On e-books, Kindle, Amazon and Your Bottom Line

e-books Milestone Ignites Lively SIPA Forum Chat

An interesting discussion took place recently on the SIPA online marketing forum. (This is one of the top member benefits.) It began when someone posted the item about Amazon.com reaching a new milestone, selling more e-books than hardbacks over the past three months.

“I mean, downloaded books didn’t just pass hardcover books; they blew them away in the last month!” the person wrote.

Right away, the discussion turned inward. Ed Hannan, vice president, publishing, PSMJ Resources, Inc., wrote: “We just put our first e-book up on Kindle and were shocked to realize that Amazon basically keeps two-thirds of the sale price of the book and does not allow you to charge more for the Kindle platform than you charge elsewhere, thereby preventing publishers from offsetting the lost revenue by charging more. It’s very disheartening to me as a publisher to see this happen. Yes, you get the wider platform of Amazon and Kindle, but unless you triple your sales, it’s a losing proposition.”

When I asked by email if he would do it again, Hannan promptly replied. “I’d probably do it again for the exposure, even though it probably won’t make us very much money. It’s a pretty easy process, though, once you figure out how to actually put the content on Amazon/Kindle. You just walk through it step-by-step (they guide you along the way) until the content is ‘posted.’ It actually takes them 1-3 days to review what you want to post, format it appropriately (you submit a Word document), and then make it available for download/purchase.”

Greg Krehbiel, director of marketing operations for The Kiplinger Washington Editors followed up by writing: “My thought on all this is that publishers need to separate the value of their content from the delivery mechanism and should set up their revenue models so they’re platform agnostic. Let the subscriber decide how he wants to use the content and let him bear the cost.”

Bob Brady, CEO of BLR, summed things up a bit by writing: “But don’t we think that, as the technology develops and expands its reach, competitive forces will force providers to share more of the revenue? Maybe not. Google does have a strangle hold on search. Maybe we’ll see the same thing here. But I can’t believe it will go on for too long.

“I think the important thing right now is to develop proficiency in the technology, but on a test-and-see basis, so that we will be prepared for the future. I don’t see any money to be made in the next 24 months, but the future is something else. If we’re not ready for it, we could be left behind.

Brady, chair of next year’s June 5-7 SIPA 2011 conference, is already planning a session on this topic. And at the SIPA Marketing Conference in Miami, Nov. 10-12, there will be a session titled Kindles & iPads & iPhones, Oh My! Marketing to Mobile Devices.

Brad Forrister, vice president of content for M. Lee Smith Publishers, wrote that, “Beyond the question of format and device is the question of market. If I were to put some of our content on Amazon in print or e-book format, or even in the iPhone/iPad app catalog, it would be to get it before customers who wouldn’t otherwise know about us, which might be worth the significant percentage they want to retain. But then the customer is really Amazon’s/Apple’s, and it’s not so easy to sell them other things.

“Bottom line for now,” he concluded. “I agree with Bob, watch, test, pilot—but with an emphasis on devices that are more likely to support the kind of interactivity that our information warrants.”

You can see why this is one of SIPA’s best membership benefits. There are seven discussion threads: Electronic Publishing (SIPAElecPub); Editorial (SIPAEdit); Marketing (SIPAMktg); Fulfillment/Operations (SIPAFulfillment); Conferences (SIPAConference); Information Technology; (SIPAIT); and Large Publishers (BIGPUB).

And as a member, it’s all free!  It’s like having a whole team of experts at your immediate disposal.


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