Articles & E-books

Comics Title Price Increases & Ordering


Posted: April 23, 2000 03:53 PM

From Comic Book Business, September 1995

It's generally accepted that the price of comics titles has risen much faster over the last ten years than the inflation rate. These price increases (which have’nt been matched by increases in the perceived value of the product) have had negative impacts on comics retailers.

I’ll admit that I’m connected with some of the early price increases. I consulted some time ago with the late Carol Kalish. One result was confirmation that Marvel, at that time, had a cadre of loyal followers who would buy just about anything that they put out. (This isn’t true any more, although Marvel doesn’t like to admit it.) I suggested that increasing the price of a 75¢ comic to $1.00 wasn’t likely to hurt sales and would increase Marvel’s revenues considerably.

Since the advent of the Perelman regime at Marvel and Carol’s death, average title prices of Marvel comics have increased to $1.95; while DC Comics products have kept pace. Average independent titles are all in the $2.95-plus range. And unit sales per store have dropped as prices have increased.

When Marvel initiated its early price increases from the 75¢ level, it was the dominant comics publisher and had strong followings in the sub-adult male market as well as among older readers who had kept their earlier X-Men reading habits. DC Comics was Marvel’s main competitor, and the other comics publishers had negligible influence on consumers. So there was excess disposable income which could be diverted into Marvel price increases without any major problems.

Marvel isn’t indispensable to most high-volume comics retailers anymore, and that "excess disposable income" doesn’t exist either. Comics are extracting pretty much all the money it can from today’s purchasers, and the only way it can grow is to attract new readers and to lure back the readers who have been "burned out" by the meaningless gimmicks of recent years.

What happened to that "excess disposable income"? Times have been hard for lots of people. There’s been plenty of down-sizing and out-of-state corporate relocation. When people are worried about making this month’s rent, there’s a lot less left over for frills.

There’s also more competition for the entertainment dollar at both ends of the comics consumer age spectrum. For adults, $1.50 videos provide 90-minutes of entertainment, while a $1.50 comic (if you can find one) provides 15 minutes of entertainment. For teen-agers and children, video games are pricy by extremely popular. And remember, the rule of thumb for a sophisticated computer game (or a Sega/Nintendo/&c. game) is that it must provide roughly 50-100 hours of entertainment. This is a cost-per-hour is roughly $1.00 which is a lot better return than the typical comic book. And most games allow for multi-person participation.

The result is that comics buyers aren’t spending more money per year on their hobby. If you look at hobby expenditure figures among various hobby interests, average yearly expenditures tend to follow this progression:

Annual Exp.

Pct in Group

< $500

40%-60%

$500-$750

20%-30%

$750-1,000+

10%-20%

$1,000+

5%-10%

You can get consumers who’s increase their expenditures, but you have got to give them a reason to become more involved with their hobby! In my opinion most comics publishers haven’t done so consistently during the last five years, and in have alienated many former consumers. Customers aren’t willing to increase their expenditure level based on the current content of comics. Exceptions are titles such as Bone, Strangers in Paradise, Sandman and Love & Rockets.

We’ve hear from our clients that customers are spending as much as they always have for comics, so higher prices mean that quantities have dropped by 20-25% or more. Customers have also dropped titles entirely when they’ve dropped below the customer’s cost-value ratio. This means that some titles which used to sell in the mid-50's now sell in the low ‘teens, and titles which sold in the high ‘teens are selling in the low single digits.

This means that it’s become more difficult to order small-quantity "mainstream" titles. If you’ve been ordering 20 copies of a book, you had a margin of 2-3 copies that you didn’t have to sell. But when you are ordering 5 copies of the same book, your margin for error drops to 1 copy!

Unless it’s a independent or alternative title, forget about recovering your wholesale costs from back issues for the most part, unless you want to wait years to sell the book. The majority of common back issues published since the 1970's aren’t quickly saleable as anything other than "quarter books". (The key to making money in comics retailing today is to churn your new comics and your common back issues. Anything else costs you money that you can’t afford!)

I spoke to a comics retailer who attended his distributor’s spring warehouse gathering, and reported that roughly 20% of the 100+ retailers there were cycle sheeting! Not that they were automated, but whether they were counting their books!

How can anyone make money on their new comics if they don’t know their sales? This is why so many comics retailers are making minimum wage for the long work-week they put in! These retailers are going to be in deep trouble this time next year when they are getting shorter terms and are getting smaller discounts on their comics.

Let’s assume that you are trying to order a book which normally sells 3-5 copies an issue. If you have one store it’s hard to order due to random fluctuations unless every copy is for a subscriber. (And even then you’ll have excess stock unless you collect a pre-paid deposit). If you make the book a subscription-only item you are giving up any opportunity of increasing store sales by exposing it to potential buyers.

If it is a higher-quality title you can leave it on the newsstand for several months and it will have as good a chance of selling as the first week you received it. But your average cost of inventory will go up. The only way that single-store retailers can afford to keep selected titles out on the newsstand for multi-month periods is if they are turning their more popular books quickly! Damn it, start cycle sheeting and use the information to help you write your monthly order!

If you are a multi-store retailer you are really missing a bet if you don’t order on a company-wide level, even if you have to break the orders back down by store to get your distributor to do your warehouse work for you.

If we take the example of the 3-5 copy title and multiply it by three stores, you can order 12 copies for the company and assign 3 copies to your two smaller stores and keep 6 copies at your strongest store. Then, if you’re tracking your weekly sales, you can transfer copies as you need them to the junior stores when they are about to run out.

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