Show Me the Money–What's the Skinny on Author Earnings?

Via Flickr Creative commons, courtesy of Tax Credits.

My degree is in Political Science with an emphasis on Political Economy. To earn this degree, I had to study a lot of statistics *UGH* and to be blunt? I agree with Mark Twain, “There are lies, damn lies and statistics.” Surveys and statistics are a science: number of participants, number of questions, phrasing of the questions, nature of the sample group, geography, etc.

Yada, yada, yada.

But somewhere in the numbers is some truth, which is why I asked one of our WANA instructors, Jami Gold, to do this guest post for me (and yes, she will be presenting at WANACon).

Sure we love to write, but I assume all of us are asking the BIG questions: Is there MONEY in writing? How do we make a GOOD living as writers? Money seems to be the taboo and we don’t want to talk about it. Too gauche. But most of us would like to be paid for what we do, so time to dig into the uncomfortable stuff.

Image via Demi-Brooke Flickr Creative Commons

I’m going to add a caveat that will support what Jami is about to say. I want to approach this as respectfully as possible. But, if I hadn’t seen so much of these attitudes/behaviors, I wouldn’t bother mentioning them at all.

Many writers want to skip steps. It’s human nature to believe we are the exception. Been there, done that, myself. But? 99% of the time? We aren’t the exception at all. There are NO guarantees to any business, but there are some core principles that, when we ignore them? It’s a heck of a lot harder to succeed.

I travel to many, many conferences. I’ve written over 800 blogs and three books regarding blogging, social media, editing, covers, etc. and I’ve gotten to where I simply no longer argue. I’ve met writers who flat out refused to do social media, who refused to learn how to blog, who cut corners on cover design and interior design or who believed Aunt Lulu who taught English back in the 80s counted as an acceptable “editor.”

Image via Flickr Creative Commons, courtesy of Sally Jean

I’ve blogged since 2008 how important it is to have a platform, yet to this day, I get e-mails from writers who have a book coming out in a month and they want to know how to build a platform in time to promote *head desk*. I’ve argued with writers about using monikers, book spam, automation, outsourcing social media, force-adding people to Facebook groups, how hiring an SEO “gurus” will not improve sales, to keep writing and stop non-stop promoting ONE book, and on and on….and *sigh* on.

Every time I blog about three-act structure, POV or the importance of studying craft, there will always be commenters who point out exceptions and that they don’t want to be bound by “formulas.” I’ve painstakingly edited for writers who then turned around and ignored everything I recommended they change to improve the book (reader experience). Later, they had no idea why sales were dismal.

Hmmm, looks legit.

I can tell you that the authors who treat writing as a business and who seek education and mentoring are making a heck of a lot more than $1000 a year. I’ve seen it. I’ve witnessed many writers who were willing to do all it took to make a good living writing and boy they are. Hugh Howey, Teresa Ragan, H.P. Mallory, and Saffina Deforges (three of these four I know personally and all fabulous). I have many more examples but this post is long enough.

I mention these author examples because these folks didn’t begin with a long traditional backlist or NYT Best-Selling Author in front of their names. In fact, Saffina used WANA methods to skyrocket from the bottom of the pile to selling 40,000 books in one month alone. She and her writing partner broke numerous records with their work.

So, I hope you guys will see that all of these writers are doing the very things Jami is about to discuss. Due to the nature of my job and what I see daily, I feel this is a far more accurate analysis.

Going to let Jami take it from here….

Original image via Flickr Commons, courtesy of Casey Konstantin

The publishing world has been abuzz with the results of the 2014 Digital Book World (DBW) and Writer’s Digest Author Survey. Headlines scream “Most authors make less than $1000 a year.”  Numbers taken out of context claim that 80% of the 9000+ respondents earn $1000 or less.

Eh. Yes and no.

Yes, the DBW/Writer’s Digest survey polled 9,210 or so writers. However, don’t let that big number impress you so much that you assume this survey data is uber-accurate. More than 65% of those respondents are “aspiring” and haven’t published anything yet.

The DBW/Writer’s Digest Survey Results

According to The Guardian, the remaining respondents broke down to “18% self-published, 8% traditionally-published and 6% saying they were pursuing hybrid careers.” Okay, so that leaves around 3000 respondents who have been published in some way, shape, or form.

But wait, a full 20% of both the self-published and the traditionally published respondents said they’ve made $0. Ditto with 5% of the hybrid authors. And yes, that means literally zero dollars, as the next income band goes from $1 to $999.

I find that result odd. Does that mean zero income from book sales? Or zero income after expenses?

