A few months ago, Marvel comics faced a minor controversy over sales rep David Gabriel who partially blamed an over reliance on “diverse” titles from the publisher in addition to DC Comics making some it’s Rebirth line of comics returnable and the 2016 Presidential Election, as reasons for why Marvel’s sales have slipped in the direct market. Existing on a larger scale that economist on a whole were just starting to get a handle on at the time of Gabriel’s comments going public, was the overall decline of traditional retail shopping across the board in the broader economy. While comics sales had been declining in comparison to the year prior for some time at that point, at six months into the year of 2017, we have the unique insight to see not only the overarching trend of decline for sales in the direct market, but an example of how Marvel & DC Comics were able to buck those trends, and whether those instances presents a stable path going forward.
For context, it would be helpful to read my piece from April of this year on Gabriel’s comments in relation to comics direct market retail system as a whole, in addition to this report from the Atlantic that came out around the same time in regards to the overarching trends of the retail market in the broader US economy. In summation, the traditional retail sector of the economy is on a downward trajectory in spite of upward movement for more traditional positive indicators to the US economy like a low unemployment rate or highs in the US Stock Market As per writer Derek Thompson of The Atlantic, the reasons for this are mainly from the rise of eCommerce, a surplus of retail outlets, and broader changes in spending habits among consumers. The continued downturn of the retail sector over more traditional positive indicators suggests that consumer spending habbits may have shifted to the point that the industry can’t support itself in it’s present state, and we are already seeing the effects in large scale closures and bankruptcy for some of the sectors largest national actors. Michael Cokery writes in his New York Times article, Is American Retail At a Historic Tipping Point?
“The current torrent of closures comes as consumer confidence is strong and unemployment is low, suggesting that a permanent restructuring is underway, rather than a dip in the normal business cycle. In short, traditional retail may never recover.”
This put’s comics retailers at a distinct disadvantage in that, they’re primarily serving a small micro-niche of consumers, with an archaic purchasing method for the retail shops and their customers, primarily as a by-product of having one single company, Diamond Comics Distribution, holding a monopoly on the service. Because of this, comic shops are particularly vulnerable to the current downturn in the retail market, and the data being provided by Diamond reflects that.
As per Diamond sales numbers, they’ve averaged a -5.9% decline in what they label as “dollars” per month over the same month in 2016, based on their monthly sales charts, meaning dollars earned off product sold from Diamond to direct market comics retailers in comics and graphic novels. While Diamond does track them improving 7.84% in dollars from the second quarter of 2017 vs the first, they are still down -10.01% in total comics and graphic novels sold in their second quarter of 2017 versus the second quarter of 2016. Because Diamond is the only distributor to comics retailers, we can say with certainty that comics retailers are spending less money on a per month basis for single issue comics and graphic novels in the year of 2017. Presumably, this is because consumers are spending less at shops, which fits in correlation with the downturn in the larger retail economy as a whole. Comic shops are making less money, and in turn, are spending less money on product over the first half of 2017. This is all happening within the larger context of retail’s decline in the overall American economy. How consumers acquire product appears to be shifting away from traditional retail outlets, and comic shops are inherently less accessible then most traditional retail stores to begin with. Comics direct market are facing the same problems that we see across the broader economy for the traditional retail sector, and those problems have the potential to be compounded by the inherent difficulty of purchasing comics in the direct market for its consumers and retailers.
So far in 2017, only the month of May showed a positive uptick in comics sales over the same month the year prior (2016), and only May and March have showed an increase in dollars over the months that preceded them. Unfortunately for the direct market, there’s very little to be replicated from those months. In May 2017, comics had their best month over the one that preceded it in addition to the same month the year prior. May is notable for being the month Marvel’s Secret Empire series debuted, in addition to issue’s two & three were released as well. Triple shipping a comic, like double shipping, is a gamble a company like Marvel can take forcing retailers to make an estimate on the books sales before seeing how it performs in their shops, essentially transferring the risk over to retailers. Secret Empire is notable for a number of reasons; it was a Marvel event that played into an overarching controversy with Captain America now being an agent of Hydra, it’s story-line is mirroring a lot of what we’ve seen in nationalistic fascist political movements gaining significant and tangible power in the western hemisphere as a whole, it further mirrors much of the controversy happening in US politics with the current presidential administration that was able to win an election, partially, by exploiting America nationalism and conflating that with racial and cultural identity, in addition to it’s alleged collusion with a foreign fascist state, and the comic itself features a well respected, it’s first and second issues were priced at $4.99, a dollar above the standard $3.99 per issue that most single issues are currently priced at, and it has a popular creative team in fan favorite writer Nick Spencer, and star illustrators Steve McNiven & Andrea Sorrentino. The gamble paid off for Marvel, and by proxy Diamond, as Secret Empire issues #1, #2 & #3 all debuted in the top ten of Diamond’s sales chart.
