The Decline of the American Comic Industry

[deuce]

Diamond Comics has a virtual stranglehold on comics distribution in the US. I wish Capital City was still around. I attended their conference in Madison back in 1990.

en.wikipedia.org/wiki/Capital_City_Distribution

[mrp]

Diamond is a de facto monopoly for comics distribution. As such they serve as gatekeepers to the market and determine which books or publishers can or cannot reach the market. Publishers have to reach a certain level of sales before Diamond will even consider working with them and smaller publishers get leveraged by Diamond in those deals so Diamond's take is much higher than it is with larger publishers. Diamond at least doubles its money with every book they sell. Those $4 msrp comics we all complain about, Diamond buys them from the publishers at a $1 and sells them to retailers for $2 or more. Retailers then sell them for the $4 msrp minus whatever discount they have to give to incentivize sales to end customers.

If Diamond screws up retailers pay for it. If they send damaged books, they'll give credit to retailers for them, but if retailers want replacement copies they have to pay additional shipping charges to get the books form Diamond, even though the mistake was Diamonds. Diamond screwed up and missed products in your order, they'll fill them if they have any left (assuming they didn't intentionally short a smaller account to give additional copies to one of their larger accounts) but you will again have to pay additional shipping for it. I know one shop owner around here (who has since gone under) who got shorted the copy of Robert E. Howard's Savage Sword he had ordered for me. He called Diamond, they sent him out a copy, by itself, not with his next order. The book retailed for $8, the shop owner paid $4 for the book (the typical 50% discount) but had to pay $8 in shipping for it to be sent o him so he was going to lose $4 to sell that book because Diamond screwed up and shorted his order. I felt bad and split the different of the shipping cost with him so he didn't lose quite so much to get me my book.

That's how Diamond does business. And they are the largest regressive force in the market. They absolutely do not want change because they control the market. What's a retailer going to do if he doesn't like the way Diamond does business? Order his comics elsewhere? Some have tried to order trades through the book market for their shop rather than Diamond, Diamond's response is to cut that shop's discounts for books and comics so they have to pay more and make less to carry the products.

The wars between the distributors resulting form Marvel's gambit to acquire Heroes World gutted the direct market leaving Diamond the only option standing and Diamond has milked it for all it's worth They will squeeze every last penny they can form retailers and publishers before it's all said and done.

-M

[mrp]

Grim news for sales trends for August...ICv2 on August sales

In short: "Sales of periodical comics for August 2017 were down 25.72% vs August of last year, while graphic novel sales were down 6.89%."

-M

[mrp]

Here's an article form the Atlantic back in May that has a lot of insight into the decline...Atlantic article

-M

[Von K]

Thanks MRP - that article covers a lot of ground.

But it does play down the problem of an editorial policy focusing too heavily on diversity themes. This article being a year old I hear recently Marvel actualy realise this point now. Nuff said...

[mrp]

Sept 15, 2017 17:50:44 GMT -5 Von K said:

Thanks MRP - that article covers a lot of ground.

But it does play down the problem of an editorial policy focusing too heavily on diversity themes. This article being a year old I hear recently Marvel actualy realise this point now. Nuff said...

The thing most people miss is that the article looks at the sales and the diversity titles are among the ones selling well in relation to others and have growing (not shrinking) reader bases, holding steady in the direct market and growing sales in the trade and book market. The diversity is not the issue, it's one of the things actually bringing in and retaining new readers. That's why they downplay it, because those books are among the few not shedding readers on a regular basis.

Ms. Marvel, featuring the teen-age Muslim-American teen girl Kamela Khan is the biggest selling Marvel book has for Scholastic. It is one of the biggest sellers in the book trade for Marvel. Initial orders for each new volume of the trades for that book are higher than initial orders of the previous volume in those markets outside Diamond's direct market. Another note on Ms. Marvel, it has had pretty much a steady creative team since it's start and has maintained a simple monthly release schedule. Other diversity titles like Moon Girl were on similar tracks to but to a lesser scale of success. Where these books are not selling, and nothing else is either, is in the regressive fanboy based direct market of Diamond's distribution. But to capitalize on the sales trends offered by books like Ms. Marvel would require an investment infrastructure for a new distribution system that focuses on markets other than the direct market, and that's not something Disney (or WB) is willing to do.

