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The Shrinking Direct Market

post #1 of 101
1/27/09 at 2:13am
Thread Starter 
Diamond Comic Distributors, the wholesale (and monopolistic) distributor for the Direct Market, has recently announced that they're raising their order rates, making it much harder for small press companies and self-publishers to get their stuff distributed throughout North America.

I fondly remember the days when I could go to the comic store and buy issues of Eightball, Acme Novelty Library, Frank, Yummy Fur, etc. These days nearly all of those are gone...Acme survives by being sold through book chains in its redux hardcover book format...Love & Rockets, a pamphlet mainstay for three decades, has been turned into an annual magazine so it can survive through book chains as well. Most independant cartoonists are turning to long-form work that can be published in book or magazine format (I just read today that Kevin Huizenga, whose work you really should read, is cancelling his pamphlet comic Or Else and focusing on book efforts).

I've known for awhile that pamphlet comics were slowly dying, but it's fair to say that the small press is the canary in the coalmine. Even Mike Richardson, CEO of Dark Horse, hinted recently that the future of DH comics might rely on trades, with monthly or semi-monthly pamphlet comics being phased out altogether as it hangs on to booksellers for survival.

In a few years I suspect the Direct Market will be "Marvel comics and some anime figurines". I'm curious what shape comics will take afterwards...or how younger cartoonists not interested in drawing, say, Spider-Man, will be able to break into such a business.
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post #2 of 101
1/27/09 at 10:52am
I'd venture online comics as well as the book/trade would be the future for independents. Online especially, as it pretty much eliminates much of the overhead publishing costs-wise, plus the creator isn't locked into a monthly schedule or # of copies sold. Those costs can be spent on advertising instead. Granted, they may not make much money at first, but I'd wager a good chunk of the independents aren't making a lot of money now anyway.

In another thread, someone suggested that companies like DC and Marvel may eventually become less concerned with comics and more focused on licensing. Cartoons, toys, movies, etc. seem to bring in more money to the companies than the latest crossover event (I think - I could be wrong, but I could swear I'd read Marvel made more money on Iron Man and the Hulk movies than they did for most of their 2008 comics output).
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post #3 of 101
1/27/09 at 11:25am
This has been a long time coming. The direct market could never support the indies unless the superheroes were booming. A lot of guys like Fantagraphics, Dark Horse, Drawn & Quarterly recognized this and started marketing their wares toward the traditional bookseller's market.
Online is the venue of choice now for grassroots indy artists now. Keep in mind that most indie comics never turn a profit, let alone a livable wage, for their creators. If American Splendor or Zap were launched today it would be carried on Blogger.
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post #4 of 101
1/27/09 at 11:28am
Quote:
Originally Posted by Timothy225 View Post
In another thread, someone suggested that companies like DC and Marvel may eventually become less concerned with comics and more focused on licensing.
That may have been me. I'm convinced Marvel has already made the decision to simply let the comics run themselves out and concentrate expansion on other vehicles such as movies, DVD, video games.
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post #5 of 101
1/27/09 at 12:01pm
Quote:
Originally Posted by BobClark View Post
That may have been me. I'm convinced Marvel has already made the decision to simply let the comics run themselves out and concentrate expansion on other vehicles such as movies, DVD, video games.
Thought the idea was familiar!
Yeah, Marvel's riding high nowadays with the films, DVDs, toys, etc. and DC seems to be following suit. The comics themselves have been so off of kids' radar (least in my neck of the woods) for so long that it's more likely I'll see Elvis at my local shop before I see a kid in there plunking down any money for books.

