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Author Topic: A Comics Journal History of the Direct Market  (Read 191 times)
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David
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« on: 11:02 AM | Wednesday, February 17, 2010 »

A little history lesson, and something I'd consider required reading, the following are snippets gathered from multiple pages from an articles originally published in The Comics Journal #116, July 1987; reprinted in The Comics Journal #277, July 2006.  No names have been changed to protect the guilty.

Part I - Fine Young Cannibals:

With their low cover price and tiny profit margin, comics had become more of a nuisance than a moneymaker for distributors. Delivery of comics to magazine racks across the country had become a haphazard afterthought. If distributors paid any special attention at all to comics, it was to defraud publishers with falsified reports of unsold returns. Some comics would be reported as returns without ever having reached a store rack or newsstand. Since the booming 1940s, the comics industry had shrunk to the point where the number of publishers could be counted on one hand. In the 1970s, DC was at a low ebb, with less than 30 percent of a small market, and even Marvel, which had gobbled the bulk of the pie, had fallen on hard times.

. . .

There was no sense of a public eagerly awaiting a title’s official release date. The low-priced comic books were held in low regard by their handlers, and if a delivery truck ran out of room, piles of comics would simply be set aside in the warehouse for next week’s delivery — or worse, to be reported as unsold returns for publisher reimbursement.

. . .

The result was that even the most avid fans had difficulty reliably obtaining the issues they wanted. Business As Usual at the beginning of the 1970s, therefore, was making an already moribund industry worse.

. . .

“Phil Seuling’s brilliant idea,” said comics retailer and former distributor Frank Mangiaracina, “was to say to publishers: ‘I pretty much know how many comics I can sell each month. Why sell to the newsstand distributor who sells maybe two out of three [copies shipped]. That’s not such a great system.’ Phil said, ‘Give me 50 percent off and I’ll keep every comic that you give me. And if anything is left over, I will sell it as a back issue.’”

. . .

Because World Color Press printed everybody’s comics, Seuling was able to get the printer to ship packages containing a precise mix of titles from the different publishers directly to each store that he dealt with. Seuling’s store clients received exactly the titles they wanted sooner than they had received shipments from the more casual newsstand distributors and at a greater discount. Where newsstand distributors got a 60 percent discount from publishers and passed on a 30 percent discount to retailers, Seuling, who also got a 60 percent discount, granted shops a 40 percent discount.

. . .

It’s shocking today to realize to what extent the Direct Market revolution led by Seuling in the early 1970s was actually the mobilization of a network of ambitious teenagers. Steve Schanes was 15 and his brother Bill was 13 when they began selling comics by mail-order and at conventions in 1970. By 1974, they had opened their first store. They would eventually operate one of the West Coast’s largest distributors, and challenge Marvel and DC with their own publishing company, Pacific Comics. “We didn’t have any childhood,” Steve Schanes told the Journal. “We just worked.”

. . .

In those days, there was no uniform day of the week on which all the nation’s new comics hit the stands at once. It was catch as catch can, and those retailers who got their comics through Seuling’s nonreturnable distribution quickly benefited from Sea Gate’s more efficient reach. “Initially, Phil would drop-ship comics from Spartan to you, and it would take as long as it took,” according to Plant. That was not nearly as long as it took for newsstand wholesalers to get around to delivering their products, and the result was that Seuling’s network of shops were able to offer new comics about a week before traditional returnable outlets got them. And shops that doubled as subdistributors for Seuling got the fastest delivery and lowest discounts of all.

. . .

Rozanski didn’t realize it, but the deal between Seuling and the various comics publishers, including Marvel, was already being attacked on another front. While Rozanski had contemplated an antitrust suit against Seuling, another distributor, Irjax Enterprises, and its Chief Operating Officer, Irwin Schuster, had actually filed one in November of 1978 against Seuling and every publisher with which he was doing business, including Marvel’s parent company Cadence Industries and magazine-publishing partner Magazine Management Company, DC Comics and its parent company Warner Communications, Warren Publishing Company, Starlog publisher O’Quinn Studios and Sea Gate subdistributor and Maryland Funnybook Shop proprietor Mark Feldman. The suit charged that the defendants had “engaged in a combination and conspiracy in restraint of interstate trade and commerce of the United States in the distribution and sale of comic books and related items to collectors shops.” Seuling and his suppliers were accused of forming a monopoly distribution operation as defined by the Sherman antitrust act and of “selling such products in commerce to certain purchasers for use, consumption or resale within the United States or the District of Columbia at prices less than the prices for such products of like grade and quality sold by them to other purchasers (including Irjax).” In addition, the suit charged that Seuling’s distribution agreement with publishers violated the Clayton Act by offering various services and facilities, “economic incentives, allowances, special payments, discounts and other blandishments” to Seuling and not to other distributors. Irjax also took offense at a direct-mail announcement sent to retailers by Seuling, in which Seuling asserted that “an off-the-wall pseudo-’distributor’ on the middle of the East Coast has been telling everyone that ‘Seuling is out, he won’t be able to deliver books any more.’ This nut has also suggested returning unsold books (bought from him) through the local distributor as ‘returns,’ a policy which would automatically get you cut off from all supplies of books from all publishers.” Seuling also claimed the “sickie” had made “harassing phone calls” and “used the mails fraudulently.” Irjax argued that this constituted libel and asked the court for a judgment against Seuling for $200,000 in compensatory damages ($100,000 apiece to Irjax and Schuster) and $1 million in punitive damages. The suit also asked for the awarding of trebled damages of $1 million for the defendants’ alleged antitrust violations.

