Author’s Perspective: Pros & Cons of Investing in an Audiobook

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Have you been thinking about turning your novel into an audiobook?

It’s a massive endeavor that’s going to cost a lot of money or a lot of time (or both). So, the real question… is an audiobook worth that investment?

Thanks to a generous opportunity and grant from the Indiana Arts Commission, I was finally able to produce my first audiobook four years after the publication of the novel.

It was definitely a learning experience! Now, I’m here sharing those experiences on my blog to help other authors looking to break into the audiobook market. Check out some of my other posts:

Author’s Experience: IAC’s On-Ramp Creative Entrepreneur Accelerator
6 Lessons About Audiobook Production You Need to Know
Audiobook Cover Reveal + Meet the Audiobook Narrators

If you’re on the fence about whether or not to take the leap and dive into the audiobook market, this article will break down the biggest pros and cons you need to consider.

Audiobook Pros

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1. Reach a New Audience

The most obvious reason to look into audiobook production is the opportunity to reach a brand-new audience of fans who prefer to listen to stories rather than read them.

There are many reasons why some people prefer audiobooks over hardcover, paperback, or ebook. For example:

• A long commute to and from work every day eliminates free time to read.
• Tedious manual tasks such as cleaning leaves time available to listen but not to sit down and focus on print.
• Visual impairment or other disabilities may make reading difficult or impossible.
• Some people process information better when receiving it orally rather than visually.

Other people simply enjoy audiobooks because, when produced with a talented narrator, the story can reach an entirely new level of entertainment.

When I listened to my audiobook for the first time, I was entranced by the different character voices, dramatic pauses, breathy whispers, and pure emotion conveyed in the story.

I’ll be the first to admit that when I’m reading an exciting passage in a book, I start reading faster and faster. I devour the words without appreciating the voices, tense pauses, and intonations that can build the suspense even more.

Audiobooks solve that problem. You can’t skip ahead or skim over the words. You have to wait for the narrator to deliver the scene the way it was meant to be experienced.

2. Tap Into a Growing Market

Not only are you reaching new fans… you’re also breaking into a market that is exploding.

For the tenth year in a row, the Audio Publishers Association showed a double-digit increase in audiobook sales with revenue gains of 25% in 2021, totaling $1.6 billion in sales. The APA’s Consumer Survey indicated that 41% of listeners subscribe to at least one audiobook service.

That growth isn’t predicted to slow down anytime soon. Analysts project 24.8% CAGR growth in the US audiobook market from now through 2030. If you’re planning to branch out into a new market for your books, it makes sense to focus on one that is experiencing predictably steady growth.

3. Accessibility

I mentioned visual impairment as a reason why some people prefer audiobooks over print formats. It’s not just personal taste or time constraints—audiobooks, text-to-speech, and oral storytelling could very well be the only way some people can enjoy books.

I think accessibility is a huge perk on the audiobook pro list. As a former landscape architect, I worked on teams that prioritized incorporating ADA accessibility into designs so everyone could access, utilize, and enjoy outdoor spaces.

The same applies to books. I want everyone and anyone who is interested in my stories to be able to experience them.

4. Extra Revenue Stream

A few months ago, I wrote a blog post that explored extra revenue stream ideas for indie authors. The sad truth is that unless you’re a bestselling author, book royalties alone probably won’t be enough to pay your publishing costs AND personal bills.

That’s why I advocate for diversification. If you can build multiple streams of passive and active revenue, you’ll position yourself to turn your passions into a sustainable business.

From monetizing your website with affiliate links and PPC ads, to building a subscription platform, to selling your own branded and themed merchandise, diversifying your revenue opportunities will make your income more secure and predictable.

Adding audio to your existing book formats opens the door to another revenue source. Of course, you’ll still have to market the audiobook, but simply adding a pop-up on your website and links in your newsletter would be a good starting point.

5. Higher Royalties

If you’re a veteran of the self-publishing business, you already know that print costs come out of your royalty share. (If you’re new to self-publishing, check out this earlier post to learn more about how print costs affect your total royalties.)

