Tilting at Windmills: If You Print It, They Will Come

Thu, September 22nd, 2011 at 11:58pm PDT

Comic Books
Brian Hibbs, Staff Writer
14

It has been a crazy couple of weeks in comic book retail thanks to the overwhelming, thundering, success of DC's New 52 relaunch.

I know there are a lot of doubters out there posting on the Internet (I literally saw someone post yesterday that said that clearly the entire relaunch was a flop because their local comic book store still had some copies left over, an entire week after they were initially released! Really? Really?!?), but I can tell you that this retailer hasn't seen this level of intense consumer interest with actual humans buying comics to read (as opposed to speculate on) in many many years. Even the closest comparisons I can come up with ("Dark Knight," maybe?), are crazy flawed, because this level of enthusiasm has previously been limited to single books -- never an entire line like this.

I'm also seeing what seems to be healthy behavior from consumers: first, exceedingly few people are buying all 52 titles, they're picking the titles and concepts that look good to them. This will mitigate greatly against a cross-line "third issue crash." Second, there's not that many people, at my store at least, who appear to be buying with the intent to resell -- despite the high eBay prices some of the first printings are apparently receiving, I'm not having to tell people that, no, they can't buy the entire stack that I have left, like happened daily during the Speculation Years of the '90s. And, third, we're seeing lots and lots of "lapsed" readers ("Yeah, the last time I bought a comic was when Wolverine lost his adamantium") returning, or people who were looking to get into capes books, but felt daunted. More importantly, these people came back during weeks 2 and 3 of this!

Creating new, repeat customers for periodical comics is the crucial problem that the Direct Market has been trying to fix for many years now, and this relaunch seems to be working this correctly. We're gaining lots of brand new subbers, and we're seeing many people reengaging with comics again -- not just the new DC books, either, but sampling many different books from many different companies. This really is, for the moment, a rising tide that is lifting all boats.

Here's an example of how kind of kooky this whole thing is: for the first three weeks of release, I've had an uninterrupted supply of "Justice League" #1. We actually sold 40% more copies in the third week of release then we did in the second. That never happens. And, sauce for that particular goose, we sold 25% more copies in just that second week then we have in the combined six weeks on-sale of "Justice League of America" #60 (the last "old" DCU JLA comic) -- that's just insane.

Really, there's no way that this launch couldn't have gone better.

Well, there is one: DC could have been as bold with print runs as they were with the editorial refurbishing or the marketing. "Oh, but who could have possibly predicted the need of the market for multiples of its initial orders?" you'll cry.

Well, me, really. It's not that I want to turn this into an "I told you so" moment, but... [stares firmly]

Anyway, look it's clear the current marketplace just isn't positioned to be able to maximize success -- there is neither the capital on hand, or the psychic will to order super-hits the way they need to be, because the underlying midlist numbers that support day-to-day operation of most stores have generally declined to the point where there's virtually no wiggle room for unsold copies.

Here's the thing: I think issue #2s are going to be at least as much of a problem for retailers as the #1s were -- in fact, I'm kind of expecting the need for second printings to probably roll through maybe even the first week of #3s because of the natural way that retailers think about ordering.

See, there's a historical drop of 20% from issue-to-issue through to about #3 on most new launches. The rule-of-thumb is if you sell 20 copies of #1, you'll sell roughly 16 copies of #2, and 13 of #2 -- this is because not every book is every sampler's cup of tea.

There's also a presumed ceiling on sales of a #2 that's probably very close to what you sold of #1 -- but if you ordered and sold through x number of copies of #1 in a few days, and then had to wait three weeks for the next printing, what kind of multiple could you have actually sold if the books were in stock?

Do you pin your "80%" rule-of-thumb on what you sold? Or what you guess you maybe could have sold? Or on the best possible I-never-ran-out-of-stock-at-any-point number?

Observationally, these are all pretty drastically different numbers for most stores. There's also the tricky calculation that has to get made in denser urban areas (where most stores-per-capita are concentrated) of, "Well, how much of what I actually sold was 'my' customers, and how much was from other local stores customers' rushing into my store to buy when they sold out?" Here in San Francisco, at least half of the stores in town were sold out of half or more of the relaunch within four hours on the first day, for each of the first three weeks. If they get #2 better, then how many copies should I have in stock?

Clearly, "will I have enough?" is one of the better problems in retail to have -- and it is certainly better than "I have far too many copies!" -- but I think there were some tremendous opportunities for growth that were lost here because DC did not have enough inventory on hand in case this was as big of a hit as it became.

At the end of the day, the publisher has the lowest unit cost of any participant in the chain, and, more importantly, the "marginal cost" of printing additional copies is generally insignificant compared to the upfront costs of creation and printer set-up. While there's a certain small amount of value for the "market heat" of a comic rising on the aftermarket, we're at 39-for-39 in first printing sell-outs, at the distribution level, as I write this -- that's a bit much.

Again, and I really want to stress this, anyone with a reasonable level of market-watching should have been able to see that the market couldn't absorb a bet of this nature—you can relaunch 5 books in a month, maybe as many as 12, and hope that the market has the cashflow and will to follow along, but five to ten times that? It can't be done.

I am reiterating this, because I think there's a sense among my peers that Marvel will try to follow suit with some sort of a similar stunt. Which is maybe even a little rational given just how much of a pump this has proved itself to be, and one might imagine that a Marvel reboot could do significantly better sales-wise.

