Book industry and magazines Flashcards
Vital statistics of books?
1.Overall sales in 2022: $26.25 billion
2. Chief increase: trade books, children and adult books
4. Online sales are beating physical retail store sales, but slight increase in physical retail sales in 2022
5. Amazon has 65% of online book sales, 70% of all e-book sales, 40% of all book sales
5 Categories of books?
- Trade books: mass media mardbacks, mass media paperback, religious books, children and young adults
- Educational books: primary and secondary texts, college textbooks etc
- E-books
- Downloaded audio books: small but growing category, at the same time, “physical” audio books declined in revenue
- Subscription services: all you can read with a monthly fee (similar model as Netflix)
3 purposes of publishing house?
- Select
- Produce book
- Distribute the book (publishers want a blockbuster)
e.g. Paul Samuelson’s econ textbook selling 1 mil copies a year, 19 editions
177,000 book titles in 2021
Features of book industry:
- Low capital entry costs, so highly competitive
- Can contract out other services at reasonable rate
In 2020: 11,000 publishing houses
2020: 1,200 select houses (producers 4 or more books during a year)
Controversies in the book industry?
Entry into industry is too simple and frequent, leads to overproduction
177,000 figure is result of low capital investment
Cause-effect argument
Low capital entry costs has led to highly competitive industry, which is innovative
Constantly searching for new markets
Fear of oligopoly, 27% of the firms control 52% of all books published
Reasons for oligopoly?
Big firms have:
- Extensive production dept
- Large sales forces
- Sophisticated marketing systems
- bidding for others
- more connections to obtain rack space and retail outlets
Is oligopoly reducing competition in the book industry?
Yes and no
Amazon might control 40% of the world’s books
and 25% of firm smith control 52% of books but
there are submarkets
mysteries, sci-fi, westerns
these are more niche
What has the history of the book industry depended on?
- Technological changes
- Transformations in the market
Evolution of books?
1.Clay tablets
2. Parchment
Taken from dried animal hides
Maganacarta was done on parchment
3. Papyrus
4. Paper
Invented in China 105 AD by Chinese
Significance of Gutenberg inventing the printing press in 1456?
Major technological change
1.All books until then were handwritten- slow and labor intensive
Significance of Gutenberg:
1.Volume of knowledge in society increased
2.Different viewpoints were introduced(non orthodox beliefs)
3. Reformation, counter-reformation
4. Everyday life was affected by those who could read, but this was still a small minority of the public
Did book publishing grow quickly after Gutenberg?
No, as late as 1800, only 10% of population in USA was literate
3 Characteristics of book publishing in the 19th Century?
- Most publishers were small family-owned
firms - Publishers specialized in one type of books
or a few areas—religious books, or medical
books - Personal marketing: Sales people contacting
established firms; little advertising
4 Changes in the book industry after WW2?
- Book clubs emerge—create habitual buyers
- Paperback books emerge—first introduced in
1939 by pocket books - Expansion in Education
- Change in the organization of the
industry—emergence of chain book stores
Features of Book store chains?
- Meant sweetheart deals for the
consumers—economies of scale and built-in
discounts - Strategic Locations—downtown stores and malls
- Computerized inventories—ISBN and computers
- Saturation advertising—one ad covers a large of
the city; special events—Harry Potter introduction
What are features of the miracle decade for books (1963-1973)
A. High Profits
B. Expansion of the book audience
C. Growing population of college students
D. Widespread growth of literacy
Why did the book industry fail to grow 1974-2004
- Inflation
- Bad management—firms had not adjusted to
merchandising techniques: loyalty programs,
discounts; - Rival Products: Computer
programs—disposable income went to digitized
What is the ISBN number?
International Standard Book Number:
Used since 1970
Originally 10 digits—now 13 digits
Each book has a unique number—can find and
manage books more efficiently
Why did Borders close?
Over-investment in CDs and DVDs
- Outsourcing online sales to Amazon
- Overexpansion of physical stores
- E-Reader Problems
- Showroom Shopping
- Weak Loyalty Program
- Sub-Optimal Coffee and desserts
- Weak Discounting Policy—price,
Despite predictions from the 1980s and 1990s,
the book industry seems to be fighting back
against the digital alternatives. Why?
- People want to feel a book.
- People read better with paper than online.
- Students dislike online note-taking and online
marking procedures.
Predictions for the future of the book industry?
Eight Predictions
- More promotions for “Big Book”
blockbusters—TV ads, newspaper ads - Different color covers on paperbacks to appeal
to different audiences - More self-publishing
- Marketing of Audio and E-Books
Predictions Continued - More innovative merchandising
strategies—loyalty programs and discounts - Remainder tables; big data marketing
based on previous selections - Amazon—brick and Mortar stores; AI
recommendations (helpful)
Magazines in the US?
7,100 magazines
Ways magazines differ from newspapers
Two Ways Magazines Differ
from Newspapers
- Don’t have to carry up-to-the minute news
- Offer advertisers a national audience
A. Articles in magazine are filler to
promote ads
B. Ads-to-Articles relationship
What does it take to prosper as a magazine during the 2020s
Need a niche (specialised content)
Attract an affluent, committed readership willing to spend
Movement online will:
- eliminate postal and reduce transaction costs
