The agency model of publishing ebooks is about to go into effect on April 1st. Just to review, it sets up a formal split between publisher and seller that, among other things, prevents retailers from adjusting their pricing. So Amazon, Kobo, Barnes and Noble, and Apple will all be selling major titles for the same price. At that point, it really starts to come down to what store you like the best, and that’s where Kobo believes they can shine.
They are certainly coming out swinging. For starters, enter the code 2party between now and midnight on March 31st for $2.00 off every book! This is the last coupon from Kobo, as they feel it gets too confusing for consumers to be presented with a convoluted discount (Fictionwise, take note!) In addition, Kobo has taken the time to outline exactly what the agency model means, and it is definitely worth a.
One fascinating bit:
Promotions, Discounts and Most Loyalty Programs Go Away
With agency, the price is the price. We lose most of our ability to issue coupons, promotions, special discounts, kickbacks, buy-X-get-one-free. We could still do it for non-agency titles, but then we end up in a weird situation of “Get $1 off, but only on these books, and definitely not on these other ones.” That’s not fun. And worse, it’s confusing to consumers. We’re sad about that, obviously. Not just because they’re a great way for us to drive sales, but because they help us focus attention on specific great books, reward our loyal customers, and celebrate the launch of new features, apps or services.
With price competition going away, expect to see a lot of focus in the ebook space on brand building. When prices are the same, the fight becomes on attracting customers on each service’s merits. Expect to see TV ads with people reading on devices under trees, on beaches, while bouncing joyously on trampolines, on bearskin rugs.
So what should you expect to see as a consumer? We’ll have to see as the dust settles, but this ties back into the future of dedicated ebook readers. I think the pricing on these is going to fall even faster than previously thought, probably to $149 by summer. The idea won’t be to take away from the multi-format reading experience like an iPad, but to lock in consumers to specific apps. Amazon, B&N and Kobo are going to find their dedicated readers are the best conduit to sales, as long as their books seamlessly move between ebook reader and tablet/smartphone. Make the eInk reader a companion to the larger piece, keep the sync system rock solid, and consumers will happily snap up books from your store. Without price competition on the book side, the competition is going to have to be on the ebook reader side; with Kobo kicking their reader off at $149, this is going to just further pressure Amazon and B&N to lower the Kindle and nook prices.
No matter what, it’s going to be an interesting couple of months in the ebook world!