Home » Disruptive Innovation, Ebook/Ereader Growth, Non-US » Plateauing is hard to do

Plateauing is hard to do

13 November 2013

From FutureBook:

Hachette’s August e-book bump appeared to come as a surprise to some. The group reported earlier today that August was a “record-breaking month” in e-books for Hachette UK, with digital sales up 80% year-on-year.

. . . .

Hachette UK also told us that e-book sales accounted for 30% of the adult trade market in the UK in the third quarter, up 10 percentage points on last year. That represents growth of about a third.

Both figures suggest what has been well reported for most of this year–that, statistically speaking, the rate of e-book growth is slowing down, even if growth of 30% remains a strong compensatory number.

. . . .

E-book growth has largely sustained trade publishers during the latter years of the big recession, and even if they do now, as some say, ‘plateau’, profit margins may continue to grow as publishers learn to better manage their inventories and working capital across the rest of their business.

Whatever the look of it, digital is more than just a growth curve. It is a complete re-wiring of the system. In this context the word ‘plateau’ is not inaccurate, but if it is taken to mean everything stops moving or that we are reaching a stable period, it is an unhelpful term. Nothing stops from this point onwards.

Link to the rest at FutureBook

Disruptive Innovation, Ebook/Ereader Growth, Non-US

11 Comments to “Plateauing is hard to do”

  1. You get the feeling that a lot of the people who talk about plateaus didn’t do well in high-school calculus.

    Well, I do, anyway.

  2. I’m sorry. But everyone knows e-books are plateauing and evidence to the contrary is just plain disobedient.

    In fact, if e-books don’t plauteau as required, I recommend Publishers send the money BACK. It’s important to let the Market know just who is in charge here.

    Consumers need to know that, too. If consumers keep buying too many e-books, Publishers should just stop selling them.

    That will create a plauteau, and a really good one, too.

  3. As a mathematician. there are times when I could scream. One of those is when people equate a drop in the rate of growth of ebook sales with a drop in sales and then get suprised when sales actually go up.

  4. I note the conciliatory point that “statistically speaking, the rate of e-book growth is slowing down, even if growth of 30% remains a strong compensatory number.” How many businesses will kick up a huge fuss over growth slowing to 30%? Hands, please.

  5. Sigh. I bet it doesn’t need saying, but here’s what’s wrong with the stats used. When you talk about increases year-on-year in terms of percentages, it only gives you a ratio. If a brand new company increased its number of customers by 100 every year, that would result in year-on-year growth of 100%, 50%, 33%, etc. The growth is actually steady; it’s the proportion that changes. In the early years of a new market, this ratio swings up wildly and then “plateaus” once the market size becomes big enough. That has nothing to do with the actual growth rate of the business, though. The growth rate could remain steady or even increase, and the year-on-year growth percentage could still decline.

    I bet there are some really good statistics nerds that could take the growth rate of a new market and project where it will “plateau” into a mature market. That would be interesting to see.

  6. Some of this is misunderstanding of mathematics, especially the subtleties of the various concepts that come under the general category “rate of change”.

    Some of it is wishful thinking (“whew, the ebook fad is over, now let’s get back to things the way I like them”).

    Some of it is obfuscation (“yes, the transition is continuing, but make up something plausible, so that our investors won’t panic and bail out before we do”).

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