The State of Publishing 2014 and 2015

As a book publisher I often wonder what the state of publishing will be like in the next year. Will we profit? Will we lose? How are the next five years looking? How were the last five years? What are the trends and how can I catch a ride? This year I decided to pass along my thoughts on the state of publishing in 2014 and 2015, but mostly it is from great data. This is also almost based exclusively on the US market and I am focusing on trade publishing.

The State of Publishing 2014 and 2015

The USA still has the biggest market for English language books, and that is where I tend to focus my marketing. As an adult trade publisher I realize I can only capture a maximum or 18% of the market while the rest is composed of textbooks (29%), professional/technical books (18%), children’s books (8%), and other at 27%.

The market is extremely competitive, but we have also seen that as many firms try to keep their costs low there will be more restructuring, mostly in the form of mergers and acquisitions. A decrease of 0.5% is anticipated from the current level of 2600 competitors. We saw this in the Penguin and Random House merger.

These mergers will also create a decrease in employment along with pay reductions. Be warned: if you are entering the publishing industry, things are looking to become even more competitive.

Risks and Opportunities

Discretionary income is probably the key driver in consumers’ book purchases, so if the economy keeps rolling like it is the book market will stay positive. It was a wash for the past five years as the economy has been in the tank since 2008. This is great as trade publishing will bounce back the most.

The price of paper is expected to remain steady or decrease through 2015 as demand has really slumped due to more digital forms of reading. This is great for small publishers as it allows better profitability on smaller runs and also offers more digital sales.

Library risk should decrease as the economy is growing and consumers do not need to spend less and can return to their old buying habits. Previously, library usage rates increased as consumers aimed to save money.

E-books will continue to hurt brick and mortar bookstore sales as more people make the switch to save money. This will cause more closures and force more people to either buy online or switch to digital formats. I will continue to focus on Amazon and indie bookstores.

In 2015, the publishing industry is forecast to grow by 1.2%, but GDP is expected to increase by 2.5%, meaning that book publishing is, sadly, in a general decline. However, this does not take into account total book sales, just revenue. Decreased revenue may be caused by lower e-book prices with higher sales. So some segments may be growing, but it is hard to identify. Trade publishing is one of the industries that will be the hardest hit, but educational segments will still increase.

In Conclusion

The state of publishing looks to be up for most segments in 2015 and wasn’t too bad in 2014. The market should be a positive one. Thumbs up for being a publisher!

If you would like to know more about one area of this post in particular, please write it in the comments and I would be happy to dig out more info for you.