Digital growth relents for Big Five

24.01.14 | Philip Stone, Tom Tivnan and Sarah Shaffi - The Bookseller

After several years of triple-digit sales rises, the rate of e-book growth has slowed considerably for Britain’s top publishers. The e-book sales for 2013—collated by The Bookseller from figures supplied by publishers—for the top five trade players was 42.3 million units. This is a rise of 18% year on year (up 6.4 million units, from 36 million in 2012), but it pales in comparison to the 105% growth digital had in 2012 on 2011.

It should be emphasised that the digital market is still very much in growth, and is in ruder health than print, which contracted 9% by volume and 6.5% by value in 2013 through Nielsen BookScan’s Total Consumer Market.  
  
Much as E L James did in the print market, the author skews the figures—both inflating the health of the e-book market in 2012, and deflating its performance in 2013. Regardless, the e-book market is still growing. James certainly had a slower 2013 than 2012: last year she shifted 323,000 e-books, the previous year she sold 3.9  million units. Stripping her out of both years’ digital figures and e-book growth for 2013 would have risen 31%, still a far shallower rate of growth than in previous years.

The slowdown has not been unexpected by publishers, and follows a similar pattern of a plateauing of digital sales seen in the US. Simon Johnson, HarperCollins’ group m.d., said: “What you’re just seeing is a slowdown in a transition from physical to e-books. Anyone who has worked in or studied technology would say that is normal. When you move far enough along an S-curve, things slow down.”

Hachette and Simon & Schuster led the way in e-book percentage growth. George Walkley, Hachette head of digital, said his group had e-book figures that were “flying in the face of  plateauing”: up 58% in volume, to 13.6 million units, and 34% in value. Walkley added: “Clearly that is very influenced by key authors like Gillian Flynn, ‘Robert Galbraith’ and J K Rowling, and Sir Alex Ferguson. Yet overall publishing plays a strong part in this. We look at our list and we see good growth across the list [not just among the bestsellers].” Hachette’s digital sales, combined with its shallower-than-market decline in print, meant that the group saw its combined “e” and “p” volume sales rise a healthy 10%.

S&S had a Big Five-leading leap of 90%, to 2.6m e-books sold. The publisher benefited from the BBC adaptation of Philippa Gregory’s The White Queen—the author was responsible for five of the publisher’s 11 bestselling e-books in 2013. S&S was also the leader in combined digital and physical sales rises: up a massive 27%. Penguin Random House’s combined e-book volume experienced a 9% drop in e-book sales, with RH down 20%—suffering in comparison to the E L James/erotica-powered 2012.  

Pan Macmillan certainly bats above its weight digitally. It has a 3.4% print market share through BookScan, yet in 2013 it sold almost a third more e-books than much larger print player Penguin. HarperCollins, meanwhile, had the shallowest year-on-year growth of any of the Big Five, up 8% to 7.4 million units (though value was up 28%), which gives it a combined physical and digital drop of 3%.

The wider picture
Full market e-book data is not available, but if the top five publishers’ share of the e-book market is similar to print (57% in 2013; 60% in 2012), then the size of the e-book market totalled around 74 million in unit terms in 2013.  That would be a 20% year-on-year rise, but a dramatic slowdown from 2012, when sales doubled to 60 million units.

According to The Bookseller’s internal analysis, based on publishers’ e-book figures and Nielsen BookScan data, e-books took a 28.6% share of the total book market last year—up from 23% in 2012, and from 12.5% in 2011. However, due to the relative cheapness of e-books in comparison to printed books, e-books accounted for only 13.4% (£220m) of the value of the overall market.

Overall, then, the consumer book market saw sales fall 2% in volume (five million units year on year), to 258 million, and by 4% (£73m) in value terms, to £1.64bn. Given the aforementioned slowdown in sales of James’ trilogy—a reduction of almost 14 million units year on year across both print and digital formats—the book market actually appears to be in relative health, in overall sales terms.
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