesn’t stop with a lack of printing capacity. “Domestically, we’re seeing some shortages of trucking, so sometimes it’s hard to get the books into the warehouse even once they’ve been printed.” Going abroad for printing doesn’t necessarily offer relief either. “In the overseas printing area, we have a lot of delays with shipping and a lot of congestion at the ports,” Felgar said.
“We’re trying to maximize [print-on-demand] as much as possible, especially for printing closer to market,” she added. “But even one of the largest vendors for POD was showing signs of capacity strain in the fall and through Christmas, and we were having really extended schedules there, especially in the hardcover area.” Princeton has offices in China and the U.K., where the publisher is running into problems importing books from Europe, a direct consequence of Brexit.
Digital solutions come to the fore
Legend Times Group, based in London, has seen the same strain on the supply chain, said managing director Tom Chalmers, who added that lead times have grown to twice as long as before. He said he felt changes wrought by Brexit were unlikely to work themselves out for at least two years. Chalmers said the trade side of his company’s business in the U.K. had suffered from ongoing lockdowns, but academic sales were consistent, and journals, in particular, were in high demand. “The need for accessibility to research has accelerated for obvious reasons,” said Chalmers, adding the company had doubled its output of journals in recent years.
Chalmers believes that data has become the lifeblood of the market, especially when the industry comes under strain, either at a time of outside pressure, such as from the pandemic, or internally, from supply chain issues. “Metadata is important to the functioning of the markets, to POD and to supply, in terms of letting people know what’s available,” he said. “This will be increasingly important over the next several years, particularly as travel and logistical restrictions remain in place. Using data as an active tool instead of a passive one is the next phase. The pandemic has ultimately catapulted these industries down the road.”
Bookselling and the books sold are changing
Digital editions also provided book buyers with a means of procuring books when stores were shuttered; as a result, audiobook and e-book sales were up. But bookstores—especially ones that were effective online—remain the primary means of book discovery, and print sales still dominated. The launch of Bookshop.org made a significant difference for independent booksellers in the U.S. and the U.K. in particular (it also recently launched in Spain). Author events, typically a driver of sales, went virtual—and will remain so for the time being. Unfortunately, virtual is largely a stop-gap solution. “Virtual events don’t translate to sales that well. What we are doing now isn’t working as well as we had hoped,” said Raccah.
Creating more efficient means of book discovery, noted all panelists, will be both one of the biggest challenges as well as opportunities going forward. With stores closed, publishers delayed publication of hundreds of new books until fall 2020 or even 2021. Correlating to this change was a shift in consumer buying patterns from favoring frontlist over backlist to the opposite. At Sourcebooks, Raccah said that strong backlist sales have continued into 2021 with those sales up 74% year-to-date over 2020. “In 2020 our sales were 65% backlist, 35% frontlist—which is a flip from previous years,” said Legend’s Chalmers. Princeton’s Felgar said frontlist was “somewhat soft” while backlist has “done quite well,” and e-book sales were “staying up.” However, certain types of promotions have disappeared; most notable of these are trade shows, which will remain virtual at least until later 2021.
“In terms of advertising dollars, we are spending a lot more. Online platforms require a certain amount of advertising spend, and the cost for a frontlist launch has definitely increased,” said Raccah. To maintain the recent surge in sales from 2020 will require more creative marketing, such as the grassroots TikTok promotions for young adult titles that have prompted tens of thousands of sales. Of course, the industry would benefit most from the full reopening of bookstores. “Bricks-and-mortar is an easier and more appropriate discovery mechanism for books,” Raccah said.
Ultimately, while publishers have become accustomed to coping with the “new normal,” and while the pace of change may be slowing, it is still likely to be significant. “It’s exciting that publishing has come through the pandemic the way it has. It is very motivating,” said Chalmers. If one thing can be agreed upon about 2020, it was a challenging and transformative year. Looking ahead, 2021 appears to be equally so.