Why More Kindle Sales Over Hardcovers on Amazon Is a Good Thing

by Matt Moore

Amazon announced recently (July 19, 2010):

Over the past three months, for every 100 hardcover books Amazon.com has sold, it has sold 143 Kindle books. Over the past month, for every 100 hardcover books Amazon.com has sold, it has sold 180 Kindle books.

This is good news. Ebooks give readers a quick, easy and (hopefully) inexpensive way to not just read books, but discover and try new authors.

However, I’m wary of how publishers will react. Some publishers fear that ebooks released at the same time as hardcovers take away from sales of the highly profitable hardcovers. As well, there is a belief that demand for ebooks and hardcovers if released at the same time are equal, so the price of ebooks relates to its perceived demand rather than cost.

Now with Kindle sales surpassing hardcovers, publishers might feel justified in delaying ebooks or keeping prices elevated to make up for what they perceive as a shortfall in profits. Yet if publishers want to improve their bottom lines, they should drop the prices of ebooks and release books in ebooks and hardcover formats simultaneously.

Hardcovers Are Money Makers

Hardcovers have higher per unit profits than paperbacks. Publishers know that big name authors have a built-in audience who are willing to pay a premium for the latest book. This is the reason why paperbacks come out a year after the hardcovers—publishers give the audience the choice: buy the expensive hardcover now, or wait a year and save.

I don’t fault publishers for this approach—they are in business to turn a profit. My issue, though, is they’re mistaken impression that releasing an ebook at the same time as hardcover will eat into hardcover sales. What publishers do not understand is they are two different markets.

Readers of Hardcovers vs.Those Who Read  ebooks

Hardcovers are for serious, committed fans. They want to read the story right now, but also want the book—its weight, cover art, and whatever other goodies there might be inside. And later, they want it up on their shelf where they can see it… or allow others to see that they have it.

People who read ebooks want convenience. Bringing a paperback on the bus or to the beach is easy. Bringing the equivalent of many paperbacks in one small device—a device where you can preview and buy new books from anyplace with a wifi signal—is easier. For those who value convenience, a hardcover is a bulky, cumbersome object that gets in the way of trying to read it.

Publishers Don’t Understand These Markets

Yet publishers get this confused. They seem to think a committed fan will now opt for an inexpensive ebook rather than a hardcover. Or, they might think the casual reader will pay for a hardcover if no ebook is available. Neither of these is true, but with this news from Amazon, publishers may think “We can’t risk hardcover sales. We should delay the release of the Kindle version. Or, increase the price so we make up the profit from lost hardcover sales.”

Publishers Have An Opportunity

But the increasing sales of ebooks is actually good news for publishers and should result in good news for readers of ebooks.

Lower eBook Prices

With ebooks growing in popularity, publishers should be lowering ebook prices. There is a large market out there interested in ebooks, but are hesitant to buy a reader and then incur additional costs of buying ebooks that cost as much a paperback—better to just buy the paperback. By lowering the price, readers can make up the cost of the ebook device in the price difference between the ebook and paperback. Though publishers may make a lower per-unit profit, the increase in units sold will increase overall profit.

Further, with more casual readers buying ebooks, publishers can lower the print runs on paperbacks, which have a higher per unit costs than ebooks.

Release eBooks and Hardcovers Simultaneously

Releasing an ebook at the same time as the hardcover might improve hardcover sales. Imagine a new novel you’re interested in comes out in hardcover and ebook. Not willing to spend $25.99 on the hardcover, you buy the ebook for $5.99 (which is lower than the price of the paperback released next year). You read it and love it. You want to go back and re-read it, savouring the experience. Rather than read the book one small screen at a time, you buy the hardcover.

Now imagine if the ebook came out a year after the hardcovers. There might not be any hardcovers left in stock, denying the publisher that additional sale.

Two Audiences—Committed and Casual—Allow Buzz to Grow

By allowing committed fans (who buy the hardcovers) and those who are curious (who buy the ebook) to read a book at the same time, publishers allow for greater buzz to build from those two audiences, who each bring different perspectives. If the buzz is positive and loud enough, it might convince someone who is waiting for the paperback to go out and buy the hardcover.

***

By day, Matt Moore is a project manager and communication specialist in the information technology field. By night, he is a science fiction and horror writer with work in On Spec and Tesseracts Thirteen and an upcoming e-book published by Damnation Books. By later at night, he is the marketing director for ChiZine Publications, a small Canadian publisher. Raised in small-town New England, a place rich with legends and ghost stories, he lives in Ottawa, Ontario. He blogs at mattmoorewrites.wordpress.com.

Silverman's Game

By Matt Moore

When a prank goes wrong, three teenage boys are locked in the basement of a remote house by a man they know only as "Silverman". Given a gun...more When a prank goes wrong, three teenage boys are locked in the basement of a remote house by a man they know only as "Silverman". Given a gun loaded with one bullet, their captor instructs them to play a game: Before the next morning, one of them must choose which of the other two will shoot and kill the third. Play the game and the two survivors can go free. If they don't, all of them will die. As morning approaches and hope of being found and rescued fades, each boy must decide if he'll work with the others to try to escape and risk being killed, or save himself by playing Silverman's Game.

E-books: I resisted. Oh, how I resisted

By Ryan McFadden

 I resisted.  Oh yes, I resisted.  I didn't want to pay for a device just so I could do something that I already do.  It just didn't make sense.  Then, gradually, I started discovering how lazy I truly am.  You mean, I have to go out of the house, and go to a store, where they may, or may not, have that one copy of Knitting with Dog Hair book?