. . .

The kind of cutthroat business practices seen in most industries were initially mitigated in the comics Direct Market by a kind of amateur camaraderie and mutual love of comics. But even the keenest of fans have always had a love/hate relationship with their fellow collectors as they compete for the best deals possible among a limited supply of desirable comics.

. . .

Marvel had so embraced the Direct Market that it had released its first comic exclusive to comics shops in 1981: Dazzler #1. It sold 400,000 copies, roughly twice what its other titles were selling at that time. Initially intended as a more efficient way to get comics to their audience, the Direct Market had become much more than that. It essentially redefined the comic-book audience.

. . .

Eclipse Enterprises, founded by Jan and Dean Mullaney, published its first graphic novel in 1978 and evolved in the 1980s into Eclipse Comics. Wendy and Richard Pini began WaRP Graphics in 1977. Mike Gold and Rick Obadiah’s First Comics began publishing in 1983. Dave Sim began his self-publishing operation, Aardvark-Vanaheim, in 1978. The Comics Journal itself would have folded in 1977 if Seuling and Plant hadn’t given it a strong push to the new comics-shop market, and in 1981, parent company Fantagraphics Books launched a line of alternative comics that would have been impossible in a newsstand-only world. The Direct Market also gave a second wind to underground survivors like Kitchen Sink, Rip-Off Press and Last Gasp.

Part II - Black and White and Dead All Over:

The direct-sales market was still in its infancy, and although it was even then owned by Marvel and DC, it hadn’t quite become the juggernaut of stupidity and vacuousness that it would become in the ’90s. We are talking degree here, admittedly, but a degree that’s significant. In the early-to-mid ’80s, the publishing field could be broken down into roughly three categories. There was, of course, Marvel and DC. Secondly, there were a handful of alternative publishers –Fantagraphics, RAW Books, Kitchen Sink, Renegade Press, Last Gasp, a few self-publishers such as Dave Sim and the Pinis– committed to the proposition that comics was an art form and devoted to publishing work of arguable aesthetic merit, and who were pushing against the ethos of commercial comics. Thirdly, there were new, independent publishers who saw an opening with the more level playing field of the direct sales market (as distinct from the age-old newsstand market) and tried to compete with Marvel and DC on their own turf by publishing superhero comics or ersatz superhero comics: First Comics, Pacific Comics, Eclipse, et al., who all had their eyes on the main chance. They were hipper than Marvel and DC, more youthful, more energized, more upscale, but they were clearly interested in manufacturing commercial comics in the traditional four-color format that imitated Marvel and DC. Publishers such as Fantagraphics published the majority of their comics in black and white because they were being written and drawn for a smaller, more discriminating readership and their sales couldn’t warrant the extra money it cost to print in color. Thus, black-and-white comics were initially generally recognized as high falutin’ art comics, safely marginalized by distributors, promoted by more adventurous retailers (who may have lived through the undergrounds) and bought by a new generation of readers looking for greater sophistication or experimentation. (There was obviously some overlap between the readers of mainstream and alternative comics, more or less, depending upon the comic: More mainstream comics readers read Cerebus than Love and Rockets, for instance.)

. . .

It took the unexpected success of the Teenage Mutant Ninja Turtles to start the gold rush. The Turtles were first published in ‘84, and prompted the boom in black-and-white comics publishing, theretofore the realm of modest-selling alternative comics. It wasn’t until ‘86 or ‘87 when it became widely known that the Turtles were in the process of making their creators millionaires, which is to say that Eastman and Laird fulfilled the failed promise of Siegel and Schuster, resulting in a whole new generation of “independent” creators with more righteousness than talent who thought they too could strike it rich by creating and, more importantly, owning, banal characters. This sense of entitlement was further exacerbated in 1988 when the Creator Bill of Rights (authored by Scott McCloud, et al.) debuted. Since independent cartoonists with integrity and talent already understood their rights and avoided working for unscrupulous publishers who would abscond with them, this document appealed mostly to mainstream artists who were bucking for more rights from Marvel and DC, and an array of amateurs who thought of themselves as mavericks — you know, like Eastman and Laird — and potential millionaires. Careerist motivations took precedence over the love of art in the alternative realm, so in 1987 you had the twin disasters of a declining market for alternative comics — due to the B&W bust — and a proliferation of untalented entrepreneurial artistes entering the market in droves.

. . .

Americans are nothing if not bored easily and kids are bored easiest of all. At some point — my guess is around September or October of ‘86 — they got bored. They realized that most of this black-and-white crud was unreadable, that it was ugly and amateurish — even uglier and more amateurish than what they were used to — that there was simply too much of it to collect and hoard, and worse, that it was no longer fun — fun being the only reason to buy anything — so they went back to buying Marvels and DCs, which were at least easier to keep straight. The boom was over. The jig was up.

