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Release e-books first at publishers’ sites? A twist on windowing

21 March 2016

From TeleRead:

E-book windowing is a way to prevent e-books from cannibalizing print book sales. Just release your new titles first in print format only.

The result? Frustrated consumers. If you’re an e-book reader, nothing is worse than realizing a digital edition doesn’t exist for that new book you recently discovered and wanted to buy.

. . . .

I think it’s time to reconsider the windowing model, but with a twist.

Rather than offering print without digital initially, why not offer that e-book exclusively on the publisher’s website? For the first 30 days, for example, the e-book is only available as a direct-to-consumer option from the publisher.

. . . .

Two of the big challenges with this approach are:

  • Making sure consumers are aware of the initial exclusively direct availability
  • Getting consumers to change their buying behavior

. . . .

The awareness obstacle starts with creation and careful management of a customer list. E-mail newsletters are critical and they must contain valuable information and insights, not just one promotional message after another. This isn’t just about e-mails and list management though. A publisher needs to be committed to building community with their audience, giving people reasons to come to its site on a regular basis, etc. Many publishers are allergic to this approach; these publishers will never create a successful direct channel.

Raising and maintaining consumer awareness is hard enough, but changing consumer buying behavior has a much higher degree of difficulty. If you’re a Kindle reader and you’ve built a large e-library with Amazon, you need a compelling reason to buy your next e-book from somewhere else.

The direct sales model eliminates the retailer and enables the publisher to keep a larger chunk of the revenue. In many cases this means the publisher nets 100 percent of the selling price vs. only about 50 percent when the e-book is sold through a retailer. So why not pass a portion of that difference along to consumers? A 40 percent-off deal during that initial direct-only stage might entice some of those Kindle loyalists to consider buying direct instead, especially if the Kindle price ends up being close to list.

Link to the rest at TeleRead

PG says that if publishers had any technical chops and management smarts, the direct sales model would have been their first ebook publishing strategy. Such a strategy would have been a valuable weapon in their fight with Amazon. To the best of PG’s knowledge, Baen is the only publisher of significant size that sells direct and it built its online sales system with far fewer financial resources than Big Publishing has.

The other element in publishers’ calculations would be one that companies operating in industries being disrupted regularly worry about: channel conflict.

Publishers have spent a great deal of time and money building up sales channels with traditional bookstores and rightly worry about what might happen to their printed books if Barnes & Noble becomes upset with a publisher’s behavior. BN knows that ebooks and ebook prices are a deadly threat to its survival, particularly now that Nook is being shoved overboard. BN looks to publishers as important allies in the battle against ebooks.

If publishers sell ebooks direct to consumers at low prices, BN and other bookstore will almost certainly retaliate by refusing to sell a publisher’s books or shelving them in the back of the store next to the local history titles.

Very few companies, including some with innovative management, have been able to solve the channel conflict problem when disruptive technology arrives. Almost invariably, they cling to their established sales channels until the company and the channel partners go down together.

Big Publishing

21 Comments to “Release e-books first at publishers’ sites? A twist on windowing”

  1. How would they even let customers know the book is available via the publisher’s website?

    Are there any publisher’s websites that are easy to navigate?

    Amazon has me trained- I check their websites for books (used) first.

    The used book stores closed down in my area, and the closest BN is in the next county.

    As for trad published books- they are so expensive, I’ll wait until I can borrow it for free via the Library. It’s not like I don’t have a ton of books to read on my device. (And with KU, millions more just waiting to be borrowed.)

    • Reality Observer

      The Baen site is easy to navigate (although still settling down from a few issues with a major upgrade they just undertook – some catalog prices are not quite right, but you’ll be charged the correct one, which is what matters).

      They also release the ebook on the exact same day as the print publication date (now, you might get hold of a print copy before the ebook is available, because they also don’t get crazy about “do not sell before” issues with bookstores).

      That said, I usually try to remember to buy their books on Amazon – to make sure any reviews I leave are by a “verified purchaser.” That helps rankings.

      • I like Baens. Bought many books there. But Baens site has always had problems.

        For instance, I found a book chasing through the ebooks catalog that I could not find on the author’s page. And last time I went to Baens, the book I wanted was NOT AVAILABLE. Listed. Had its own page. But NOT AVAILABLE.

        When I comparison shop between Baens and Amazon, I find Amazon offers the same book from Baens auto-delivered wirelessly to my Kindle instead of side-loaded from my computer for 25¢ less.

        On the gripping hand, Amazon sends me an email every day to say, “Hey, how about this book?” Baens never does. I still have not figured out which I prefer. But I will say this: On a rare occasion, I bought a book Amazon recommended. The jumping to a conclusion is left as an exercise for the reader.

  2. This would require they deal with the lowest of the low: readers.

    Won’t happen – or it will happen very poorly. And people will again blame the author. Very sneaky.

  3. I’ve wondered before why some popular self-publishers don’t do this, seems to me you don’t lose anything and gain the chance to make a little extra from your most dedicated readers.

    • I think PG has the right of it. The big traditional publishers see booksellers as their customers, not readers. Similarly, one source of B&N’s pain is they see publishers as their customers, not readers. Both parties have made numerous deals that benefit their supply chain partner at the expense of the customer.

      • I missed the “self” in “self-publishers” on first reading. For self-publishers the benefit of direct sales are minimal. The 30% you aren’t paying to Amazon (for example) has to cover setting up and maintaining a storefront, keeping records for tax purposes, and meeting all regulatory requirements, which as Angie notes can be quite involved. For a large publisher with many titles to spread the costs across, it’s beneficial. But for an indie with a few dozen titles? Maybe not.