 It started simply enough: I had the Kindle app on my computer because I didn't want to wait for Amazon to ship me said Knitting with Dog Hair, so I ordered it instantly and had it delivered to my computer.  For a decent price without paying for that pesky shipping fee.  Interesting. But I couldn’t take my laptop to bed with me, could I? (Okay, full disclosure – I tried.) Then I got an iPhone.  Wow, I can have all my books with me all the time!  I can read in the bank line.  I can read when waiting at a red light (joking . . . I do this at all coloured lights, not just red).  I can read while you’re trying to talk to me.  “Yup, uh huh, yeah, interesting, yeah, genocide, yup, frogs . . . wonderful.”

But, that iPhone was frying my eyeballs.  When I was traveling recently, the glare on the screen (I mention traveling because it’s more difficult to control the environment), combined with the refresh rate (the amount of times, in a second, that the screen refreshes) made for a killer headache.

Then the e-book manufacturers started having a little price war and brought the price of their readers to a decent level.  What timing!  So I bought a Kindle from Amazon.  The Kindle has several cool features: it's e-ink (no refresh rate . . . so you're actually seeing a static image), search capabilities (can't remember where that character first appeared: use this), built-in dictionary (just move the cursor and it'll give you a definition at the bottom of the screen), it's wireless (so you can download and sync books anywhere), the battery lasts a week (not quite accurate), and adjustable font size.

If I had my way, I'd never buy a physical book again.  I know, I know, you like the smell of a book.  You know what?  That's mold.  Or chemicals, or bleach.  It’s not good for you.  I joke, actually, because I’m not a good one to argue about the tactile experience of books -- because I trash them, give them away, or junk them.  I have a good friend who has stacks of books with perfect spines -- as if they've never been read at all.  He delicately peers between the covers, turning the pages like this is a medieval manuscript.  My books are tattered, dog-eared, sauce-stained, and bloated from where they were dropped in water.  In other words -- I've never worshiped at the temple of the physical book.  It's just the delivery vehicle (and yes, with an expensive e-reader, I now have to treat it with respect).

Then there's the cost of books.  Simply put -- I don't care about the cost of physical books anymore.  I like that e-books are all $10.  I don't care whether it's available as a paperback or a hardcover and that it may or may not be more expensive.  I am purchasing a different product and I’m simply not concerned about it.  Like comparing a DVD, to a BluRay, to going to the theatre.  Each price doesn’t affect how I view the other forms.  $10?  I don't even think about $10.  It's an easy price.  It's a good price. It's disposable. And I don’t even have to leave my house to buy it. Will $6, or $5, or $9.50 cause me to buy more?  No.  I think the price has been set.  $10.  Done.

Now, there are down sides.  I can’t lend books (I believe the Nook, you can). Sure, no one makes money for lent books, but I don't know how many writers I've hooked my family and friends with because they read the first one that I lent them.  As an aside, Rob Sawyer made a good comment this past weekend: for $10, you don’t need to lend it.  Give it to them.

Is the e-book going to create business?  I don’t believe so.  But publishers will lose business if they don’t support it.  How am I so sure?  Because I’ve already skipped buying books because they don’t have them in e-format – and I’m not going to mention any names.

Small publishers should be front and centre in jumping on the bandwagon.  Generally speaking, it’s more difficult to get books from small presses – that whole pesky distribution thing.  Make it readily available so I don’t have to pay shipping for your books.  Don’t make me work to get a book from you (remember, I’m lazy).

The book is an interesting format.  While I’m hardly an expert at the history of the book (and I’m sure our friendly moderator Helen Marshall, who is an expert in this field, will slap me down ruthlessly if I’m wrong) but the book has not changed in centuries.  Compare that to music (people still claim that vinyl is better) and moving pictures (I’m still dead set against 3D).  Now, for the first time in centuries, along comes a change in the book format.  It’s worked for so long; why change now?  Because it’s better, that’s why.

This is a big issue.  I haven’t even touched on the role of publishers in all of this.  And marketing.  And even bookstores.  I’ll let someone else tackle that issue on a different day.

E-books are not going away.  Are they going to replace physical books?  Too early to say.  But don’t panic, fair book lover!  I’m sure there’ll always be a place for your leather-bound novel on the shelf.  And while you’re getting ready to settle for a night of pleasant reading with your physical book, don’t forget to spin up that phonograph so you can listen to all the hits of the 1920s.  Ah, the good ole days.

***

Ryan McFadden is an Aurora-award winning fantasy/SF author in London, Ontario.  His novella "Deus Ex Machina" was one of the four Aurora-winning stories of Women of the Apocalypse. The Apocalyptic Four are planning our next project, The Puzzle Box is under consideration by Edge Science Fiction and Fantasy.  Other writing credits include stories in Alienskin, Chicago Overcoat, Afterburn SF, Sinister Tales, as well as a finalist in the $1500 JFJK contest.

Women of the Apocalypse by Eileen Bell, Roxanne Felix, Billie Milholland, and Ryan McFadden

Four women. Four shooters. Four destinies to save the world…

The Four Horsemen of the Apocalypse are coming. And four Archangels find the perfect champions to save the world: fighters, warriors, soldiers, and brave men, all ready to fight for humanity against end times. All they have to do is drink a shooter — a caustic mix of alcohol and divinity that will imbue them with the conviction to battle the Four.