from publishing books to publishing portfolio; lessons from amazon
TRANSCRIPT
Getting from Publishing Books to a Portfolio; Lessons
from
Hermann BussGEA Consultancy bv
219 september 2013
Bookpublishers feel being attacked
319 september 2013
The market movesconstantly
419 september 2013
Cowboys seem to take over
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What used to work doesn’t anymore
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Publishing is in
Transition
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TRANSITIONto what...?
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Mi
What could you do
?
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Look at Developments
1
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Mi
Is there something to learn
from online playerslike....
maybe
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Amazon is a giant...
- Started in 1994- in Seattle, USA
- 91.300 employees
- (april 2013)
- Turnover $ 91miljard
- growth 29% p.j.
- range of products (in ca. 16 categories)
- Worlwide logistics network
- Marketleader online sales
!
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MAAR MET EEN VISIE
BUT WITHa
VISION
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Jeff Bezos wanted to combine old economy with a concept
without being bothered by fysical retail:
the internet
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HOW?
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1. Large Selectio
n
Digital gives endless choice and inventory
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2. Ease of Use
Digital boosts customerfriendly solutions
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3. Lowest Price
Digital allows high margin and lowest prices
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1. Large Selectio
n
2. Ease of Use
3. Lowest Price
It yields an Effective Strategy
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MAAR MET EEN VISIE
COMPETITIONThe Digital Engine is the perfect way to gain advantage over the
competition
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MAAR MET EEN VISIE
INNOVATION
Amazon uses 6% of its turnover for Research&Development;;Dutch Bookpublishers do less than 0,5%
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MAAR MET EEN VISIE
VALUE CREATION
New Competitors in Publishing build up REACH first; Relevant
Content Comes in Later.
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MAAR MET EEN VISIE
Value Creation
Amazon accelarates its Reach by Smart Cooperations and
Acquisitions
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ACQUISITIONS SINCE 1998.....
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Little A
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...WITH A PURPOSE
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datamining
online boekretailer
online boekretailer
reminder service
usedboeken
online financial. transactions
online webanalyses
rareboeken
social community boeken
gebruikteboeken
Little A
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...WITH A PURPOSE
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social community boeken
Little A
Online Reach &Technology
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...WITH A PURPOSE
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Online Reach &Technology
selfpublishingplatform
e-books mobileprint on on demand
social community books
Audio books
social community books
used books
search environment
authorfansite
social community books
Little A
Audio books
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...WITH A PURPOSE
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Online Reach &Technology
social community boeken
Little A
Self Publishing
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...WITH A PURPOSE
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Online Reach &Technology Self Publishing
succesful out of print & selfpublishers
translationsin Englishs
Romance
thrillers, mysteries
scifi, horro, fantasy
romance,Mysteries
DistributionAgreement
liteary fiction,memoires
comics
Children’s books and Young adults
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...WITH A PURPOSE
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Online Reach &Technology Self Publishing
PUBLISHER
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...WITH A PURPOSE
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Online bereikTechnologie Self Publishing
PUBLISHER
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MAAR MET EEN VISIE
LESSONS
There are three things we can learn from Amazon
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1. Aim for getting Reach
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- FOCUS on a number of markets and genres and realise therein the biggest and deepest offer (catching up Amazon in all its breadth is out of your reach anayway)
- LEARN to know all your customers in these markets an realiase relevant Reach with them.
- MAKE as much as possible interesting products for them (do it together in cooperation with others or via takeovers)
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2. Realise ease of use for your customer in everything you do
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- One click away design- Ease of ordering- Ease of searching- Ease of marketing- A low price, not necessarily the lowest- Serve customers with products the customer
perceives as helpful
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- plan nieuwe dingen- maak ze af en test ze snel- stop er mee als het niets blijkt te zijn- investeer iets minder en ga partnerships aan met partijen die
andere competenties hebben dan jij.
3. Innovate and Invest
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- Plan new things- Finish them and test them fast- Stop if it doesn’t work, kill our babies- Invest in partnerships with parties that have
competencies you don’t have.
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What’s happening between Publishers and New Entrants
high
low
low highCRITICAL MASS/REACH
RELEVANCE
neededposition
!
route via content:publishers in transition from print to digital/online/hybrid
route via media-equipment, network or distribution channel:e.g. Apple, Google, Amazon
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Wie neemt welke rol en positie tegen welke prijs?
high
low
low highCRITICAL MASS/REACH
RELEVANCE
crossubsidises
media and channel
crossubsidises
content
Added Value fromcontent
Added Value frommedia and channel
neededposition
!
What’s happening between Publishers and New Entrants
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Get big, get niche or get out!
high
low
low highCRITICAL MASS/REACH
RELEVANCE
neededposition
!nr. 1 and 2players
small nicheplayers
selfpublishers
specialist publishers,science publishers
new entrantsnr. 3, 4 and 5players
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Look atThose Who Use Your
Products
2
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Who Are My Customers
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What do they consider important
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Make a distinction between products for Endusers and other Actors
An Actor doesn’t use the publishing product but is part
of your businessmodel e.g.
Authors, advertisers,
distributors etc.
An Enduser actually USES your publishing product
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Get to Know your Customers by gathering
Data about them
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Look what their (hidden) motives may look like
Empathy map by Xplane.com
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SEGMENT AND PROFILE
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1. Example of an Internetsegmentation
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Demographic
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Psycho Graphic,Benefits,
etc.
