Marvel Dives Deeper Into Digital Distribution

Digital comics carry both opportunity and danger: the opportunity to greatly expand the comics audience and the danger that the direct market will not survive the transition. And while Marvel Comics was been one of the first publishers to go digital, the publisher has been somewhat slow to adopt certain initiatives such as same-day print and digital releases. Last year, Marvel dipped its toes into the deep water, making its Ultimate Comics line available digitally the same day as the print versions came out, and last week, it announced that the entire Marvel Universe would transition to same-day print and digital by April, 2012. The publisher followed with this week's announcement that they would be making graphic novels available on the Nook. Today, CBR has exclusive details about a new program that will encourage digital readers to check out their local comics stores.

CBR News spoke with Peter Phillips, Senior Vice President and General Manager of Marvel's Digital Media Group, David Gabriel, Senior Vice President of Sales, and Arune Singh, Director of Communications, Publishing & Digital Media, about these new initiatives, how Marvel will keep retailers in the loop, and what the publisher wants to see from this week's print release of "Avenging Spider-Man" #1, which comes with a download code for a free digital comic.

CBR News: I want to walk through this carefully, because it's a bit complicated and I haven't seen these details in the news reports. Marvel is going same-day digital with its Marvel branded app on iPad and Android, correct?

Peter Phillips: That is accurate. Just to clarify our current offerings, we have Marvel Digital Comics Unlimited on our website. It's browser-based and allows you, in a Flash reader, to read comics that are six months old or older.

Will you be doing same-day releases through Digital Comics Unlimited?

Phillips: That is not our current plan. For now, that product will be available in the app offerings in iOS and Android as well as in the Google Chrome store.

Will readers be able to buy comics on their release date in comiXology's Comics app, or just the Marvel branded app?

Phillips: Marvel branded.

Will they sync with comiXology, so they can be read in either app?

Phillips: Yes, I believe they will.

And then also in the Marvel Chrome app?

Phillips: I'm a big supporter of our apps. I am not against the Google Chrome store, but we get a ton of downloads and interest in the iOS and Android apps, more than Google. If you had a crystal ball to look at where I'm going to put my efforts in the next 6 to 12 months, well, you can figure that out.

You haven't mentioned Graphic.ly at all.

Phillips: I haven't. That doesn't mean they aren't important, but we have other ways to grab our product. Its not that they are not important, they are, but this conversation about immediate availability is focused on our iOS apps and Chrome.

Will Marvel be part of the comiXology app on the Kindle Fire?

Phillips: Yes.

So you're pretty much on every platform, then.

Phillips: Barnes & Noble is a much higher-profile opportunity for our readers. Kindle has an app by comiXology, which has been announced. That has basically all the [comics] publishers in it, so we will be one of the group. Those are floppies, as opposed to the Barnes & Noble product where we are going to be featuring graphic novels.

Bleeding Cool reported this week that Avenging Spider-Man #1 is being offered on the Marvel DCU same day as print. Is that true?

David Gabriel: That's just a glitch; you can't actually read it,

Marvel has been pretty aggressive about getting into digital comics, yet less aggressive about same-day print and digital publishing than some other publishers. What were the deciding factors in your move to same-day digital?

Gabriel: Actually, that's kind of a weird question. We have been doing this since last September or October; we have been putting books up the same day as print and increasing the frequency every month since then. The whole point of that announcement was to give a final end date for everything going up.

Can you give us an idea of what percentage of your revenue comes from digital sales, and how you expect that to change -- do you see it becoming a bigger slice of the pie or the whole pie getting bigger?

Phillips: The only thing I would be comfortable saying is, we believe the whole pie gets bigger.

Gabriel: I'll tell you what we have said in the past: adding the Marvel app, for us, has been like adding a top ten retailer.

Recently, Marvel canceled of a couple of series before they were published. Would you ever consider going digital first, or doing exclusive digital issues followed with a trade, as Archie is doing with its Jinx property?

Gabriel: I wouldn't say never, but with the things that have been going on here in the past couple of weeks, we are not looking at any of those books that have been cancelled for various reasons [going to digital publication]. In the near future, no.

A lot of book apps are introducing the ability to share, so you can lend a book to a friend for a limited time. So far, comics apps haven't done that. Are there any plans in the works for sharing on any of the Marvel comics platforms?

Phillips: I will just say that I love that idea. I know we're cryptic sometimes. There are so many things people want -- my priority in the digital side is staying close to what we hear from consumers. But that is a nifty thing that is offered by several platforms and I like it.

One concern, especially by comic store owners, is that as digital distribution grows, print will suffer. How do you plan to encourage customers of your digital comics to visit brick-and-mortar retailers?

Gabriel: We are working on some couponing programs that would be a digital coupon that gets sent to digital customers. So the Marvel app digital customers would get a coupon for a dollar amount that they could print out and redeem at their local comics store. We will be talking to retailers over next few weeks, 15 to 20 retailers, about what is the best way to do it, the most fair way, how to help the customers find the closest store in their area and, if there is not a store in their area, how to drive them to an internet shop that would accept the coupon. I think we will be the first publisher to offer something like this in support of the direct market retailers. We both can exist side by side very healthily, and we are just starting to find ways to do that.

Will your graphic novels stay available digitally when they go out of print on paper?

Gabriel: Sure, unless we don't want them to.

What will be the price of the digital comics?

Phillips: It's funny we are asked this question; we have a year and a half of established pricing.

So, same as print, then. Any plans to mark them down after some period of time?

Arune Singh: Marvel does 99 cent sales every week [on comiXology], so there is a lot of fluctuation of [prices] for the consumer's benefit.

Gabriel: We will make a book completely free if we are trying to promote something else. There are a lot of opportunities for different pricing strategies. Again, we are looking at the model of a comic shop: A store owner wouldn't have a comic on his shelf that was $2.99 for four weeks and then mark it down to 99 cents. They would have it at $2.99 for as long as they could, and when the trade comes out, most retailers put those into back issue bins and generally the price goes up a bit. I'm not saying we are doing that, we are not copying everything they do, but we may not reduce the price.

How about offering digital bundles at a discount?

Gabriel: That's sort of what the idea is behind the 99 cent sales. It's not random issues; we pick two or three runs of books, like the first 15 or 20 issues of New Avengers. Now we are doing digital collections within the Marvel app.

"Avenging Spider-Man" #1, which is out now, includes a code for a free digital download of the comic. What sort of response have you gotten?

Gabriel: There was definitely a demand for that first issue, 20 to 30% higher than usual. If you check back in a few weeks, we will have a better idea of how the redemptions are going for the downloads. Every code that gets redeemed by a consumer, they put in the retail store where they got the comic at, and we are crediting retail stores with 50 cents for each redemption. No other publisher has done this before with no price increase.

Aren't you worried this will cannibalize digital sales?

Gabriel: No. One of the hopes is that it increases sales of other comics in the app. We have other comics going up today

We are really doing to look to see how many people are downloading the free comic. We are hoping to get a high response on this. For the next couple of books we do, if ten people out of 100,000 download the free book then maybe it's not worth the effort we are putting into the program, but if 90,000 download it, then we will look at it. We keep pushing the fans, the consumers who buy the books, to use that digital code to see the whole digital program.

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