Part 1 – Methodology and Metrics
“When you can measure what you are speaking about, and express it in numbers, you know something about it, when you cannot express it in numbers, your knowledge is of a meager and unsatisfactory kind; it may be the beginning of knowledge, but you have scarcely, in your thoughts advanced to the stage of science.” – Lord Kelvin
This set of blog posts represents the end of my discussion for Indie Pubbing, why I did it, and how I proceeded. This has been very much a “learn as you go” effort. I have run other businesses, and in the process of doing that, I have learned that you need information about how the business is running to make day-to-day decisions. The quality of these decisions in turn determine how well our business works, and how much money we can take out of it.
The obvious question is why do I care as a writer? After all, mostly I write. Most of us don’t really think of our writing as a business, most of us hate promo, and most of us do what everyone else does, because we think it works. The problem is that when you make decisions without any feedback you can’t really tell if it works or not. I am lucky – in addition to having the correct half brain which functions for writing (I never can remember which half is which) I also have been an analyst for a long time. For me, acquiring the necessary data and studying it is natural.
This post is concerned with wringing useful information from data which is available to us as indie-pubbed folks. It simply isn’t possible to do this when you are selling through a traditonal publisher, nor is it even possible through an ePublisher. You don’t have access to the information on a daily basis, instead the time frame is closer to six months, at best a quarter.
Like the rest of you, I don’t have much time. I have to divide my day between my day job, writing, rewriting, blogging (fell down on that one for the last few months), social media, oh yes, and planning what I’m going to do next. Whatever I came up with has to require little time investment. The spreadsheets I use evolved over the last six months. I spend a few minutes a day (at midnight every night for the sake of consistency) entering the data. On days I miss, I estimate, since I can always get a final value and divide it up. Being fairly proficient with Excel, it doesn’t take me much time to graph something I want to study, or to add some new analysis, for example when I experimented with Google AdWords advertising. Often, I can pretty much see the effect of an external effect on sales numbers or averages.
I record the following pieces of information:
1. Sales for the day, broken down by Amazon US, Amazon Europe, Barnes and Noble, and Smashwords. Because of the difficulty with understanding Smashwords sales numbers, and the fact that it is a small part of my sales, I’ve come to ignore them.
2. Date and day of the week
4. Number of Twitter Followers. For a while I was looking at the connection between number of followers and sales.
5. Position on the best seller list. I obsessed over this for a while, but I’ve stopped recording it lately.
6. Sales price.
7. Extra information for a specific evaluation, e.g. adword clicks
I am looking for the following results from studying the data:
1. Trends, correlation of the data to external events.
2. Projections for how well we’ll do this month
3. Evaluation of promotional actions’ effectiveness
4. Graphic display, the ability to visualize anomalous events.
5. Immediacy, near real time support for decision making.
These are all well within the capabilities of Excel.
I now have a little over six months of data on sales for my first book. I found getting the data pretty straight-forward, and keeping it in a set of spreadsheets works well for me. I want to look at two different kinds of phenomena:
1. Short term issues. If I change something, how quick do I get a change in sales.
2. Long term issues . How are my sales doing from month to month.
For this reason I use two kinds of spreadsheet – one captures daily information over the month, the second records sales data for each month over a year.
I have made all the spreadsheets since I started at the end of December available. They are on Google Documents, and should be accessible to everyone, at the addresses shown below. Please let me know if you can’t find something at my e-mail address below. Feel free to download if you find them useful.
This has evolved since I started. The monthly spreadsheets changed as follows:
I only tracked totals in December and January, I didn’t have a monthly sheet.
In February I started forecasting what our monthly totals would be.
In March, I improved the method for forecasting
In April, I added the capability to have results for more than one book (my second release wasn’t ready yet, but I wanted to be prepared) I also stopped keeping track of my best seller list position and the number of twitter followers as aggressively. Also note the what-if calculations for various monthly sales vs price. I was deciding whether or not to increase the price of the book, and to what.
In May, I added Google AdWords tracking. Note that for much of May and June there was no promo done to get a decent understanding of advertising by itself. The spreadsheet was not changed (other than the date and days of the month) through june.
Next time I’ll show the application of this method to evaluating promo and advertising, including my Google AdWord results.
Links to online spreadsheets
February 2012 sales – http://tinyurl.com/722tnao
March 2012 sales – http://tinyurl.com/6snr544
April 2012 sales – http://tinyurl.com/6qu893f
May 2012 sales – http://tinyurl.com/74vmdkw
June 2012 sales – http://tinyurl.com/6me2c45
July 2012 sales – http://tinyurl.com/73t6l2t
Year to date total – http://tinyurl.com/7jp2nab
(Note: July is month to date)
To comment or question offline, my email address is email@example.com