        • Reality Observer

          Yep. I did a back-of-the-spreadsheet “what-if” on that one a while ago. My (rough) figures said I’d have to sell around 500 books to break even with the 70% Amazon royalty. At around a thousand sales, it would hit around 73%. Not that many authors out there with THAT kind of dedicated readership that hits their website.

          Plus, of course, that it takes away from writing more salable product. Also, as I noted above, if you go Amazon in the long run – not a single one of those purchasers are going to be “verified” – lessening the value of their reviews (the dedicated are the most likely to review you, too, and with a positive one).

    • One reason I wouldn’t consider selling books directly from my site is the sales tax issue. Depending on where the buyer lives, you might owe sales tax to a state, a county AND a municipality, and tracking which and where and how much and whom to send it to and what forms to file is a major nightmare. And that’s not even getting into Europe with its VAT taxes, and who-knows-what elsewhere in the world. If someone comes up with a turnkey service to handle all this crap, I imagine more indie publishers will consider selling from their sites. Until that’s solved, though, it’s MUCH more hassle than it’s worth.’

      Angie

      • I agree. States could make a LOT more money from online sales if they would SIMPLIFY it for small businesses. That’s the one thing that’s keeping me from selling directly: Convoluted tax system.

    • My hesitation comes from the loss of visibility you get on Amazon or another platform. Someone who knows to check your website to buy a book is *going* to buy the book no matter what. They weren’t just browsing and decided to buy your book on an impulse. By shepherding your gimmie sales to a captive website instead of a bigger one, you lose the rank (and visibility) improvement you get out of that bucket of sales, and you lose the impulse sales from readers who don’t know you. If you have a shelf of books available, those serendipitous sales might result in more than one purchase, all said and done. You have to lose less than one visibility-driven sale for every two you drive to your website to come out net positive, even before you consider the effort of maintaining the site (and revenue related upkeep, as noted).

    • They do.

      Go see Hugh Howey’s site, to name one example. There are a bunch of others I forget.

    • In addition to what Angie and Gordon said, there’s also hacking. If Sony and Home Depot can’t be trusted to store their users’ information properly, why should I trust Joe Schmoe Author to do it?

      The most I’m willing to risk is Kris Rusch’s A-store, which is just an Amazon store embedded on her site. Link to how it works: https://astore.amazon.com/ I think B&N offered something similar. An alternative would be the “Pay with Amazon” or “Pay with PayPal” button that Storybundle.com uses.

      I’m going to go out on a limb and guess that for most authors, “cyber security” is just a collection of syllables. Even the ones who’ve heard of it have better things to do than trying to stay ahead of malicious hackers. This is one of those “leave it to the experts” situations, as they have the deeper pockets for lawsuits. Fighting in court doesn’t pass my WIBBOW test.

  4. “To the best of PG’s knowledge, Baen is the only publisher of significant size that sells direct”

    O’Reilly.

    And I agree, channel conflict would be a problem.

    • Baen used (?) to sell eArcs before official release date at the same price as a hardcover. Lois McMaster Bujold confirmed they sold well and Baen split the extra income with the author.

      The last aspect is contrary to standard qig5 behavior and Baen is not located in the NYC high rent district.

    • Baen also has trained its fans to look for the Monthly Baen Bundle. They let people know ahead of time what is going to be published, and give them an opportunity to buy several books at once, before publication, for a reduced price.

      Just to be evil and to bring people back, the content of never-before-published Bundle books is only available in part, while reprints are generally made available in full.

      For example, on March 15th, the five new June Baen Bundle books became 1/2 available, while a previously published book was available in full. On April 15th, 3/4 of the books will show up. On June 7th, the full content will be available. You pay 18 dollars for 6 books, which means it’s 3 bucks a book.

      On the other hand, if you buy an e-ARC, you get instant gratification and the full content of the book, months before publication. But you have to pay more: it’s 15 dollars for one book.

      Baen is constantly releasing new ebooks from their other ebook partners (like indie writers), and they also have a fair amount of free ebook and short story and podcast content; so there’s always a reason to drop by their site. Since they also maintain the very popular forums of Baen’s Bar, they have no problem attracting people to their site.

      • Reality Observer

        It’s a daily stop for me. Although I am trying (if not with complete success) to stay out of the Bar these days.

  5. I’m not sure that all of this actually makes sense. One of the assumptions of “channel conflict” avoidance by a supplier is that the actual vendor to the end user (in this instance, B&N or another major chain bookstore) can act to significantly punish the supplier because there’s a perfect substitute for that supplier’s goods already in the vendor’s catalog… and that consumers will accept substitutes as equivalent.

    Neither is actually true. And what’s worse is that marketplace demonstration that one cannot substitute, say, a Janet Dailey (S&S) novel for a Nora Roberts (Bantam) novel* also denigrates the value of the publisher’s branding, as distinct from author branding… and that would blow up a lot of things. A lot of things.

    That said, I can believe perfectly well that MBAs doing strategic marketing analysis would continue with the assumptions they learned in grade school regarding canned beans (the “classic” example), without examining whether those assumptions are valid in this marketplace. I think PG has accurately described publisher beliefs about the likely response of B&N (et al.) to direct sales channels… but not the actual effects.

    * Snark warning: This example chosen with malice aforethought based upon past authorial feuding in public. Mostly because it’s Monday and I feel that way.

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