Your Book's Bottom Line

Promotion, Profit or the Poorhouse

By Deb Simpson

The opening installment of this four-part series, "Your Book's Bottom Line", focused on book development costs. In this article, the focus will be on marketing costs, including promotion, advertising, book reviews, promotional items (bookmarks, etc.) and promotional events (book launch parties, signings, etc.). This is an area that can be expensive, exhaustive, and confusing for many authors. It is also an area where the costs can quickly erode the book's profit margin. Therefore, remaining aware of, and in control of, promotion costs is vital to your book's bottom line.

First, a review of some of the terms used in this article:

Marketing: The selling of an idea. Includes Product, Position, Promotion & Pricing, but begins with Branding. May include domain names, book themed websites, press releases, social network postings, email marketing, logos, trademarks, etc.

Advertising: Paid announcements. May include advertisements for websites, social networks, newspapers, magazines, billboards, radio, TV, etc.

Book Reviews: Book evaluations. May include paid or unpaid reviews, provided on websites, book jackets, promotional items, etc.

Promotion: Activities to encourage sales. May include promotional events, items, advertising, and more. Features the book's name, logo, tagline, description, etc.

Promotional Items: Items used in marketing / advertising. May include bookmarks, flyers, brochures, toys, key-rings, magnets, t-shirts, hats, book give-aways, etc.

Promotional Events: Events used for marketing / advertising. May include book readings, signings, speaking engagements, book fairs, etc.

You may find that you use all of these tools, some of them, or others that are not listed here, but promotion of your book, however accomplished, is often the factor that both drives the book's success and affects its overall profit.

There are many excellent sources for marketing or promoting your book, and for developing marketing plans and tracking effectiveness, so I will not cover that in depth this article.

One key point to remember is that marketing and promotion do not begin when the book is published. In fact, they may even begin before the book is written! (Think of celebrity memoirs).

It is common today to purchase a domain name in advance of a book's publication, and to develop a branding approach, to include taglines or subtitles in the book's' advance marketing.

Book reviews are often obtained before a book is commercially available, and are used on the back cover or book jacket as a marketing/sales tool for the book. And, the marketing and promotion continue throughout the publishing lifetime of the book, from the book launch parties, to book fairs, speaking engagements, and ongoing social media postings. As most of us are launching and promoting our second book, we continue to market the first, and this process continues with each successive publication.

So, how do we track the costs for one book vs. another? Here again, I use a simple Excel spreadsheet, as I do with book development (1st article in this series), but for the ease in showing the approach for this article, I used a table. Another option would be to use an accounting software application, such as Quicken® or QuickBooks®.

As we discussed in the first article, the total cost for marketing and promotion is then spread across the total books sold, to determine the cost per book. For example: If 100 books were sold, the marketing and promotion costs shown above would equate to $7.57 for each book, but if 1000 were sold, the cost becomes $0.76 per book. As you can see, the costs of promoting you book must be tracked and considered to determine your book's bottom line.

Please notice that the costs outlined for the book do not include general marketing costs, such as the fees related to hosting your author's website — this is an overall business expense and will be considered in your general business accounting, not in the accounting specific to this book (unless there is a specific website and hosting fee for the book itself). Also, please note that you may classify your costs differently (you could lump them all together rather than break them up by prepublication, etc.). As long as you track them, and have receipts with dates and times, the specific categories are up to your discretion, or that of your accountant.

The next article in this four part series will focus on publication costs, form an author's perspective. Although this is more important in self-publishing, all authors need to understand the overall publication cost to better understand your book's bottom line.

If these articles have been helpful to you, or if you have comments or questions, please contact me through my Web site (link below). Thank you and Happy Writing! •

Next: Formats, Fulfillments, and Fees »

© 2011 Deb Simpson. All rights reserved.

Deb Simpson writes fiction, nonfiction, and poetry. She's been employed in the healthcare industry for more than twenty years and holds a degree in Business Management. More »

Updated 1/5/14