- Economically Speaking


Every day the news sounds worse: we're in the worst economic freefall since the Great Depression, they say. Unemployment is rising. Costs are rising. Credit is unavailable. Dogs and Cats are living together.

Thing is, I still seem to be doing OK at Comix Experience - as I mentioned last month, our third quarter was up 15% from the previous year, and our October was up 8%. I'm knocking wood right now that this will continue on, but I don't see any huge reason it shouldn't be so.

At the end of the day people need to be entertained, and comics scratch a particular itch that isn't scratched in other ways. Even better, comics have hit a cultural point where, if we're not lovingly embraced, at very least we're accepted among other mediums as valid and legitimate, which gives us a big leg up on previous economic crises.

Plus, y'know, the new President-Elect reads comic books, too, which can't hurt either.

This doesn't mean things are all bread and roses, of course - there will be blips and burps, and businesses (be they retailers or publishers or distributors) who are undercapitalized, or are bad planners, or are just not as good as they need to be to do their job, run the risk of going under. It is just that I don't think that the larger economic picture in general has as great of an impact upon any specific market as some of the pundits believe.

What I do think is that fear can be self-perpetuating. As near as I can tell, most of my customers are not directly being impacted by the economic malaise - certainly not, at least in the Bay Area, as much as we were impacted by the dot-com bust, or the drop in tourism after 9/11 - but that the talk about the malaise has got people second guessing their choices.

Certainly, I think we've reached a fair amount of price resistance in the comics market. $3.99 cover prices are a large barrier to "Feeling Good" about the market. But the issue isn't price specifically: it is absolutely clear to me that people will pay almost anything for something that they actually want. We're selling "Watchmen" hand over fist, and there's absolutely no barrier in people's minds for paying $20 for that. Nor does the $4 cost of a "Secret Invasion" or "Final Crisis" seem to be a problem for the overwhelming majority of the readership. Because people want those things. As a "luxury" item, people will pay whatever they need to for that luxury, as long as they can see the value in that luxury. If there was a new, say, Alan Moore and George Perez comic tomorrow on a subject and character that people want you could charge ten dollars for it, and people would buy it without batting an eye. But asking $3.99 for something less popular, or by an unremarkable creative team is always going to be a hard sell in the best of times.

The point is that content is king, and that price for any individual item is a secondary consideration at best. Yes, absolutely, price in the aggregate can and will cause people to second guess their habits, but in the individual cases, the question is more that of value than of price.

In the comics market things are skewed in another way - in terms of the Marvel and DC "universes" we're often not actually selling the individual pieces of the story. What we're actually selling is the periodical thrill of participating in those universes.

I had an interesting conversation with a publisher the other day where he wondered out loud what would happen without the periodical in the superhero genre: could Marvel and DC switch to a GN-driven format for those characters?

I very much think that the answer to that is "No". Oh, sure, you'll always be able to sell an upscale format of an A-list creative team on A-list properties, but there are probably less than two dozen "A-list" creators, and far less than a dozen properties for whom that would be tenable. There would be a measurable market for an OGN of, say, Spider-Man. There is a much much smaller market for an OGN of Iron Man. And there's effectively no audience for an OGN of, say, Ms. Marvel.

But people will (in many situations) buy a periodical comic featuring Ms. Marvel. Why? Because what is selling is not as much the individual character, but, rather, the connections to the larger "Marvel Universe."

To put it another way, in a somewhat tortured analogy, the Soap Opera "Guiding Light" was been in near-continuous daily production since 1937. But I suspect that if you took the most popular character from that show and put them instead in a once-a-quarter two hour movie, not many people would watch. While Soap fans may tell you they're watching for the "character" or the "story," what I think they're actually watching for is the serialization, and/or the continuity. It isn't about the particular character, or about the story line - it is about the daily action and habit of following the serialization.

Marvel and DC's superhero universes are very much the same. I think a great deal of the appeal is in the macro of those universes as much as it is about the individual storylines. People like dense continuities where they can feel like an insider for keeping it all straight, for investing their time and their personalities within it. There's a sort of genuine pleasure to be able to escape into an ongoing and neverending fictional world - and I really don't think that pleasure can be matched if all the stories were to stand alone, as it would in an OGN world.

