Guest Column: What We Should Learn From Amazon
Last year, Amazon’s 10-K filing with the U.S. Securities and Exchange Commission listed publishers as its competitors in addition to bookstores and others—which started a flurry of chatter in the industry concerning the threat the online retailer poses to publishers in general. The nervous types worry that Amazon will eventually remove the need for middlemen like agents, distributors and even traditional publishers, as they create a one-on-one author/reader experience and purchasing system.
Fast forward to May of this year, when Amazon announced AmazonEncore, a program the company says “will use information such as customer reviews on Amazon.com to identify exceptional, overlooked books and authors with more potential than their sales may indicate.” Amazon buys the rights to these selections and intends to push them not only on its site, but also through traditional retail channels. The chatter became louder as people tried to sort out exactly what net effect Amazon’s move would have on publishing as we know it.
Despite the long-standing speculation that Amazon would move into direct competition with publishers, and the discomfort expressed by so many at the announcement of the AmazonEncore program, it’s not uncommon for a retailer in any industry to produce its own product. (Sterling Publishing is a wholly owned subsidiary of Barnes and Noble, for instance.) And while Amazon’s position of power in e-tailing is undebatable, the move to make AmazonEncore titles available to retail is a nod to the greater market share of the brick-and-mortar channels. It’s far too early for Amazon to do anything to alienate traditional publishers (its biggest suppliers of book content); rather than seeing AmazonEncore as an ominous strike against the current acquisition and distribution process, book industry players should take the opportunity to learn from one of the smartest players in the field.
It’s not surprising that our industry’s knee-jerk reactions to these developments are fear and resistance to change. This year’s BookExpo America CEO panels showed that fear of free books was the primary (if not misguided) concern of big publishers. The focus on fear instead of opportunity is all too common in this industry. The reality is that Amazon should be commended for forcing publishers to take a closer look at how talent is discovered. The model currently in place in traditional publishing—which puts content discovery in the hands of a select few agents and editors—becomes less and less viable as the volume of new titles continues to explode.
AmazonEncore moves toward democratizing acquisitions, much like HarperCollins’ Authonomy, which lets enthusiastic readers do the legwork of finding the diamonds in the rough and gives aspiring writers a chance to have their work read and possibly published.
Amazon has access to market research that provides invaluable data on customer buying habits, trends and growing markets, and is best positioned to uncover hidden gems. The end result is the publication of books with strong demand indicators behind them. If Amazon can use its customer data to issue the books its customers want, not only through its site, but through traditional retail channels as well, why on Earth would we fight those sales? Do publishers really want to retain their position as the ultimate curators at the expense of overlooking what the reading (and buying) public has to say about what they want to see published?
More sales create a healthier industry and happy readers. And Amazon has the unique opportunity to create new potential readers by target marketing to the segment of its customer base made up of loyal, but non-voracious readers. There’s nothing we need more. Rather than fight it, you’ll see smart publishers following Amazon’s lead into genres and topics that otherwise might have been ignored.
The publishing industry is the first to admit that its business is broken. We should be learning from and supporting Amazon in its bid to shake things up a bit. Remember that Darwin’s “survival of the fittest” isn’t about being the smartest or the strongest; it’s about being the most adaptable to change. Amazon, unlike traditional publishers, has remained nimble and committed to meeting the needs of its customers. If it turns out that Amazon fails indie publishers and readers, the free market will run its course and alternatives will surface.
Right now—before we know Amazon’s terms, how many titles it plans to publish per year, or whether it will draw big-name authors away from traditional publishers—the industry’s time is best spent developing a long-term strategy for using new technological tools (whether it’s crowdsourcing, capitalizing on print-on-demand, or finding places to meaningfully interact with readers) and finding a way to adapt to the new user-centric paradigm.
Clint Greenleaf is the founder and CEO of Greenleaf Book Group (GreenleafBookGroup.com), an Inc. 500 company, and a leading publisher and distributor with several New York Times and Wall Street Journal best sellers. Greenleaf (a CPA) sits on the University of Texas Libraries Board, blogs for Inc.com, and has been featured in the Wall Street Journal, Inc. magazine, Fox News, MSNBC and Entrepreneur. He speaks about publishing and entrepreneurship across the country at conferences, seminars and schools.