Wednesday, December 28, 2011

2012 Digital Perspectives: The Consumer

We have written a series of short articles titled, ‘2012 Digital Perspectives’ which we shall publish this week. These will look at what we believe are the short term issues, challenges, potential game changers and outcomes across the digital publishing value chain.

Yesterday we looked at digital publishing from the author perspective and today we look at the Consumer. It’s the same house but we shall see a different perspective.

Today’s media noise about ebooks and digital is now driving a greater consumer awareness about the opportunities and importantly what they want from digital content. What issues matter may vary by the different consumer demographics and they will change with time.

Who do the public recognise as the drivers of their ebook needs – Amazon, HarperCollins, Randon House, Penguin, Apple, Kobo, Barnes and Noble, Waterstones, Google?

We now live in a global world where consumers are connected 24x7 and can compare prices at a click of a mouse. They no longer are influenced by newspapers, magazines, TV, radio but now have a virtual world of information available in a click on the move. Importantly, the largest power block is not the youth, but the silver surfers, who now have the greater disposable income and time, are increasingly technically savvy and are the heavier book readers.

What Amazon has taught us is that no single device is going to satisfy demand and that ebooks have to be available across all platforms. They learnt this trick early on in the physical book world with ABE, marketplace and other ventures and now have transferred the logic to digital.They also recognise that the first page consumers turn to in a book in not the copyright page to see it it’s a new book.

Amazon understand consumer demand and behaviour better than most and it is this that aligns them with consumers. We should remember that it was consumers made Apple, Amazon, Google, Facebook and it was consumers that walked away from MySpace, Napser, Sony.

What are the key issues consumers look for in digital books? Do we understand these, or do we presume to understand them? Price is probably a major if not the major driver, but does this apply to all content and demographics? Availability is probably a major driver, but is it of the latest, or the right content and how do they find it in the digital haystack, let alone validate it is the right one for them?

Digital rights management has to work for not just publishers and authors, but also consumers. Napster demonstrated the folly of tight control and MP3 music is the norm and DRM free. Even Apple have had to yield to consumer demand for DRM free music. We must always consider the consumer usability needs, as well as our own and if we make it too hard to enjoy, share, borrow and read then, they will find an alternative.

The industry must find a way forward on the library ‘free to lend’ versus ‘buy to own’ issue. Consumers will increasingly question the commercials and ownership benefits and the more some refuse to do business with libraries on digital, or demand unreasonable terms, the greater the divide becomes with the group that matters – the consumer. Libraries charging for loans should not be off the agenda and we must also recognise that loans, rentals and on demand commercials should not be restricted to libraries and their members. As consumers become more aware that they have ‘lost’ the right of the first sale doctrine on ebooks then an ‘on demand’ 'Spotify' model could be the obvious answer.

The folly of agency pricing was not in a return to retail price maintenance by a back door to just stifle Amazon and support Apple, but the fact that it was not in, or would not be perceived to be in the consumer interest.

The salient lesson that the music producers failed to grasp was that the ‘customer is always right’ and it is all about perception and making that a ‘win win’ not a ‘win loose’ situation.

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