I don’t know, but it does make me suspect the question wordi
ng and/or the respondent base was a bit hinky. Maybe those authors are planning on self-publishing, or maybe they have a traditionally published book that hasn’t been released yet. Or maybe the DBW/Writer’s Digest respondent base doesn’t reflect professional published authors.

Many have criticized the survey because it was run by Writer’s Digest, who’s been known to recommend vanity publishers to those interested in self-publishing. If the respondents were from the vanity publishing arena, then yes, I could see their income being zero (or negative).

Brenda Hiatt’s Survey Results

Anyone who has studied the industry knows that one book alone isn’t going to cut it. Professional authors, those that treat their writing as a career, focus on building a backlist. If we have 3-6 books out, it doesn’t take much income from each to break $1000.

A look at Brenda Hiatt’s amazing site “Show Me the Money” lists the advance, royalty rates, and earn out for various romance and YA traditional publishers. The vast majority of earn out amounts on her site are over $1000, so even if an author publishes only one book a year, they’d still beat that DBW figure. And Brenda’s gathered data from almost 2700 traditionally published titles.

Now, that’s not to say her respondents are rolling in the dough. The average advance or earn out probably works out to around $10K, with some as low as $200.

My point is that I don’t quite trust DBW’s results. But I’m not going to pay nearly $300 for the full report to analyze how the heck they came up with their numbers. The results strike me as “link bait” in their attempt to sell copies of their report.

Beverley Kendall’s Survey Results

We all know some self-published books are crap. I’ve seen them. I’ve talked to their authors. And they plain don’t care. They’re in it for the quick buck, or they believe they’re geniuses who don’t need editing.

That’s why I was far more interested in the results of Beverley Kendall’s survey of self-published/hybrid authors. Some self-publishers obtain professional-level editing and covers, and that group should be more comparable to traditionally published authors. Beverley asked the questions that really matter rather than lumping all self-published authors together.

She analyzed results from her 822 self-published respondents, and 65% of her respondents had no previous traditional or epublishing deals to improve their name recognition. Keep that in mind for these results. (And I highly recommend checking out her 29 page, free report of her analysis at the link above. Fantastic information!)

Original image via Flickr Creative Commons, courtesy of dfbphotos

How Off-Base Is the DBW Survey?

First thing I note (page 4), 48.05% earned over $10,000 in 2013. Even with no traditional publishing name recognition, 46.04% of self-published-only authors earned over $10K. Hmm, that’s quite different from the 5% for self-published-only authors earning those numbers in the DBW report.

The second thing I note (page 10) is that backlist really matters. While 80% of respondents with 1-3 books for sale make $10K or less, that figure drops quickly with additional books. About 50% of respondents make more than $10K when they have 4-7 self-published books available, and 20% make more than $50K. At 12-20 books available, over 50% of respondents are making 50K or more, and 30% are over $100K.

How Much Does Professionalism Matter?

Now let’s look at those numbers for professional, self-published authors—that is, those who use a professional editor and cover artist (page 13). Of those who didn’t use a professional editor (Beverley’s definition: “with a publishing background”), 40.23% earned more than $10K. In contrast, of those who did use a professional editor, 50.82% earned more than $10K.

Similarly, of those who didn’t use a professional cover artist (her definition: “graphic artist or professional designer”), 39.21% earned more than 10K. In contrast, of those who did use a professional cover artist, 52.55% earned more than $10K.

In short, professionalism matters. And the percentage differences between professional editing and professional cover design aren’t much, so they both seem to be important. However, a professional cover has a slight edge over editing if you’re dealing with limited funds.

Image via Bill_Owen Flickr Creative Commons

Is Beverley Kendall’s Survey the Anomaly?

Brenda Hiatt’s “Show Me the Money” page surveys self-published authors too. For 2012, her respondents averaged 10 titles each (that backlist mentioned above) and averaged $137K. The median, which discounts outliers better, was still $51K.

Those figures match Beverley’s 2013 results for authors with similarly large backlists. So I think it’s safe to say that for those authors who approach self-publishing as a career (build a backlist, use professional editors and cover artists, etc.), making more than $1K a year is the norm.

All that said, it’s also important to keep an eye on craft and not just think about backlist. In Beverley Kendall’s report, almost 40% of authors with 60+ self-published releases(!) make less than $10K because they’re skipping professional editing or book covers in their single-minded focus on release numbers.

