If you go back a few years, back to when Marvel had a tier of $2.99 comics and $3.99 comics, Marvel started including a free digital redemption code with the $3.99 priced books. Buy a print copy, get the digital edition for free. At the time, you could look at as getting the digital copy for $1, but almost everyone I’ve ever talked to thought it was just Marvel attempting to justify that $3.99 cover price. DC used to have a handful of titles like Justice League where you’d get a download code for an extra $1, but sources told me that those codes weren’t redeemed with high frequency and it was essentially just a variant cover, in terms of retail.
And a couple interesting things spun out of this.
First off, long time Beat readers will have seen me comment on how it’s often cheaper to buy print copies of new comics because a lot of retailers will give you a discount and there are no discounts on new digital releases. And for that matter, Marvel may have a sale, but they’ve never had a regular price rollback after a month or two like other publishers have. That means digital readers, depending on their local shop, had an incentive to buy a print copy… for the digital code. A 10%-20% discount adds up if you buy enough.
And, perhaps more interestingly, a secondary market opened up. Did you only want the print comics and not the codes? You could sell or trade those redemption codes online. Here’s a piece I wrote about that for The Next Web a couple years ago, if you want to get into the mechanics. The short version is that a lot of people were subsidizing their comics habit by selling or trading those codes. Suddenly your Marvels cost $2. If you look at the reactions to the announcements, you’ll also see a few references to some shop owners selling codes on unsold copies for $2. Which makes sense. Cover your cost for the code and stick it in the discount bin – the discount bin becomes profit, rather than salvage.
I’m a little surprised we’ve never heard anything about whether a comic is really mint if the sticker over the redemption code has been peeled.
So Marvel’s new scheme, apparently, is to swap out the digital copy of the individual issue for a couple “classic” issues. Only it’s going to be 2 “classic” issues each week, so buy 4 different Marvel releases and get 4 copies of those two freebies. We’ll see if there’s still a secondary market for those. Now what they mean by “classic” comics is the first issue of a tpb collection. One of the first examples they give is Civil War 2, which is absolutely hilarious in how wrong-headed that is. Yes, give away the comic a Marvel reader is mostly likely to have purchased in the last year and that has not been well received. Is that really the best use of resources?
Now Marvel is *saying* they’re going to do this for the retailer and those previews will sell tpbs for the retailers. And this might be true… given a few assumptions.
- That after the digital readers have been chased off to Amazon and Comixology, the remaining print readers will have interest in digital previews in meaningful numbers.
- That those reading the digital previews decide to seek out a print copy of the tpb, not a digital collection, since they read the first issue in digital.
- That the retailer they bought the print comic from has the classic tpb in stock – I don’t think that can be taken as a given assumption.
In theory, more previews – particularly of books that everyone hasn’t already bought – should sell more tpbs. Where they get purchased and in what format is something everyone is going to have to wait and see. It’s not a sure thing that a few extra tpb sales are going to make up for lost digital purchases for some retailers. I’d expect the effects of this change in programs to be vary widely from shop to shop. This may not have a noticeable effect at every shop.
What Marvel isn’t saying is perhaps a bit more interesting and this is where there’s potentially a little gambling going on: this move breaks up those secondary exchanges. The people buying discounts codes have three options:
- They can go to a retailer and buy print for full price or the shop’s discount.
- They can buy digital from Marvel/Amazon/Comixology for full price.
- They can say “forget paying for single issues” and either start pirating or drop the habit entirely.
Retailers should be hoping they see some new customers. Marvel’s probably rooting for more digital sales.
Here’s the thing about digital. Marvel almost certainly makes more off a digital sale than they do a print sale. Diamond discounts go to 55% and sometimes higher with promotions BEFORE Diamond takes a cut. You walk in off the street and Comixology will give you a 50-50 split. Marvel’s exclusive so they almost certainly have a better deal. Perhaps 70% of list price or higher. And no printing costs. Yes, digital is Marvel’s friend.
So even if all they do is nudge the digital readers away from buying print for discounts, they’re likely to see an incremental bump in revenue. It would take a lot of people dropping a lot of books for them to take a loss on this, although it’s not impossible – remember, some people were doubling their comics budget selling those codes, so if they had a strict budget, they’re going to be buying half as much.
So, in theory, this could stabilize your revenue/profits during a sales slump.
There’s actually quite a bit going on with this announcement. Whether it helps or hurts the retailers remains to be seen, but everyone who’s howling has a reason to howl.
The thing we do know is we’re going to start getting an idea how many people were buying print for digital and this might be the rare instance where customers DO tell their retailer they’re leaving to read on their tablet. This is a much more interesting thing than it appears at first glance. Oh, sure – you have a handful of titles known to sell proportionally higher in digital (Ms. Marvel being the poster child for this phenomenon), but the rule of thumb is said to be 10-15% in digital sales. But I’ve never heard any kind of a number associated with those download codes. It’s not clear anyone on the retail side of things is going to know with much precision how this will shake out until their customers complain or they notice a sales drop-off.
Todd Allen wears a lot of hats. At various times he’s been (alphabetically), a bouncer, college professor, humor columnist, Internet producer and an NBA/WNBA Beat Writer, among other things. He’s the author of Economics of Digital Comics. You should probably read it.