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New Amazon app changes the game for publishers – or the book trade?

October 13, 2010

Recent developments by Amazon to allow people to scan bar codes, compare prices and instantly order take the Amazon brand into new territory. Their new iPhone app turns them into the comparison site that serves the world, inviting people to compare the prices they see in the shops with Amazon’s prices for the same products. And it’s easy to use.

For publishers who use Amazon as an element of their marketing mix – and many of them (if not most or all) do – this represents another challenge. If someone comes across a book they like and then scan the bar-code, they can comparison shop and, most likely, choose to order from Amazon.

This is a mixed blessing. It means more books sell but potentially at a lower price. For publishers selling to Amazon at a fixed price, this probably will have limited impact. However, in potentially pushing the price of books down, it puts ownership of perceived value in the hands of Amazon (where value is defined by them as lower price), and puts pressure on an already weary book trade.

Of course, in the name of trade, customer value and competition, we should laud this. Why shouldn’t Amazon be successful at this? Customers know Amazon’s brand. They know their service. They know their pricing. In fact, Amazon is a publishing brand with probably greater recognition than many of the publishers they serve. They have become the eponymous brand of the publishing world: “doing an Amazon” is short-hand for building the ultimate customer service centred website.

Amazon have taught publishers and book shops a big lesson in recent years: if you don’t care about your brand, your value pitch or your customer service then we do. And if we’re good at it and you’re not, then tough. Now, by stealth, Amazon is owning not just the customer service high ground but also the brand perception ground too.

Of course, publishers will enjoy the benefits of this latest initiative in that it may increase the size of their sales through Amazon but, as we know, for any business to survive it requires a relationship with its end users. If, ultimately, Amazon owns the customer relationship, what can publishers do to engender loyalty? What personality does a publisher have which will attract readers back?

With the growth of e-books, e-commerce mega sites, self-publishing and social media, branding and brand perception has never been so important to publishers. Yet few understand its relevance or have strategies to develop their brands. I would posit that few even care about “brand”, often seeing it as a waste of good money.

But, in the coming years, brand strategy will become a core element of publishers’ efforts to stay relevant in a world increasingly dominated by more savvy, more commercial and more responsive third parties. Those companies which ignore this will find themselves cannon fodder as customers go from shop to shop comparison shopping their way to great savings at the expense of substantial value.

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