The article doesn't downplay the diversity issue, it argues (mostly convincingly) that diversity is not the issue in Marvel's declining sales. All it's done is alienate the last hardcore segment of disgruntled fanboys haunting comic shops thinking they are entitled to have Marvel and DC cater to their preferences because they have been buying big 2 comics for x number of years. The audience was long gone before the diverse characters were being introduced and new books featuring them were being brought to market.

Marvel's concession that diversity is the issue is just spin; it's simply them throwing in the towel on other markets where growth potential exists and doubling down again trying to appeal to the regressive fanboy base of the direct market because no one wants to put the effort or investment into growing the market outside that. They will return classic characters that are more fanboy friendly but maintain rotating creative teams and bi-weekly shipping when they can and continue to settle in the less than 50K sales level for top titles after the 3rd issue of each title because that is pretty much all that is left in that market. Any sales gained will not be growth, but shifting existing customer dollars from other publishers for short term gains, but they won't be sustainable because DC will then initiate their own response that will shift the pendulum back to them then Marvel will respond as they ping pong readers back and forth in the direct market bleeding a portion off every month as they have done for the last 30 some odd years to get in this situation. More of the same is not a solution that will change anything.

-M

[Von K]

There Is A HUGE Audience Waiting To Come Back To Comics Once Pros Stop Actively Pushing Fans Away

[mrp]

You mean all the people who had already gone away before diversity in comics became an issue. The biggest fallacy and scapegoat out there is diversity pushed away people. They were gone before diversity was an issue. The push to diversity was an attempt to reach out to new audiences AFTER all the traditional fans left. They're not waiting to come back when diversity ends, they left before diversity was an issue. Anyone who blames diversity and SJW for the demise of comics is scapegoating and blaming people after the fact for what happened long before it was even an issue to push their own social agenda tha thas nothing to do with comics.

-M

[Von K]

MRP - I think it's a whole slew of issues causing the overall effect. Some say it's not diversity per se but the superficial way it's being implemented.



Summary of key points:

Event fatigue
Crossoveritis
Too many reboots and switching swapping characters/teams mean it's not worth investing in stories that go nowhere
#1 issue spike-and-slump business model
Creative stifling caused by big business ownership (WB/Disney), too corporatised
Short term profit over storytelling quality drives core readership away
Movie success expanding audience to global, but new comic titles don't match their movie character representatives, causing newcomer confusion

[mrp]

The bulk of the audience has been gone for over a decade. 10 years ago the best selling books were selling, 100-150k regularly, 15-20 years ago mid tier books were selling 100K and top tier were selling 200K +. Currently top tier books are still selling at 100k (the new Metal series broke 250K, but midtier are down to 30=40K. Events started about 10 years ago, AFTER the bulk of the audience had already gone. What happened in the last 10 years (which is what everyone points to as why the audience fled) is actually not the cause, its the effect of the audience going and leaving only hardcore fans left. The audience left over 15 years ago, starting when comics went exclusively to the direct market and lost access to the mass audience. No new generations of readers came along to replace the traditional loss of readers who outgrow comics and move on, so it catered only to the hardcore audience and cut off its source of creating more, without accounting for the traditional bleed off. The more they catered the product to the hardcore remnant over the last 10 years (events, #1s etc. etc. complex continuity, etc.) the more they estranged comics form new readers. All that was left was the hardcore audience, which was too small to be sustainable in the long term. What they have done over the past 2-3 years is try to reach out to the mass audience outside the hardcore base, who have gotten entitled over the last 2 decades because everything was catered to them and they are now acting like spoiled little brats who have had their toys taken away. If comics does not reach out to a wider mass audience through formats, price, acessibility of product and yes diverse characters, there is no future for the direct market as it is currently constituted. The attrition rate among the hardcore fans was too high even when everything was catered to their tastes to make it sustainable. looking at content, continuity, and character issues from the last 10 years is an emic point of view that misses the real causes why people are no longer buying comic books in sustainable numbers. An etic point of view is needed to see what caused the customer flight 15-20 years ago and bars new customers from coming to comics.

