Funny Business #5: The Good Kind of Audit

When it comes to comics, sales estimates tend to get people all excited. Fans want to see what's selling. Pros get all bent out of shape because they say the estimates are low. Some people even think it's nobody's business what a title sells. However, that last bit is not as defendable as the first two. If there's advertising in a comics periodical series [the traditional comic book series], it's very much the advertiser's business what a series is selling (or at least the total of the comics the ad appears in). That's not just in comics, "traditional" magazines have the same advertiser concerns and, guess what, both traditional magazines and comics periodicals both get their circulations audited.

The auditor for both DC and Marvel (as well as Bongo) is BPA Worldwide. Technically speaking, BPA stands for Bureau for Performing Audits, but everyone just refers to them as the BPA. Because the DC and Marvel circulations are audited, guess what? We have some hard numbers to work with, as long as we know how to interpret them.

DC doesn't break out their listings by individual titles, just overall circulation and circulation by market (Teen, Mature Reader, etc.). Marvel, on the other hand has a monthly breakdown of the audited direct market sales and a breakout for one month that includes such interesting and otherwise untracked items as newsstand sales and subscription copies. What say we delve into those Marvel numbers?

Disclaimer: if you like to moan about how inaccurate sales figures are, please take it up with the BPA, not me. They know more about tracking circulations than you do. It's true. What you're going to look at are real numbers, the numbers advertisers look at to determine value and payment. I'm not talking about estimates. Everybody clear on that? Let's continue.

We all know that the estimates based on the Diamond sales ranking chart are somewhat understated, but we don't always know by how much. Comics trade news sites such as ICV2, Comic Book Resources and Newsarama all do sales estimates and those estimates tend to be very close to each other. I randomly picked 4 titles from Marvel's audit for the first half of 2007 and compared them to the estimates at ICV2. Here's what I found:

A bit of house keeping before the analysis. BPA audits are by cover dates, which is a little more confusing since Marvel puts the direct market release dates on the cover these days, but for BPA purposes, the audit date is two months after it ships, so a January 2007 book is one that hit the direct market in November 2006. (This is a magazine thing.) ICV2 didn't have an issue of Ultimate Fantastic Four on their April chart, hence the blank spot in the June audit period. Yes, ICV2 had Wolverine selling more copies than the BPA did for four months of this audit. I don't have an explanation for that.

However, throw those anomalies out, and you see the audited numbers are consistently 8.5% - 12.2% higher than the Diamond estimates. If you're the sort of person that like to use a plus-or-minus-two-percent margin of error, bump the Marvel numbers up 10% and you should probably be pretty close to reality for the direct market.

Where does this extra 10% come from? Re-orders, foreign sales, and the fact that those numbers you're used to seeing really are just estimates. An estimate, by definition is going to be a little bit off.

Is 10% a good number to universally apply to all sales estimates? Not at all. First off, Marvel doesn't do that much by way of over-printing. Oh, sure they do on selected projects and you'll see availability here and there, but not across the board and not to the extent DC does. My inclination is that DC's actual numbers after re-orders will be 15%+ greater than estimates, but without audited data, that's only a guess. With independents, your mileage will vary, but 10% is a legitimately derived point from which that discussion can take off.

That's just the direct market. Comics also sell in the traditional magazine market. Not so much on newsstand as at Borders and Barnes & Noble, but if you're in the right grocery store, you'll still occasionally see the odd comic book. (If you were wondering what was up with more monthly comics in the chain book stores, that's easy: their inventory tracking is a lot more accurate than the old newsstand system.) Comics also still have subscriptions. The month breaking out the old magazine market and subscriptions is May 2007, which means the comics hit the direct market in March, and would have floated in the newsstand/Borders Market through April and possibly into May.

Coming to a formula for estimating the newsstand and subscription gains based on the direct market isn't going to happen because the results are all over the board. The best selling comic on the newsstand was Amazing Spider-Man with 8,001. Mind you, this would have been during the run-up to the Spider-Man 3 film (May 2007 release) and part of the top-selling "Back in Black" arc. The second highest seller on the newsstand was Marvel Adventures Flip Magazine with 6,733 copies. That's one of those magazines you hardly ever see in the direct market (audit says 768 copies ordered there) that reprints two of the Marvel Adventures comics. Yes, Marvel Adventures material seems to do better outside the direct market. The worst-selling book [series] on the newsstand was Ultimate Fantastic Four with 567 copies. The second-worst selling book was Marvel Adventures The Avengers with a 707 copies. Throws a direct market-based algorithm straight out the window, doesn't it?

The comic with the most subscribers was Marvel Adventures Spider-Man with a whopping 27,395. You want to know why Marvel Adventures exists with low direct-market sales? There's your answer—subscriptions. The second-highest subscriber count was Ultimate Spider-Man with 14,890. The lowest subscriber count was Mighty Avengers with 77 (that title had just debuted, so don't read too much into it). The second-lowest subscriber count was Spider-Man Loves Mary Jane with 280.

Now, let me emphasize, this is a one month break-out. It might be a good month, it might be a bad month. We don't know. Some titles are picking up over 10K copies in sales from newsstand and subscription, some aren't even picking up 1K. It's just a different market. Subscriptions are also subject to mass market visibility. With all those films, Spidey is going to have more subscribers and the two most accessible Spidey books are the two top subscriptions. I somewhat suspect after the Iron Man movie, there's been a bump in Iron Man subscriptions.

On the subject of Marvel Adventures, while Marvel Adventures The Avengers doesn't appear to be a traditional market hit, in this auditing period, Marvel Adventures Fantastic Four's total circulation was 10,341, compared to 5,047 in the direct market. That's more than double. Marvel Adventures Spider-Man sold 35,368 overall, as opposed to 7,044 in the direct market. Plus, they get repurposed in a Flip Magazine that's the #1 newsstand seller. Anyone working on Marvel Adventures comics has the right to scream about sales estimates not being accurate and you have to listen to them. They'd be right. I also find it interesting that the Marvel Adventures subscription numbers are quite so high. Does this mean parents with young children don't feel comfortable taking the kids into a comic store, or just that the direct market isn't convenient for them?

[Todd Allen is a technology consultant and adjunct professor with Columbia College Chicago's Arts, Entertainment & Media Management department. Allen's book, The Economics of Web Comics, is taught at the college level. His further comics industry commentary is available at Indignant Online. The opinions expressed here are not necessarily those of PW Comics Week.]