Does Publishing Have Ketchup On Its Hands?

At a time when many are trying to achieve their New Year resolutions to get fitter, TV schedules are littered with the dangers of obesity, the news has increased coverage on the increased obesity of not only of adults, but also children and also the Hairy Bikers top the charts with a book about their own battle to fight their obesity, it is somewhat cynical that the industry celebrates the promotion of 15 million children’s books by McDonalds. Some would that this is a somewhat cynical promotion of heavily discounted children’s books through the sale of what many would regard as junk food.

For the next two years McDonald's is effectively giving customers a voucher for discounted participating children’s books to be used to redeem titles for £1 through WHS. They claim 9 out of 10 parents responded positively to their similar campaign last year and asked them to do more book promotions. Why wouldn't they at £1 a title?

The National Literacy Trust are fully behind the promotion and obviously believe that inducing parents to feed their children in MacDonalds is the answer to getting more children reading and can make a real difference to child literary and ‘well-rounded children’.

It’s as if we have ignored the Jamie’s campaign for better school meals, ignored the news about the increase in obesity, ignored all the TV and media coverage on the dangers of unhealthy eating and junk food, ignored our own industry charts and diet books and rum to pick up a few pieces of silver instead and done so under the banner that it will improve the numbers of children that read.

We have seen the cost of unhealthy eating and lifestyles on the NHS. We have seen proactive legislation and taxation levies on the advertising of smoking and dangers of tobacco. We have banned tobacco companies cynically endorsing sport. We are now witnessing a similar approach to alcohol abuse, but we still fail to grapple with the soft drink and junk food endorsements of sporting events such as the Olympics. Its as if money still talks louder than logic.

The publishing industry, publishers and authors should step back today and ask themselves if they are happy to endorse this somewhat cynical promotion which is clearly aimed at children and whether they will, as a result, be seen to have ‘ketchup ‘ on their hands.

Kobo Unplugged

The one thing that you can say about Kobo is that they remain focused and determined to forge an international offer and pit themselves in the face of some formidable competitors. Their international strategy was eloquently conveyed by their evangelist and Vice president of content, sales and merchandising , Michael Tamblyn, speaking at the Digital Book World conference in New York. Michael said that when you start from Canada you have no option but to go International.

Michael’s presentation is good and well worth a listen and brings home some of the realities of managing a tight roll-out to many countries and the need to segment operations and stick to a template approach. They aim to establish themselves in 12 more countries this year, which may not sound that ‘gun ho’, but is a country a month and will get harder as they break out of the English speaking and ‘western’ markets.

However, international growth, which is heavily reliant on ‘partners’, can have its challenges. Last weekend we visited a large WHS store and saw first hand how a partner can let you down badly. Getting some retailers to treat it better than just an instore franchise is itself a challenge, but this was in what was a ‘hotch potch’ of a ‘pick and mix’ store that frankly made the old Woolworths look good and was hardly aligned to the messages Kobo needs to get across. Yesterday, Asda announced that they would be selling the Kobo touch reader for £87 which is just under the Amazon Kindle price of £89, which enjoys the Amazon brand and is backed by significant mainstream advertising campaign. Simply relying on spot buys, bin end POS and a comparable price isn’t exactly pushing the boat out. We have already seen how the old Waterstones was unable to retail ebook readers in store. Its one thing to have retail partners, its often another thing altogether to control their representation of your offer.

Michael presents some very interesting figures for Kobo sales of self published titles in various countries. Self publishing represents some 7% of US unit sales, this rises to 8% in Asia, 9% in South America, 10% in Australia, New Zealand and Europe and 14% in Africa. He explains some of the reasons behind the local variances but the percentages are somewhat higher that we expected and demonstrate that the opportunity that is potentially starting to blossom under the ebook umbrella.

Michael also shares some interesting insights on local and global pricing which demonstrate how many publishers still see physical and digital pricing locked together.

Kobo are now within the Japanese giant Ratuken, which will give them better backing and they know that they will need it as they race to get themselves established in many countries and across all the continents. This is about raising brand awareness and credibility just as much as it is about service. Whilst Barnes and Noble still today remain largely unknown outside of publishing and the US market, Kobo now has a better street profile in a growing number of countries. It will be interesting to see how the Kobo brand stands up to the potential Waterstones’ adpotion of B&N’s Nook and how they both compete with Amazon in the UK later this year.

To hear Michael's 15 minute presentation

Related posts
Kobo Steps up to go Global (Nov 2011)
Can Kobo Win at the Races? (oct 2011)
Kobo Has to Follow (June 2011)

The Goose has laid its Golden Egg

According to the latest Internet sales statistics from Interactive Media in Retail Group last months sales rose 55% on last year to hit £3.47 billion and they also passed the watershed £100 billion mark. The first retail internet stores are only 12 years old and WHS was one of the first and they now generate more sales a month than all the West End of London stores do in a year!

When the Internet first appeared most retailers shunned it, said it offered little return, was risky and pointed to Amazon and said no thank you. The booktrade was no different and although WHS was followed by the other chains the effort was often half hearted. We must remember that WHS actually bought up The Internet Bookshop, a very successful starter and one that offered a clear brand but then merely merged it into their offer and lost its real potential to take on the likes of Amazon. Many accountant would lok at Amazon and see one goose and not see the golden egg let alone undersand the positive cash flow, global branding and potential marketplace they were building. Today Amazon is everything but a publisher and owns mobibook, booksurge, marketplace etc.

So what about the traditional retailers? IKEA and Topshop have joined the party this last year. Travel now accounts for the largest consumer spend with the likes of BA.com and Ryanair.com. The largest retailers are Amazon, Tesco, Dell and Argos.

What will the next 12 years offer? Who will dominate this landscape then and more interestingly what business models will porevail.