As for the independents, I see those sections of the shelves get smaller and smaller every month, and the Graphic Novel sections grow larger and larger. Plus, with the way the economy is now, and spiraling production costs ($3.99 for a comic? Are you shitting me?), I'm convinced the internet's the way to go. You can pretty much draw, color, add text and special effects in Photoshop (save $$$ on paper and ink!), PDF the sucker, post it online, and charge a fee to download. The viewer can print the comic out, or save it to their desktop (saves on buying long boxes). It'll kill the comics as investment industry, but I figure that's pretty much dead anyway.
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post #6 of 101
1/27/09 at 12:16pm
Has it ever occurred to the Big 2 to trim back their lines to one core book per character/group? That seems like a good way to cut costs and keep readers, who would no longer feel pressured to buy four different titles to follow one character.
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post #7 of 101
1/27/09 at 12:18pm
Someone get Cordo in here.
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post #8 of 101
1/27/09 at 12:26pm
Quote:
Originally Posted by Timothy225 View Post
It'll kill the comics as investment industry, but I figure that's pretty much dead anyway.
Let's all hope so.
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post #9 of 101
1/27/09 at 12:33pm
Someone still has been paying for CGC grading? Those dumb bastards.
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post #10 of 101
1/27/09 at 12:41pm
Quote:
Originally Posted by Richard Dickson View Post
Has it ever occurred to the Big 2 to trim back their lines to one core book per character/group? That seems like a good way to cut costs and keep readers, who would no longer feel pressured to buy four different titles to follow one character.
I'd been a big believer of that for decades, but there's that large percentage of fans that HAVE to have Uncanny X-Men, X-Men, New X-Men, Wolverine, Wolverine and Son, Wolverine and Mom, Oh That Wolverine!, Ultimate Wolverine, Wolverine and 18th Century Quantity Surveying, etc. They bring in bucks to the comics companies, and the extra shelf space forces other competitors' titles out the door.

I always felt having multiple titles for a character kind of meant you'd burn through story ideas that much quicker. One or two titles max for your biggest characters is enough, IMO.
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post #11 of 101
1/27/09 at 12:46pm
Quote:
Originally Posted by EdHocken View Post
Someone still has been paying for CGC grading? Those dumb bastards.
Not me - that struck me as such a scam (I always found the 700% markup between a NM comic and a CGC graded comic very suspicious). Hell, it wasn't that long ago you could get CGC packaging at your local shop, and I used to work with the suppliers for CGC's holograms, so it'd take me 5 minutes to make my own authentic CGC stuff.

Still, "there's a sucker born every minute".
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post #12 of 101
1/27/09 at 12:46pm
Quote:
Originally Posted by Timothy225 View Post
...Uncanny X-Men, X-Men, New X-Men, Wolverine, Wolverine and Son, Wolverine and Mom, Oh That Wolverine!, Ultimate Wolverine, Wolverine and 18th Century Quantity Surveying, etc.
Thank you, Timothy. I needed that laugh.
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post #13 of 101
1/27/09 at 12:55pm
Live to serve, Judas.

I'd read a bit more about this at CBR - Diamond's take is that doing this will weed out the folks who are more interested in selling an idea to a TV or movie studio as opposed to an independent getting a regular ongoing series out. Makes sense, but it's obviously a double edged sword. They also run the risk of losing a lot of good independent stuff, but I'd guess they aren't TOO broken up by it as they have all that Marvel and DC money to fall back on.

I'm just waiting for the inevitable crash, like we had in the '90s, except there'll be more panic this time around. I see DC is already letting some folks go due to the economy (their parent company Warner Bros. is cutting staff at all their companies. Will Marvel follow suit?).
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post #14 of 101
1/27/09 at 1:52pm
Quote:
Originally Posted by Timothy225 View Post
I'd been a big believer of that for decades, but there's that large percentage of fans that HAVE to have Uncanny X-Men, X-Men, New X-Men, Wolverine, Wolverine and Son, Wolverine and Mom, Oh That Wolverine!, Ultimate Wolverine, Wolverine and 18th Century Quantity Surveying, etc. They bring in bucks to the comics companies, and the extra shelf space forces other competitors' titles out the door.
Yeah, you've got to think that the Marvel and DC bigwigs have done the math on this stuff, and know that the way they're doing it maximizes short-term profits.

