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Bookstore Bonanza: The Economics of Erotica

Fifty Shades of Grey by E L James
Source: Amazon
Fifty Shades of Grey by E L James

Sleeper bestseller “50 Shades of Grey” may be bringing new attention to erotic fiction, but the economics of erotica are black and white.

The 29th annual Romantic Times Booklovers Convention is taking place from April 11th to April 15th just outside of Chicago, and organizers say it’s the biggest ever with 2,000 industry insiders and readers in attendance.

Romance is the best-selling fiction genre, raking in $1.4 billion annually, and sales in sub-category erotica are hotter than ever.

Books-A-Million fiction buyer Margaret Terwey says her company has seen a 40 percent bump in erotic book sales since the release of the initially self-published surprise hit “50 Shades of Grey” by first-time British author E. L. James. Many credit the book with bringing “mommy porn” to the forefront, pulling in a whole new consumer to the genre.

But while sales of “50 Shades of Grey” are reigniting the racy genre, many of the category’s publishers credit e-books for saving erotica. With tablets, both the act of buying and reading e-books is much more discreet, keeping those nearby from knowing exactly what readers are delving into.

“With the different types of tablets out today you can get away with a lot more risqué type of literature to read. Instead of sitting on a plane with some Fabio cover model on the front, you have an Apple symbol,” says Dr. Ivan Rusilko, osteopathic physician, erotic book author and model.

The exponential growth of e-books has helped erotic fiction sell faster than ever before.

Smashwords.com is the largest distributor of self-published e-Books and its founder and CEO Mark Coker says e-Books were just 0.2 percent of all books purchased in 2006, 1 percent in 2008, 8.3 percent in 2010 and 19 percent last year.

According to Idea Logical Company, Amazon.com’s e-book market share has fallen from 90 percent in 2009, to around 60 percent now, though it still dominates rivals. The research firm estimates Barnes & Noble has 25 to 30 percent market share and Apple has much of the rest.

“E-books give us the opportunity to re-jacket [erotic books] and re-represent them…all of the sudden there is a larger readership," says Brenda Knight, associate publisher for Cleis Press. "We’re happy as clams!”

Edward Nawotka, editor-in-chief for the online journal Publishing Perspectives, says there’s a lot of money in this category, and publishers are finally accepting this. With e-books, there is a great amount of tolerance and acceptance of the sometimes quick-and-dirty writing associated with erotic fiction.

The economics of erotica are undeniable. Leading erotic e-book publisher Ellora’s Cave sold just 40 books per month in 2001, 54,000 titles a month in 2005, and now monthly sales average about 190,000. The pattern of these sales isn’t unique to Ellora’s Cave but a trend throughout the genre.

Cleis Press made about 30 percent of its sales through Borders, and the book store's bankruptcy was devastating, Knight says, until the sales reports revealed that all the money the publisher lost with Borders was made back in e-book sales on Christmas Day alone.

“e-Books saved us…it saved our business,” Knight says.

Questions? Comments? Email us at consumernation@cnbc.com. Follow Courtney Reagan on Twitter @CourtReagan.

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