DC Says Print & Digital NEW 52 Sales Exceeding Expectations
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When DC Entertainment had a chart-topping September when the company relaunched its comic book universe, executives touted the sales success.
But what about October?
The release today of October's top 100 comic books and market share results showed that month 2 of DC's "New 52" reboot was a big one for the publisher.
There's no doubt sales have dropped since September, since DC isn't talking about 100,000-plus sales on multiple titles like the publisher was in September.
And once again, DC has made its sales executives available for the press, to talk about what the numbers mean as the company tries to capitalize on the success it experienced with its relaunch.
To follow up on today's release of October sales numbers, Newsarama talked with Bob Wayne, DC's senior vice president of sales, and John Rood, the company's executive vice president of sales, marketing and business development.
Newsarama: Let's just start with the numbers you've seen so far. You guys had told me that September print numbers far exceeded projections, and the digital numbers were about what you expected. What about the second month? How do they compare to sales projections and expectations?
Bob Wayne: If you go with what our expectations were from a number of months ago, when we had to budget this out for the rest of the year, we're certainly still well above our expectations.
If you go for how we were feeling once we saw how September turned out, this is gratifying that it's continued the same trend and that we had so much strong reorder activity from September, plus such strong second issue numbers in October that it gave us an unprecedented foothold on the Diamond charts.
Nrama: John, there was a lot of advertising thrown at this initiative. Do you feel like it can survive beyond September without all those marketing dollars being thrown at it?
John Rood: Well, the publicity energy is certainly continuing stronger than we could have expected. Here, 10 weeks after we hit the streets, we're still dialoguing with you guys, and with mainstream press too, so that part's great.
Yeah, our ad dollars were finite. And we certainly want to bring some ad dollars back into market when these New 52s are collected edition Volume 1 in the spring/summer.
But yeah, we're certainly going to see some fall-off in advertising and publicity energy. But so far so good.
Nrama: Are you thinking about continuing television, or are you leaning more toward the co-op advertising? What did you think was the success that you might follow-up with in the spring?
Rood: The co-op is a 12-month imperative. And it's great to see more and more retailers taking advantage of our best in class program. We also are making sure that the incentives that we've announced for January though April are getting communicated to the retailers. It's a challenging time to be a small business owner, and we're really trying to empathize here. Empathize with $2.99 pricing, and empathize with these incentives.
As far as the media mix for consumer advertising, our television weight will wane, but we'll still try to have a digital presence ongoing.
Nrama: I'm interested in the fact that you extended retailer incentives for DC titles through April. What were you thinking was the magic number as far as timing on this? The launch had incentives, and now the continuation has incentives. Why April? Is there something you know that I don't about the magic number of months you have to give incentives to retailers?
Rood: Yeah, that's a good question. Not that much that you don't know. But we really just try to do it in chunks. We felt good about what would be four months at a time. So we're just falling on that rhythm, because that's a horizon, not born of any event per say. More just saying, hey, four months at a time, we need to re-address and revise and re-communicate.
We really were asking a lot of the retailers to change their order behavior, and to change their forecasting. So the incentives are just to say, here's the titles we believe in, and the titles we believe in. And celebrating the distinction between the titles by celebrating distinctions between variants and between returnability and between discounting and the like.
Nrama: DC hasn’t published any second printings for #2 issues, even though you reprinted practically everything in September. What does this change mean?
Wayne: It's really just more reflective of the demand from the readers and the retailers wanting to make sure they could start with the first issues of as many series as possible and get sample as many things as possible.
It's been quite a challenge just to keep up with the manufacturing logistics of publishing literally twice as many comics as we had originally told the manufacturing department we were going to have.
Nrama: Wait, to clarify: When you say twice as many, you don't mean twice as many of the #2's than you originally thought, do you?
Wayne: No, I mean in the sense of having one month having produced, basically, 52 #1 reprints and 52 #2's. That takes a lot of time going through the process and stuff. There's no change in policy where we're planning to do that every month, that next month we'll be announcing, you know, new printings of #2's and #1's to go along with #4's or anything like that.
Nrama: Do you think the lack of reprints on #2 issues means retailers have already found their sales level and the peak has crested already on these?
Wayne: I think it means that, but I also think it means that we took what we learned as quickly as possible from the level of reorder activity and what the total percentage was based on the initial orders when we were setting the print runs for #2's. So we ratcheted it up and went heavier on the #2's than we've ever gone line-wide before.
Nrama: We talked a little about incentives, and your co-op advertising is continuing, but is there anything else that you guys are looking at to help maintain this type of sales level and excitement? What's the plan in place beyond October's results?
Rood: Continuous on-time delivery is something we heard was going to be a concern at the announcement of the New 52, so that's still the thing we're focused upon most.
If we can keep delivering newsworthy stories and do it in a timely manner, that's actually what we're looking at most here.
There's speculation about titles falling off the list, but that's not our concern on the sales and marketing side.
Nrama: Sounds like you saw our Top 10 yesterday. We're only two months in, so it feels a little early to even ask about the lower-selling titles. But at what point do you guys start talking about dropping certain titles from the line-up? Or is that completely an editorial function?
Rood: Well, no, it's a shared function. We really looked at the promise that this initiative was going to give our entire line. We've said to you before, we don't really care about winning the market share battle. Or winning any month, per say. But the data we do look at is things like line-wide average. And when line-wide average is as high as it is, that makes us pretty bullish. And if this is the level the retailers are settling at, we're bullish about that as well.
But yeah, you obviously look at the top of the line. You look at the bottom of the line. And you see, is there any kind of fall-off that's precipitous enough to make us reconsider printing?
