image-thumb174[1] Why are publishers so lousy at building the close relationships with consumers that they’re going to need in the coming digital age? Publishing consultant Mike Shatzkin suggests that part of the reason might be that their biggest retail customers, perhaps fearful of getting cut out of the loop, don’t want them to.

This is the kind of thing you don’t know for sure from the outside. Conversations between publishers and their top accounts, like conversations between publishers and the agents for their top authors, are private and closely guarded. But it has been anecdotally reported in the past that Barnes & Noble is not happy if publishers sell to consumers. And I’ve also heard that Amazon has told publishers that if they charge any price lower than the suggested retail in a direct sale, Amazon will consider that lower price to be the basis of their discounts, not the suggested retail.

This is probably why more publishers don’t try to sell e-books direct to consumers—their biggest customers will retaliate if they try it.

Shatzkin points out that just about everybody else is trying to form those relationships—authors, retailers, celebrities who might become authors. Publishers with consumer relationships, Shatzkin notes, will be publishers with bigger promotional mailing lists, and hence more effective at marketing. But it’s hard to build those relationships with consumers if you’re not directly selling to consumers. (This is one area where SF/fantasy press Baen really shines.)

And those retailers who are the publishing industry’s aforementioned biggest customers are starting to blur the lines between retailer and publisher, with self-publishing programs such as Author Solutions and PubIt.

Amazon has such a large share of the online print and ebook businesses that, with the publisher disintermediated and the author able to take a much larger share, they can credibly make the argument that a branded author — or one that otherwise does her own promotion and marketing — can make as much money through them alone as through a publisher serving the entire market.

The relationships between publishers, distributors, retailers, and consumers are starting to change in interesting ways. Who knows what the landscape will look like five years from now?

3 COMMENTS

  1. Great point.

    If you look at the value chain of traditional publishing, the distributor has always been the link to the reader not the publisher.

    This doesn’t really matter if the publisher stays connected to the reader. This hasn’t happened, and the publisher seems more interested in putting barriers between the author and reader than creating channels.

    I’m sure at some point publishers will ‘get’ it, but I don’t know that it will happen fast enough for some of the big houses.

  2. An interesting take on relationships between the parties in the publishing chain.

    But I don’t buy the theory for a minute. The major restrictive issues that Shatzkin discusses are price based. I see absolutely no restriction on them developing a relationship with the reader. Indeed I suspect this is being used as an excuse. Publishers have never cared about the reader in the past and they are finding it exceedingly difficult to care now. You only have to read the article above on Teleread from the Publishers Association where they say:
    “Undermining territoriality goes against our copyright law and against the terms of the contract the UK publisher has with the author. Everybody loses out.”

    Their use of the term “everybody” is extremely interesting here and illustrates how they think.

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