This isn't the field of dreams, it's not going to be if they build comics that appeal to the traditional fan they will come back. That's a myth that's killing any real chance to bring customers to comics.

People who point to anything in the last 10 years, character or content wise in comics (i.e. diversity, events, reboots, continuity etc.) are missing the point that these things are the effect of losing the audience, not the cause. The bulk of the audience was long gone before any of these things became a factor.

There are 3 major issues that caused audience flight and is preventing an influx of new consumers

1) destination specialty stores as the only outlet for comics that are not present in vast swaths of the country to make comics available for people to buy them and are not accessible to non-hardcore audiences where they are present. Comic shops are not user friendly and have a high learning curve for consumers where they do exist and there are only 5000 such shops in the 50 states so there are places where even folks who may be open to discovering comics cannot.

2) The format, frequency, cost and amount of content in the traditional comic book does not work with the way modern audiences consume entertainment media and is an unattractive product to an average non-hardcore fan, and is overpriced compared to other options on the market, so lacks value. Twenty pages of content that does not even make a standalone installment of the story for $3-5 released every month and only available to people who pre-order the books for the most part and for 2-3 days after release (a week at most before its replaced on the shelves with new product) is not going to bring people to the table. It's a dinosaur format in today's entertainment field. The problem isn't stories told via panels and pages with art and text, those sell quite well to mass audiences in different formats, it is the the format and frequency of how it is packaged that doesn't work in today's marketplace, but hardocre fans won't allow the format to evolve to something that can survive in the current marketplace.

3) Gatekeeping by hardcore fans creating barriers for new fans to enter the hobby/field/industry. Hardcore fans decrying fake fans, ridiculing the comics new fans like and telling them they are doing comics wrong make comics an uncomfortable place for new customers to enter and give comics the influx of readership and customers it needs to sustain itself and possibly grow.

The issues facing comics have to do with their position in the marketplace, how and where and how often you can get the product and how much you have to pay for it, and how to grow the market for the products you do have so the product can reach potential customers in a format that is attractive and accessible for them to spend money on. There is not a large enough hardcore fan customer base to sustain comics as a practical business without an influx of new customers. The economy of scale in printing/publishing works against them. The smaller print runs are the larger per unit costs are and the harder it is for companies to break even or generate profit with the product. The hardcore fan base had shrunk to the point where economy of scale was working against the industry long before diversity, event-fatigue, #1 weariness, reboots, character variation, etc. were even part of the conversation in comics.

So go ahead and bring back the traditional versions of character, boot out all the diversity, en event,s give people their high issue numbers on the trade dress, etc. back. It won't make a damn bit of difference. Comics will still be an unattractive product inaccessible to the vast majority of potential customers because of the direct market, pricing and format, and sales numbers will still be below sustainable levels because of economy of scale. All you will have done is allowed more customers to leave via attrition and driven away the newer customers who have come to support comics in other formats sold in places other than traditional comic shops over the last few years, and wasted, time, money and other resources that could have been used to make effective changes instead.

Catering to the preferences of hardcore fans is what led to the issues comics are facing today. Doing it again/more isn't going to get different results this time. You know what they call doing the same thing over and over again expecting a different outcome is called don't you?

-M

[deuce]

"This isn't the field of dreams, it's not going to be if they build comics that appeal to the traditional fan they will come back. That's a myth that's killing any real chance to bring customers to comics."

You keep prancing around this. Quit hinting. WHAT is your solution? What is your master plan?  According to you there is a "real chance to bring customers to comics." What is this "real chance"? Lay it out in detail.  None of the rest of us have your insight and the industry needs to know ASAP.

[mrp]

This is something I wrote on another forum on the matter...

So we have often talked about ways to reach new fans for comics. How super-heroes in other media have outstripped their popularity in comic form, how loss of newsstands led to missing out on a couple generations of new readers to comics etc. We all know what the situation is, but what are some ways to overcome this-to reach new readers and turn them on to comics. It isn't about quality of content, because it's not a case of if you build it they will come. They're not coming no matter how good or bad the comics themselves are. People are not going to suddenly walk into a comic shop and start buying comics, so it's more of a case of if Mohammad won't come to the mountain let's take the mountain to Mohammad.

