From Digital Book World:
For the fourth straight year, romance book publisher Harlequin has posted revenue declines despite gains made by other large publishers. Romance readers have been early and enthusiastic adopters of ebooks, yet the company’s digital advances haven’t outpaced its print retreat.
So I took some time to talk with Harlequin CEO Craig Swinwood about the company’s results, how it has adapted to the rise of ebooks and self-publishing, and what the future holds for the publisher.
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Jeremy Greenfield: Has the rise of ebooks hurt your business?
Craig Swinwood: The market is dynamic, so things are connected. For us there’s a couple of issues around digital that were certainly advantageous for us early on but have become a variance in the past couple of years.
Romance readers were really the early risers on the digital adoption curve. They were the first to get excited about digital reading. So we had a pretty big uptick pretty quickly, particularly in back-list. We have thousands and thousands of titles that weren’t available to most readers because there was no space in physical retail for them. Digital allowed us to offer those titles.
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JG: One of the issues Harlequin is having that the company mentioned in its 2013 earnings report is pricing.
CS: E-tailers can discount whatever they want to discount, and they can discount all of our books and none of our books. It’s up to them. We’ve done everything we could to keep a level playing field for all of our stakeholders. When we look at the pricing of mass market paperbacks in the digital space compared to the discounting of new release hardcovers, obviously as a choice the mass market paperbacks didn’t seem to stand up very well when you can buy a new hardcover at the same price or lower. Because we are primarily mass market we didn’t fare as well as the competition during the holiday season and we lost share in the fourth quarter.
From a pricing standpoint, we were seeing digital pricing for new release hardcover and trade paperbooks at or below digital list price for mass market publications. Pricing is having an effect as far as choice goes. In the physical world, mass market paperback as a segment is half the size it was in 2008. Harlequin was overindexed in that segment.
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JG: One of the things that has impacted the publishing business as a whole but particularly the romance segment is the rise of self-publishing. How has Harlequin fared now that there is increased competition for content?
CS: The best way to respond to any amount of competition is to provide more value and better quality and I think we do that every day.
One of the things that self-publishing has had is a nimbleness to get to the market very quickly versus a traditional publishing cycle that we’re in. Because of that we started Carina Press five years ago which is our digital-first imprint and we’ve done incredibly well with that. It allows us to expand into different genres and test some things out. Self-publishing is an incubator for creativity. Some of those authors who favor self-publishing probably favor a certain amount of freedom of experimentation that they may not have had with a traditional publisher.
Link to the rest at Digital Book World
PG says three cheers for freedom of experimentation and barf to overindexed buzzwords in any segment.