Thursday, August 09, 2012
Creating A Virtuous Circle for Book Exchange
The sheer number of start ups continues unabated. Some address new opportunities and warrant a closer look, but many often fail to deliver their elevator pitch. Many make sense, but little money, others make little sense but still attract money, a mere handful become successful and are often eaten up by larger organisations.
One that we found very interesting is the US start up Bookmooch, which is a used book exchange.
Users list their books that they want to trade, getting credits for those listed. When another user takes one of the books the seller gets additional credits. No money changes hands and all that is paid out is the postage by the seller. The acquired credits from trading can then be used to acquire other books. In rewarding the giving of books with credits that can only be used at the exchange, Bookmooch has created a virtual circle of engagement. However one can only benefit if the book you want is in the exchange so Bookmooch also allows members to create wish lists and if their needs are not available they have the option to buy them seamlessly from Amazon. Members can also provide feedback on the titles they acquire. There are no membership fees, no trading fees and Bookmooch makes money through advertising and Amazon referral commission.
The site has been operating for 6 years, and has a quarter of a million members. The “give one and acquire another” approach has much appeal to those with bulging bookshelves who are looking for new reads.
Many may question whether a free exchange can make serious money as what money it makes is out of secondary services. We would suggest that with the numbers it is attracting both in active members and usage the opportunity is real. The information it is collecting on demand, listings, demographics etc and on backlist titles itself has real value. However if, or should that be when, the first sale doctrine on ebooks gets addressed its model and appeal could take off. This again raises the thorny issue of the current pricing and licensing of ebooks and whether the current arrangement is in the consumer interest and sustainable.