This is why ebooks bring in higher royalty percentages—no print costs. In most cases, there aren’t any material costs since consumers are purchasing a digital file. The one odd exception is Amazon (KDP), which for some reason charges a delivery fee for ebooks if the author chooses the 70% royalty option. Here is the delivery fee breakdown from KDP:

Delivery Costs are equal to the number of megabytes we determine your Digital Book file contains, multiplied by the Delivery Cost rate listed below.

• Amazon.com: US $0.15/MB
• Amazon.ca: CAD $0.15/MB
• Amazon.com.br: R$0.30/MB
• Amazon.co.uk: UK £0.10/MB
• Amazon.de: €0,12/MB
• Amazon.fr: €0,12/MB
• Amazon.es: €0,12/MB
• Amazon.in: INR ₹7/MB
• Amazon.it: €0,12/MB
• Amazon.nl: €0,12/MB
• Amazon.co.jp: ¥1/MB
• Amazon.com.mx: MXN $1/MB
• Amazon.com.au: AUD $0.15/MB

Audiobooks, like ebooks, are digital files. This means you can count on receiving much higher royalties. Exclusive contracts usually guarantee around 40% royalties in your pocket, while non-exclusive typically range between 25%-40% after factoring out the cut to your aggregator.

(I go into a much deeper breakdown with examples in this blog post.)

If you’re able to sell the audiobook yourself, you can pocket even higher royalties. I, for example, sell my audiobook through Author’s Direct. Since this platform doesn’t do any marketing, all the sales come directly from me and I get to keep 70% of the royalties. The other 30% go to Author’s Direct to support their CX and tech teams in case any customers have issues with their download. With Author’s Direct, I also have a lot of freedom to run my own promotions (and still earn more than I do from third-party retailers).

My print books, for comparison, average between 12%-23% royalties after the print cost has been removed from my share. Based on profit percentage, the audiobook is much higher.

Audiobook Cons

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1. Production is Expensive

I can honestly say that without the startup funds from the IAC, my audiobook would have been out of reach due to budget constraints. As it was, the project ended up being more expensive than I’d originally estimated.

Because there are a lot of different factors impacting your cost, it’s hard to estimate how expensive your audiobook will be. For a ballpark guess, you can use the standard estimate of 9,300 words narrated per minute divided by your book’s word count, then multiply that by your narrator’s PFH and post-production PFH rates. You may also need to pay a graphic designer to make your cover, plus potential registration fees depending on the distribution model you choose.

In many cases, authors can reasonably expect to spend upwards of $5,000 turning an average-sized book into an audiobook.

Your final cost will depend on the narrator(s) you choose, their rates, the type of contract (PFH, royalty share, hybrid), post-production costs, digital assets, and registration fees. The current industry average, according to the project manager who oversaw my audiobook, is $200 PFH (per finished hour). That rate is strictly for narration. If the narrator handles post-production editing, s/he will usually charge a higher PFH. Otherwise, that extra step is delegated to a third-party editor, and it’s a separate PFH rate on top of the narration rate.

(Again, I dive much deeper into this topic in another blog post.)

For many indie authors, $5,000+ a big investment that’s out of reach. I recommend looking into grants, sponsors, and other financial opportunities if you don’t have enough saved yet for an audiobook.

2. DIY is Time-Consuming and Requires Equipment

One way to cut costs is to record the audiobook yourself. If you have voiceover experience, this is absolutely a feasible option.

If you don’t… DIY doesn’t usually work out very well.

First, it’s a major time commitment. Can you afford to budget hours upon hours of work recording your audiobook and then editing out the background noises, lip smacks, swallows, mistakes, et cetera?

Second, you need the right space and equipment. Sitting in your living room recording on your iPhone isn’t going to cut it. Do you have a soundproof space? Do you have a good microphone? Do you have editing software? Do you know how to use it?