Long term is another story, but who's really expecting the big two to think long term?
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post #15 of 101
1/27/09 at 1:55pm
Quote:
Originally Posted by Timothy225 View Post
Oh That Wolverine!
This may have been a short lived series, but it was my favorite.

The larger indies have branched out to other distributors. I'm not saying losing a chunk of Diamond sales won't hurt, but they've been bracing for impact for a few years now. It's the guys between Marvel and Top Shelf (Oni, Dark Horse) that will probably feel it the worst.
And let's not forget the real victims here- Mad Magazine readers. The usual gang of idiots have been reduced to a quarterly publishing schedule! YEECH!
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post #16 of 101
1/27/09 at 1:57pm
Quote:
Originally Posted by Timothy225 View Post
Diamond's take is that doing this will weed out the folks who are more interested in selling an idea to a TV or movie studio as opposed to an independent getting a regular ongoing series out.
Diamond is only interested if they are the one making the money.
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post #17 of 101
1/27/09 at 2:14pm
Quote:
Originally Posted by James May View Post
Diamond is only interested if they are the one making the money.
You're right, but the claim to weed out the TV/movie idea folks was the cover story they gave out.

Re: other distributors, apart from Haven, who are the others? I only ever see Diamond Previews (I hear that might be going away as well) at the shops.
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post #18 of 101
1/27/09 at 6:04pm
Some food for thought-
http://www.atomic-robo.com/?p=330
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post #19 of 101
1/27/09 at 9:57pm
So much for getting back into self-publishing again.

I've got boxes of my books crowding my garage. Any ideas? I was considering going to local cons and handing them out at the door or donating (as they're kid-friendly) to children's homes/hospitals.
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post #20 of 101
1/28/09 at 1:28am
Quote:
Originally Posted by DARKMITE8 View Post
So much for getting back into self-publishing again.

I've got boxes of my books crowding my garage. Any ideas? I was considering going to local cons and handing them out at the door or donating (as they're kid-friendly) to children's homes/hospitals.
publish them online. pimp the shit out of yourself. Get enough readers to be able to sell advertising space.
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post #21 of 101
1/28/09 at 1:58am
They're really going to $3.99 a comic? Anyone who pays that is an asshole.

Diamond could go out of business and it wouldn't hurt comics creatively, so This isn't really big news. Ten years ago it would be a problem
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post #22 of 101
1/28/09 at 11:44am
Quote:
Originally Posted by DARKMITE8 View Post
I've got boxes of my books crowding my garage. Any ideas? I was considering going to local cons and handing them out at the door or donating (as they're kid-friendly) to children's homes/hospitals.
Give them out on Halloween.
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post #23 of 101
1/28/09 at 1:54pm
Something I've never understood: why can't comics be sold on newsstands and at convenience store magazine racks again? I think there may be formatting issues, but so what? I know Mad can still be seen on magazine racks, ditto Archie and Disney I think (at least, I saw them there within the last decade--maybe something's changed).
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post #24 of 101
1/28/09 at 1:56pm
If I remember correctly, it's because unsold magazines are returnable, whereas comics aren't.
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post #25 of 101
1/30/09 at 3:18pm
Quote:
Originally Posted by BobClark View Post
Give them out on Halloween.
We get zero traffic in my neighborhood, but I may hand them out at work, when people bring their kids in. Good idea.
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post #26 of 101
1/31/09 at 10:29pm
Quote:
Originally Posted by Matt M View Post
If I remember correctly, it's because unsold magazines are returnable, whereas comics aren't.
OK, so...why would that be? I just don't see why monthly pamphlets aren't embracing a sales model that has proven successful in other media.