One idea that I had if I were marketing for Marvel or DC would be to talk to the multiplexes where the movies are playing about setting up a little shop next to/near the concession stands where I could put out some product for sale to the movie goers. Start with things like some Funko Pops, Action figures, blind bags featuring the characters that will move enough and generate enough revenue to make the space pay for itself, but also have stacks of the cheap $1 True Believer reprints of comics for sale-Deadpool is playing have stacks of the New Mutants #98 True Believer comic. Spider-Man Homecoming is playing have 6 or 7 True Believer issues at $1 each, Star Wars is playing put a bunch of the $1 Star Wars True Beleiver issues etc. and a bunch of trades like the $5 trades they put in Wal Mart a few years back (or even their Timely Comics reprint attempts forma few years back) that collect 4-6 issues, a complete story on the cheap. Price them at a level where they are impulse buys not investments of entertainment dollars.

Inside each comic or trade I would include 5 things-a code to get a free 1 month trial of Marvel Unlimited, a coupon/code for 50% off a 1 year print subscription for a comic, and a Comic locator ad complete with a coupon for 25% off your purchase at a comic shop (where the shop owner could redeem the coupon back with Marvel to get the discounted money so it's on Marvel's dime not the retailer) and ad for Free Comic Book Day and an Ad for Halloween Horrorfest giveaways. The first three would be designed to give the purchaser incentive to make an additional purchase of actual comics and the means to do so as well as giving them a cheap entry point to get an actual comic to read for themselves or their kids, and the last 2 give them knowledge of opportunities to get more inexpensive ways to find an entry point into the comics themselves.

People aren't going to see a movie and suddenly decide to start buying comics on their own, but if you put the comics themselves and incentive/motivation to get more comics the comics themselves might become a gateway to more comics. At the very least it will get some comics into the hands of potential readers and provide some revenue for the publisher (and more revenue for the theatres too, they need incentive to do this too).

The industry cannot rely on potential customers coming to them. It's not happening. It hasn't happened. And it's not going to happen. It needs to reach out to the potential customers, go to places where those potential customers are, places where those interested in the characters can be given an opportunity to impulse buy into the medium and experience the characters in the comics themselves so that they can then have the opportunity to become customers.

Obviously movie theatre concessions are not going to bring a new generation of readers on their own, but a smart program of similar outreach programs could start to make a difference, to create new readers and new customers. Because that's what it comes down to, comics are a business and they need to find new customers for their products. If there is competition for entertainment dollars (and there is) you cannot be complacent and wait for the customers to come to you. You have to go get them and be in the places where the customers are and give them a reason and the opportunity to get your products.

Obviously you have to have quality products to keep them there once you get them there, but you have to get them there first or it won't matter how good or bad your product is.

It doesn't have to be a publisher only drive thing either. Lots of publishers like Image, Dark Horse etc. do the $1 reprint sampler things and Image has a lot of the Vol. 1 trades as an intro price/loss leader, but you need to get those things where potential customers/readers are, having them in comic shops where new customers are rare and current customers are set in their ways won't cut it, so it can be an outreach by publishers, retailers or even Diamond if they ever got their head out of their own ass.

____

So essentially, they need to bring the product to where customers buy it and sell it in a format that people will buy-complete stories in affordable packages sold where people actually shop that can stand alone and not require a customer to by multiple titles to get one story.

Some other considerations, first there is no infrastructure for alternate distribution really in place, so unless publishers are willing to invest in creating such an infrastructure, print distribution options are limited. There are no more newsstands for them to recapture, so the monthly format is pretty much a dead format in all but the niche hobby market of the Diamond market. Unless publishers are willing to abandon that format for something else, they are not going to find a lot of growth for their products unless they can find ways to get that product into the wider marketplace. However, the hardcore fan base would lose their mind if the format was abandoned, which is where the real crux of the problem is. Evolve or die. To move forward they need to let that hardcore fanbase go, or if they are going to cling to that fanbase, they need to accept they are on life support and will die when that fanbase finally dies.

