A Peephole into the Wonderful World of Publishing

July 28th, 2007

The Business section of today’s New York Times has a fascinating piece on the economics of selling Harry Potter. Not publishing, mind, but selling. Think Barnes and Noble and Borders and Amazon made a killing? Not so much: between deep discounts, giveaways, parties, free shipping, etc., most of the major sellers are out of pocket on the season’s Biggest Book. Why would they do that? Goodwill, in part (that’s yours, the buyer’s). Competitive edge (note that Wal*mart is selling the book $.30 cheaper than Costco… I personally would pay an extra dollar to avoid Wal*mart, but that’s just me) and staying in the game. Getting people in the door, where they may buy more books–building a pattern, essentially, of book buying. Amazon, in particular, gets your email address and data, and gets to market less discounted books in the future.

Nothing in this industry is simple; half of the industry is working on a model from a hundred years ago; the other half appears to be pelting down the long hallway toward the future (electronic rights! POD! podcasts!). It’s just kind of illuminating.

7 Responses to “A Peephole into the Wonderful World of Publishing”

  1. David Louis Edelmanon 28 Jul 2007 at 9:41 pm

    Personally, when I stood in line at my local B&N last Saturday morning for my copy of Deathly Hallows, I also took the occasion to buy a $40 programming book that I’ve been putting off buying for weeks. And it seemed like at least half of the people in line with me had other books in their stacks too. Undoubtedly few of those people would have been at a B&N at 9:30 in the morning without Harry.

  2. Lois Tiltonon 28 Jul 2007 at 11:39 pm

    “We lose money on every copy we sell, but we make it up in volume!”

  3. Kevin Andrew Murphyon 29 Jul 2007 at 12:00 am

    I actually did the “patronize your local independent booksellers” business by going to the Bookshop Santa Cruz, but that was also because my sister and her family had trecked all the way down from Truckee for a visit and wanted to go to a big opening.

    The Bookshop Santa Cruz did something hard to do: Have a shop more crowded than the main hall at Comicon. And lines around the block.

    However, my niece and nepphew had fun, dressed as Moaning Myrtle and a Dementor, and even my sister got some horrific pink clothes at a thrift store and came as Dolores Umbridge. And Shakespeare Santa Cruz did some fun stuff with setting up a fireplace with Sirius Black’s head in the flames for kids to talk to.

    Of course, my copy was $7 more than it would have been via Amazon. But a reasonable price for some entertainment.

  4. Madeleine Robinson 29 Jul 2007 at 2:40 am

    My family did the Potterwatch at Borders. Sarcasm Girl dressed as Bellatrix LeStrange; I was Delores Jane Umbridge (and was roundly hissed). It was all grand. But Borders not only sold the book at a 40% discount but handed out a poster of the cover art to everyone who picked up the book on that opening night. Granted, the poster probably only added a few cents to the price of the book, but all that hoopla wasn’t cheap–at the very least they were paying for extra security and lots of staff working very unorthodox hours indeed. Plus, we got a 20% off coupon for our next purchase.

  5. Katharine Kerron 29 Jul 2007 at 3:20 am

    I think that’s called a “loss leader” in other kinds of marketing, like food stores. Its goal is indeed to get people into the store in hopes they’ll come back for other stuff.

  6. Leon Staufferon 29 Jul 2007 at 5:05 am

    Yup. All sorts of retail industries use it. For an odd example, most convenience stores/gas stations make very little money on gasoline (the big cut goes to the refiners, producers and the government), the profit is in inside sales. Coffee is a heck of a lot more profitable than gas, and people don’t scream abuse at you while they buy it (normally, anyhow).

  7. Katharine Kerron 30 Jul 2007 at 3:07 pm

    people don’t scream abuse at you while they buy it (normally, anyhow).

    Unless they’ve drunk too much of it. :-)

    Kit

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