Can Schiffer's Minimum Advertised Pricing Solve Publishers', Authors' and Retailers' Woes?
Out in the bucolic countryside of Southeastern Pennsylvania—where Chester and Lancaster counties meet, and the main distinguishing factor between the rolling pastures and cropland is whether they’re farmed by tractors or the Amish—Schiffer Publishing (schifferbooks.com) has been putting out books across a fantastic array of categories for 37 years. The company was started by Publisher Pete Schiffer’s parents—his father was an antiques dealer, his mother an art historian—as a way to provide more value and information for their customers. In the intervening decades, Schiffer has published some 4,500 titles on everything from art and architecture to ghosts and the paranormal.
A respect for value—of content, of books, of authorship—has been at the heart of the publishing house’s ideals. It's the driving force behind the company’s Schiffer LTD imprint, notable for a minimum advertised pricing (MAP) policy that stipulates the imprint's books will only be distributed to outlets who do not advertise the products below a publisher-set minimum price. In the store, the seller can sell the book for any price, but if Schiffer LTD finds that the title has been advertised below the MAP, it will no longer distribute to that seller. The policy may seem as idyllic as Schiffer's pastoral setting, but it's one that's got a history in other industries.
Book Business Extra caught up with Pete Schiffer, who was on his way to the airport en route to the Frankfurt Book Fair, to discuss the policy that the company thinks is the “wave of the future” for publishing.
Book Business Extra: So how has minimum advertised pricing been working for Schiffer LTD?
Pete Schiffer: We launched three titles (two and a half years ago)—[using the MAP policy]—that we created ourselves internally. We don’t want to try something new with an authored work; we don’t think that that is in everybody’s best interests to test something with the passion and the devotion of somebody who has invested the time in creating a book. We created three books, and we had success with it. So we’ve opened it up to our authors. Over the last two seasons we’ve published more than 45 additional books. They’re doing well. We created the imprint for the authors who were asking for another solution from the normal paradigm of how books are being sold in the current marketplace.
Extra: Where did you get the idea?
Schiffer: We saw that minimum advertised pricing policies are something that are very standard in other industries. And they’re actually standard in the book publishing industry in other countries, but they haven’t been adapted, to our knowledge, any time before this in the [U.S.] book publishing world.
Extra: What conditions in the market led you to test this policy?
Schiffer: It’s not really specific market conditions, but the way that people look at books and the way people are thinking about books. We think that books have a high value, and keeping the integrity of the book high is essential for keeping the longevity of books and the overall value. If you create these beautiful, high-end, well-put-together books and if you price them properly, then everybody in the market, from the publisher, the author, the book reseller to the customer, are all treated fairly.
We see that a lot of the massive discounting that is involved in the current book publishing and book sales marketplace is truly a race to the bottom. Everybody’s trying to cut cost, but they’re also cutting the quality out and they’re cutting the longevity of the industry in its current form.
Extra: Can you share any results?
Schiffer: Our customers are very happy; our authors are very happy with it. We have many major museums, many major bookstores, independent or otherwise, that have signed the policy form and are adhering to the policy terms. It’s been a very positive thing for us so far. We don’t put all of our books into this imprint. We publish about 300 new books a year, so it’s only a small selection of titles that really fit this type of model in the current world.
Extra: How do you determine which books do fit the model? Are there any guidelines or rules of thumb you use in determining the price of the book?
Schiffer: It’s a conversation with our authors. We publish in many different areas, so it really is there to serve a specific purpose for a specific direction that the author intends for the book. For many of our authors, the books are their babies—it’s a labor of love—and it hurts them when they see their books are being discounted so heavily. And it hurts the perceived value of their work. As a publisher, we want to make sure that our authors’ work is being properly represented.
We don’t have a specific criteria that the book has to meet certain standards to be a part of it, or certain exclusions. It’s something that’s handled on a case-by-case basis.
Extra: Have you lost any distributors as a result?
Schiffer: We haven’t lost any distributors, but there are several who are not participating, so they are open to any of our other nearly 4,500 titles that we have in print, but the LTD titles would just not be open to them. But I don’t know of any of our customers or trading partners who have gone a separate way from us because of the creation of this imprint. There are several that believe in it and are participating in it and find it to be a very positive thing, because it allows them to choose what their final sales price is, and not compete in an unequal world of advertising. This policy has only to do with the advertising. It has nothing to do with the final sales price of the book.
In my “prior life” I owned a few bicycle stores, and there’s a company called Mavic that has a similar policy, and it was something that really helped me see the integrity of their product. And it helped me know that they were behind me. That is a very comforting thing, and it helped me sell much more of their bicycle wheels. Many other industries have this MAP pricing policy, where you can’t advertise it below a certain price, but when you get into the store or when you’re sitting down across the table from somebody, you can then decide what that final price is. And it allows that individual or that company who is selling it to determine what their margin is going to be. And we think it’s an important thing to let the customer decide what that is, and to have an equal competitive advantage with anybody else.
Extra: Does letting the bookseller set its own margin affect Schiffer's margin?
Schiffer: [Schiffer] and [Schiffer LTD] books are sold under the same terms. There is no difference if it is a normal Schiffer title or a Schiffer LTD title. The imprint was created solely for the protection of our customers. The upside is the benefit it offers to our customer.