Second, the way they compensate their creative talent is tied to the current format and distribution models. It needs to change for their to be substantive changes to the format and distribution of comics. To move forward, they need to devise (or adopt) new compensation models for the creators and abandon page rates tied to monthly output (which is essentially a piecework model of compensation that is an outdated compensation mode, especially for publishing). Some publishers (mostly graphic novel publishers who are divisions of larger book publishers not monthly pamphlet publishers) have adopted the traditional book market structure of giving creators an advance and then paying royalties for sales in all formats (digital, print, collections, etc.). This allows creators to make ends meet while creating products that can be sold/marketed in a variety of markets and formats without the need to be working on the next issue constantly to survive. This flexibility will allow them to explore different formats both in print or in digital to find what will sell in the current market.

Now, Marvel has actually seen growth in their Unlimited subscription service. Customers pay a monthly (or yearly) fee and have access to read as much (or as little) content as they want. There is a 6 month lag time between release of new books and their availability on the service. A large swath of past material is also available with new material added each month. This is essentially the Netflix model. It is not viable for this to be the only means of distribution with the current compensation model for creators. Right now it is a way to supplement revenue, but not be a primary revenue stream for content. Comixology has adopted a similar service with a number of publishers participating. DC has vowed they will never provide such a service as long as the current regime there is in power.

Such a service is probably the best way to reach potential new readers in the current marketplace though. It allows customers to sample product to fond what they like and then seek that out. The free trials at movie theatres is one way to get them access to such a service. I would put a free one month subscription code in every DVD/Blue Ray package as well.

Another format to look at is digital serialization followed by print collections. Publish stories in installments through a digital service first, and when the story is complete, collect and publish it in print. You can still make monthly pamphlets of the installments available on something akin to a print on demand manner at comic shops through Diamond, but the price for the print should be set to account for print on demand economy of sale and the digital pricing set to be competitive with other digital entertainment options. They need to find a way where the direct market is the supplementary income and not the main source of revenue for their content.

Of course none of this is going to happen without a serious capital investment by the publishers and their corporate owners, but that's the real issue. They see print as a dying format and are only interested in maximizing the revenue stream while it still exists, not in investing into the publishing division so it can make the kind of evolutionary changes it needs to make to adapt to a 21st century marketplace. What little benefit there is in the status quo is anchored at the top, so Marvel and DC lack incentive to change the status quo too much, so change is likely going to have to come form other publishers, creators, and retailers.


Along those lines, check out the keynote speech by David Pedersen (of Mouseguard fame) from last night's Ringo Awards about how to expand readership... Facebook live coverage of Ringo Awards it's about 9 minutes into the video that Pedersen starts, his thoughts on expanding readership are towards the end of his speech.

I don't know that I have answers, I have ideas, new things to try that haven't been tried and been failing for two decades. But I know what's not going to work because it hasn't been working for the last 20 years and it's not going to suddenly start working magically.

-M

[mrp]

So as part of the outreach form smaller publishers, one program I thought was an interesting attempt was that Valiant Comics sponsored comic retaielrs to set up booths on the Vans Warped Tour this summer to promote their books.

Our local retailer was part fo the program, Valiant paid for them to have a booth at the Warped Tour show here in Ohio...





bringing comics to places where crowds like this are...



I talked to Tony (the shop owner) and he said it was moderately successful but he did have a lot of people new to comics checking out stuff and making purchases.

A small step, but it's not doing the same old thing expecting different results, so that's something.

-M

[Von K]

Valiant also participate in the Kindle Worlds initiative on Amazon.

[mrp]

Part of what got me thinking about this was a conversation I participated in with the esteemed Mr. Busiek on an invitation only Avengers mailing list many years ago (back when Kurt was writing Avengers and had just been announced as the writer on Conan) where he lamented the loss of the newsstand and pointed out it would cause comics to lose generations of new readers who would not discover comics as we had, on newsstands, in convenience stories, in grocery stores, in drug stores, etc. The direct market would continue to lose readers, as comics always had, but without new readers coming to replace them. He intimated he thought it would bite the comics industry in the ass in about 20-25 years. Well here it is just about 20 years later, and lo and behold, look what is happening.

