Do you remember the scene in the movie "Arthur," when our loveable main character was having a meeting in his father's office? Arthur was told if he didn't marry Susan, he would be cut from the will and lose his $750 million inheritance.

"You know, when the light hits Susan's face a certain way, she really is beautiful," Arthur replied, "Of course, you can't always depend on that light."

Well, that sums up exactly how I feel about royalties.

If you're a copywriter specializing in direct response, you've probably heard about royalty payments. You take a lesser fee for writing a package. Then, if the test mailing is successful and the package "rolls out", you'll earn anywhere from .01 cent, .02 cents, or even more depending on how many pieces mail.

Rollout quantities differ, but if you take a typical rollout of say, 250,000 pieces and you're earning a royalty of .02 cents apiece, it means an extra $5,000 in your pocket. If your package becomes a top control and mails over 1 million pieces, that's a cool $20,000 on top of your fee.

Not bad, right?

When you hear of copywriters earning six- and seven-figures a year, it's because of royalties. I do earn royalties on some packages. And I'm the first to admit there's nothing nicer than receiving a check in the mail for an extra $5,000 or $8,000 -- and not having to strike a single finger on the keyboard to earn it.

When royalties work, it's a beautiful thing. But, in my experience, you have to depend on the moon, stars, and plants to line up in a certain way in order for you to receive them.

And I gave up on astrology years ago. 

3 Reasons Why I Prefer a Flat Fee 

I’ve had several arguments with my colleagues about royalties.  Yes, there is something to be said for having “skin in the game.”  Yes, it is a way to add on to your income. But I've become so disenchanted with royalty arrangements that I prefer to work on a flat fee. Here's why:

Reason #1: There are simply too many parameters out of the writer's control.

In most fee + royalty situations, clients (rightfully) expect you to cut your fee anywhere from 20% to as much as 50%, since you'll be paid on the back end.

That is, assuming your package is a success. And these days, that's a BIG assumption.

You see, you can write the best copy in the world. But as far as the success of a package, only 20% is due to the creative. 40% has to do with list selection, and the other 40% is due to the offer -- also known as the famous 40-40-20 rule. 

You don't know how large the test mailing will be. You don't have any say as far as the list selection. You can suggest various offers, but the client can easily overrule you with a (less effective) one of his own, i.e. a continuity offer (which depresses response as much as 50%.) One of my clients told me earlier today that since October, their response rates have plummeted. If a package does become a control, any rollouts are smaller.  

Plus, the time of year your package mails is important, too. August and December, for example, are horrible months for my area of direct response. If some obscure marketing director mails your package at the wrong time....well, I don't have to tell you what happens next.  

A few years back, I wrote a component package for a terrific "comfort food" cookbook. To my shock, the client mailed it in June, right at the start of the summer barbeque season. Naturally, the package failed.

Reason #2. There's no guarantee when -- or even if -- your package will mail.

Recently, a magalog I wrote for a new client (working on a flat fee basis) finally mailed -- one year after I finished the first draft! Imagine if I was waiting with bated breath for royalties on that one? And several magalogs I wrote never even mailed at all.  The client “changed his mind.”  Another got into legal problems, and shelved my package until everything was sorted out.

Budgets are cut. Test mailings are postponed or cancelled. Financing dries up. It happens all the time.

Reason #3: You have to rely on your client to be honest.

When your package mails, it's YOUR responsibility to track down your client and see if you are owed any royalties. Don't expect clients to be proactive about providing you this information.

90% of clients are honest and will provide you with the postal records of how many pieces mailed. But you have to be aware that some will hide this information, too. They can schedule mailings they'll forget to tell you about. They can mail far more pieces than they say.  

They’ll say things like, “we mailed the package several times, but they were in small tests of 20,000 increments.” I've even seen cases where clients "cook" numbers to show your package didn't beat the control after all!

And let's say your package does win? A client can decide not to re-mail it because "the average order wasn't high enough" ... "the production costs were too expensive"... or they “lost money on the back end.” I know of cases where a client changed a few headlines and some body copy, and claimed it was no longer the writer's package at all!

These scenarios don't happen often, but they do happen (in fact, they've all happened to me!) In the end, the client is in control and you have to trust they'll do the right thing. Call me cynical and jaded, but I'm not comfortable with that at all.