If Marvel does consider this, however, I hope they're able to put more people into the loop, a whole lot earlier. After I wrote my last Tilting on this in June, I wrote a far more specific and detailed proposal for how to mechanically make this work better, while at the same time having enough copies on the market to maximize growth for DC -- there was, I believe, a way to have a much larger volume of copies, at a very low risk. I'm led to understand that several other individuals wrote up something similar, but at the end of the day the fundamental problem ended up being that all required tweaks to the way Diamond already does business, and there were simply not the hours in the day to make those tweaks possible in the time frame that Diamond was allotted.

Be clear that I'm not blaming Diamond for that -- if I understand things correctly (and I may not!), Diamond knew about the New 52 at around the same time the retailers did... that is, at the same time the consumers did. That isn't enough time to programmatically change their distribution system in time for the launch.

My pitch (the very very very short version) was that DC dramatically overship, on consignment, opted-in retailers. There were a number of simple rules for the system that disallowed it from being "gamed" (for example, while you, as a retailer would sign up for overships, you wouldn't know ahead of time which book was being overshipped by how much, so you'd still have to put in the order that you thought was "right") This would have allowed DC to get enough copies on to the market, and to set ceilings and floors on what a "HQ" store should have in stock, as well as leverage that "yes, we're committed list" to do even more targeted marketing. But, while Diamond is currently able to do both overshipping and consignments, doing it across an entire line of books for several months for all accounts, isn't something that Diamond is setup to do across the board.

And, it wasn't that it couldn't be possible for Diamond to programmatically do that -- it was that getting it done would take more time than there was on the ticking clock.

That's if I understood what I was being told, of course; which, knowing me, is often a coin toss.

Either way, then end result was that a lot of the marketing efforts to drive people into stores will likely end up being "wasted" because of lack of stock at the local level. One hopes smart retailers are doing things like creating waiting lists, and trying to sell other new or exciting books to these new customers, but I can tell you as a smart retailer, that simply doesn't ever have the same impact on sales as having the item that people want when they want it.

This entire promotion really underlines a tremendous amount of things about both comics and the market:

First: there is clearly, clearly, a tremendous amount of potential interest in printed comics. People have been coming out of the woodwork for this promotion -- new readers, lapsed readers, people wanting to turn their kids on to comics (er, um), you name it -- and they are coming for the print. While I did read some measured words from DC (I think it was "digital sales broke our expectations"), I'm reasonably confident that if any individual digital book sold even a six digit number of copies in the first days or weeks, we'd have read a press release about it by now. Print is multiples of digital, and the demand was so high that DC is having to go back to press on at least the entirety of the first three weeks of these books.

Turns out, once again, Internet punditry was generally wrong: the "rest of the world" doesn't automatically want digital over print.

Second, given the repeat business we've seen from these new customers for each of these weeks, there is clearly a tremendous potential interest in serialized comics. I'm trying to talk to as many of these new faces as I can, and the most common thing that I'm hearing is that they liked about half of what they sampled, and they'll be back for that next issue. Which would be a wonderful response.

But DC has to be very, very careful not to chase these people away with too many crossovers, line expansions, price increases, and all of the things that comic book publishers of all sizes and shapes have continually historically done since the advent of the Direct Market. I beg you in advance (and I'm sure I'm already too late with all the "strange woman" appearances), please concentrate on each individual issue being individually satisfying, and resist the pull of the line-wide event.

Third, the comics market has been bred into an environment that is finding it difficult to maximize success. It isn't enough, DC has now clearly proven, to minimize risk in the case of a monster hit. It's not like we didn't already know that one, we've several of examples over the last decade -- but to see it linewide like that is slightly shocking.

I firmly believe that the reason for the change in retailer behavior (could a Vertigo launch in this retail environment? Could you ever see something like the black & white boom today?) is vicious overproduction by nearly all publishers. The "new 52" really could have been better served by being a better focused "new 26", if you ask me, though I know you didn't!

Fourth, marketing at the publisher level, actually spending real dollars, can really and truly have an impact on consumer behavior. Spending money, and spending it smartly, directing people to ways to buy your material (oh, and letting retailers know that you're doing that?): that's a good thing.

Fifth, Replacement copies are simply too far away -- due to changes to accommodate day-early release, unless you pay for expensive shipping, reorders are generally two weeks away. Second printings are three weeks away if you want them to be on a FOC order (which most retailers do). Due to this, what matters most in a big media hit is if copies are out at the front lines in the largest quantities possible.

Finally, yeah, people (in general) really do love comics, and I think sometimes "well, maybe we've forgotten that? Or forgotten how to talk to our people?" or something.

There will be some fast corrections at some point, on some of the 52, and it seems likely that at least some books will go very quickly back to where they were before the relaunch, but I think at this point that we are going to gain a tremendous number of readers back on at least some of the line for as long as DC can earn their dollars and keep their attentions. The quality of the work will, as always, determine where it ends up landing.

Here's hoping it keeps up, because this kind of infusion was something the market seriously needs.

My kudos to DC's marketing team for successfully creating a level of interest that is somewhat akin to something like a new Harry Potter book being released, and doing it widely across an entire line of 52 titles.

Brian Hibbs has owned and operated Comix Experience in San Francisco since 1989, and is a founding member of the Board of Directors of ComicsPRO, the Comics Professional Retailer Organization, even if this column and every other one is purely and entirely his individual viewpoint as an individual retailer! Feel free to e-mail him with any comments. You can purchase two collections of the first Tilting at Windmills (originally serialized in Comics Retailer magazine) published by IDW Publishing, as well as find an archive of pre-CBR installments right here.

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