Comics are finally starting to diversify a little subject-matter-wise, now they need to diversify in terms of distribution. Bookstores are nice, but they're not going to save pamphlets. Newsstands seem like the logical alternative to comic stores--I'd like to know why comics gave up on that form of distribution in the first place.
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post #27 of 101
2/1/09 at 2:51am
Thread Starter 
Newsstand comics are returnable, just like magazines, which is apparently why you don't see them on newsstands anymore...you can thank the direct market:

Quote:
Back in the late 1970s and early 1980s when the newsstands were still a major sales channel for comic books, it was not unusual for more copies to get returned than sold. Sometimes returns were nearly double the number of units sold. As the direct market took over and the returnable sales from the newsstands became a smaller and smaller percentage of the overall sales, publishers like Marvel were able to reduce the number of units printed and never sold significantly. In some cases, this unsold portion accounts for less than 3% of the total print run for an issue. The bottom line is that the non returnable sales in the direct market are a much safer business model for the publishers. Keeping the titles on the newsstands involves a bigger risk for the publisher.
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post #28 of 101
2/1/09 at 4:09pm
Fine for Marvel and DC, but clearly the other publishers need to get on that shit ASAP.
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post #29 of 101
2/1/09 at 4:18pm
It's a dead end, prankster. The entire periodical industry is dwindling. Magazines are dropping like flies. Trying to infiltrate the newstand market would be jumping from a lifeboat onto the Titanic.
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post #30 of 101
2/1/09 at 4:40pm
Yet I'll bet the periodical market is still doing better than comics, and when the dust clears, there will still be periodicals on newsstands. Comics pamphlets have a far more uncertain future.

Even if it's just a short-term solution, I bet it could get some smaller publishers though the worst of the economic downturn. In the long term, if something new has to be dreamed up, fine. But in the meantime, they need to get their fucking product out there, and that seems like the best way to do it.
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post #31 of 101
2/1/09 at 4:42pm
Prankster, you're a nice guy, but you're also the guy on this board who can most be counted upon to say things that have little bearing in reality. Some periodicals may survive, but the reality is that 90% of the periodical market will not exist in ten years as we know it today. Publishing on paper is a waste of time for people who don't have a market share in that medium already.
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post #32 of 101
2/1/09 at 4:44pm
But there's no market for Scott Pilgrim and it's ilk on the newstand. The newstand market is middle american mainstream. It's Us and Time magazine. Not to mention the fact that most indie titles have cuss words and sexy bits.
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post #33 of 101
2/1/09 at 5:04pm
Quote:
Originally Posted by Richard Dickson View Post
Has it ever occurred to the Big 2 to trim back their lines to one core book per character/group? That seems like a good way to cut costs and keep readers, who would no longer feel pressured to buy four different titles to follow one character.
DC takes this approach.

Batman has Detective Comics and Batman.

Superman has Action Comics and Superman.

And to be fair, both those comics have been around since the 40's.

Green Lantern has his own book which is a Hal Jordan book and there is also Green Lantern Corps which is more Kyle Rayner and general Green Lanterns. (both those comics are in my opinion the best comics you can buy)

There are no other multiple books.
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post #34 of 101
2/1/09 at 5:10pm
That's true if you just count the in-continuity books. But there's the All-Star book for each character, plus the Superman/Batman book, plus Batman and the Outsiders.
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post #35 of 101
2/1/09 at 5:21pm
Basically, it's not Marvel and DC completely (or even mostly) at fault, it's Diamond's. They're the ones responsible for the books being priced they way they are - then the cause and effect breaks down where Marvel and DC have to print more titles to make it worth distributing through Diamond. The only problem is that Diamond isn't sinking the "direct market", it is the direct market and there's going to be a large backlash coming from the "big two" in the very near future because they can't afford it. As Diamond has lost distribution business from the smaller and independent publishers, who realized a long time ago it wasn't even worth it anymore, they've had to begin raising their fees to compensate for all of the lost business. In the next decade we're going to see maybe a 20% reduction in comics being printed - online comics won't be as big as people are speculating and with the high price of "motion comics" those won't really grab people either - but we'll have lower fees for publishers because there are going to be several alternative distributors springing up that will eventually make it more of a market than the monopoly it's been.
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post #36 of 101
2/1/09 at 6:34pm
Quote:
Originally Posted by devincf View Post
Prankster, you're a nice guy, but you're also the guy on this board who can most be counted upon to say things that have little bearing in reality.
Wow, really? Worse than Snaieke? Worse than Noah?

