An Act of Sheer Desperation
"And I must be an acrobat, to talk like this and act like that."
Is Tokyopop screwing over retailers by pulling titles like Dragon Head from the Direct Market and selling them exclusively from the Tokyopop website? That's the question that's consumed comics and manga weblogs over the past few days. Canadian retailer Christopher Butcher accuses Tokyopop of biting the hand that feeds it. British manga blogger David Taylor thinks that this may encourage fans to stop reading series perceived as not selling well. It goes without saying that over at ICv2, retailers are falling over themselves to vent furious frustration.
A clear-cut case of contempt for brick-and-mortar store operators? Not necessarily, says longtime manga translator Bill Flanigan:
"I think Chris Butcher of Comics 212 and Dave Taylor of Love Manga are a little off base when they think that TokyoPop is "biting the hand that feeds it" when it decides to do an on-line exclusive. Every publisher would like to get the books into the retail outlets because that is where the shoppers are. More than likely, the retail chains bit TokyoPop's hand first by deciding on low orders. (Actually, I doubt anybody bit anybody's hand here. These decisions were probably made by looking at the numbers on both sides. I doubt there are any hard feelings on either side over these books.)
I think Flanigan makes, if not a solid case, then at least an arguable one. I've heard Western comics-industry types claim that manga publishers have an "unfair" advantage over their domestic-comics counterparts because they don't have much in the way of overhead costs like, you know, actually paying writers and artists. As Flanigan makes clear in another part of the linked essay, however, this simply isn't true: Aside from the up-front licensing costs, there's also the costs of translation and production — and since the overwhelming majority of manga volumes sell in bookstores rather than the non-returnable Direct Market, unsold books can cost the publisher, rather than the retailer.
Further, any time one sets foot into an argument like this, there's an elephant in the room that must be acknowledged: The majority of Direct-Market retailers don't care because the majority of Direct-Market retailers don't sell the stuff to begin with. One has to tread carefully around retailers who do stock non-superhero comics in quantity when making arguments like this, of course, but the fact remains that such retailers aren't by and of themselves a big enough segment of the manga pie to be courted with the same courteousness and consideration as, say, Barnes and Nobles' book buyer. And make no mistake: If these books were selling well at major chain bookstores, we wouldn't be talking about this right now. If Tokyopop thought about the Direct Market at all, their concerns were likely as not squashed the first time someone in the accounting department asked, "Direct what?"
And the argument, expressed by multiple retailers, that Tokyopop has fiendishly used them as a place to develop fanbases for titles before pulling them to reap the poor, downtrodden comics-shop owner's hard work and leave nothing behind simply doesn't hold water on the face of it. It's not like we're talking about Fruits Basket, here. I have no doubt that Christopher Butcher has managed to make the thoroughly absorbing thriller Dragon Head into The Beguiling's bestselling manga title, but how many stores have a retailer as knowledgable, passionate and persuasive as Butcher working for them, pointing customers toward the quality titles and steering them carefully around gratuitous crap like DearS? All things considered, you wouldn't have a difficult time persuading me that Dragon Head is losing money under the current system, and shuffling the deck therefore seems somewhat reasonable, at least on the face of it.
Read excerpt from right to left. This panel and the one below from the second and fourth volumes (respectively) of the Dragon Head series, ©2016 Minetaro Mochizuki.
There are two problems with this argument. First, Tokyopop faces greater and more cutthroat competition for popular manga licenses and bookstore shelfspace than ever before in the company's history. With the acquisition of Viz Media by Japanese publishers, and the Random House/Kodansha deal giving Del Rey Manga a near-bottomless barrel of titles from which to choose, Tokyopop licensing agents have to work extra hard to get their hands on product that will sell to teenage manga fans. One could certainly make the argument that bookstore owners, having cherry-picked the best titles from Tokyopop's portfolio and left the rest to rot, don't have any right to complain if they publisher sells the leftovers on their website — but sales to the Direct Market, being non-returnable, are effectively found money, so far as Tokyopop publisher and C.E.O. Stuart Levy's concerned. What exactly is to stop Tokyopop from doing a quick solicit before ambling off to the printer, then adding retailer orders into the print run? It's not like anyone besides the Christopher Butchers of the world are taking a gamble, here.
