Thursday, September 17, 2009

The Digital Revolution, Part 2

The publishing industry is of course notoriously technophobic and slowww.  It's being dragged into this revolution only because its fingernails are not strong enough to anchor it to the well-worn floorboards.  With all the good news about a smarter compensation model and faster idea-to-paycheck lifecycles and whatnot, it's still terrified that the big online retailers will eat the launch profits, piracy will eat everything after that, and the publisher will never get paid for their investment.  Yes, I oversimplify, but if you want details you won't have to google hard to find them.

Frankly, I'm not going to argue with these fears; they are legitimate - for the short term.  Restructuring, getting into the direct sales business, and keeping on top of the current technical formats is very hard.

But it is going to be so worth it!  Here's why: the internet is one gigantic matchmaker.  In my opinion the biggest challenge with hardcopy publishing is getting the book and the person who wants it together in the same room at the same time.  This is absurdly difficult - especially when the person doesn't know they want the book until they have it literally in their hand.  Step One to fix this: put the book online, make the first chapter free, and make the rest instantly available.  Now the room is the internet and most of the planet can get there.

But the internet is a big and crowded room, you say?  True, but it has secret magical matchmaking powers that hardly anyone in the publishing industry seems to know about yet. I am not talking about Amazon's search function or B&N's 'people who bought this also bought this'.  I am talking about user profiles, click stream analysis, data mining, and predictive behavior algorithms.  Today we are not even scratching the surface of the potential for getting a book into the hands of the exact readers who are going to want that book.  But it will come.  And when it does, the industry will discover the true diversity of readers' tastes, and that it can cater to that diversity and actually make money doing it!


  1. True, I still find out about books the old-fashioned way (word of mouth), but usually buy them on Amazon. Occasionally I "accidentally" find a book via Amazon search, read glowing user reviews, love the book myself, and wonder how I'd never heard of it before. It'll be interesting to see how book marketing catches up. Nice read btw!

  2. I just saw a research paper analyzing the "long tail effect" that is assumed a part of internet marketing. The conclusions the authors draw are a little depressing, because what they see from analyzing sales data is that this effect of broader availability and internet matchmaking that we all assumed would happen isn't really happening. Its still all about the blockbusters, and the little titles don't draw enough to make it clear that stocking them is worth the money.

    I was surprised to see this, and I think you are likely surprised by it, too.


  3. John, I'm neither discouraged nor surprised because we are talking about two different things.

    I'm not talking about internet sales of hardcopy books; I'm talking about internet sales of ebooks, for which there is no per-unit inventory cost.

    Furthermore, this study is talking about the matchmaking currently in use. As I said above, we're not yet scratching the surface of what can be done. Take the Netflix prize for example. Interdisciplinary teams worked for a couple of years to make a bare 10% improvement in the movie recommendation algorithm. The field is still in its infancy.