What Are Sales Numbers and How Can They Best Be Used Ace Masters January 25, 2012 Columns, The Burning Mind Sales What are Sales Numbers and how can they best be used? Numbers–they are universal and tell the absolute truth. If you believe that, then I have an igloo to sell you in downtown Phoenix. Numbers–if one is good enough–say whatever one wants them to say. Turn on any news channel and odds are you will see reports on the economy. Using the same sets of numbers, one commentator will prove we are coming out of the recession, while another will tell you the same numbers show we are on the verge of a depression. Research “Hollywood Accounting” and you will find any number of lawsuits over money owed, even though the “numbers” showed different. Like any good wordsmith–who can weave fantastic tales with words–someone equally as good with numbers can make them tell any story they want. What good are numbers then if they can be twisted and mangled? They are extremely good if used properly and truthfully to gain truth and perspective on whatever subject the numbers cover. For us the subject is Diamond Sales Numbers. But, before we can get to that truth–and understand what you can learn from these numbers–we have to understand what Diamond Sales Numbers are. First, it helps to know what they are not. Diamond Sales Numbers are NOT actual sales of any given issue. That is, the numbers do not reflect how many copies of a given issues are sold on the retail market. What are they then? Simply put, Diamond Sales Numbers are the number of copies Diamond sells to the retail market as a distributor. Or, in even simpler terms: Diamond Sales Numbers are the amount of copies of any given issue ordered by Retailers, not the amount sold by retailers. What does this mean? Your local comic shop orders 10 copies of John Doe #1 but only sells 6 copies. The other 4 copies end up with the back issues. Diamond does not count the 6 sold by the retailer in their sales number. They count the 10 the retailer ordered because Diamond sold 10 copies to the retailer. This is an important factor to keep in mind at all times, not just when going through Diamond’s numbers, but when receiving orders from Diamond. Diamond Sales Numbers are retailer orders only, not retail sales. All this may sound negative, and may once again beg–if not demand–the question: What good are numbers then? And once again the answer is that they are extremely good if approached with the understanding of what they are. Numbers are extremely important to any business. They are valuable and a necessity as long as you approach them with the proper understand and let the numbers tell the story, do not dictate the story to the numbers. You want the truth numbers can bring, not the truth you want them to show. Used right, the Diamond Sales Numbers will reveal the story of the industry: Market Shares: The market share of the industry controlled by each company is determined by their sales numbers. The companies that have the highest sales and the most titles obviously have the highest market share (DC and Marvel). What sells and doesn’t sell: Numbers will tell you what titles are selling and can also give hints as to why they are selling. They also reveal titles that don’t catch on. Genre: If you look at the number carefully, you can get some idea of how each genre sells. Even more important, you can get an understanding of how a genre sells for each individual publisher. Popularity – Titles: The numbers reveal what the most popular titles are in any given period; the higher the sales number, the more popular the title. However, as with genre, you can get publisher specific and learn what the most popular titles are coming from each publisher. Popularity – Creators: As with titles, you can discover the popularity of specific creators. Does a title’s sales number rise when a particular writer or artist joins said title? Does a title’s sales nose dove when an artist or writer leaves the title? The numbers can tell. In the hole: No title can last forever. The sales number can give you insight into what titles might be headed toward the netherworld of cancelation. Profit: Want to try and figure out how much a title makes? Check out its numbers. Then realize that most publishers make 36% of the cover price. Then take out around 60% for cost and you might be looking at a ball park profit numbers. Budget: No way, right? You can’t figure out your budget using sales number. Well, maybe not completely, but partially. From this you should be able to come up with estimated printing costs for different potential print runs. Predicting the Future/Trends: This is what numbers are truly for, and perhaps the most important function. Ever heard of the term “learn from the past?” That’s in full effect here. Sales numbers are the ultimate way to predict the future of any industry and the trends that may come. One example of this is the massive crossovers that DC and Marvel do. During the 1980’s, crossovers like Crisis on Infinite Earths and Secret Wars did stellar numbers–these were followed by a number of company-wide crossover that still last to today. The huge leap in sales for Crisis on Infinite Earths and Secret Wars predicted that future crossovers might yield those same results. At the same time, they predicted the trend of crossovers. They were dead on. Diamond Sales Numbers (orders), are a powerful tool. Especially once you understand what they are and how best they can be used. But, before you can put them to use, you have to look at the numbers first. And that means it is time for the Diamond Top 300 . . . Burning Question: With the above information laid bare before, I want to leave you with a Burning Question we may never have an answer to. If the Diamond Sales Numbers are retail orders and not retail sales – then how many comics are actually sold on a monthly basis, and how many hit the back issue bin? Later, Ace.