Rolling for the Initiative – How to Make the Possibility of Comic Returns Work

Rolling for Initiative is a weekly column by Scott Thorne, PhD, owner of Castle Perilous Games & Books in Carbondale, Illinois and marketing instructor at Southeast Missouri State University. This week, Thorne discusses how comic book publishers have traditionally been successful in enticing stores to carry new comics, as well as the pros and cons of steep discounts and the ability to return.

I’m going to spend a little bit on comic retail here, because we sell comics as well as games. One of the biggest problems for publishers is exposing customers to new comics. Publishers have generally approached this in two ways: deep discounts and the ability to return.

Important discounts. In general, MSRP discounts on comic books range from around 45% to 55%, depending on the publisher and how much the store buys from the distributor. To encourage stores to take a risk on a new title or to increase the purchased quantities of an issue the publisher wants to push, the publisher will increase the discount on that title to 60% or more. The publisher might, for example, offer the first issue of a new book at 75% off the MSRP to increase purchases. When Marvel Comics used Diamond Comic Distributors as a distributor, the publisher offered discounts on various titles: buy 20 copies of this issue and get an additional 10% off, buy 40 and get 15 off %, etc. After Marvel moved its distribution to Penguin Random House, those incentives disappeared.

Publishers will also offer related discounts: Exceed the order quantity of Batman #162 with the quantity ordered on #165 and get an additional 10% discount, by linking the discount to the quantity ordered of another title. Generally, I’ve found that discounts don’t increase additional sales, because unless I think the book sells, additional copies, even at a discount, will just clutter my shelves.

Returnability. I’m a bigger fan of using the returnability to entice stores to try a new comic: which means either all copies are returnable, or if a store orders above a certain quality , copies are returnable. Image Comics used it wisely to increase purchases of issue 193 of The Walking Dead. Image Comics did not tell the retailer or the reading public that this would be the final issue, and had even issued solicitations for issues after #193 in order to keep the series ending a secret. However, retailers have been advised that any copies of this issue purchased will be refundable. Retailers taking advantage of this offer found they had plenty of extra stock, at little risk to themselves, to satisfy the increased demand caused by the end of the series. The possibility of return allows retailers to mitigate the risk of trying a new series. Even better is when the publisher offers the possibility of feedback on the second and third issues of a new book, as this allows stores to more accurately gauge the sales of the series.

One problem publishers have with the returnability is offering it in conjunction with ratio variants. If a store buys 50 copies of house of slaughter, for example, the store may then purchase a copy of a limited-edition cover, which it may then sell for typically 10 to 20 times the price of the cover. The possibility of return applies to ratio covers, and a store could, if it has the initial capital, buy 500 copies of house of slaughter to get 10 ratio covers, then return unsold copies of the main book three months later for credit. The publisher gets the money within a month of the book’s release, but then gets hit with huge returns three to four months later, which really hurts profitability. Additionally, we are seeing more ratio hedges coming to market, reducing the limited number of hedges expected to come to market and devaluing them.

One way to solve this problem is to decouple report covers and the possibility of return, so that consigned purchased books do not count towards the purchase of a report cover, while quality purchased books for a cover of report are not eligible for the possibility of return. We would likely see fewer ratio covers offered for sale and more reasonable amounts of consigned books purchased.

Oh, by the way, we have a lot of Magic: The Gathering comes out this fall. By my reckoning, a major set releases every month from September through December (see “‘Magic: The Gathering’ Release Schedule for 2022/2023”). Hush.

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The opinions expressed in this column are solely those of the author and do not necessarily reflect the views of the editorial team.

Daniel K. Denny