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Why Amazon Dominates

12 June 2012

From Digital Book World:

Marc McLeod of Shoppify, an online retailer site that allows users to set up their own storefronts writes:

“You really need to shower your users with love. People buy technology from start-ups for one of two reasons. One, it’s technology that they can’t get anywhere else, or two it’s a level of service and support and love that they can’t get anywhere else. The start-ups that do really well and take off have showered their users with love. You send a request to support and you hear back right away. They’ve got a very active blog and they build a community. Every time an executive goes to a different city they’re having dinners for the users in that city. They’re building massive loyalty and those users are going out and becoming ambassadors and helping recruit more users.”

In many ways Amazon, despite being a company 100 to 1,000 times the size of many publishers, still behaves very much like a start-up, while many publishers do not behave like start-ups at all.

Most publishers think their content is unique. They think they have the equivalent of must-watch shows, like Mad Men (A&E) or Game of Thrones (HBO, SKY) – that makes cable channels so profitable and secures them a place in the can’t-do-without subscriber bundles (even if the rest of the programs they offer might be crap), but books are much more fungible than TV programs.

. . . .

Where Amazon beats publishers hands down is the level of support and service it offers, be it free shipping, no questions-asked return policy, etc.

Low prices on  a small range of best sellers are just “link bait”. Many items are actually more expensive at Amazon than at many other retailers, but consumers still would rather buy from Amazon because of the trust they have in Amazon and the ease of shopping combined with the “no regret” customer service Amazon offers and the awesome breadth of its catalog.

. . . .

Supporting Barnes & Noble breaks the monopoly, but in the long term just creates a duopoly with the same consequences. Publishers really need not just behave more like start-ups, but engage with more start-ups, too or they will be operating in a market where the buyers (retailers) have oligopoly power.

Link to the rest at Digital Book World

Amazon, Big Publishing

4 Comments to “Why Amazon Dominates”

  1. I’ve always valued customer service over price. With Amazon, I get both.

  2. Ann Patchett is anti-Amazon as well (see link to her speech at BEA). She is a bookstore owner, I get that. But I’m sure she sells the majority of her own books at Amazon.

    These people can’t possibly believe that they are striking out on behalf of readers. The jacked-up prices of their books have sent many of us to libraries for years. Now we can jump on Amazon and save more money in gas.

    http://www.mediabistro.com/galleycat/self-published-bestseller-list_b52860

  3. Distinguo:

    Books are not ‘much more fungible than TV programs’. Good books are not fungible at all. What they are is sold individually. You can’t watch A Game of Thrones without subscribing to HBO, or whichever channel carries it in your own country; you can’t just buy the one show. But there was never a publisher in the world that could compel readers to subscribe to its entire output in order to get one book.

    • Yes, THIS. That bit bothered me too. Note that Game of Thrones only is an HBO show because it was a hugely successful book with a big following.

      It’s in the back of my mind when everytime I see someone grumbling about amazon’s so called “monopoly”. Books are not commodities, and copyright IS all about monopoly. Every single work is it’s own little monopoly.

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