What Hugh Howey Won't Talk About (but Should). The Book Channel Part V of Several Parts. The Resellers
The Resellers (the Second Tier)
We finally come to the most exciting part of this series, the resellers, in particular Amazon.
Resellers are the customer facing side of the book distribution channel. When I was a kid, resellers primarily consisted of independent stores and small regional chains (Bookmasters, for example, in NYC). Over time, national chains such as Crown, Waldenbook and and others spread across the country, usually opening stores in strip and enclosed malls. (Paperbacks were also widely available in drug stores, toy shops, supermarkets and similar outlets.)
In the 1970s, Barnes and Noble pioneered the concept of the big box bookstore and was joined by Borders. These mega stores were usually built in large strip and some indoor malls and provided special in-store sitting areas, served light food, premium coffee, and sold music, gifts, games, magazines and newspapers in addition to books. Over time, the big box stores, in conjunction with Amazon (remember, the company went into business in 1995 as online book reseller), steadily ate away at the mid-sized chains and independent stores and drove many of them out of business.
In the early 2000s, senior executives at both B&N and Borders were positive the future lay in building as many large stores in as many economically viable locations as possible. In their view, independents and regional chains would survive only in areas that were demographically unable to support a big box. In that event, many in the industry predicted that Amazon would pick up most of the independents' business (a prediction that has turned out to be true in many markets).
Then, in 2007 Amazon introduced the Kindle and began to disrupt the sales and business model of the last great analog technology, one whose existence began in the West with Gutenberg.
(As a quick historical note, you should be aware Amazon did not pioneer the concept of the inexpensive E-reader. From 1999 to 2001, several technology companies, including Adobe, Sony, Panasonic and perhaps a dozen others who are gone and buried attempted to kick start the E-pub market to life. They failed because the technology of the time provided a reading experience that was far inferior to that of the book. To read more about the effort, I suggest you pick up a copy of my immortal tome In Search of Stupidity: Over 20 Years of High-Tech Marketing Disasters, available in Kindle on Amazon, B&N and other fine retailers everywhere (print too, though if you're in technology, you won't buy a piece of a dead tree).
The impact of the Kindle was profound, comparable in many ways to the introduction of the Apple iPod. The Kindle's reading experience matched that of the printed page in the "eyes" of most of the market and offered portability and flexibility options not possible with printed material. Growth in the print market came to a quick halt, then began to contract. The contraction is continuing and cannot be halted.
By 2011, Borders had liquidated operations and B&N was battling for its life. The company attempted to claim its share of the digital future with the Nook reader, but lacked the infrastructure content, financial pockets, and patient shareholders, to compete with Amazon. B&N backed out of the Nook and sold the rights to Samsung. I don't think the timing was particularly fortuitous for the Korean giant. Dedicated E-readers are being subsumed by smartphones and tablets in the same fashion as the smartphone subsumed the iPod. Amazon's Kindle reader is available on every major hardware platform and works fine on all of them (especially on Amazon's own Fire line of tablets). I suspect Amazon will be happy to vacate the dedicated E-reader market ASAP as at its best, the units were sold on a break-even basis and many more at loss leader prices.
The Reseller Channel Today
The book reseller channel today is broken into two primary components, print and digital. If you are an indie author, you will almost never have any reason to interact with print resellers. Please note that if you as an indie or a publisher sell your books online or perhaps at shows, you are not considered a channel. You are a direct seller. More on this later in the series.
Print resellers can be categorized into:
If you are an indie author, you will almost always be required to interact with online digital resellers based on your book's price point. The digital reseller channel consists of:
What is the Future of Print Reselling?
It has none. Within 10 years, the market will have shifted to digital delivery. The environmental arguments against print alone make the demise of the technology inevitable. (I've worked in print shops and it's a pretty dirty business.) Throw in cost, form factor, flexibility, potential tie-ins to multimedia and games and production issues and the future is clear. Print will survive as a niche technology and occasionally see micro rebounds in the same way that vinyl records enjoyed a small resurgence about six or seven years ago (good for me, as I collect turntables) among some millennials. But that will be it.
What is the Future of Digital Reselling?
Digital publishing will be the dominant means of producing and selling books within 10 years. Within 20, print will be a curiosity within the market.
How Do Resellers Make Money?
Resellers make money by selling books via three primary models.
The battle between the books publishers and Amazon that has captured so much press attention focuses on the desire of larger publishers to price some (not all) of their books via the agency model while Amazon wants to buy and price books via the wholesale model. The best interests of authors are not the primary or secondary concern of either party. The battle is over control of the industry's balance of power.
In the next article, we'll dig into the two models and analyze why the publishers are fighting for agency and Amazon for wholesale and the likely impact on authors depending on who prevails. We'll also be digging further into MDF, an acronym that indies will come to know very well, but perhaps not love very much.
Review Submission Guidellines
Want me to review your book? You must join the Rule-Set mailing list and contact me at firstname.lastname@example.org. Do NOT use the contact form for a review request; for press and publishers only. Your book can be a proof but ready for sale within 60 days.
Scifi/-fantasy only at this time. Make sure it's been professionally copyedited. If it's not, I'll know in about five pages and will reject the book. I don't mean to be a hump about it, but approximately 40% to 50% of the books I've received have had far too many typos, comma splices, misuse of dependent clauses, etc. (No, it doesn't have to be perfect. Most books have a few typos, including ones coming out of "traditional" publishing.) Your book cannot succeed in the market with such flaws and it's not fair to ask reviewers to read it in such a state.
I'll take a look at YA, but I'm not the best fit to that audience. PDF, Mobi, print all fine. If you have an author website you wish me to link to, please provide the URL. I don't charge and I also don't guarantee a good review!
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