Coming up with a reasonable promotional budget is one of the aspects that POD published authors often run into trouble with when it comes to promoting their books. Some authors underestimate their expenses, others are willing to spend as much money as they can in book promotion. The truth is that balancing such a budget can be a complicated process, in which common sense, pre-existing expectations and an out of bounds enthusiasm are often at odds with each other. There are no absolute formulas but there are some useful guidelines that can be used.
The first thing you have to remember is that even though it is true that you must be willing to spend some money in order to promote your book, spending thousands of dollars to sell a hundred copies is obviously a very bad idea. If you want to make a major investment, that is up to you but such a decision should be made with a clear understanding that chances are that that money will never be recovered.
Given the emotional attachment most of us feel for our books it may be difficult to approach this aspect as a business venture, but it is necessary if you want your book to become a source of profit. You may think of your book as your baby, and as such you may be willing to do everything in your power to help it succeed in the big, bad world, but you really shouldn't throw common sense out the window to do it.
To come up with a workable system you may have to set a reasonable budget for book promotion, and doing this is easier if the budget you required to release the book in the first place was small. The key to make this a successful budget is that the amount you get back should be enough to recover your promotional costs, your publishing costs and enough money to keep on promoting your book with no additional resources coming out of your own pocket. This means that rather than having a "total" promotional budget, you may be better off with a more layered approach. You have to remember that the more you spend, the more books you have to sell in order to break even. A very simple example would be the following:
If you are spending the money you could expect to recover if you were to sell one hundred copies, and assuming that you paid a similar amount in order to have the book published in the first place, you would then need to sell 200 copies in order to break even (100 copies to recover your publishing costs and another 100 copies to recover your promotional costs). To this figure you should probably add another hundred copies for future promotional expenses. This means that you would have to sell 300 copies if you want to keep on promoting your book without having to make any additional investments out of your own money. Obviously if you spent more money to release your book than the amount you would recover by selling 100 copies of your book, then you should add those copies to the number of books you would have to sell to break even, and this would cause you to have to increase your promotional budget as well. Here it is important to keep in mind that this figure should be based on your royalties, not your retail price. This means that if your book has a retail price of $15.00 and your royalties are $3.00 per copy, then 100 copies would pay you $300.00, not $1,500.00.
The basic system used above indicated that your initial promotional budget should be equal to your publishing costs, and that you should attempt to make three dollars for each dollar that went into that original promotional budget. This system holds true regardless of how much you spent getting the book published in the first place, but the thing is that this system tends to balloon nicely, and that is one of the reasons why it is so important to keep publishing costs to a minimum. An example of this would be the following: If your publishing costs were $1,500.00 you should invest another $1,500.00 in promotion and hope to make $4,500.00 for the system to work, however your royalties are likely to remain pretty much a constant regardless of your choice of publisher, so rather than 300 copies you would have to sell 1,500 copies, and the truth is that in most instances that is not likely to happen, regardless of what you do when it comes to book promotion.
Another hard truth is that using this system you won't be really turning a profit until after you've spent a second promotional budget and sold a second batch of copies, if you are lucky. In quite a few instances you may discover that you have spent your whole promotional budget and you have not succeeded in breaking even. In these circumstances you may have to choose between giving up --not a good idea, but still an option-- or allocating a new promotional budget, knowing that you will have to sell even more copies if you expect to break even. Using the smaller of the two examples that were mentioned above, in which you had to sell 300 copies, you would have to sell 400 copies with the promotional resources that you have assigned as a second budget --assuming that you are spending a similar amount-- minus those copies you managed to sell with the original budget.
The advantage you have with this system is that once you've recovered your original investment and enough money to keep on promoting your book you will be, in a sense, playing with their chips and your book promotion efforts will be self-sustaining. A huge advantage not only because you won't need any additional investments, but also because it will provide you with a very clear limit to your promotional budget. Once your book promotion expenses are self-sustaining you can use this simple principle: If it has to come out of your pocket it is probably not worth it, though there may be a few exceptions to this rule.
But getting back to the management of your original promotional budget, if you succeeded in selling your target number of copies out of your first promotional budget, then the final third of that money you earned should be reinvested as a second promotional budget. From this second promotional budget you may want to keep half of your earnings and invest the other half to keep on promoting your book. This system can then be kept in place for as long as you can manage to keep selling copies of your book.
Ideally this system should work as a sort of balloon, allowing you to sell more and more copies of your book with each promotional budget, and also enabling you to keep some of your earnings for yourself. For the sake of simplicity I am going to stick to the previous example in which you had to sell 300 copies with a budget that amounted to the royalties you would receive for the sale of 100 books.
