Image Leaves Diamond. What Does That Mean for the Industry?

Because I know you want to know.

So hey, did anything wild happen in comics today? Anything?

Diamond Comics kicked off the week with a set of announcements that bolstered the connection to publishers like Ablaze, Opus and Massive (formerly in operating as Whatnot’s publishing division), moving the later two up to the front of the catalogue.

That’s a chunk of news and deals to make and drop all at once. One could assume Diamond was trying to get ahead of something - and if they were, that thing was probably today’s big announcement.

From Image:

PORTLAND, Ore. 05/24/2023 — Image Comics is pleased to announce a worldwide exclusive distribution deal with Lunar Distribution, effective with September on-sale titles (which will open for order on the Lunar site for retailers on Wednesday, June 14), for Direct Market/comic shop distribution.

Previously exclusive to Diamond Comic Distributors, Image Comics will join DC as one of Lunar's largest periodical publishers and will work in partnership with Lunar to share further communications with the Direct Market, including "next steps" details, to ensure a seamless transition for comic shop retailers.

"First and foremost we want to thank Steve Geppi, Chuck Parker, and everyone at Diamond for their ongoing service and all that they've done for Image over the years. For over three decades, they have been at our side, supporting our books from the moment we founded our company back in 1992," said Todd McFarlane, President of Image Comics. "Every Image comic published, since our inception in '92, has been distributed to thousands of retail outlets by Diamond, and they have played a very important role in our company's evolution."

"We have enjoyed our relationship with Diamond over the decades and we have made some wonderful friends there, so this decision has been a difficult one," added Erik Larsen, Chief Financial Officer at Image Comics, who served as Publisher at Image from 2004-2008. "It was not a move that we made lightly, though, and ultimately, the change was made because of the benefits to readers and retailers who are our real customers. There are services Lunar will provide that will make it easier for stores to buy our titles, and for fans to find our books. This is a big win for them, and we hope this new partnership is as strong and long-lasting as the previous one. We wish Diamond nothing but the best as we look toward the future."

"We leave with nothing but the deepest respect for Steve, Chuck and all of the folks at Diamond, both past and present," said Jim Valentino, Image's Vice President and former Publisher at Image from 1999-2004.

"This is a big change, but we will still be working with Diamond in other capacities and look forward to maintaining those relationships with the Diamond team for years to come," noted Eric Stephenson, the company's current Publisher and Chief Creative Officer. "Lunar is an impressive new player in the Direct Market, and we are eager to work with them on the next phase of our development, as well as joining DC in leading the industry toward what we believe are positive changes for everyone."

Christina Merkler, Co-owner at Lunar Distribution stated: "We are thrilled to announce our exclusive worldwide distribution deal with Image Comics. We are constantly seeking innovative ways to expand our reach and bring exceptional content to our retail accounts around the world. This partnership will allow us to further expand our offerings and provide unparalleled access to the most exciting and sought-after titles in the industry. We look forward to working closely with Image and continuing to provide top-notch service to our Direct Market accounts."

Lunar Distribution was first launched in 2020, when it became the home distributor to DC, and provides distribution services to the Direct Market with an emphasis on quality, efficiency, and customer satisfaction. Retailers interested in learning more about how to set up an account with Lunar can visit: https://www.lunardistribution.com/home/faq.

Now, there are some immediate questions that need to be addressed after this, and I have the answers to some of them. Let’s toss out what I’ve been seeing as “frequently asked questions” and if you have any more asks, feel free to hit the comments, and I’ll do my best to follow up.

This deal only seems to address the direct market sales. Doesn’t Diamond still distribute graphic novels and collected editions to the book market?

Yes, that remains true. For now. There are apparently further announcements to be made. I had been hearing for almost a year that the company would land at Penguin, so maybe the book market winds up there. Or maybe Image’s structure makes it more troublesome to properly deal within the traditional book market, with less of a “set schedule” style of publishing line, but one that consists of many different creator owned businesses with their own separate needs and release schedules. The book market famously has titles scheduled far more in advance than the direct comic market’s “two months” for structural reasons, and that might need to be addressed.

Maybe it makes sense for Image to stick with Diamond, or for Lunar to get into the book market business? Or maybe Image had already been modifying how they plan releases in collected edition - as evidenced by most planned collected editions having data available to discover on book market sites. We’ll surely find out more in the coming days.

So wait, does this mean comic retailers will no longer be able to get Image product from Diamond?

There seemed to be a lot of confusion in retailer circles early on today when this news was announced. By the time I was awake and functioning, Diamond’s messaging had been released, alongside further e-mails from Lunar and Image.

From Diamond:

A Message to Retailers from Steve Geppi

Chairman, President & CEO Geppi Family Enterprises

Dear Diamond Customers:

Today, Image Comics announced that effective September 2023, Diamond will serve as a wholesaler for Image comics and graphic novels to the Direct Market. We are working through details, including reviewing discount terms, and will communicate any changes as quickly as possible.