Lessons Learned: How to Maximize Chances for Success

Beverley Kendall’s report is a gold mine for those on either path. Her results show what works for maximizing income, but many of the tips are also no-cost ways we can reach more readers:

• Write a series
• Make a series-related short story, novella, or the first novel free
• Include excerpts of other stories, especially at the back of the freebie
• Price novel-length books in the $2.99-$4.99 sweet spot
• Build a backlist of quality stories
• Don’t expect success overnight—think in years

On Beverley’s Facebook page, she shared a few more survey tidbits. This one is very enlightening on what it takes to make more money:

“Of authors who earned over $50,000 in 2013

95.93% have 4 or more books up for sale
93.91 % have been self-publishing for more than 1 (one) year.”

Remember those years I mentioned? Time and backlist, everyone, time and
backlist. *smile*

On this post and this post, Beverley illuminates the value of series and freebies:

• For authors over $50K:
  • 96.93% of their bestselling books were part of a series
  • 68% offered one or more books in the series as a freebie
• For authors over $500K:
  • 100% of their bestselling books were part of a series
  • 88.24% offered one or more books in the series as a freebie
• For authors between $0-$10K:
  • 25.60% have not written a series
  • 32.53% offered one or more books in their series free
  • 41.87% do not offer a freebie from their series

However, not every author should offer a freebie. This is where a long-term strategy comes into play. We can lose money and potential readers if we don’t have other stories available, as shown by this post:

“After downloading and reading a free digital book by an author, 88.54% of readers have gone on to purchase other books by that author.”

Only a few of her insights on how to maximize our chances for success apply more to authors willing to invest or write to the market:

• Use professional-level editing and book covers
  • Beverley notes one reason why those from a traditional publishing background make more money: “22.69% MORE authors who were originally traditionally published had their books edited by someone with a publishing background than authors who had never been published before.”
• Choose the “right” category/genre (note: this often involves chasing trends(*), so your mileage may vary)
  • * New Adult Romance: 43.48% earned more than $50K
  • Mystery/Thriller: 30.77% earned more than $50K
  • * Erotic Romance: 28.57% earned more than 50K
  • SciFi/Fantasy: 19.15% earned more than $50K
  • Non-fiction: 10.34% earned more than $50K

Finally, after I pestered her for more insights, Beverley did another analysis for what the statistics would be when an author did everything “right.” Of the 121 respondents who:

• Have been self-publishing for more than 1 year
• Wrote a series
• Put one or more of their books free
• Have 4 or more self-published books available
• Price their work between $2.99-$7.99
• Acquire professional editing and book covers

The stats revealed that 81.82% earn over $10K and 57.04% earn more than $50K. Click through to this link to see the full breakdown.

Beverley’s report is invaluable for showing what works. Lumping all self-published authors together (the serious and the non-serious) dilutes the lessons we can learn from those doing it with a plan for success. As Beverley said in her follow-up post:

“So does it matter really if 80% of self-published authors don’t make more than $1000 in a year if you intend to emulate the 20% who are doing it right and making a very comfortable living doing it?”

…And now I’m burnt on numbers for a while, but I hope this has been educational and enlightening. *reassembles brain*

****

THANK YOU, Jami!

COOL CONTEST. So, WANACon is this coming weekend. PajamaCon is FREE (Thursday Evening) and gives you a chance to make sure your computer is set up properly if you choose to join us for the conference. If not? Still a fun time and a chance to learn. SIGN UP for WANACon HERE. Also, AGENT PITCHES are available. You can SIGN UP HERE.

Since my goal is to see you guys succeed, I am offering three BIG prizes for WANACon Attendees. Grand Prize is The Book/Brand Combo. I will personally consult to either assist in plotting a new book or fixing one that doesn’t work. I will also consult you personally on your brand and give you a plan for SEO, content, everything. Book Prize is I work with you to plot or fix a book. Branding Prize is I personally consult you on your brand, teach you about SEO and lay out a plan.

EVERYONE who attends automatically gets ten entries. Encourage a friend to sign up and you earn 25 additional entries and the friend who signs up gets 15. Just make sure to tell us who referred you. WANA is committed to helping you realize your dream.

Author Jami Gold

After discovering a chemical compound that makes chocolate even more awesome, Jami Gold moved to Arizona and decided to become a writer, where she could put her talent for making up stuff to good use. Fortunately, her muse, an arrogant male who delights in making her sound as insane as possible, rewards her with unique and rich story ideas.

Fueled by chocolate, she writes paranormal romance and urban fantasy tales that range from dark to humorous, but one thing remains the same: Normal need not apply. Just ask her family—and zombie cat.

Find Jami at her blog, Twitter, Google+, Facebook, Pinterest, LinkedIn, and Goodreads.