(If you don’t have a soundproof space in your home, check your local library. Mine has a recording room available to book ahead of time.)

Third, narration is a skill. If you don’t have the training, experience, and talent, odds are slim that your audiobook is going to be good quality. Many listeners instantly scroll past audiobooks that are narrated by the author (unless it makes sense, such as an autobiography).

Narrating your own audiobook can quickly become a project where you bite off way more than you can chew. There’s a reason audiobooks are expensive to produce if you’re hiring professionals. You’re paying for time, skill, and experience. If you decide to take that on by yourself, keep in mind that it’s going to be a huge time investment and possibly a monetary investment if you’re lacking equipment.

3. Risks with Amazon and “Audiblegate”

With an audiobook, you don’t have to worry about misprints, shipping problems, material costs, et cetera. Although being a digital file (and therefore earning higher royalties) ended up on the pro list, that doesn’t mean it’s a risk-free investment.

Amazon is the big dog in the audiobook market, but they’ve been known to abuse that position. “Audiblegate” is an ongoing issue that affects authors and rights holders even if they aren’t exclusive with ACX (Amazon’s audiobook company).

Here’s the issue in a nutshell:

Amazon’s reporting is notoriously opaque at best. It’s hard for authors to keep an accurate tab on how many books they’ve sold and how many have been returned. In October 2020, a reporting glitch at ACX revealed that Amazon’s practices were even dirtier than people realized.

Amazon’s “easy exchange” policy allows customers to return or exchange audiobooks at no charge… even if the consumer already listened to and enjoyed the audiobook in its entirety. Customers can still swap it out, no strings attached. But Audible doesn’t absorb the cost of those returned/exchanged purchases. Instead, they dock that cost from the author/narrator/rights holder while keeping 100% of the profits from membership fees.

Some authors claim that they’ve actually owed Amazon money because Audible charged them for the returned audiobooks and their subsequent sales for that month didn’t earn enough to offset those costs!

Multiple groups, including the Alliance of Independent Authors (ALLi), Fair Deal for Rights Holders & Narrators, The Author’s Guild, Science Fiction & Fantasy Writers Association (SFWA), Romance Writers of America, and others have pushed back against Audiblegate. In 2020, the US Author’s Guild hosted a public letter endorsed by over 13,000 international author, narrator, and producer organizations to demand changes in Amazon’s shady practices.

Amazon has made some concessions, but not nearly enough. They agreed to stop deducting royalties for returns made 7+ days after the original purchase (previously, it was 365 days). Audible has also made efforts to improve reporting transparency, allow ACX rights holders to terminate their Audible distribution, and permit ACX-exclusive rights holders to switch to a non-exclusive agreement after the audiobook has been on sale for at least 90 days.

Audiblegate isn’t over yet. This isn’t the first instance of Amazon screwing authors… and it won’t be the last. There’s no question that Amazon holds a near-monopoly over many markets. Authors need their books, ebooks, and audiobooks to be available on this platform if they want to be successful.

But it’s also important to be aware of the risks involved when dealing with Amazon and its production companies (KDP and ACX) before signing any contracts or making exclusivity commitments.

Conclusion: Is an Audiobook Worth It?

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If your budget allows audiobook production, the pros do outweigh the cons. I can say from experience that diversification is a good business plan. For some authors, a paperback and ebook are enough. Those two formats cover the main bases.

But I have readers who love to collect autographed hardcovers, so I offer that version as well. My profit margin is a little lower, but people who prefer hardcovers are grateful.

And I have other people who seem interested in the story but say they don’t have time to read. Now, when they ask me if the book is available in audio format, I can tell them yes. I’m thrilled that I can now offer the first book in the Chronicles of Avilésor: War of the Realms series in four formats now instead of three.

Yes, the audiobook was expensive to produce, and it’s way to early to know how quickly I can earn that investment back. But I had financial assistance from a state grant to make it happen, and now I’ve been able to break into a brand-new market and introduce my story to new fans.

It’s the start of a whole new adventure!