Anyway, how does my post even conflict with yours? I said that there would still be periodicals in the future, so did you. I didn't say they'd be thriving, just that they're probably doing better than comics right now, in spite of everything. And that it might be a short-term thing for minor publishers who are going to be fucked over by what Diamond's doing. This is triage I'm talking about, not a solution to all their problems. Honestly, I can't see a way it wouldn't be rough for comics, but what else are they going to do?

The direct market is a shitty distribution system that's about to get shittier. The problem for non-Big Two publishers is going to be getting their stuff out there in some form or another. I'm not saying this is an ideal solution; I don't know what is. But there's still drugstores and newsstands out there, frequented by people who don't go into comics stores. Why not pursue them? Is the periodicals market seriously that much worse than the direct market? Even in a year's time, will it be? If the only choices are between shitty distribution systems, why not try as many as you can simultaneously? What's the downside? I'm seriously asking.

Scott Pilgrim, and trades in general, are another thing. I'm talking about floppies.
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post #37 of 101
2/1/09 at 6:37pm
Let me put it this way: aren't comics publishers already in the periodicals market? Given that, doesn't it make sense to try new avenues of distribution?
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post #38 of 101
2/1/09 at 6:57pm
The days of using newsstands, 7-11s (remember when they used to have Slurpee cups with superheroes on 'em? And comics cost 10 cents? Ah, to be young and foolish again), etc. to distribute comics is long gone, thanks to the direct market, like Dax stated. Comics in general don't have the audience they used to anymore (re: kids), so there's really no incentive to drop $$$ on distribution costs to a newsstand chain, where chances are you'll get more copies returned than sold.

Until the direct market changes - if it ever does - the best bet is to eschew floppies altogether and take to the web. Devin's right, most periodicals that are around now will most likely be online only within 10 years or so, as it saves money on production and distribution costs - a must in these economic times. Independents could really show their "rebel" attitude and start taking advantage of that now, and beat the Big Two to the punch.

Also saves the collector on storage costs, too (bags, boards, long boxes, etc.). And don't get me started on how the trees feel ("There is unrest in the forest, there is trouble with the trees...")
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post #39 of 101
2/1/09 at 7:07pm
Marvel used to make a push at the newsstand market every few years, and failed every time. That was part of the original pitch of the Ultimate line: they'd publish a magazine-format collection of Ultimate comics every month. Pretty sure that was their last such experiment.

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post #40 of 101
2/1/09 at 7:11pm
Quote:
Originally Posted by Timothy225 View Post
The days of using newsstands, 7-11s (remember when they used to have Slurpee cups with superheroes on 'em? And comics cost 10 cents? Ah, to be young and foolish again), etc. to distribute comics is long gone, thanks to the direct market, like Dax stated. Comics in general don't have the audience they used to anymore (re: kids), so there's really no incentive to drop $$$ on distribution costs to a newsstand chain, where chances are you'll get more copies returned than sold.
If the economics really don't work, then fine--I'm just always dubious about the comics industry having considered every option, when it seems like they sometimes don't even want to consider more than one option. But the reason comics don't have the audience they used to is that they stopped supplying to anyone outside these cramped little stores. They can't reach kids anymore, at least in floppy form. So it's a vicious cycle.

No argument, though, that the time to try this was probably a decade or two ago. It's just that I don't see any good options left, so maybe this is one of the less bad ones.

