Big, Commercial Publishers:
First, the bad news. Your revenues are in decline, your distribution model is unsustainable, you’re beset on all sides by technologies and cultural changes that seem to have just as much potential to harm your interests as to further them, and despite having been in the same business for over a century, your inability to predict your customers’ wants and needs makes you feel (and operate) more like professional gamblers than the capable captains of a respectable industry.
Now, the good news. All of these seemingly insurmountable challenges are really just the distracting side effects of a single, underlying issue. Better yet, it’s an issue you can resolve anytime you like, by yourselves, without the input of any high-priced consultants, the adoption of any expensive new technology, nor the invention of some as-yet-undiscovered business paradigm.
When I tell you what the underlying issue is, your initial reaction will most likely be to dismiss what I’m saying out of hand. All manner of rebuttals will immediately spring to mind, you will remind yourself that you are the publisher here after all, and there’s no way some nutjob on the internet could possibly understand your business as well as you do.
If only for the sake of being able to honestly say you’ve explored every possible option, please commit now to keeping an open mind for as long as it takes you to finish reading this article and giving it full consideration. At this point, can you really afford to ignore any new ideas?
The underlying issue is this: you have an image problem. More accurately, you have a self-image problem.
You don’t recognize the business you’re actually in, and as a result you believe your business is unique and ultimately unassailable on some level. This distorted self-image keeps you from fully aligning your business practices with your business goals and the desires of your customers.
You think you are curators of literature, and both authors and guardians of culture, but those functions cannot possibly be performed by any organization being run with a primary profit motive. You are no more curators of literature than Nike is a curator of shoes. If you wish to remain solvent, you can only be authors and guardians of culture to the extent that it helps (or at least, doesn’t harm) your bottom line.
You also believe your industry in its present form is a permanent fixture of modern culture, an institution venerated by the public it serves. You believe in the inevitable longevity of your industry, in its very right to exist regardless of profitability, with the same certainty and fervor the executives of print newspapers had about their own industry until very recently.
If you could see yourselves as outsiders do, you would realize you’re actually engaged in the most common (and possibly oldest) business there is: producing and selling consumer products. There is no shame in this; your products have the power to inform, entertain and inspire. However, bibliophiles notwithstanding, there is nothing inherently valuable or sacred about your products, and you will only remain in business as long as large numbers of people are willing to buy them. Yours are not the only products that can inform, entertain or inspire. If consumers find a competing product they like better, they will buy the competing product.
The fact that your product happens to be books doesn’t make it unique or special in any way, in a business sense. However, you believe books are special and unique products, and have built your entire industry around traditions and practices that support your false belief, often to the detriment of your business. In every other commercial industry, traditions and practices are only honored so long as they help (or at least, don’t harm) the bottom line.
Purveyors of computers, cell phones, clothing and even kitchen appliances wait to see how well consumers like a given product before investing the effort and money on releasing a premium edition of the product. If you intend to release both a premium (hardcover) and standard (paperback) edition of your product, you release the premium version first, and release of the standard version is often contingent on sales performance of the premium edition.
Many times I’ve wanted a book that I couldn’t afford in hardcover, or didn’t think was worth the hardcover price, but the book was never released in paperback. Apparently you aren’t aware of this, but cost-conscious consumers—and this group encompasses most consumers—will frequently "wait for the paperback" in the same way they will often opt to skip a movie at the theater and "wait for the DVD" or "wait for it to come out on cable". This business practice alone probably costs you millions of dollars a year in unsold hardcovers and lost paperback sales, yet you continue to do it because it’s traditional to your industry and you’ve attached a certain degree of status and internal fanfare to the idea of a hardcover release.
Movie studios allow their customers to access and use their products when ever, how ever, and in whatever format those customers want. Whether it’s in the theater, on DVD for sale or rent, Blu-Ray, via digital streaming online, on pay-per-view, or even on an iPod, the customer is completely empowered to control his experience of the product. As a result, many, many more copies of the product are sold and filmmakers earn much more money than if they limited their films to theatrical release alone.
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