Our recent post on bundling of print and e-books (see Bundling – Publishing’s Next Battleground) set off a thread of interesting and provocative responses.  One that we found particularly cogent was written by Joe Esposito, CEO of GiantChair.  He addresses the question of why bundling is so hard. He also suggests some viable solutions. We reproduce his post here in its entirety, with thanks to Mr. Esposito for hitting a lot of nails on the head.

RC

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To bundle you need: a direct relationship with the consumer, clearance of IP issues with authors, an ISTC-ready platform (so multiple ISBNs can be grouped together on one page), ecommerce capability (shopping cart, etc.), links for fulfillment (for both e
and p), and a marketing or merchandising strategy.

A bookseller (e.g., Amazon) has a direct relationship with the consumer, but typically does not have IP clearance with authors, which makes bundled pricing difficult. A publisher that wishes to sell direct has the relationship with the author, but typically has only weak connections to consumers. This is why bundling is hard: the necessary components are rarely found in any one organization.

Part of the reason to bundle is that creates unique SKUs [stock-keeping units, sort of unique identifiers for bundled products]. In the U.S. publishers’ direct marketing is limited in part because of discounting on widely available SKUs. Thus a publisher may try to sell a book in print from its Web site for $20 and a PDF for $16, but Amazon may sell a Kindle edition for $9.95. Thus consumers who go to the publisher’s
Web site “bounce” to Amazon or B&N.

A unique SKU, however, reduces the bounce rate. Get the print and the PDF for $20 — and you can’t get this combination anywhere else.

Of course, a publisher could also try to undersell Amazon for a standalone e or p book, but that is an assault on the entire retail supply chain. I do not advocate discounting by publishers when they sell direct.

Our experience with e and p combinations with our clients has been very positive. I am amazed by the proportion of PDF sales we get, with out without the print bundle. The bundles sell better than any one format.

Why do people want the PDF (or it could be ePub or MP3 audio, etc.) if they already have the print? It depends on the type of book and the individual consumer. For intellectually serious books, people appreciate the search capability (and tiny storage requirements).

Outside our company’s own experience, there is the interesting capability of all the ebook vendors, which keep the book in an online account indefinitely. That is an interesting feature. So, for example, I read The Da Vinci Code in print and then gave it away. I will never look at that again. But I am reading Wolf Hall now, a truly serious book. I may want to refer to that again sometime. Having a cloud-based version is attractive for that reason.

I think we will see a great deal of uptake for the bundled Google Editions, especially when they are sold directly by publishers. It is an entirely new marketing paradigm and should be watched closely.

Joe Esposito