And speaking of those advances…

My last post touched on publishers paying out-of-whack advances in order to attract the hoo ha authors and their hoo ha stories and, in the process, are going belly up. Everyone dreams of the gynormous advance – buying small islands, telling one’s boss to go blow themselves, playing Hemingway and writing and boozing it up while raking in grand royalty checks. But reality is far less forgiving and far more cruel.

What goes up, can come down

I know any number of authors who received some pretty hefty advances – at least 50k – and are now without homes. Or agents. I’ll rewind to a few years ago. Their agents sold their stories to Big Hoo Ha Publishers for some nice coin, even though they were debut authors. The books came out and…and…didn’t do as well as everyone had hoped. The authors didn’t earned out and their sell-throughs were dismal, so the publisher was out the advance and all the investment they put into producing the books – including the big print run.

Within a year or so, the books were quietly taken OP (out of print), and they were dumped. Their agents also dumped them because they knew none of the Big Hoo Ha publishers would touch them. See, authors who don’t earn out are generally given wide berth, in case their lack of success is akin to germ warfare and they’re contagious.

They go from on top of the world to scraping the bottom of the barrel because they were given a set of parameters they couldn’t meet – such as that big advance.

In another case, the author had a three book deal and a very hefty advance. The publisher decided to stick it out because their investment made it too big to fail in their minds. So they poured more money into the series and gave it a huge promotional push. The author was sent on book tours and a few TV events.

And the book still failed to meet the financial outlay. It didn’t come anywhere near to advancing out. The books are still in print, limping along, but she will never get another deal with the publisher. What went up, came crashing down.

But what if…?

But let’s say their advance had been modest  – then what? Well, for starters, they would have advanced out in a blink of an eye and began earning royalties almost immediately, depending on the size of the print run.

The advance has traditionally been tied to the print run – the bigger the advance, . The size of the advance has been the equivalent of saying, “we believe in you.” The bigger the advance, the more books they need to ship out because they have a bigger belief the book will be a hit. But that belief is a crapshoot because we can’t control the one thing that our success hinges upon – The Marketplace, which is a very fickle mistress.

Some books become major hits when no one expected it. Conversely, expected hits have tanked. A huge advance puts a lot of pressure on the author to perform or be deemed unsuccessful. Problem is, once the book is published, it’s pretty much out of the author’s control. Yes, they can promote heavily, but you can’t control what readers buy.

Traditionally, large publishers print up very large numbers of a title in order to saturate the marketplace with that book. They have to do this in order to earn back their investment. And if it fails, they’re left holding the bag. The first person they’ll blame is the author, and they do that by bidding them adieu.

Where Reality and Dreamland Collide

So that large advance you or your agent is pushing for may be your downfall by adding undue pressure for you to succeed. You’re a debut author without any kind of track record or readership, so it’s a scary time. And let’s say you earn out and your book enjoys a pretty good sell-through. You may be offered a contract on another book. And guess what? Your advance will be even bigger, and the print run will be astronomical. To me, this is a setup for failure because they keep raising the bar. At some point, the bottom will fall out – and guess who eats it? Well, yes, the publisher, but also the author.

Once you’ve bottomed out, you’re damaged goods, and no one will touch you.

This is an infinitely stupid way to run a business. Why should it be so hard to tailor one’s business in order to enhance the success for everyone? The Big Gun mentality is to make bigger bucks with fewer authors. This means a lot of risk AND a lot of great books that won’t be included in their lineup. But that’s the way with conglomerate publishing. They are owned by companies who know squat all about publishing, yet they insist on fantastic results.

Let’s face it, getting the big bucks is great. Fan-freaking-tastic. But just know what befalls you on the other side of that coin. These are tough times and publishing is in a state of evolution. Be sure that you have all the facts in order to make decisions that will ensure your success rather than becoming yesterday’s news.

9 Responses to And speaking of those advances…

  1. NinjaFingers says:

    Preaching to the choir here. I want a small advance and a decent marketing budget.

  2. Suzi McGowen says:

    I’ve heard more than one author talk about using a pen name because they couldn’t sell (anymore) under their original name. The advances were too big, they didn’t earn out, and now the publishers won’t look at them.

    It’s bad enough to have to go through the whole “starting as an author” process once. Can you imagine having to do it twice? (Or more!)

  3. The problem with the pen name is few are fooled since you need to provide your real name at some point.

  4. Tara Maya says:

    Are publishers willing to consider trading a big advance for a higher percent of royalties? I admit, I’ve only been published in ebooks, where the no advance/higher royalties is standard, so I’m used to this model. It makes more sense to me than making the publisher take a big risk, and then punishing the author if the risk doesn’t pan out.

  5. Tara, many elements of a contract is negotiable, and royalty rates are absolutely included in that mix. That’s why it’s so important to have an agent. They know how to negotiate these kinds of deals.

  6. Anon says:

    Hi Lynn
    I was hit by this in a slightly different way and not as a debut author. My UK publisher paid me a higher-than-usual advance for two books because they had a link with a US publisher whom they were confident would take them too. Then the recession hit and the US publisher changed its mind about a whole load of the UK authors, including me. Cue unearned advance; cue unhappy publisher. And I get to feel guilty. 😦

    Your post is spot on, of course.

  7. Hmm…foreign distribution…you bring up an excellent point, and I should do a separate post on this because it’s a tricky beast that can yield a lot of cool things and a lot of scary things.

    Mind you, I know squat all about your situation, but I certainly hope your publisher isn’t making you feel guilty because you shouldn’t. Not for a minute. This is a game of chance, and we all play the game in the hopes that we guessed correctly.

    Personally, I’m very leery of foreign distribution because sales are completely out of the publisher’s control. If the author and publisher reside in the UK, then how can one promote a book in the US? The author is an unknown and is unable to promote their book in the US, so what will compel a reader to pick that UK book off the shelf?

    And how many US bookstores will actually stock that UK book? It’s hard enough for US publishers to get their books stocked – and I’m talking everyone here – large and small publishers. Foreign distribution costs a ton of money, and I don’t think that (on average) the small indie press has enough clout to make enough money on the deal.

    Again, I don’t have the particulars on your deal, but I would never offer a larger than normal advance just because I struck a foreign distribution deal because I know full well that it’ll probably end costing me a bundle with little assurance that it will make money.

    So don’t feel guilty, Anon. They gambled and lost, and it’s not your fault.

  8. Most of the genre writers I know use up to 25% of the advance on promotion which the publisher won’t or can’t do. Cut the advance and there goes some of that expensive promotion.

    Also, many nonfiction writers depend on the advance to pay their expenses regarding research, interviews, etc., while they are writing the book. Unlike fiction writers, they sell with just a few chapters and an outline which is usually changed by the publisher so, no advance, no book.

    One size does not fit all.

    A savvy, experienced agent should help you make decisions like this.

  9. Marilynn, thank you for bringing in another perspective. And you’re absolutely correct – one size doesn’t fit all, and those advances are used to help defray promo costs. I maintain that there is room for sanity to reign supreme in order to help authors be successful – which should be everyone’s goal.

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