Sunday, January 08, 2006

Personal Finance Books: What's the Next Big Thing?

Since I work in publishing, part of my interest in personal finance books is from the other side of the fence. I wonder what makes a particular book stand out from the crowd, what the next big bestseller will be, and how it was marketed. People like Suze Orman and Robert Kiyosaki have been around for a while now-- will someone else come along and capture the interest of the book-reading public in the way they have? And how will the publisher make it happen?

Publisher's Weekly recently did a feature on finance books, with an article titled "Who's the Next Biz Guru?" The article talks about how in the past, publishers have looked for authors who already have a platform-- they're affiliated with a newspaper, magazine or TV show, or are active on the lecture circuit. But as one editor says, that doesn't necessarily guarantee a book will succeed. Too many books have said all the same things, about cutting expenses, paying yourself first, maximizing 401k savings, etc. What made some of the current bestsellers stand out is that they actually "promoted ideas that were out of the ordinary, even contrarian," such as the Rich Dad, Poor Dad series.

Another interesting point made by the PW article is about the promotional venues for finance books: "...television coverage of the topic is limited. There's no equivalent of the Food Network for personal finance authors, and Oprah... isn't likely to showcase one of Suze Orman's competitors as long as Orman pens a regular column for O magazine."
How do personal finance authors get the word out about their books? Radio, print, and increasingly, the Internet. Quite a few PF bloggers seem to have been sent advance copies of Lee Eisenberg's The Number and have written reviews of the book. (I personally was not asked to review or promote the book, but became interested in it after reading about it on other blogs, and decided to add an Amazon link on this site, which is exactly the kind of viral marketing effect the publisher was probably hoping for!)

So who might be the next big thing? PW profiles some candidates.

Loral Langemeier certainly has the out of the ordinary and contrarian ideas that should get her a lot of attention. Her book, The Millionaire Maker (available now), takes a tactical, not psychological approach to building wealth. She thinks entrepreneurship is the way to go and wants people to quit their jobs, start small businesses and buy income-producing rental properties with their savings. She does not focus on cutting expenses or getting out of debt. "Millionaires don't worry about a latte a day, you know," she says. She counters the suggestion that her approach might be risky by saying "it's only risky because most people don't know." Her platform: she has a coaching-consulting company called Live Out Loud and claims that she has made over 200 people millionaires and that none of her 10,000 clients have ever filed for bankruptcy. She herself was a multi-millionaire by age 35. She has done TV segments on a San Francisco station about her financial makeovers, and regularly does appearances with T. Harv Eker (Secrets of the Millionaire Mind), Marc Victor Hansen (Chicken Soup for the Soul) and Robert Kiyosaki. From what I read about this book, it sounds like it could be a big hit, so keep an eye on this one.


Phil Town's book Rule #1 (available late March '06) offers a practical plan for getting rich via value investing. Town says "it's really simple... you just buy a wonderful company and you buy it at an attractive price." He has no formal business training, so his book is said to have a populist twist, and focuses on how the average investor can gather data on the internet. Town also shares a lot of his personal story about how he was transformed from an ex-Green Beret hippie rafting tour guide to the clean-cut motivational speaker and millionaire he is today. He regularly speaks at day-long "Get Motivated" conferences and estimates that he has told his story to "a couple million" people over the past four or five years. His publisher compares the launch of Rule #1 to when they were launching Suze Orman's The 9 Steps to Financial Freedom. They had Town set up a blog a year before publication. They introduced him to key bookstore buyers at BookExpo America (the national convention for the publishing industry), gave their sales reps DVDs of his lectures, and flew a national chain store buyer to see Town speak at a stadium in Philadelphia. And watch your AdSense, bloggers-- the book will be advertised via Google. This book also seems to have a good chance at success, but I wonder if it really says anything new and exciting enough to really make people want to buy it. But the publisher might be thinking that value investing advice, even if it's all been heard before from the likes of Warren Buffett, is going to seem more appealing to more people than the kind of radical plan Loral offers. If I had to bet, I think Loral might just hit a nerve and have Phil beat. But Phil's publisher (Crown) has announced a first printing of 250,000, vs. the 100,000 McGraw Hill says they'll print for Loral. These announced first prints are always complete lies anyway, so that might mean nothing. Who knows. I'll have to report back on these in a month or two with data from Nielsen BookScan, which tracks retail sales, to see if my hunch was correct!

