All about Auctions

While most books published today are not sold through auctions, there remains ample curiosity in auctions—and often a desire for them—among authors. At the US Book Show in May, a panel of agents and editors discussed why they run auctions, how they think about auctions, and lessons they’ve learned about auctions.

First, what’s an auction? An auction is when a literary agent decides to sell a book by telling publishers to submit their best offer for it, and the highest bid wins. The two most prevalent auction types are best bid and round robin. A best-bid auction tends to be the most straightforward and efficient: The best bid wins. Authors can of course choose not to take the highest bid; aside from an advance amount, bids might include the publisher’s marketing and promotion plans. In a round robin, publishers submit bids in rounds, and these often take longer to play out. The agents who prefer round robins believe they generate higher bids—or “auction fever”—in the end. (Keep in mind not all agents conduct auctions; infamously, agent Andrew Wylie said at the DOJ vs PRH trial that his agency doesn’t do them because he knows how to get the best deal for his clients without auctions.)

The most clear-cut reason for agents to run auctions is to drive up the advance and obtain better overall terms. A heated auction can also create marketing and publicity buzz for the book that leads to TV/film interest and other rights deals before the book is even finished. Stacey Barney, associate publisher at Nancy Paulsen Books, says the process of putting together an offer for an auction “feels exciting and invigorating” partly because it involves working with her community of colleagues and friendly competition. Agent Anthony Mattero at CAA says his favorite part of auctions is when multiple offers come in and they’re all around the same number. “That’s a very good indication of what the market will bear.” However, he later added that auction strategies and outcomes vary more for fiction than nonfiction. With nonfiction authors who have a platform, he called the auction process more of “a math problem”—indicating that everyone knows how to put a value on the author’s visibility or ability to sell books. But with fiction, it’s more about putting something out on submission to “see what it’s worth.”

The downside of auctions? Mattero said it leads to letting editors down when they don’t win: “We really respect what you all do to get the deals together,” even having no control over the result. Zachary Wagman at Flatiron (Macmillan) said his favorite thing about an auction is “when I can avoid it.” He finds it easier and faster to consider exclusive submissions or make pre-emptive offers—an offer so attractive that the agent/author accepts it without moving to auction. But Mattero (an agent) hates pre-empts, as did most agents on the panel. Agent Wendy Sherman, president of Wendy Sherman Associates, said that certain editors/publishers will call the night before an auction begins and try to pre-empt at that point. But she tries to avoid accepting such offers, as do other agents, unless it will appear eminently justified to all the other editors who put time and energy into preparing an offer for the table. Plus, Mattero added, you don’t want your authors wondering how an auction might have played out with 12 different publishers putting in their best bid.

When publishers get auction fever, it’s not just the editor who’s affected. Barney said the finance people get it because they’re competitive too and want to win. When they don’t, “Everyone’s very indignant, particularly if the team really believes in the book and believes we can publish it best.” So internally they’ll discuss how to strategize and win auctions. “That’s an advantage to doing a round robin,” Barney said. “It can be slow if people are going up in smaller increments,” but it can build conversation and competitive spirit inside the publisher with each round. However, Wagman pointed out that auction fever can create a discrepancy between the market among publishers and the book’s actual potential in the consumer market. “Those things exist on different planets as far as I’m concerned,” he said.

Good communication and transparency are key during the auction process. Agents and editors alike want honesty and clear terms—no smoke and mirrors. Mattero said he doesn’t want anyone feeling buyer’s remorse after a deal and that “radical candor is a useful tool in auctions. If I never lie, I never have to remember anything. You just say what’s happening. … This is how many people are in, here’s who’s bidding against you.” He mentioned that some editors assume during a best-bids auction that he will later come back and say, “Oh you’re close, want to throw in more?” But he doesn’t, and he ensures editors know this at the outset.

Agents and authors want money, but they also look for the love. Sherman said it really matters when editors can demonstrate this isn’t just another deal to them. “You want the package, the person with the vision. The communication has to be completely open. I don’t believe we can really do that in an offer in an email. I can hear it in someone’s voice when they really want a book,” she said. “We’re going to do the same dance with the same people [editors] again and again. So just be honest with me.” Joanna Volpe, president of New Leaf Literary and Media, says it’s challenging when the editor who clearly best “got” the work and the author isn’t the highest bidder, and the author can’t ignore the money difference. But sometimes authors do go with the underbidder. Wagman added, “I don’t like having contentious relationships with agents because publishing is hard as hell already. … I try to keep to a no a-holes rule.”

Bottom line: While the surface discussion was certainly money focused and about getting top dollar for every client, the heart of the discussion was about using auctions to place books with editors who would help take them to market successfully. Wagman said, “I don’t buy a book without an author call” and then learning afterward, if he considers that call a success, “Was it as good for the author as it was for me?” In other words, if it feels like a “mutual appreciation society,” he’ll do whatever he can to get the right offer on the table. Barney said, “If you win [the auction], it’s just the beginning of the process. Now you have to publish the book in the best way possible. If you enter the auction, be damn sure you really want that book. You have to be an advocate all the way through.”