Part III - Suicide Club:

In December of 1991, Marvel Comics President Terry Stewart met with several of his company’s most popular artists. By their own accounts, the artists were there to make Stewart an offer they knew he and Marvel would refuse: Give them their own, creator-owned titles or face a mass walk-out. Marvel refused, the artists walked out, and in February of 1992, six of the seven initial members of Image Comics — Rob Liefeld, Todd McFarlane, Jim Lee, Marc Silvestri, Erik Larsen and Jim Valentino (Whilce Portacio, who left the company’s inner circle shortly afterward, was in the Philippines) — held a press conference to announce the formation of their new company.

. . .

By the time the Image creators broke from Marvel, the company had already begun to resort to gimmicks like variant and hologram covers to stimulate interest among readers and collectors. Meanwhile, fans had begun to discriminate between titles based on the creators who made them, seeking out work by writers and artists whose work they liked best and learning to ignore the more substandard works. This created the rise of what was then the modern crop of fan-favorites — almost all of whom would now be publishing under the Image banner.

. . .

It’s hard to underestimate the initial effect the formation of Image had on both superhero fans and the comics industry in general. The creators’ first public signing at Golden Apple Comics in Los Angeles in the summer of ‘92 attracted as many as 2,000 comics fans; police had to be called in to control the crowd, while news helicopters hovered overhead, recording the massive wall of people. The Image crew’s next public appearance, at the Chicago Comicon, drew lines a mile and a half in length. Using the Scott Rosenberg-run comics company Malibu as administrative and distribution base of operations, Image’s initial comic-book efforts had sales in six and seven figures, numbers rarely reached even by Marvel and DC by that point, and unheard of for any other company.

. . .

Adding to the frenzy was the appearance of a new market of buyers: trading-card shops, which had just experienced a speculation-induced bust in their own market and had retrenched their financial positions by adding comic books to their backstock. For such a market, used to trading their wares in almost stock exchange-like terms, the sudden appearance of a new comics imprint fuelled by outrageously popular creators must have looked like a no-brainer. From the beginning, Image comics weren’t merely bought by fan readers, but by speculative collectors as well, who purchased multiple copies of each issue and sealed them away as investments.

. . .

The final element necessary to turn the Image frenzy into a massive speculative boom was Wizard Magazine. Wizard can best be understood as the Comics Buyers Guide on crack cocaine; while the Guide had always served as a price guide for longtime collectors, it also served as a reader’s guide and nostalgia review as well, catering to both the mainstream industry’s readership as well as collectors who bought back issues of decades-old comics out of a fondness developed in their childhoods. Wizard was different. It catered exclusively to the newest and youngest readers, excluding anything comics-related that didn’t fall into its immediate sphere of attention, and from the very beginning it kept the speculative market front and center.

. . .

Image began to get later and later in the release of new issues, and their solicitations failed to reflect this fact. Titles would ship months after they were supposed to ship, causing instability at the retailer level. By the time some books hit the stands, fans had lost interest in what they had previously ordered through their comics-shop subscription services; the sell-through rate for such books was atrocious when compared to books that shipped on time. In April of 1993, only two of the 13 titles Image solicited for the month actually shipped on schedule.

. . .

The final nail in the speculator market’s coffin was a miniseries called Deathmate, a variant-covered title which featured a crossover between characters from the Image line and that of Valiant, which after a takeover by investors and the ejection of Jim Shooter was now called Acclaim. While the series originally captured a high degree of anticipation among buyers, it shipped so many months after its due date that the buzz surrounding it had evaporated in the interim, again leaving retailers holding the bag.

. . .

Image Comics, meanwhile, hired cartoonist Larry Marder away from a position in Moondogs comics-shop chain in an effort to bring itself into something laughably resembling a professional production schedule. The efforts soon began to bear fruit, and Image finally began shipping books on time.
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« Reply #1 on: 02:02 PM | Wednesday, February 17, 2010 »

Thanks.  I like reading about the history of it all.  I am glad you keep posting interviews, links, etc.  Please continue.

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« Reply #2 on: 02:02 PM | Wednesday, February 17, 2010 »


The final element necessary to turn the Image frenzy into a massive speculative boom was Wizard Magazine. Wizard can best be understood as the Comics Buyers Guide on crack cocaineRoll On Floor Laughing while the Guide had always served as a price guide for longtime collectors, it also served as a reader’s guide and nostalgia review as well, catering to both the mainstream industry’s readership as well as collectors who bought back issues of decades-old comics out of a fondness developed in their childhoods. Wizard was different. It catered exclusively to the newest and youngest readers, excluding anything comics-related that didn’t fall into its immediate sphere of attention, and from the very beginning it kept the speculative market front and center.


Thank you for posting this David. Very interesting. This kind of historical awareness is why 11 O'Clock is such a great podcast.
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David
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« Reply #3 on: 02:02 PM | Wednesday, February 17, 2010 »

My pleasure.  Glad you're enjoying 'em.
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