Some other new books mentioned in the PW feature:
The Number, by Lee Eisenberg
Money, A Memoir, by Liz Perle
Not Buying It: My Year Without Shopping, by Judith Levine

Disclosure (sort of): Because I work in the publishing industry, I may occasionally be writing about books published by companies I work for or have worked for in the past. I won't tell you which ones, because I don't want to reveal who I am or where I work. If a book publicist contacts me via this site and asks me to review a book, I won't accept a galley because I won't give out my mailing address. Any book I discuss is one I have either bought, borrowed from the library, read while sitting in a bookstore, or obtained through my job or contacts at other publishing houses who were not told why I wanted a copy. I do have Amazon ads on my site, but otherwise, any financial gain I might get from promoting these books is very indirect and very small. If I praise a book, it is because I think it deserves praise, and if I think a book sucks, I'll say so even if my company publishes it! Either way, I don't think I'm moving the needle. If my blog suddenly started getting a million hits a year, I might reconsider this policy, but for the moment, that's the way it goes, folks. Caveat lector.

7 comments:

Caitlin said...

Great post...those two books both look interesting to me.

But I really wonder what PW sees as "out of the ordinary, even contrarian" about Kiyosaki. I know a lot of people really like him, and whatever works for people I am all for, but all he's saying is "buy assets, not liabilities" IMO. Which seems extremely basic. Maybe I'm missing something (I only read RDPD and wasn't inspired to read further)

I am starting to think that the big successes are the people who take a very standard, simple idea and just market the hell out of it.

Anonymous said...

i can tell you i've had a sneak peak at phil town's book - it's pretty wonderful. very engaging and readable. dare i say "empowering"? i think his edge is going to be his ability to make direct investing in the market seem easy and intuitive. and he blows holes in the notion that mutual funds will secure anybody's financial future.

Anonymous said...

caitlin-
maybe what's "contrarian" about Kiyosaki is that he says to buy assets not liabilities, and to always cash flow, while nowadays most RE "investors" do the opposite and are putting their money into negative cashflow properties.

(somewhere in that statement i just made is some deep-rooted spite about the stupid housing-bubble conundrum this country's gotten itself into...)

Dwight said...

"Too many books have said all the same things, about cutting expenses, paying yourself first, maximizing 401k savings, etc."

Yep. But to strain the point, we all know the way to lose weight (eat less, exercise more, etc.). Yet there still seems to be a popular new diet that captures the public's imagination every couple of years. As long as there really isn't a "one size fits all" diet/exercise program (or savings/investing regimine), then the equivalent of easy fixes that tell people what they want to hear will be popular.

And the good news, for authors and publishing houses, is that there are large and numerous niches. There will be popular real estate authors, get out of debt programs, and even doomsayers telling you the world is going to hell tomorrow (has Ravi Batra ever been right about anything?).

I haven't read a personal finance book in at least a decade, but I do have a question on who is out there now. Is there a Dr. Phil (for lack of a better way to put it) of personal finance? Someone who tells you quit being a victim and take charge? I'm guessing Suze Orman is pretty close, but I'm not sure. I ask because I would guess that pop psychology trends and personal finance trends are interwoven.

OK, I'll stop rambling now. It's been a long day...

JLP said...

Excellent Post!

I received a copy of Loral's book. It is interesting and VERY different. This book is going to step on a lot of toes.

One thing that bugs me about her book is that it seems to be an advertisement for her "Wealth Building Community." She wants you to build your own companies with "experts" to help you out. Guess where you find the experts? Through Loral's company.

I hope to review this book in the near future.

Later,

JLP
AllThingsFinancial

Nina Smith said...

Great post... I mentioned your Loral review today on Sitting Pretty!

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http://ruleoneforum.com