In many ways this issue highlights both the complex decision-making processes that lie behind things that are highlighted as faults among large publishers (and in so doing offers if not a defence, then at least an explanation for seemingly bizarre decisions) and the core problems of these publishers (that they are at once too large to move easily and too small to challenge their existing partners on tech or ecommerce grounds). There’s much to ponder in this post as you would expect with Mike:
Because Random House didn’t have that blind spot, they were, first of all, aware that their conversion rate on clicks to Amazon was very high, much higher than they would expect to get themselves if they tried to encourage consumers to buy direct. So the capture of more margin per sale would be at the expense of losing many sales. But, in addition, the extra margin can get burned up pretty quickly with the costs of running a direct-sale operation. One that provides solid user experiences, customer service, and other now standard eCommerce practices anywhere near today’s customer expectation is expensive — more so when it isn’t your primary business. eCommerce is a huge distraction, especially when it is executed by the folks who are also your digital marketers! That, or additional head count (which further lowers margins), would constitute a publisher’s choices.
Filed under: Future of Publishing
