December 25, 2006

BestSeller Lists-1: Accuracy

The New York Times Best Seller List is perhaps the most famous and coveted bestseller list, and some claim that most buyers check this list before making a purchase. [I doubt this, as do others - see below.]

How this list is compiled is a trade secret, but it's known that the NYT "News Surveys" department creates it and the NYT Book Review publishes it.

It's a weekly list, said to be based upon weekly sales reports from a selected set of independent and chain bookstores - and wholesalers - across the country. The sales tallies are not wholesale figures: they represent actual books sold to the individual buyer.

There are other bestseller lists, of course. USA Today has a well-known list: providing the top 150 in book sales without categorization, it gives other information, including the week of peak sales and number of weeks on the list.

Publisher's Weekly has its list. So do various booksellers: for independents, check out BookSense; for chains, look to Barnes&, and Borders, which is "teamed" online with The Christian Booksellers Association also has its own list.

Once you've found the lists, the question becomes: what do they tell you? On his blog From Where I Sit (12-22-06 entry), ThomasNelson CEO Michael Hyatt tells you: not much. The lists don't include things like Wal-Mart sales, and the bulk of the Christian market, for example.

Hyatt explains: "Most of the bestsellers lists are inaccurate. In fact, I can't think of a single exception. They claim to be comprehensive. Supposedly, they represent the best selling books in the country. But the fact is, they don’t. At best, they represent sales through a specific sales channel. But guess what’s missing? That’s right. All the mass market outlets like Wal-Mart, K-Mart, Target, Costco, and Sam’s and Christian bookstores (some 2,300 stores or so). This is a big piece of the market.

"For example, at Thomas Nelson, about 34% of our total sales come from Christian bookstores and another 16% come from mass outlets. Only 21% of our sales go through general market bookstores like Barnes & Noble, Borders, and Books-a-Million—the stores the New York Times polls. The other large Christian publishers probably have a similar mix. As a result, the Times completely misses the number of units that are moving through some very significant sales channels. At best, they can claim that their bestsellers list represents sales through only one specific sales channel.

"...The best solution of all would be for Nielsen’s BookScan to collect data from Christian bookstores. It already collects data from 6,500 general market bookstores and other retail outlets, including Target, K-Mart, and Costco. (It apparently does not collect data from Wal-Mart or Sam’s.) It is also based on point-of-sale data, so the data is thus more reliable. It reflects what customers are actually buying."

PoynterOnline's BookBabes blog (11-19-04 entry) has a nice discussion of an article written in Fall 2004 by Marina Krakovsky which appeared in The Washington Post Book World.

Krakovsky's interest was piqued by a study by Stanford business professor Alan Sorensen, who had compared the NYT List with Nielsen BookScan. (Nielsen more accurate, NYT didn't impact booksales in any significant way.) Krakovsky investigated how various bestseller lists are compiled, comparing them to the Nielsen BookScan, which purportedly logs approximately 70 percent of all book sales.

Margo Hammond, book editor for the St. Petersburg Times writes, "So which bestseller list really tells us which books America is buying? It would seem none of them. Even [Nielsen] BookScan can't convince Wal-Mart to disclose its sales, for example. BookScan may provide the most accurate list for the whole country. But for now the public buys into the more "whimsical" lists because they carry some sort of branding allure, without thinking about how these lists reflect the tastes and philosophies of each publication as much as they do actual sales. Instead of bestseller lists, perhaps we should call them Lists of Books We Think Our Particular Readers Are Buying."

Ellen Heltzel, co-author of the BookBabes column for Poytner, replies: "Beware the big clomping feet of BookScan. Sure, the data-meister doesn't clock Wal-Mart, nor, for that matter, does it measure sales to libraries or assigned reading on college campuses. But, in the four years since it was started, BookScan has turned itself into a force to reckon with. Where newspapers and magazines used to offer the best that was available in customer advisories on what was selling, now BookScan can do it better. Cultural lag and tradition accounts for why the reading public is still addicted to The New York Times bestseller list. But BookScan's Jim King makes it clear that his outfit would like to become the standard inside the industry -- and outside, as well.

BookScan's advantage is that all it does is collect the numbers that reveal winners and losers (as far as sales go, anyway). It surveys national chains, regional chains, discounters like Costco, and independents. The information is helpful to publishers, who now can make decisions based not only on how their own books are doing, but with fair measure of the competition."

In 2003, Publisher's Weekly wasn't so sure about this new kid on the block. "So how representative are the service's numbers? An informal survey of the top-selling books of 2003 showed some surprising things.

"BookScan generally claims to represent between 70% and 75% of sales in the industry (Wal-Mart and some of the supermarket chains are among those who decline to report.) But a comparison with in-print figures supplied by publishers reveals that the numbers are more likely to represent about 65%, even after deducting for unsold books and returns.

"For BookScan's top ten nonfiction titles published last year--a list that include mass-market favorites like Phil McGraw's diet books as well as indie hits like Benjamin Franklin: An American Life--no title had BookScan sales comprise more than 75% of total sales. For some of the books that had strong special-sales, they ran as low as 25%."

[Note: if you want to check the sales of a particular book (e.g., if you want to confirm the accuracy of your royalty check), you can buy a sales report based upon Nielsen BookScan information from the BookStandard. An example of what you get for $85 is shown on the site in .pdf format.]