But gosh, we didn't expect to have these great kinds of problems to have at this stage.
Nrama: Since Diamond’s October sales reflect retailers response to what they saw in September, what do November orders tell DC about what retailers saw in October?
Wayne: For November numbers, we're seeing that the top titles are holding in above where we had projected. The middle titles are coming in about where we projected. Then the shakeout of figuring out which of the titles are more narrowly focused will become a bit crisper with November.
But since we've had so much volatility on the final order cut-off process throughout this entire run, I'm not willing to say that the market has finished adjusting up or down on any individual title at this point. So we're being a lot more cautious than we would have been if we were having a conversation like this six months ago.
It's much more difficult to know what's happening on an individual title than it was before, just because of all this volatility.
Rood: And the cross-promotion, both from retailer referrals to fans talking to one another, will bring new readership in to titles.
And then when they start to get collected, and a whole portion of readership comes to us via collected editions, we expect there to be a surprising lift on certain titles.
Nrama: Digital day-and-date was up front in the very first New 52 announcement in USA Today on May 31st and was mentioned early and often as a major element to this in every subsequent interview/news story from June through September. But you've been mostly silent on how digital sales did in September and October. Can you indicate how digital sales are doing?
Rood: Yeah, I think we're still quite encouraged by them. And I would reiterate what you mentioned earlier: Both physical and digital are exceeding our expectations. And that right there is a case study. Who else in print can talk about digital as something other than a replacement medium? We're seeing it as additive — nearly entirely additive, if we're to believe our research.
And so that, to me, is still the best part of bringing on both platforms the New 52 to a global audience.
But back to what I said before to you, and you mentioned it on this call, so I'll say it again: The physical sales that is exceeding our expectations is exceeding it greater than the digital sales are exceeding our expectations, and yet they're still exceeding our expectations (he said in a mouthful). [laughs]
So what would you guess the percentage is on digital as a percentage of physical? And I'll try to bark yes or no if you're close.
Nrama: Uhhh... 1 percent?
Rood: Ha ha. You're cold.
Nrama: 10 percent?
Rood: You're much warmer.
And there are iconic titles across the DC Universe that we knew would be the most magnetic to the brand new and lapsed readers. So to have an arsenal of big, iconic names like Batman, and Superman, and Green Lantern, but then also iconic publishing brands like Detective and Action, then you can imagine that there's more digital interest, and in turn commensurate digital percentage of total sales on those big-name titles.
Nrama: DC's decision to have an exclusive deal with Amazon put you guys at the center of the book wars, as Barnes & Noble and Books-A-Million. Neil Gaiman recently pointed out that it's the creators who suffer when books are pulled from bookstore shelves, and he stated that he thinks it's "a bunch of people not talking to each other and overreacting." Are you guys not talking to each other?
Rood: We're talking actively. And we're excited to make news with partners beyond the ones we've made news with already.
Nrama: I hope the next news will be something on an iPad, because I'm a little offended I can't read Sandman unless I have a Kindle Fire. But there's indication the deal with Amazon is only for four months. Is that right?
Rood: I've heard that reported. We'll tell you, we do exclusive deals, much like across any entertainment medium, they aren't exclusionary deals, and they're not in perpetuity deals. So we are keen to put these products in as many hands as possible, and we're keen to partner with brands that want to sell devices, but also want to offer our product across their entire ecosystem.
Nrama: Have you received any word from these bookstores that they'll start to stock the physical copies again, once the digital copies are made available to them?
Rood: I'm not going to go into the details of our dialogue, but that's obviously what we're interested in doing.
Nrama: The last time we talked, you said you hadn't made a decision about whether the Justice League/digital combo pack was a success. Now that you've solicited more digital/print combo packs, can you answer whether the first one was a success?
Rood: Yes, we consider it a success. We chose not to offer something as a Trojan Horse, stuck in purchase whether the customer wanted it or not. We wanted to make it available to those specific customers that wanted to buy the SKU called the combo pack.
Nrama: What percentage of people are actually redeeming the download. Do you know?
Rood: We're in the process of going through those numbers. We intend to share more detail about our retailer and consumer survey with retailers, and then ultimately the press. And then we may get as granular as sharing hard numbers about the combo pack to the retailers and in turn the press, because we want the retailers to be as excited about the SKU as the consumers apparently are.
Nrama: You know, we joked last time we talked about Tom Brevoort's interview where he said that if DC does well, the whole industry does well. But he also said in that interview that he wakes up every day and he comes to work to make sure Marvel stays #1. I'm wondering, do you guys think you're making his job a little more difficult?
Rood: Yeah! I mean, if I can win battles I didn't even realize I was fighting, I guess it's going pretty well!
Here's the second month that we "won" the month, and you're just going to have to believe us when we tell you that this is not something we fixate on.
We probably wouldn't have $2.99 as such an important part of our product offering if we wanted to win the dollar sales market share battle each month.
We probably wouldn't put out as few titles as we do if we wanted to win the unit sales market share battle each month.
Nrama: When this whole initiative was announced on May 31st, there was one quote in particular that predicted something very revolutionary: Dan DiDio said DC would “rebuild and reshape the comic book industry." Sales are obviously strong, but how do you think DC is reshaping the industry for the long-term?
Rood: Hard facts about new readership.
That means new traffic in stores, and new converts to the genre via new technologies.
Wayne: I don't think there's ever been this large of a coordinated effort to bring in new readers, to bring back lapsed readers, and to try make sure Tom Brevoort doesn't sleep.
No, but I do really think this is an unprecedented effort to bring back new and lapsed readers, and just to refocus the enthusiasm of the existing base. I think that is a very significant change in the industry.
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