The success of Secret Empire was hardly the only reason May 2017 saw a spike in dollars for Diamond. Batman #22, one of DC Comics most popular titles, saw a crossover with The Flash #22, using a story line that related to last years hugely popular DC Rebirth one shot title by hinting towards lingering plot threads between that book, and DC’s iconic Watchmen miniseries. In addition, both books increased the average month to month sales of the titles significantly through lenticular 3D covers. According to John Mayo of CBR, sales for Batman #22’s lenticular cover were 114, 174 units to the direct market with 72,741 regular covered issues. Sales for Flash #22 lenticular cover edition were 104,506 units to the direct market, with 59,261 units with the regular cover, enough to debut both series in the top ten in sales just based on the lenticular cover issues of the titles. Batman #22 & Flash #22 also featured some of comics more popular creative talents in Tom King & Jason Fabok for Batman, and Joshua Williamson and Howard Porter for The Flash. Both books were also priced at $3.99 each, one dollar more then the DC’s standard $2.99 price point for each series. In addition, Batman & The Flash double shipped that month as well, with wiht issue #23 of Batman also debuting in Diamonds top ten for their sales charts. May 2017 also saw a spike in sales for Marvel’s Venom title when it was renumbered, in addition to the debut of a relaunched Guardians of The Galaxy title at the same time as the films squeal was released in theaters. This was in addition to the Deadpool: Bad Blood graphic novel, featuring a return of the character’s creator, Rob Liefeld, doing interior art for the property for the first time in decades. This was in addition to the release of Wonder Woman Volume 2: Year One collection, featuring an origin story for the character by fan favorite and critically acclaimed creators, and hitting shelves a month before the debut of the film adaptation of the character.
The problem is that the conditions that led to these outcomes is hardly repeatable or sustainable in terms of generating income in the long term. In spite of how much it tries, Marvel can’t launch a new event series every month with the same level of talent on display, and creating controversy around their characters while relating titles to real world events doesn’t guarantee sales, as is evident from the relatively poor selling Civil War II or other changes to their legacy characters that didn’t get the same level of attention like the Riri Jones Iron Man, Amadeaus Cho Hulk, or even the Sam Wilson Captain America that proceeded the Hydra Steve Rogers. Marvel will be going back to some version of their original numbering for their titles in the fall, but that’s only a one time change, while the film and TV release schedule is far too sparse to make those a consistent source for generating direct market comic sales through related content. As recently announced, DC Comics will continue to capitalize on the success of DC Rebirth’s Watchmen connections with their Doomsday Clock twelve issue maxiseries but curiously, will not have any additional tie-in issues outside of the 12 issues in the series, meaning that any possible future capitalization on fan interest for related stories like Batman & Flash #22 is out of the question. While the lenticular covers look to have boosted sales on the comics, it’s debatable as to whether those type of variations can be a sustainable means of sales revenue in and of themselves. Furthermore, the creative talents on all three books, along with those featured on All New Guardians Of The Galaxy #1, Deadpool Bad Blood & Wonder Woman: Year On; represent some of the highest regarded comics writers and artists in terms of quality, and popularity in the medium. That’s difficult to replicate by it’s very nature, being among the best or most popular inherently means a smaller subset of creative talent then the total number of creators that are capable of creating comics for larger comics publishers. This is compounded by the fact that most creative talent currently in the comics medium that demands similar levels of name recognition have either left the more popular superhero comics altogether for creator owned work, or will only work on superhero comics where they have full creative control, as opposed to event miniseries and crossovers that require heavy editorial input from their publishers.
For March 2017, the top selling single issue of the month was The Amazing Spiderman #25, priced at $9.99, with The Dark Knight III #8 coming in second place priced at $5.99. Those two markups can most likely account for the uptick in dollars over the month prior, February 2017, which also had a raise in price point for #1 seller Star Wars: Darth Maul & #7 seller, All-Star Batman #7, but only at $4.99 as opposed to the $9.99 & $5.99 price points for March 2017 top two selling comics. While comics publishers would surely like to sell comics at these raised price points that they did in March, raising the cover price to more then double what a single issue costs across the board doesn’t seem viable as a long term means of increasing revenue. When the retail economy as a whole is losing customers, and comics direct market appears to be following the same trends, raising costs brings an inherent risk of driving more consumers away, one that could be equal to or have a greater effect then what they’d make up for in additional revenue.
As unique as comics direct market is, it’s not above the larger trends of the broader economy, and in reality, much of what makes it unique has as much potential to hurt the industry as it does to help. The comic’s industry has come to revere retailers in the direct market as the lifeblood of the of it’s economic system, and has made their bed with Diamond as the singular distribution system. But that small niche is far from being immune to shifts in the larger economy, and right now, economic trends are all pointing towards a downward trajectory in the traditional retail sector, a sector of the economy of which comic shops make up a small subsection of the larger whole. As tempting as it may be to look at success of March & May 2017 in relation to the health of the direct market, the reality is that most of the mitigating factors that contributed to profits in that month aren’t repetable in any way that point towards prolonged sustained success, or a reversal of the downward trend we are seeing in direct market profits as a whole. What we’ve seen manifest itself in the direct market over 2017 is a continuation of a larger downward trajectory of the retail economy, and the comics industry itself hasn’t discovered any meaningful long term solutions to reverse those trends in their favor. Marvel & DC Comics are betting big on more event comics throughout the year to try and do just that with the latter’s Legacy initiative involving a series of one shots while reverting their current ongoing series to their classical numbering, and the former’s Dark Nights Metal & Doomsday Clock event series with Metal’s many associated tie-ins. It’ll be pertinent to watch how these books sell over time, and how those months perform in relation to last year. While it certainly possible that these publishing plans can reverse the downward economic trends we’re currently seeing, the more likely scenario is that the rising tide of disruption in the retail economy as a whole is going to make things worse for the comics direct market in the foreseeable future, and there is little to nothing that any combination of actors can do about it. Topical event or crossover comics with great creators and unique cover gimmicks have been a tried and true method to boost comic book sales for years in the direct market, and it certainly seems to have worked at least once this year so far. But against the rising tide of the larger economy, it might not be enough this time around, and the losses are already compounding. Whatever happens to traditional retail outlets in America, and the small subset of comic book shops included in that larger economic sector, it’s looking more likely that a seismic change is on the horizon, and one not everyone will survive.
The data in this article was sourced from Diamond press releases. Click on the links below for each months press release