While their announcement today marks a new chapter in our partnership, we are delighted that Diamond will continue to play a vital role as a key source for Image comics and graphic novels to the Direct Market. We also remain your largest single-source for comics, games, collectibles, and hundreds of other amazing pop-culture products from a huge variety of publishers each and every month.

We are devoted to serving your needs each and every day and I thank you for your continued trust and support.

Diamond will continue to be a source for Image product, much like they are wholesalers for Marvel, IDW and Dark Horse. In addition to that, official DC direct market distributor Universal will continue to offer Image titles on wholesale, having set up an ordering page roughly a year ago in advance of rumoured upcoming changes. Image titles currently go through their Montreal warehouse where the DC books are processed, while any titles distributed from Penguin Random House go through their Toronto warehouse.

Universal is said to be setting up an American based warehouse in the fourth quarter of the year.

Image seems like a big company to lose. Is Diamond in trouble?

You’d think so. I’ve often thought so. But the company is far more resilient than one might think. I’ve heard that in terms of margin, Diamond is often making more money off the comics they distributed than they did before. Reduced volume might mean they’re making less in general, but more per copy sold.

They also admitted to floating a lot of their business structure through shipping costs when they talked about the ways they were hoping to reduce said costs for retailers. One way or another, Diamond will find away, largely on the backs of retailers who outright refuse to adapt.¹

At the very least, they exude enough confidence to have Boom! Studios keep their single issue distribution exclusive to the company, making them their biggest single issue client as of September. Boom! talked about this agreement, and noted that they will also be providing a 2% frieght rebate to offset the costs of ordering their books through Diamond.

To this date, the rebate that Boom! is paying for has been the only reduction that I’ve seen to my shipping costs from Diamond, so let none of us say Diamond isn’t great at making money.

Diamond requires retailers to hit a minimum order per month, right? How’s that playing out?

While Diamond’s minimum is a $425 purchase, if you’re a comic store whose bread and butter came from the front pages of the catalog (and if you buy the majority of your graphic novels from the book distributors who are their main distributors), quite a few shops are going to find difficulty scrounging to hit minimums. And while one could argue that the option to order Marvel, IDW, Dark Horse and Image allows a retailer to close this gap, it says a lot about the state of Diamond and comics in general that there are going to be places that will have to spend extra for the privilege of nabbing books from some of the smaller tier publishers.

Minimums purchase orders from distributors are often commonplace, but truly, I don’t envy people with dreams to start a store a build up an order with Diamond these days.

Is there a bad guy here?

No, absolutely not. Just people trying to survive. I’ll set aside a certain amount of blame for Diamond choosing to be a follower after they became a monopoly. They made many great changes during that time, including producing a decent, if not extremely buggy point-of-sale and subscription system (that by all accounts is in a state of wild disrepair), the final order cut-off program, and many others. Most, if not all of Diamond’s changes were in reaction to something, instead of a thing they truly innovated. They stopped being hungry, and they eventually became, pound for pound, and cost for cost, the very worst option to get your comics and graphic novels from.

But it can not be argued that the company saw the industry through some of their darkest days - when there were no other options for distribution. A system they helped cause, but one they made it to the other side of. The comic industry would not be as strong as it is today without them in the past.

But retailers will often talk about how abandoning Diamond for places like Lunar or Penguin Random House is somehow doing the industry a disservice, and absolutely disagree. Diamond is not who they used to be. The shut the whole direct market down during the early days of COVID and expected companies they stopped paying to stick around and not seek out other options in the face of complete and utter failure.

Asking these companies to stick with Diamond for the greater good would be like Marvel demanding retailers order the X-Men line like they used to in the 80s & early 90s. “Didn’t we support the industry with these books? What’s a few hundred copies every month between friends?”

While I’ve greatly enjoyed the X-line as of late, it is no question that those books don’t sell like they used to. No single issue comics really do, and they haven’t for a while. Just like Diamond isn’t the company for our modern times. As the sales of graphic novels suggested a time to shift some thinking, and get in line with book distributors and their decent margins and free shipping, Diamond just… continued their course.

They were eventually outpaced by every other option available on cost and (most times) service. As a business, I can’t blame these companies for jumping ship for options that are either ahead of, or riding the curve, and not one that is desperately trying to chase the curve as it speeds away.

Anyway, have any other questions? Post them below! I’ll do my best to get them answered.

I’m going to do my level best to return to these parts later this week, and talk about some things that have happened lately, both good and bad. The world just doesn’t stop turning.

Talk with you soon.

-B.

1. To be honest, the refusals range from “very understandable” to “a thing changed and I’d rather not”. At the end of the day, we all engage with capitalism on our own terms.