Over the last few years, you’ve given some very upbeat interviews about the general health of traditional publishing. Does a company like Penguin Random House have anything to learn from looking at successful indie writers and the recent self-publishing revolution?
I see the world of self-publishing as complimentary to traditional publishing rather than something which is a threat or antithetical to a company like Penguin Random House. Indeed we have had very happy experiences of self-published authors deciding over time they would like to be published by us because they think we can scale them to a bigger audience, and because they would rather concentrate their time on their writing rather than marketing their work. At the same time though, I do think Penguin Random House can learn from successful indie writers. I very much respect how those writers really understand and get close to their readers, and their social media skills are often very strong. How self-publishing has made our lives more complicated is it has become harder for us to capture the attention of the public for our books because there are so many more titles out there now. But rather than moaning about that, traditional publishers just need to get even better at marketing and promotion.
You’ve been very vocal on the subject of publishers experimenting with subscription. Do you think the larger the company, the less likely it is to innovate with new commercial models ?
No! I don’t think size has anything to do with it. In fact, in some areas our size is allowing us to innovate with new commercial models because it gives us the resources to experiment and take bigger risks. For example, in the children’s area, we are innovating with the boldest commercial model of any publisher in the world because we are investing literally millions of pounds in co-creating, co-producing and co-owning children’s Intellectual Property which goes way beyond books into animation and then other consumer products. Traditionally if publishers did own a broader set of rights beyond books, they would licence those rights to third parties. We are maximising those rights ourselves and often helping to create the IP as well, and as a result we enjoy the lion’s share of the profits. We are doing this with classic brands like Peter Rabbit and The Snowman which we own, and creating totally new IP like Puffin Rock, a new character led brand which will be on TV before moving into publishing and merchandise.
Our issue with subscription is that at the moment we can’t see the business model. Why cannibalise existing sales? Why torpedo our current business model when it is very robust? We are not totally closed to subscription and we are experimenting with subscription in audio. What might really interest us in subscription is if it genuinely took us to new audiences, to non-traditional book readers. We are seeing very little evidence of that though from the vast majority of subscription companies, perhaps because they are strapped for cash and can’t invest properly in marketing.
I’m interested in innovating with new commercial models which turn the dial, reach new audiences and make us more money in a scalable way. I’m not interested in new commercial models which either lose us money or simply play to the gallery.
There’s been a lot of talk about the new Penguin Random House website and its new purpose. Was there a temptation to develop a full blown direct-to-consumer sales strategy?
The new PRH website will be the first publisher website based on user experience. We have done a ton of consumer research and what we are told by readers is that they would go to a publisher website not to acquire or discover books but to forge closer bonds with authors. So that is where we are focussing all our energies. The purpose of our website will be to help to create long-term engaging relationships between authors and readers. The website will have an ecommerce capability and over time we hope there will be an opportunity to sell special products and experiences to a niche audience of superfans. There was no temptation to develop a fully blown direct-to-consumer sales strategy. It would be quicker to burn the money. If huge and experienced retailers like Tesco and Barnes & Noble have found it so hard to retail ebooks, what hope would we have?
Has the merger of Penguin and Random House made you think differently about how you manage so many different brands within such a large publishing portfolio?
Publishing a book or an author is a very intimate, entrepreneurial business. In my view, it is done best by small, highly creative, highly entrepreneurial teams who are agile and fairly autonomous. It involves quite a lot of micro management (in a good way) and the devil is often in the detail. That is why at Penguin Random House we fundamentally believe in the importance of imprints and autonomous divisions. And it is important to protect and nurture those centres of publishing excellence. At the same time though, our scale at Penguin Random House does provide us with some competitive advantages which we need to maximise as well – connecting as one company around the consumer (in a whole host of ways), scaling best practice around the group, ensuring we are a destination employer, reaping the benefits of the Penguin Random House global network of publishing companies, and so on.
At whitefox, we put a lot of store in the value of a large curated network of professional freelancers. How do you think the relationship between publishers and outsourcing will evolve over the coming years?
So many different skills are needed to create and publish good books. As I say, I want Penguin Random House to be a destination employer – the place where people who love books, ideas and writing can do the best work of their lives. As a destination employer as well as a publisher with such a broad spectrum of books, the freelance community in addition to all our permanent staff is hugely important to us and I would be very interested to know how we can best work with your brilliant network.
If you were to identify some new skills and specialisms that writers and publishers were likely to value in the future, what would they be?
This is not a very original answer but I do think marketing in particular is changing very quickly. I think content production skills (for marketing) are going to become more and more important. Especially video, graphics and animation. So that is one area. Another of course is analytics. Creativity in marketing is as important as ever but there is so much more opportunity now to measure the effectiveness of our marketing, not just in terms of retrospective analysis but also in terms of planning.
About Tom Weldon
Tom Weldon was brought up in London. After studying history at Oxford University, he was a graduate trainee with Macmillan. After three years as a non-fiction commissioning editor, he joined William Heinemann, then owned by Reed Elsevier. He spent nine years there as an Executive Editor, American Editorial Director based in New York, and then Publisher of the imprint.
In 1997 he moved to Penguin as Publishing Director of Michael Joseph. In 2001 he became Managing Director of the Penguin General division (then comprising of the Michael Joseph, Viking, Hamish Hamilton, Fig Tree and Penguin Ireland imprints). He was made Deputy CEO of Penguin UK in 2009 and CEO in January 2011.
In July 2013 he was appointed the first CEO of Penguin Random House UK.
Tom has also attended London Business School. From the age of nine, Tom has had a passion for horse racing. In his view, gambling is very important to publishing as well. He does not find it surprising therefore that he fell in love with publishing on his first day at Macmillan and that love has never gone away.