Where the Value Is

Yesterday afternoon at The Bookseller’s FutureBook Conference we were sidetracked for a while by an unfortunate conflation of DRM and copyright. The two are often mixed in the same breath – usually in an argument against DRM-free electronic publications. It was one of the day’s less comfortable moments with the overwhelming sentiment on the Twitter timeline at odds with what was being said on the platform. Hachette’s staunchly pro-DRM standpoint did not seem to sit well with many, and there was a discernible tension (of a “you could cut the atmosphere with a knife” variety). Whilst I had not much enjoyed Charlie Redmayne’s morning keynote presentation – his contribution during the Driving the Future Panel – on the subject of his experience of taking Pottermore DRM free – was a powerful one, and he repeatedly made comments that were both astute and pragmatic (always a winning combination in my book). I’m cautious on quite how much other publishers can learn from the J K Rowling / Pottermore example, however throughout the session Redmayne was on the nail in his observations, in particular his pithy statement “Amazon taught us the value of the customer relationship“.

I was discussing this afterwards with a colleague who ventured the view that Amazon don’t actually know all that much about their customers, they know about service. This may or may not be the case but what Redmayne said was the “value” of the customer relationship. Owning the execution of the financial transaction is to own one of the two anchor points of the supply chain. It is an anchor point that publishers have traditionally viewed as a distraction and outsourced to wholesalers and re-sellers and this is one of the reasons many trade publishers in particular are playing catch-up when it comes to understanding what consumers want – and how they want to engage with books.

If you manage the financial transaction you own one of the two indispensable elements of the chain (creation and sale). One of the most remarkable things that Pottermore and Bloomsbury have achieved is to wrest a direct-to-consumer sale for a “trade” product away from Amazon. And no matter what the scale of our business, whether we publish hundreds of thousands of Harry Potter books or highly specialised information that sells in tens or hundreds or copies, the value of the customer relationship is something we would all do well to think about.

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4 Responses to Where the Value Is

  1. I wonder whether this continuing distance between publisher and reader (let’s not call them ‘end-users’, please!) is specific to book publishing. Most of my industry experience has been in the scholarly journal market, where reader behaviour has been recognised as a significant driver of sales to intermediaries (chiefly academic libraries rather than members of a trade supply chain) for a long time now.

    It is now almost impossible to sell online subscriptions to librarians without the inclusion of tools which allow the librarian to track usage of the title, right down to the article level and publishers use this data themselves, both in their marketing activities and when making decisions about launching new titles or soliciting papers for existing journals. There is a resistance in many places to Amazon-style comment and ratings tools (not scholarly enough, darling!) but the big players in this market (and many of the smaller ones) all have teams of people dedicated to tracking and analysing readership of their material in order to improve their offering to customers.

    I suspect that this difference in perspective is a product of the much earlier adoption of digital and online publishing by the journal publishers and that as book publishers adopt these same business models, they will inevitably develop ‘reader relationship management’ as well as customer relationship management.

    • Sheila says:

      Thanks for this very thoughtful comment Amanda, and I entirely agree with you that journals publishers have, like the ISBN & ISSN, been an industry Cinderella for far too long. Trade Non-fiction publishers have much to learn from journals publishers.
      As for the “not scholarly enough, darling” well there’s the rub. Journals publishers understand the value of endorsement (except they call it peer review and do it pre-publication not post-publication). Tech companies and social networking companies however haven’t yet found a meaningful, reliable equivalent (save perhaps Expedia and Tripadvisor reviews). The “like” button just doesn’t cut the mustard….

  2. Rob Lowe says:

    A really interesting piece.
    I thought it was interesting that while the industry recognises the changes that creating digital products will have on the internal structure of publishing companies, and product development it seemed (to me) that this was mainly addressed as an opportunity to broaden the scope of the editorial role, whether as part of an interdisciplinary team or otherwise. At the same time, there was a recognition that publishing would become an increasingly customer-focused industry – cultivating the relationships you advocate. Again, it makes sense, and there were a few models already in evidence, the more direct engagement that Osprey uses – effectively crowd-sourcing their publishing programme, the crowd-sourcing of actual content/assets, and the more conventional market research/focus group research, all of which, backed up by web analytics data should provide substantial insights into customer behaviour. But unless I missed it, I didn’t hear anyone acknowledge that a customer-focused approach could drive organisational change. If you start publishing directly for your existing customers, then marketing (knowledge of the market, access to the market, creation and refinement of the product) becomes a significant factor in the development and commission process. This might, or might not drive innovation, depending on how it is handled. Either way, it’s more than just publishers deciding to restructure, the hierarchy may change before they’re ready to initiate it.

    • Sheila says:

      Thanks for taking the time to comment, Rob. I can’t really see how a customer-focused approach can’t drive organisational change in businesses that have hitherto been largely disconnected from customers (by which I mean users / consumers – not just re-sellers). Many of the things you say touch on other things I am mulling over post-FutureBook and will be discussed further on this blog, time permitting, in the next few days.

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