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United they stand
01.07.10 | Tom Tivnan
"The Independent Alliance five years on," Will Atkinson says. "I'm trying to think of an equivalent success. Maybe the British Empire?"
Faber's sales and marketing director is in a jolly mood, and his irreverent gag about the empire might be because I catch him on the phone while he is on a work trip to far-flung former colony New Zealand. Yet joking aside, on the fifth anniversary of the founding of the sales coalition of 10 like-minded independent publishers, there is a sense of building. Perhaps not empire building, more of a socialist collective building, if that collective's raison d'être was to shift tonnes of books.
Take a look at the numbers. The group launched in July 2005 with six founding members—Faber, Atlantic, Canongate, Icon, Profile and Short Books, with Quercus coming on board in September of that year and Portobello in 2006. Revenue through Nielsen BookScan's Total Consumer Market for the entire Alliance at the end of 2005 was £29.9m, which would have made it the UK's ninth largest publisher, sandwiched between Oxford University Press and BBC Publishing (now part of Random House). Fast forward to the end of year 2009—Serpent's Tail became a member when acquired by Profile in January 2007 and Granta joined in September 2007—and Alliance publishers accounted for £57.4m, just pipping Pan Macmillan to fifth place on publishing's league table, trailing only the "Big Four" conglomerates.
That is a 92% increase in value sales, with the Alliance's market share climbing from 1.8% to 3.3%—in a five-year period when the TCM as a whole rose by 6.4% (£1.647bn to £1.752bn). Apart from through major acquisitions, no publisher has seen growth of that magnitude. Random House, for example, was at £230m in 2005, and hit £239m in 2009. Astonishingly, the Alliance has had two of its biggest years in 2008 and 2009 despite the overall market contracting, its sales rising 12.5% and 20.5% year on year respectively, thanks in large parts to hits from Aravind Adiga's Man Booker Prize winner The White Tiger (Atlantic), Sebastian Barry's Costa-winning The Secret Scripture (Faber), Canongate's two Barack Obama titles and Quercus' Stieg Larsson trilogy.
The Alliance effect is not just in the UK. The Alliance takes on foreign sales for its members principally in Europe and the Middle East, with individual arrangements elsewhere: e.g. Atlantic's sales in Australia and New Zealand are handled by Australian publisher Allen & Unwin. The past couple of years have seen a concentration on mainland Europe, with the group's sales doubling to £4m in the past year.
Not because we're indie
"The almost perverse thing is that we have done this in the age of the conglomerates," says Atkinson. "Each of the companies are driven by big personalities—[Canongate's] Jamie [Byng], [Profile's] Andrew [Franklin], [Atlantic's] Toby [Mundy] . . . all the heads of houses. And you have amazing talent pools apart from the heads, many who have done well in the bigger publishers—like [Atlantic's] Ravi Mirchandani and [MacLehose Press'] Christopher MacLehose to name just two—but who arguably are not really suited to the corporate machine, and who thrive better in an independent."
Both Atkinson and Faber c.e.o. Stephen Page talk about the advantages of being independent: the ability to take more risks, to be more nimble than the conglomerates, and they stress the reason the Alliance works is that within the framework, each publisher remains "virulently independent". Yet it does ultimately come down to the books. "The strength of the whole enterprise is the differing parts, the collection of talent, and everyone contributes," says Page. "But the conglomerates have an intellectual capacity, too, and moreover the infrastructure and the manpower. This is not us patting ourselves on the back because we are independents. It does come down quite simply to the books we publish. We don't get space in W H Smith's or on Amazon because they like us because we are indie; it is because our books sell."