The other problem, though, is that Stuart Levy is a two-faced jackoff, at least if you go by his recent interview with Calvin Reid for Publishers Weekly's comics newsletter:
"We're very bullish on the direct market. We think there's a mutually beneficial role between small comics shops and a manga publisher like us, specifically. We support local artists, the lifeblood of the comics shops. And we're both really passionate. The challenge for comics shops, I think, is to get newer customers into the stores. Now that I've studied the history of comics in America, I feel confident saying that they need to remember their own history. If they do, they'll know that back in the '30s, '40s and '50s, this is what the American comic book industry was like. There were all kinds of genres, all kinds of artists and wide popular appeal. The fact that the market happened to get narrow and the genres became more pigeonholed and stereotypical, that's not what made comics big in the first place. So in my opinion we're bringing the comics marketplace back to its roots."
This is bullshit. If the Direct Market's so allfire important to Tokyopop — and given current market conditions, the need to maximize sales in every conceivable market certainly makes sense — than why make statements like this at the same time that you're moving to take saleable product out of retailers' hands... especially if there's so little risk involved in not doing so? Either Levy didn't think about what the twin announcements would mean to retailers and he's an idiot, or he simply wanted to paper over the obvious and he's a two-faced jackoff. Companies like Marvel and DC can get away with behavior like this because they own the Direct Market — it's not like retailers are going to turn away orders for Marvel's Civil Wars just because Marvel screws them over. Tokyopop, however, doesn't have the industry clout necessary to pull stunts like this, Fruits Basket or no Fruits Basket.
A far likelier scenario is that Tokyopop decided to take a handful of titles that weren't paying for themselves through sales at the big chains, and use them to develop an online-sales market among the hardcore fans, thus increasing profitability by keeping the cash that otherwise would've gone to distributors and retailers. If this is the ultimate goal, then offering said titles for sale in comics shops just dilutes the website-sales potential. Since the few retailers likely to get pissed over such behavior aren't responsible for enough of the money pie to take seriously, there's no reason to take their complaints seriously either. But if this is the case, turning around and petting said retailers on the head is just rubbing salt in the wound.
Even if this is Levy's ultimate motivation, however, it's still a risky plan. As Dave Lartigue notes in an open letter to Tokyopop:
"Right now I get new volumes through my comic shop, Modern Myths, as part of my regular order. This is convenient for me and helps support a shop I like. Moving to web-exclusive removes this convenience, asking me to place an additional order somewhere and pay shipping. As much as I like the book, and I like it very much, at the end of the day it’s just a funnybook, and now that you’ve made it more of a hassle to order it, I won’t do so. I can live without it."
And even if Direct-Market retailer reaction to this specific plan doesn't concern the folks at Tokyopop, there's as always the little matter of blowback. Former retailer (and current comics-shop manga consultant) Dorian Wright explains it thusly:
"My first impulse, honestly, is to simply stop ordering any Tokyopop titles outside of what we need to fill pull-lists. Why should I take a chance on ordering a new series from Tokyopop if, two or three volumes later, they might decide that it isn't selling what they think it should be and make it an online exclusive item? Why should I attempt to build an audience for a title in the store if Tokyopop could decide that they'd rather cut out the middle-man and sell the title direct themselves? And what do I tell customers already buying a title when Tokyopop decides to take it exclusive?"
I doubt this is the reaction Stuart Levy was hoping for. It's likely what he was trying to head off at the pass with his Publishers Weekly interview. So why do it? I think the likeliest explanation was offered by California J-culture retailer Ed Sherman over at ICv2:
"My read on all of this is that Tokyopop is in trouble. When they cannot keep hot titles in stock, there is obviously a problem. I hope that this is not the case. Tokyopop has always treated the direct market well, and they are responsible for creating the American manga market. But this Web exclusive project just strikes me as an act of sheer desperation. Am I wrong?"
It's entirely possible that Sherman is wrong, of course... but would you care to bet fifty bucks on it? Me neither. To that extent, Levy just managed to complicate his perception among the more discerning fans and industry professionals that he'd be better off keeping in his corner, especially if he's serious about being "bullish" on the Direct Market. Maybe he isn't a two-faced jackoff, after all. Maybe he's just an idiot.
Postscript: The above essay led to a number of questions from readers, leading me to offer clarifications over the next couple of days:
[...] Finally: Yesterday's commentary produced some debate in the comments section, including one participant who couldn't understand why a publisher without the support of a majority of comics shops would have any reason to keep solicitating to those who did order their wares, or how such an attempt could still be profitable. Wasn't I contradicting myself by simultaneously noting Direct-Market indifference while arguing that money could still be earned from the few retailers who did order manga in greater numbers? Wouldn't Tokyopop be losing money on the deal?