First you have that budget that amounted to 100 copies, and you managed to sell 300 copies, for a total of $900.00, of those $900.00, $300.00 were to recover the original promotional investment, another $300.00 went to cover your original publishing costs and finally the other $300.00 were set aside to keep on promoting your book. In other words, you have spent quite a bit of time, money and energy and you still haven't been able to take one single penny to the bank. In the next round, however, things get a little better. You spend the $300.00 you had set aside the first time around, and once again you get $900.00 out of it. You no longer have to worry about recovering the original promotional budget, nor should you worry about recovering your publishing costs, so now you are in fact making a profit. Of those $900.00 you may want to take out $450.00 for yourself and reinvest the other $450.00. It may not be much, but at least now you have some money to show for your efforts. Keeping the same formula, with those $450.00 you can now use to promote your book, you should attempt to get $1,350.00 back, keep $675.00, and reinvest a similar amount, and then repeat the cycle. In theory you should always see more and more money, unfortunately that is not the way it works out in the real world, eventually you will find that your returns are shrinking (balloons are sort of round, they tapper off eventually, and they tend to burst if you force more air into them than they can stretch to accommodate). Even if this is not a pleasant decision you should not invest a lot more to keep your promotional efforts going, remember that most books eventually go out-of-print. If you are using POD you may be able to keep your book in print, and you may still get some additional sales, but there comes a time when promotion ceases to be profitable, even if the book remains available.
This example sounds very nice, but it is a bit misleading. One thing that was missing from the previous explanation were numbers of copies. If you bring these numbers back into the picture you may realize that even with a conservative system such as this (which does not lead to a huge profit) you would have to sell quite a few books to stay afloat. If you sold 300 copies the first time around, and another 300 the second time around, then you went on to sell 450 copies, by the third time around you would have sold 1,050 copies, and the truth is that very few POD published books ever reach those numbers. If you continue to invest half of your profits in order to keep promoting your book you would have made a grand total of $1,125.00, and this is not a very significant return when you consider the time and effort you must pour into the project to reach these results. Living off your royalties is a wonderful dream, but unfortunately it is likely to remain just that.
As you can see this is not too optimistic, but it is the way in which the system works. Since increasing your promotional expenses would have a very direct impact on the number of copies you would have to sell in order to break even it may be a good idea to start small and expand from there. Focus mostly on those options that are not too expensive and may get you the best results, such as a website and a direct approach that does not require a great budget. In the early stages of the process I would say that paid advertisement in specialized publications may not be a very good option, even if it may be seen as a valid alternative later on. Mortgaging your home in an attempt to turn your book into a best-seller is not a good idea.
If once you have spent the resources you had originally allocated to book promotion you find that you have not sold enough copies to break even you must analyze what went wrong before spending any more money. You should try to determine what works and what doesn't, and you should also take into account how short you fell of your original goal in order to determine the changes that must be made as you continue to promote your book.
One thing you have to keep in mind as you plan your second promotional budget is that you must try to sell your book to different audiences. In fact this is more important when you succeed in reaching your goal than when you fail to achieve it. If you failed to achieve it you may want to approach the same audience again from a different perspective, if you have already tapped out one particular market, then all additional efforts to target that same market will be wasted. Remember, you are trying to sell a book, and people are not likely to buy it more than once.
Also, while coming up with a budget and allocating it wisely is extremely important you shouldn't lose sight of the fact that there are some promotional options that are free out there. These are great and they don't have an impact on your budget, though they may help boost your sales. Keep an eye out for these opportunities. Even though most of them are not likely to turn your book into a best-seller, and they may require you to invest a considerable amount of time and effort, they may be extremely useful when it comes to getting the word out there that your book exists. If you are on an extremely tight budget you may want to focus on these free options first, and attempt to sell enough books to establish a promotional budget out of those sales, but doing this is a tall order.
Oddly enough one of the most important things POD published authors have to give up when it comes to book promotion is having someone who is not emotionally involved who pulls the plug on the book. Sure, knowing that your book will never be out-of-print, and not having to worry about additional expenses is wonderful, but there comes a time when continued promotion ceases to be cost effective, and acknowledging that fact is difficult when you are the author of the book in question. Maintaining a website may remain an affordable option, especially if you have other books that you are actively promoting, but other efforts may eventually become redundant. On the other hand one important advantage of keeping your book in print, even if you are no longer promoting it, is that, should circumstances change, your book would still be available to new readers. One example of this is that even after you have stopped promoting a certain title, the success of a different book may reawaken the interest in your previous works. Remember that even though you promote your books independently, especially when they have different target audiences, each book you sell may lead someone to discover your previous works as well.