The Readers are the Gatekeepers Now

Tuesday, March 13, 2012

Bundling ebooks with hardcover

Canadian Tech Forum Wrestles with The Challenges of E: " Schnittman argued that the idea is a win for consumers, who get to have both the convenience of an e-book and the object of the book to keep, and for authors, who would get higher royalties. Retailers would get a 25% increase in price without any additional use of shelf space..."

Does it ever occur to these people that, in the eyes of most readers, an ebook has zero cost to deliver? We know it doesn't, but if a self-published author can deliver an ebook for a couple of hundred dollars in fixed/sunk costs, readers in the know aren't going to be willing to tolerate paying an extra $7-10 for an ebook version of the hardcover they're purchasing. If these people were thinking, they'd give away the ebook version with the hardcover copy. That would be a truly reader-friendly gesture.

Perhaps some high-minded (snobbish) readers are happy to pay $35-40 for a hardcover, as a status symbol of their consumption habits. However, the rest of us are looking for bargains.

We know the extra 25% tacked onto the price is going to net maybe 17.5% of 50% (or less, i.e. discount off cover price offered to the retailer/wholesaler) of that 25% to the author, if he/she is lucky. We've heard there are situations where the author doesn't get anywhere near that, because of the newer punitive contracts and the publishers' definitions of "net sales of ebooks," which are far short of the standard 40-50% of cover price the retailer pays to the publisher.

Precisely because there's no additional shelf space cost, we don't see the justification for giving an extra 25% of cover price to retailers, who'd presumably keep 40-50% of it, depending on the discount structure. Schnittman is advocating for this as a sweetener to retailers, with whom publishers have always had a closer relationship than with readers. If retailers were smart, and wanted to keep the goodwill of book buying customers, they'd mark the 25% down significantly. We're hoping this is what any publisher offering this kind of deal would be anticipating.

We think the idea of rewarding retailers in this manner has probably arisen out of the misguided notion that retail hand-selling of books is more valuable than offering the consumer a great price and free shipping. Surveys of book purchasers do indicate some buy based on hand selling by a book retailer salesperson, but the quantity of such sales is miniscule. In our opinion, discussion of hand selling is a feel-good mechanism for people who work in, and run, bookstores to boost their own morale in a time of bricks-and-mortar retail contraction.

4 comments:

  1. When thinking about costumers, publishers see booksellers, not readers. In this paradigm, the eBook-bundling tactic by publishers makes sense.

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  2. Agreed, antares. As an indie/self- publisher, do you see things differently?

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  3. I so agree with your analysis, Azarimba. Have you seen the prices of eBooks at M&B site and Harlequin? Same as print copies or more!

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  4. I noticed that, too, Nas. Romance is a little different from the normal popular fiction case, however. Lots of women like the anonymity of the ebook downloaded to their ereader, instead of having to carry around a paperback which brands them as reader of romances. Some people don't want to be labelled as romance readers. They're possibly willing to pay a premium price for the ebook version.

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