Strategically Speaking: Surviving Volatility
● Looking at perhaps the most striking statistic of all—that unit e-book sales closed calendar year 2010 at a staggering 114 million units—can anyone still think that e-books are a passing fad?
Educational and Professional Markets
The study findings for the less glamorous, but usually more profitable education and professional sectors are, for the most part, considerably rosier than they are for trade:
● Higher-education delivered a 23.1-percent increase in net sales over the three year study period—closing 2010 at $4.55 billion. This is extraordinary growth by any yardstick and confirms the industry maxim that higher-education publishing is counter cyclical—with sales rising the tougher the economy gets.
● Professional publishing net revenues grew by 6.3 percent during the study period. Revenue for 2010 closed at a respectable $3.75 billion.
● Perhaps more encouraging was the corresponding increase in unit sales of 6.3 percent between 2008 and 2010 to 171 million units.
● On the downside, the study paints a more depressing picture for the elementary-high school (el-hi) marketplace with sales declining 6.2 percent during the three-year period, although dropping to a still-respectable $5.5 billion.
Several interesting developments have been shown on the distribution-channel front, and a few findings will come as a surprise:
● Net revenue generated by sales to retail chains closed 2010 at just over $3 billion.
● Publishers' net sales revenue to brick-and-mortar retail chains saw a decline of 2.7 percent over the study period.
● Net sales by publishers to online channels closed 2010 at $2.8 billion—a three-year increase of 55.2 percent.
● The unit sales gains to the online channel have been even more significant, soaring 68.6 percent over the course of the study to 276 million units in 2010.