By the way, Dark Horse has been working to get online and revived Dark Horse Presents as a web-only mag, so maybe they're going to be in the vanguard of this stuff.
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post #41 of 101
2/1/09 at 7:13pm
Quote:
Originally Posted by Matt M View Post
Marvel used to make a push at the newsstand market every few years, and failed every time. That was part of the original pitch of the Ultimate line: they'd publish a magazine-format collection of Ultimate comics every month. Pretty sure that was their last such experiment.
OK then. Though as we already mentioned, the economics may affect Marvel differently than a smaller publisher...but OK, OK, fair enough. I concede the point.

Online it is, I guess.
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post #42 of 101
2/1/09 at 7:42pm
Quote:
Originally Posted by The Prankster View Post
Let me put it this way: aren't comics publishers already in the periodicals market? Given that, doesn't it make sense to try new avenues of distribution?
Not ones that will be dead within the next five to ten years, especially when they were never all that robust to begin with. The point of pushing into alternative venues is to expand production semi-permanently. No sane business model involves spending money to jump on to markets that are already on their way down.

I've been saying for years that while monthly print comics may not die altogether, they'll no longer be the primary form that comics take. As the article that Bob linked points out, creators are running out of compelling reasons to seek out the print form in favor of online distribution. In fact, at this point, I would say that print comics exist more out of a sense of tradition than any kind of business sense. Comics fans simply don't want to give up on them. But the people who grew up with physical comics are going to be dead eventually, and the new audience will demand something that actually makes sense.
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post #43 of 101
2/14/09 at 2:47pm
Chris Butcher, manager of The Beguiling, one of the best comics stores in existence, has a great post on why Diamond is being extremely stupid.
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post #44 of 101
2/14/09 at 5:20pm
He's 100% right.
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post #45 of 101
2/14/09 at 6:43pm
In the end, this will probably turn out to be a good thing for the end user comic reader, but it's going to be hell for the middle man business owner. We've been seeing the decline of the comic shop for a long time, but this could be the end of it altogether. Web distribution is just too easy a way for creators to be in direct contact with their readership, and with minimal payout to other parties.
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post #46 of 101
2/14/09 at 7:46pm
Here's a question. It's axiomatic--and borne out by the recent box office--that movies make more money in economic hard times. Actually they seem to apply it to entertainment in general, so does that mean comics will benefit as well? I'd say they wouldn't because they're so overpriced, but movies are pretty damn overpriced too.
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post #47 of 101
2/14/09 at 7:51pm
Movies are only overpriced if you're only talking about theatrical viewing. Home video is actually one of the most economical forms of entertainment out there, especially when you factor Netflix into the mix.

Comics are now four dollars for something like ten minutes of entertainment. That's insane. Even if you are watching movies in a theater, they kick comics' ass.
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post #48 of 101
2/14/09 at 8:25pm
True, and that's why I'd like to know how this applies to other forms of entertainment as well--books, music, etc. Has concert attendance gone up since the economy hit the skids? Those are pretty overpriced.
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post #49 of 101
2/14/09 at 8:42pm
The sales in comics have mirrored the economy almost perfectly, except that we started slipping just before things got bad because people were already starting to tighten up their spending. When people are starting to budget for necessities, comics are the first items scratched off the list. With that being said, we're not starving. Our shop has been around and in the same location for almost 30 years so even if only the dedicated customers came in we'd still be doing alright. Same can't be said for a lot of other shops, though. The bottom hasn't dropped out quite the same way it did in the 90s, but a lot of shops are going to start closing up once it no longer becomes financially logical.
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post #50 of 101
2/14/09 at 9:07pm
I only hit the comic stop once a month, buy my usual books and get out. It's to the point where spending 3.99 to try out a book is annoying. Yet I feel like a prick if I stay there, read the book and then put it back on the shelf. So is there anything in this stimulus package that will help bail out the comics? I've been going to the same shop off and on for like 12 years. I'm surprised they are still in business (really, they sell old school transformers for up near $100) I'm on a rant....
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