Indeed they do punch above their weight: 29 Alliance titles have taken more than £1m through the TCM in the past five years (for comparison, HarperCollins, which in 2009 had TCM revenue just under three times the Alliance's, has had 66 over £1m in that time). This may have something to do with timing. The Alliance was born in the midst of the lit light revolution with the reading group boom and in the shadow of the "Richard & Judy" book clubs. Some of the biggest selling books of the past five years have been prize winners—The White Tiger, The Secret Scripture, The Life of Pi (winner of the 2002 Booker, but Canongate have cleverly repackaged it several times and it is the publisher's third biggest seller in the past half decade). And there has been a yen for smart and quirky popular non-fiction, such as Profile's New Scientist titles. A funny thing happened on the way to the mass-market discount culture: retailers found out that there is a commercial appetite for the higher brow end of the business. When Tesco started stocking the Man Booker shortlist, you knew something had changed.
Of course, it was precisely to get greater voice in the mass-market culture, and greater entrée and terms with Tesco and the other supermarkets, Amazon and the chain booksellers that the whole enterprise was founded upon. The sheer weight of numbers made the big retailers sit up and take notice: "Our relationship with Amazon and the supermarkets was transformed overnight," says Atkinson. Profile founder Franklin was, according to Atkinson, one of the main drivers of getting the project off the ground. And it made sense that Faber was at the core; the biggest player with the biggest name, its sales force had been representing Icon and Short Books.
Faber is still very much at the centre of the enterprise. The sales force is Faber's, the other members pay Faber commission for representing their books. And Faber is still the biggest publisher, accounting for the plurality of sales, which has ebbed and flowed between about 40% to 32% in the five years of the Alliance.
"Founding the Alliance was like the founding of the European Union," says Atlantic c.e.o. and publisher Mundy, with a geopolitical metaphor to rival Atkinson's. "I'm actually serious about that. We're like EU member states who came together to find common solutions to common problems. Obviously, there was this huge shift to the high volume, high discount market post-Net Book Agreement. We can't underestimate how important being a part of the Alliance has been to our growth."
For Philip Gwyn Jones, c.e.o. and publisher of Portobello, the access afforded by being a member of the Alliance is crucial. "For the smaller members like ourselves, the benefits may be even greater. A publisher our size outside of the Alliance would never have the same type of relationship we have now with Amazon or Apple. It is a collective thing, though. You could argue that even Faber would not have the same type of access if it wasn't for the rest of the group."
Time and again, Alliance members point to the intangible benefits outside of just increased sales. The heads of houses and sales teams meet about once a month, but there is also a top to bottom communication throughout the companies, with production teams, marketers, commissioning editors, digital teams and publicists meeting regularly.
Atkinson says: "I don't know how to say this without sounding incredibly pompous, but I think what the Alliance has going for it the most is this vast intellectual reservoir of publishing talent. Publishing can be a lonely business, but there are so many different ways we share ideas and learn from one another."
Short Books co-founder Rebecca Nicolson agrees: "There is a definite collegiate feel. Yes, we are competitive. Yes, we end up bidding against each other on books. But we also end up meeting to discuss problems, to have a gossip. All of which helps run your business."
This collective sharing can be transformative. "When we started out I would say we were more of a academic publisher, more series based," says Icon m.d. Simon Flynn. "In the last five years we have changed our list, become more of a traditional trade non-fiction publisher."
The obvious question is what does the next five years hold for the Alliance? The size of the Alliance will, for the time being at least, remain largely the same. There have been some newcomers, Atlantic becoming UK agents for Dave Eggers' McSweeny's Books and more recently, taking on handling Birmingham indie Tindal Street Press' sales, which will, in turn, fall under the Alliance.
"There will, of course, be additions when members create imprints or do distribution deals like Atlantic has done," says Page. "But it is really important to sustain the group as it is and do our best for our members. We're full up."
Yet how will digital change the make-up? Will a sales collective be so important, or perhaps more difficult to sustain, in the disparate, multi-channel world of the e-book? Page says: "There are major investments we are all making and how we construct ourselves in the next five years will be crucial. I don't think digital will diminish the Alliance, in fact, I think there may be an amplification of it. I expect there will be so many strong new entrants to the book trade, more than just Apple or Google, that the Alliance can play an ever greater role."