I found these questions a bit frustrating, if for no other reason than that I was once on the same side of the argument myself. So whay changed my mind? Well, a few years back, I'd stumbled across an ad placed by Fantagraphics Books in the latest Diamond Previews catalog and couldn't for the life of me figure out why the company that signed my paychecks was even bothering. Why was Fantagraphics soliciting to the Direct Market in the first place, when the vast majority of retailers were ignoring them? Wouldn't it be better to simply abandon the Direct market altogether and put all efforts into growing the bookstore market for Fantagraphics-published books?
I put the question directly to company co-owner Kim Thompson, who first responded by giving me one of those looks that said, "I'm trying not to treat you like a complete idiot, really I am, but questions like this aren't helping." After listening to me say my piece, he replied, "Why would we want to turn down free money?" Kim then walked away, leaving me to contemplate the exchange. It took me a minute or two, but I finally realized what he was talking about, and that he was right and I was wrong.
Here's how it works: Before they even go to press with a given product, publishers solicit their books through the market's one remaining distributor, Diamond. Retailers then have roughly a month to place their orders, which are then collated and sent back to the publisher, who can then use the number of ordered copies to set their print runs. Since all sales are effectively set in stone by those orders, all a publisher needs to do is match the orders with the number of copies published in order to sell out at the outset — all risk is therefore effectively transferred to retailers, who must bet in advance how many copies can be sold or find themselves paying for material still remaining on shelves at the end of the day. Simple, no? This is why Dave Sim was able to sell the concept of self-publishing to Eddie Campbell by telling him, "This is the easiest thing you'll ever do."
Is it possible for publishers to lose money in the Direct Market? Oh my, yes, and the smaller a publisher you are (and the more ambitious your plans), the likelier the possibility of failure. You can set the print run higher than initial orders, in hopes of selling back issues at a later date. You can set your price point too low, robbing the book of its ability to pay for itself. You can spend excessive money on advertising in Diamond Previews, and your ads will sit in the back of the catalog where most retailers don't bother looking. If the book doesn't earn enough to pay for the time not spent on a day job, you can wind up in the poorhouse hoping that the comic will eventually justify the loss of income.
None of this, however, need apply to Tokyopop selling titles to comics-shop owners. Since they're only selling to the minority of retailers with a genuine interest in manga, there's no reason for excessive advertising, as the retailers in question presumably already have a handle on the material. Since solicitations can be made before going to press, all Tokyopop really need do is add the number of copies ordered by retailers to the number printed to sell over the company's website, which could in theory even save money by allowing for a lower cost per unit due to greater volume added to the print run. The real risk to Tokyopop's gambit comes not from printing for comics shops, but from printing for the website, where the company must guess how many copies are likely to sell, and assume the risk for those that don't. If your purpose is to sell books already rejected by the returnable booksellers' market, any sales made through the Direct Market ends up effectively being — sing along, kids — free money.
This is why I'm skeptical when Tokyopop's Mike Kiley says things like this:
In the spirit of full disclosure, the titles that are not volume 1s, the existing, continuing series that we're putting into that program, probably fall into one of two categories. Either A, they have been commercially very challenged and we want to try and give them a shot in a different way; or B, they're just really special in some way that we think the regular distribution mechanism hasn't been able to deal with. It hasn't been able to get the right amount of exposure and highlighting that we think those titles deserve. That's my take on the two reasons why existing properties could go into the program.
Full disclosure, my ass. Again: There's no reason not to solicit titles both in the Direct Market and online, unless your purpose isn't to find a way to sell marginal titles, but rather to experiment in ways to cut out the middlemen and keep the resulting income for yourself. If there's another explanation for all this, Tokyopop hasn't been forthcoming in offering it up.
If Tokyopop's executives were to freely acknowledge this to be their motivation at the outset, I'd have no problem with it, and might even defend the attempt. Hell, there's no denying that using quirkier, more marginal titles to build an online sales base among hardcore manga fans is a potentially good idea, despite the risks. Alas, by conflating the bookstores and comics shops together in its rhetoric, Tokyopop is attempting to justify itself through sleight-of-hand, rather than freely acknowledging what appears to be the ultimate aim of the program. And since this program has to have been in the works for some time, the solicitation cycle being what it is, I don't see how Stuart Levy can talk about being "bullish" on the Direct Market while Mike Kiley excuses taking saleable product from comics shops by alluding to poor overall sales without both gentlemen being perceived as acting like two-faced jackoffs.
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