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Persona
marketing strategyproduct strategy
innovations
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2. Example Dutch Public Media
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3. Example Dutch Mentality Milieus
Source: Motivaction
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4. Example Australia
Ref: ‘Books Alive, Reader Research’, prepared by Starcom for Australia Council for the Arts, 2008.
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You get to know your Customer and Her/His Problems/Needs/Benefits
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Look at the Portfolio You Offer Them...
3
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Analyse your
portfolio and your
competition
with the GE
matrix
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Selfpositioning publisherGE-matrix
high
low
high lowRELATIVE COMPETITIVE POSITION
MA
RK
ET
AT
TR
AC
TIV
EN
ES
S
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Used Criteria
- market volume- yearly growth of the market- average profit margin- added value to primary process- possibility to innovate and differentiate- market cyclicity- intensity and diversity of competition- impact on customer environment- influence of political environment.
-marketshare-growth marketshare-image/reputation-market knowledge-commercial power-product costprice-efficiency production-logistical performance-product quality-technological knowhow..
MARKET ATTRACTIVENESS RELATIVE COMPETITIVE POSITION
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EXAMPLE
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Resulting Basic StrategiesGE-matrix
FTE Middelen5% 15% Voorschotten,
royalties etc. 50% 35% product
ontwikkeling 20% 25% promotie
20% 20% sales
5% 5% klantrelatie
high
low
high lowRELATIVE COMPETITIVE POISTION
MA
RK
ET
AT
TR
AC
TIV
EN
ES
S
Selectief / managen op inkomsten- bescherm bestaande programma- concentreer investeringen in segmenten waar winstgevendheid goed is en de risico’s relatief beperkt zijn
Manage op inkomsten- bescherm positie in meest aantrekkelijke segmenten- waardeer productenlijn op- minimaliseer investeringen
Terugtrekken- verkoop op tijdstip waarop de waarde maximaal is- snij in vaste kosten- niet meer investeren
Vasthouden positie- investeer in maximaal haalbare groei- concentreer inspanning op handhaven sterkten
Selectief uitbouwen- specialiseer rondom de (beperkte) sterkten- zoek naar wegen op zwakten te compenseren en om te buigen- terugtrekken als er geen indicaties zijn voor aanzienlijke groei
Selectief uitbouwen- investeer zwaar in meest aantrekkelijke segmenten- bouw vaardigheden op om de concurrentie aan te kunnen- benadruk rentabiliteit door kostenreductie en productiviteit
Beperkte expansie of oogsten- zoek naar mogelijkheden (met beperkte middelen) voor expansie- of: minimaliseer investeringen en rationaliseer operatie
Bescherm en heroriënteer- manage gericht op huidige inkomsten- concentreer op meest aantrekkelijke segmenten- verdedig sterkten
Investeer om uit te bouwen- ga voor marktleiderschap- bouw selectief op sterkten- verstevig kwetsbare gebieden
aantrekkelijkheid
protect expand
rationalise
exit
withdraw
new initiatives
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Make Strategic Choices forInvestment and Innovationby using the GE matrix
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Analyse the RISK of running away of
your Authors during Transition
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Authorimage, Turnover and Risk of running away have impact
Authorimage
Risk
of r
unni
ng a
way
0
0
5
0,2
0,4
0,6
0,8
1,0
1 2 3 4
Authorimage
Risk
of r
unni
ng a
way
0
0
5
0,2
0,4
0,6
0,8
1,0
1 2 3 4
DANGERLet Go
Not important
Question Mark
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Use other ways to
determine interesting innovations for your
product portfolio
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Place your products and development in another context...
PublishingPortfolioTM
QuestionProblemNeed
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PublishingPortfolioTM
Place your products and development in another context...
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..it delivers new insights..
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Product Connect
BE
LE
VIN
GK
EN
NIS
VE
R
ST
RO
OIIN
G
- Offline
-
- Online
- Offline Boeken, ebooks
-
- Online Boekenapps
Social Transact
• leesclub
• community• leestweets
in app bestelmogelijkheid
- Event- Crime-beurs- Game, video’s- Films
..or unexplored places..
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Make the Unthinkable Thinkable
4
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MAAR MET EEN VISIE
CONSIDER:
what would I do if I would invest 6% of my turnover in
innovations ?
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Do I have... CompetenciesCapacityProcesses...
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MAAR MET EEN VISIE
ALSO CONSIDER:
what would I do if Amazon would enter my publishing area ?
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Of als deze jongenshetzelfde doen?
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...Het begint er al op te lijken...
Online bereikTechnologie Self Publishing
UITGEVER?
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1. Grote Selecti
e
2. Gemak
3. Lage Prijzen
They Look For This
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Be Wiser and Smarter
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MAAR MET EEN VISIE
1Look at Developments
2
3
4
Look at Those that Use Your Products
Look at the Portfolio You Offer Them
Make the Unthinkable Thinkable
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Thank You!
Sources- Rosales et al.,Amazon business models,
Heriot Watt University, Oct 2010- Guy Kawasaki, APE, Author Publisher
Entrepreneur, Nov. 2012- Stéphane Distinguin, Amazon.com: the
Hidden Empire, faberNovel, May 2011.- McKinsey&Co, Amazon’s secret sauce,
CMSOForum, Oct 2012- Bill Slawski, Amazon Acquisitions and
Investments, SEObythesea.com, Jul 2009- Wikipedia.org- Illustrations: Microsoft Office Online;
Slideshare
[email protected]: +31(0)6 53 841 935
This is a translated presentation held in Dutch for the NUV (Dutch Publishers Association 19/9/2013)
Inspiration- Andre Knol, GEA- Guy Kawasaki- Alexander Osterwalder