Marvel names Penguin Random House exclusive distributor for comics, graphic novels

On March 23, 2020, Diamond Comic Distributors suspended its shipments of new comics to the Direct Market for several weeks due to the Coronavirus pandemic; on April 17, DC responded with an emergency move to set up two new distributors — an arrangement which since has appeared to become permanent for one of them, Lunar Distribution. Today, a little over a year after the initial Diamond shutdown, Marvel Comics has made a more historically significant move, according to ComicsBeat — stepping outside the Direct Market altogether by naming Penguin Random House its exclusive distributor for comic books and graphic novels beginning on October 1.

According to a letter sent by Marvel to retailers, Diamond will still be able to sell comics to retailers as a wholesaler — an intermediary. Retailers will also receive free shipping from Penguin Random House. Hachette will remain Marvel’s bookstore distributor. Retailers were encouraged to open PRH accounts now to register for Marvel’s monthly title catalogs and solicitations, which will continue to be available to retailers approximately three months ahead of on sale.

Presumably, the majority of comics will still be nonreturnable; without that, the Direct Market ceases to be a distinct marketplace. As opposed to the newsstand magazine market for comics and the book channel for graphic novels, the “Direct Market” has been defined historically as the group of retailers who buy those products outright from publishers and their intermediaries. (UPDATE: Bleeding Cool has the question-and-answer packet that PRH is providing shops here. It describes that all retailers will get a flat 50% discount for nonreturnable comics purchases, with free freight. Currently more than half of Diamond’s Marvel accounts get better than a 50% discount, all the way up to 59% for the biggest outfits — but the shops pay the shipping.)

Diamond sold $213.5 million in Marvel comics and graphic novels to comics shops in 2019 at full retail; that was about 40% of its print product dollars. DC, which left last year, was $155 million in 2019. Diamond’s share of those would’ve been smaller, just its distribution fees. Geppi Family Enterprises CEO Steve Geppi responded with this letter to retailers:

“Today, Marvel announced a new arrangement for comics, trades, and graphic novels going to the Direct Market. Starting with product on-sale October 1, Diamond will purchase these Marvel products from Penguin Random House (PRH) as a wholesaler rather than distributing them directly from Marvel. 

“This change represents a behind-the-scenes shift in how we obtain these Marvel products for distribution, but it does not impact our ability to supply you with Marvel comics, trades, and graphic novels. While there are still details of this new arrangement to work through, including discount terms, we are committed to communicating any changes well in advance and making this as operationally seamless as possible. Marvel has been and remains an incredible partner. We are very pleased that we will continue selling Marvel product to the Direct Market.

“As you know, Diamond has been in the business of comic distribution for almost 40-years. Many of you have been right there with us. We take our job seriously and cherish our relationship with you even more. We value the trust and confidence you put in us to carefully pick, pack and consistently deliver the collectible-quality merchandise you order. Our value-added programs and services including the Comic Shop Locator Service, Free Comic Book Day, ComicSuite, PREVIEWS catalog, Shopify store builder and PULLBOX have helped shape the industry and support your business. 

“Diamond is the industry’s largest single-source of comics, games, collectibles, supplies and more. We offer products from hundreds of vendors each month with more than 200 print publishers alone. This allows you to spend less time placing orders, and more time serving your community of fans. Diamond has always been highly focused on the specialized needs of comic retailers and we are dedicated to the Direct Market. We will continue to work hard to earn your business each and every day.

“My team and I look forward to continuing as your primary source for Marvel comics, trades and graphic novels, providing industry-leading selection, service and support now and in the years to come. As mentioned before, there are still details of this new arrangement to work through and my leadership team is working as quickly as possible to be able to share additional information with you in the coming weeks and months.”

As noted, this is historically big: since the decline of the newsstand more than three decades ago, the dominant method for getting Marvel Comics to shops has involved comics whose roots are in the comics industry. At the time of its move to exclusive distribution by Diamond in 1995, DC’s Paul Levitz received plaudits for keeping the solution within the industry, rather than bringing in Warner‘s magazine distribution arm. There’s a culture to comics selling — peculiar product naming conventions, specific demands in terms of product condition, and a need for transparency regarding sales volumes — that require special care on the part of any intermediaries to get things right. Clearly PRH successfully made the case to Marvel that it can handle the job.

It’s worth noting that PRH has been a publisher of graphic novels on its own for many years, and has been a fixture in Diamond’s charts for more than a decade; it also handles bookstore distribution for other comics publishers, including Dark Horse, IDW, and since last summer, DC. It’s not in the Direct Market, to be sure, but the company is definitely “in” comics, if not necessarily “of” comics.

(Edited to add: A further couple of thoughts about Diamond and its capacities. Its main warehouse is in Olive Branch, Mississippi, right across the line from the busiest air freight airport in the Western Hemisphere in Memphis, Tennessee. With FedEx headquartered there, it might have even passed Hong Kong’s airport during the pandemic. During the distributor wars in comics in the early 1990s, it would have been the place to be if you were trying to beat another distributor for speed — but part of what helped save comics distribution in the mid-1990s was the climb-down from having to do things like direct air-freight to retailers, proprietary trucking fleets, and having warehouses everywhere. Saving on all of that is what helped keep the Direct Market afloat. If Diamond is just a wholesaler for Marvel, increased speed of service today wouldn’t necessarily come into play, but it could be meaningful for the company for its other lines.)

As to the state of future reporting, we’ll have to see. As just mentioned, one of the pillars of the functioning Direct Market is that retailers have a good idea of quantities of copies on the market for pricing purposes; without it, both retailers and collectors are on their own to guess whether something’s really rare or not. (UPDATE: In that packet for retailers mentioned above, PRH also promises to add material to its retailer website with a “a listing of top-selling titles.” No word on including relative sales levels for retailers, or if customer-facing reports will exist. Marvel didn’t do its own charts in the Heroes World days; DC/Lunar have yet to.)

In our case, Comichron is an archive of circulation information, so we’ll publish whatever we receive. We also developed a retailer order dataset last summer, on which our rankings for issues were based and which was most recently used for our latest DC report. There are 85 years of comics circulation data Comichron has access to, only a small portion of which is on the site; depending on how the workload involved in tracking the current market changes, that historical reporting could be accelerated.

More information as it becomes available, of course. ComicsBeat has additional information and analysis here.

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