Or to put it another way: what DC is selling to you isn't so much Batman or Superman or Wonder Woman - what they're actually selling you is a place where Batman and Superman and Wonder Woman and a skillion other cool characters all exist and interact together. What the superhero reader is really buying is the macro of the "universe," even if there are specific pieces and situations within it that appeal to you more than others.

Somewhat parenthetically, this is almost certainly why Marvel is kicking DC's butt in market share right now - Marvel took over half of the market in September 2008 - Marvel's "macro," from Civil War to the "Who Do You Trust?" of Secret Invasion has been very relatable to the world outside our window; while DC's macro is all cool high-concept spectacle (Seven different Lantern corps, Darkseid winning humanity's free-will, 100k "supermen" on Earth, and so on), that isn't as humanly translatable.

But we do have a huge economic iceberg coming on the horizon, and ironically a lot of it sort of stems from Marvel's massive recent success.

As near as I can tell, the people in charge of Marvel, and I don't mean on a publishing level, I mean their bosses, don't especially care about comics or publishing. They're looking to leverage the characters across as many platforms as they can, and comics are just one small piece. They've lucked into a situation where dynamic editorial strengths are pushing the quality of the individual books as best they can, but at the end of the day, I don't have faith that the people making the ultimate decisions about money matters care whether the editor-in-chief is Joe Quesada making good comics, or me, making lousy comics, as long as more money is made this year than last year, as long as more money is made this quarter than last quarter.

I'm pretty confident that if you could show Marvel's upperest management that stopping periodical publishing, and going all digital would instantly give them 5% more revenue with no downtime in the transitions between markets, they'd stop publishing periodical comics tomorrow, with no hesitation whatsoever, nor any concern for the current and existing market.

(Thankfully, the math on that looks to be pretty far away, so that isn't a concern)

But at the end of the day, the people employed by that upperest management have a mandate to make more money this year than last year. If they can keep producing "good" comics to do so, more the better, but by hook or by crook they'll either make more money, or be replaced by someone who will.

One way to do that is to increase the title count. They've certainly done that (and appear to be continuing to do so, fairly dramatically). Another way to do that is by increasing cover prices. And they are doing that as well - up to the point where this month's "Astonishing X-Men: Ghost Boxes" #1 is $3.99 for just 16 pages of comics content.

Of course, you can also do it by breaking new markets, and Marvel is also aggressively trying to do that. Certainly, Marvel is publishing a wider range of material than they ever have before, and should be congratulated for that, but those efforts are more likely to pay long-term dividends then to help them significantly next quarter, and next quarter is where much of their focus appears to be.

One problem with increasing title count at the same time as you're raising prices (the majority of Marvel's new mini-series and special projects appear to be coming in at the $3.99 price point; usually for a standard 32-page package) is that you really run the risk of alienating your customer base while they're being stretched too thin - in two directions at that. I'm seeing fewer and fewer sales on spin-off material, and I'm slashing my orders on stuff that doesn't "matter," that's not strictly in-continuity or relevant to the current Marvel Universe. Because the customers can't possibly keep up with all of it.

The question is, can the retailer tell the gold from the dross when they're placing their orders? If they can't, that's a massive iceberg to deal with, especially with Marvel's dominance of the market share being so wide - it simply isn't healthy for one participant in a market to be so disproportionate a share of it, as they become "too big to fail"

We'll have something to worry about if standard Spider-Man, Iron Man, Batman, Superman, etc go to $3.99 per issue for the 32 page package, but I just don't see that happening in the next year (though a move to $3.50 could happen, perhaps), because my observations of consumer behavior is showing a stiff price resistance there for anything that isn't exemplary. Presumably, this will begin to show strongly in the sales charts over the next 3-6 months.

The real risk for comics, as always, comes from greed and over-proliferation. These things are almost always self-correcting, however, given enough time (and bloodshed) - and I feel well positioned to weather that. Is your local retailer?

Brian Hibbs has owned and operated Comix Experience in San Francisco since 1989, and is a founding member of the Board of Directors of ComicsPRO, the Comics Professional Retailer Organization. Feel free to e-mail him with any comments. You can purchase a collection of the first one hundred Tilting at Windmills (originally serialized in Comics Retailer magazine) from IDW Publishing. An Index of v2 of Tilting at Windmills may be found here. (but you have to insert "classic." before all of the resulting links) You may discuss this column here.

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