This is a modified excerpt from a book I’m working on called The Business of Independent Comic Book Publishing. It’s the fifth installment of my seven part summer series on independent comic book marketing. My plan is to start from the basic idea of marketing and explore the goals and challenges of marketing in the competitive environment of comics.
This week, we try to pin down how to determine the actual number of potential readers in your market.
The size of your target market defines various aspects of your project. A narrow focused market will require different marketing, distribution, advertising and sales strategies than a larger group of ideal readers. Your market size can influence what type of book you create. Depending on your goals and your resources, it might even lead you to alter your definition of your ideal reader or your story idea. You shouldn’t chase a market when you develop your story. The key is to fill a niche that is small enough for you to focus on and large enough to make the effort worthwhile. Marketing expert Seth Godin refers to this as the smallest viable market.
How Do You Measure the Size of Your Target Market?
Measuring market size for an independent comic is as much art as it is science. The psychographics and genre appeal of any story to any individual reader is emotional and subjective (See Who Is Your Ideal Reader?). Market size can fluctuate at will, and there’s no way to track that shift unless you’re Charles Xavier. At the same time, statistical analysis and historical sales figures can only estimate current demand or potential interest in any given story. There are two main methods of calculating market size, but for our purposes, one is superior to the other.
A Bottom Up Analysis involves determining how many retail locations will sell your product and how many units each one typically sells. This type of analysis makes sense for other products, but for independent comics it creates a challenge in terms of data because it is difficult to determine in advance which comic shops, book stores, libraries, alternative outlets, or online retailers will actually carry your book. Amazon will carry most projects, but that single data point might not be enough to justify bottom up analysis, even if they are the 80,000 pound gorilla.
A Top Down Analysis involves determining the overall size of the market and then establishing a realistic estimate of the market share that you can capture. This is a better option for an independent publisher following this book, since you already have access to the competitors in your niche market from our discussion of competition (See Who Is the Competition for Your Target Market?). Of course, there are other sources of marketing data from firms like Ibisworld, but I’m working under the presumption you don’t want to spend a thousand dollars of your investment when free data is waiting for you on the internet. Let’s continue to use Blood Bond I created in the competition post and keep the numbers simple using Comichron’s monthly North American sales tracking as a data source..
Question: If I found ten competitors for Blood Bond and the total number of single issue sales in December of 2018 was 20,000 units, how much could I expect to capture with the first issue of my book?
Answer 1: If the market was divided evenly, then each competitor sold 2,000 copies (20,000 divided by 10) because they each had 10% of the market. If I came in and also captured an equal share of the market, then I would be trying to capture about 9% of the market, or 1,800 copies.
Answer 2: In reality, capturing market share is not that easy, especially for new products on the market. Several analysts in the startup space advise new businesses to assume they can grab no more than 1-5% to start out with, no matter how many competitors are in the market, so we might only be looking at 200 copies sold without effective marketing.
How Do You Measure the Dollar Value of Your Target Market?
It’s one thing to know how many copies you can sell to your target market. It is another thing to understand how much money that market can generate. Market value is the amount of revenue a market generates over a given period of time. For example, if the average price of a monthly comic is $3.99 and 20,000 copies are sold in a month, then the monthly market value of the Blood Bond niche is around $80,000.
There are three things you need to remember when looking at market value for independent comics, because like market size, market value isn’t an exact science.
The numbers are going to be gross not net, so the payments to both the retailer and the distributor will be deducted from what the publishers ultimately receive.
This example only takes into account single issue sales. A similar analysis would have to be done for graphic novels, trade paperbacks, digital sales, or any other distribution model you plan to use.
Comichron statistics track how many units are sold to comic book shops. They do not track units sold to bookstores, libraries or actual comic book readers.
How Do You Measure the Growth Rate of Your Market?
Market size isn’t a fixed number. Every month and every year, the market size can change, especially for luxury entertainment like comics. As an independent publisher, it would help you to know if your market size was growing or shrinking before you make your book.
Fortunately, sites like Comichron have been tracking monthly and annual sales trends since 1995. Once you determine how big your target market is now, go back between six months to two years and see if you can see any trends.
Did the number of competitors go up or down?
Did the overall market grow or shrink?
What do the past trends suggest about the future?
This last question is mostly speculation, since there is no definitive way for you to know what the market will look like two or three years from now. But if you see numbers that are continuously dropping month after month, you might want to take that into consideration.
How Do You Determine the Patterns of Your Market?
In the same way there are trends in terms of rising and falling, there can also be a predicable sequence of events in comic book sales. Check the monthly sales number to see if you can spot them for your niche.
Do more books get sold during convention season or the holidays?
Is there a dry spell every year when no one is releasing new content?
Do sales of new issues fall off a cliff a month after release, or do the sales from month to month appear stable?
Understanding the specific patterns of your target market can help you decide when and how to release your book to give it the best chance to succeed.
Knowing the size and characteristics of your existing market is a helpful tool for building a foundation with your customers. But if you are a new independent publisher trying to fight for the same ideal readers as all of your competitors, you will be fighting a battle that most publishers lose. It is vital for your project and for the industry as a whole to expand the target market to that vast untapped population that has never read a comic before.
We’ll explore ways to increase your target market next week.
Have fun with your comic.
If you have questions about the business or legal aspects of your comic book publishing and you'd like a free consultation, please contact me and we can set something up that fits in with your schedule.
PLEASE NOTE: THIS BLOG POST IS NOT A SUBSTITUTE FOR LEGAL ADVICE. IF YOU HAVE AN ISSUE WITH YOUR COMIC PROPERTY, DISCUSS IT WITH A QUALIFIED CONTRACT ATTORNEY OR CONTACT C3 FOR A FREE CONSULTATION