It's a conversation that stuck in my mind an one I have continued to pursue over the years with other industry professionals I have met, retailers, collectors, fans, readers, etc. etc. all of which have contributed to shaping my views on the matter over the past 20 years. My background in economic history (from a previous academic career) has helped provide some context to these conversations, as I tend to look for patterns ans cause effect relationship where others don't and looking at longer trends rather than reacting to more immediate events that often are mistaken for causes but are really effects of previous causes. But this is more a matter of putting various pieces others have seen/noticed and remarked on together into a bigger picture, kind of synthesizing a theory from all those pieces rather than me coming up with anything whole cloth on my own. If I have made errors in the synthesis, they are wholly mine, not the people's whose ideas influenced and fueled my pursuit of the theory.

Over the last 20 years people have been predicting this that or the other thing would bring the people to the comics shops to start buying comics, whether it was movies starting in 2000 with Fox's X-Men or 2008 with Marvel Studios Iron Man, or TV shows, or video games featuring super-heroes, or reboots of continuity, or tv commercials or radio commercials, Facebook ads, or what not and in the end, none of them brought people to comic shops even though the stories and the characters have gotten more popular than ever.

I just don't think there is a magic remedy that will suddenly get people to go to the comic shops (especially not things like the content of the books themselves, the trade dress including issue numbers etc. that are a concern to only collectors not readers and other customers). Comic shops are essentially a ghetto newcomers won't venture into unless the shopowners go above and beyond in marketing and creating a store environment that appeals to the mass customer not the hardcore comic fan, and those shops usually focus on trades, games and pop culture ephemera rather than monthly comics. AS super-heroes and comic stories get more popular in other media and growth occurs in the book trade, the comic shop has continued to decline and declined faster because it doesn't offer a shopping experience or a product appealing to a contemporary customer, especially to younger potential customers who could be long term future consumers of their product. Doing more of the same or trying to go back to what was perceived to have worked 20 years ago isn't going to change that. Whatever potential solution (or solutions) for the industry decline are out there have to take that bottom line reality into account before the can make any headway to turn things around. There are some short term things that can help, but they require a lot of intensive labor and capital investment without large enough returns in the short term to make it appealing to companies that live and die by quarterly reports as Disney and Warner Brothers (and hence Marvel and DC) do.

So I am not sure I know what the answers are, but I know what things are not the answer because they have a proven track record of failure to turn things around. Whatever the solution is, it needs to find a way to make a comic product that is appealing and accessible to the modern consumer so that the popularity and success of the characters in movies, tv, toys, and video games can be translated into successful revenue generation by the comics themselves in whatever format and in whatever market emerges. In the short term, they need to have outreach programs to get the current product in the hands of new customers (things like the Vans Tour outreach, the movie theatre marketing I mentioned etc.) to raise consumer awareness of the products that are being offered and where they can get them, but long term they need to find a way to produce and deliver the product in a manner (format & marketplace) where contemporary consumers will find it appealing and spend money on it in large enough quantities that they can overcome the obstacles presented by economy of scale, hardcore fan attrition (through loss of interest, change of economic circumstances-job loss, having children, retirement, need to downsize after nest is empty,etc.-, deaths in the older demographics of the customer base-and it is an older and aging demographic that currently makes up the bulk of the comic consumer base, etc. and find a steady source of new readers to replenish those they lose.

Without a steadily replenishing fan base, things fall out of the common culture-as massively popular as characters like Tarzan, The Shadow, Doc Savage, Lone Ranger etc. were, they lost the steady flow of new fans replacing the old and faded from prominence. Do they still have fans, sure, but not at the level where they are sustainable properties continuously producing new content featuring them, and not at a level that has a lot of growth potential. They became niche properties rather than mass properties. The comic properties have grown, so they are not in danger of becoming niche just yet, but the comic book format as we know it has, and it can fade even further from prominence (and possibly disappear altogether) unless it finds a way to evolve into the 21st century marketplace.

-M