Easons

Making Frenemies: Kobo, Easons & Ebooks In Ireland

20131030_192630Easons, which once had ambitions to launch its own ereader, has joined forces with Kobo. The deal will see Easons selling Kobo devices in its 60 stores and has attracted little negative comment unlike Waterstones deal with Amazon last year. In fact it seems, so far, to have been pretty universally welcomed in the Irish trade.

Easons has, despite the aforementioned ambitions, chosen the path of least expense with regard to making its ebook offering credible and coherent. That meant, although its e-store concept was attractive, it was selling several different brands of device and its ebook platform was off the shelf and was not always as smooth as possible. What’s more its options were somewhat limited. Tesco has been selling Kindle ereaders since before last Christmas at prices well under €100 and Amazon has spent hundreds f millions making those devices and the ecosystem surrounding them, very user-friendly. The Waterstones Kindle match-up has sat oddly with the trade, the deal has also put Kindle ereaders and tablets in front of readers in many places. So Easons has been faced by deep pocketed rivals and the most likely platform partner already pretty much wrapped up with rivals.

We don’t yet know how successful this move to partner with Kobo will be. Easons is still offering Sony ereaders from its website (on 2nd November) and Kobo’s ebook offering not yet live through the retailer’s website either. Even so, Kobo has launched a new consumer facing ebook site for Ireland which will surely power Easons ebook store when the partnerships rolls out properly. The site’s not perfect yet, for instance, I can’t yet find out where to but one of the company’s tablets in Ireland yet, but that’s an easily resolved issue.

Irish facing stores are a rarity in the ebook space, on Kindle, users must choose between buying their ebooks from Amazon.com or Amazon.co.uk. While the process is fine and workable, it still presents pricing challenges and means picking out Irish bestsellers can be hard. Apple offers an Irish facing ebook store but there’s every indicator that sales through the store have been relatively low.

The bigger question for me is what will all this mean for ebooks in Ireland. The last year or so has seen most Irish publishers begin to take ebooks very seriously with some publishers quietly indicating that digital sales are no accounting for double-digit percentages of units sold (though often a lower percentage of revenue given the disparity in price). The best indications I’ve seen suggest that while fiction is the leader, there are some fine performances  in non-fiction too and that backlist is proving its worth yet again.

“One in five books sold on Easons.com are ebooks”

Interestingly, Conor Whelan, Easons MD, said at the launch of the Kobo/Easons partnership (which took place at the launch of Kobo’s new Irish offices, itself during the Dublin Web Summit) that: “One in five books sold on Easons.com are ebooks” a fact that sailed over many people’s heads, but struck me as a very nice nugget of information. It indicates that Easons is doing much better at selling ebooks on its own than we might previously have imagined, thus suggesting the Kobo partnership might really drive ebook take up and sales in Ireland if it can connect with readers.

I’m intrigued that the offering will include more that just the ereaders. Kobo’s tablet offering is really quiet good (in the non-iPad league that is) and at €149.99, the Kobo Arc 7 will provide Easons with a reason to get non-readers in the door that the ereaders on their own simply will not. In fact at that kind of price point, the tablet may well be the most attractive part of the device line up.

Kobo has found a strong partner to grow mind-share and market share in Easons. It does have a very large presence on the high streets of Ireland as well as an impressive brand and awareness in Irish readers mindsets. The company also runs highly successful media campaigns in the run-up to Christmas and ereaders and tablets will be a leading gift category yet again in 2013 and ebooks still have lots of room for growth in Ireland.

The problem is that Kindle is dominant and massively so, and will not be pushed aside  easily. It will require a by a determined new brand and dogged execution both on the device side of things (which means hoping Easons can deliver) and on the ebook sales and promotion side of things (which means work for Kobo and its staff).  It does seem to me though that even if Kobo only manages to build a secure second player position, it could be to both its and Easons advantage. It the companies can make it work, we might begin to see the kinds of percentages that the US & UK have been seeing over the last year or 25-30% units being sold in digital form.

Here’s hoping!

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The Rewards & Costs Of Inaction

Eason LeafI’ve often written of the value of inaction in the face of an uncertain future. Today, I want to write about both the rewards and the costs of inaction in a specific case, Ireland and the ebook retail business.

Eason, by far the largest bookstore chain in Ireland, is set to launch an ereader onto the Irish market in December. It’s called the Eason Leaf. To be fair to Eason, it has a natty offering, a 6-inch, touch-screen eInk device with weeks of battery life and storage for 4,000 titles. All for less than €100. It could plausibly become the best-selling dedicated ereading device in Ireland after the Kindle and create a mass market for ebooks sold via the Eason ebookstore.

You could say that the company’s move is a great example of collecting the rewards of inaction. Having followed a sensible and cautious strategy in a period marked by uncertainty and using the intelligence it gained during that period, Eason acted decisively.

It bought in a device from an OEM, branded it and is selling content directly to readers via its own ebookstore. In this way Eason can build a closed circle for its customers with itself at the centre and all the while build a digital retail position to rival its physical one.

No doubt Eason has seen the work Barnes & Noble was able to do in the US, converting heavy book readers to Nook users through in-store selling efforts and hopes to replicate it.

Even if you see the move as more defensive, ie a way to capture a limited audience of ereading book people, while ensuring the majority stay devoted to print, the strategy has the benefit of being low cost. I don’t often have praise for Eason, but in this instance I think the company has played a good hand. Given the choices available to Eason I think it has taken by far the best option it has.

The costs of inaction of which I wrote at the beginning then are being paid by the other ereading/ebook retail players (Kindle aside) whose inaction has meant their ereader presence here is not backed by a convincing consumer message, and certainly not by a retail store presence. They have not scaled rapidly enough in order to stifle competition,

Kobo seems to be making the most of its distribution via chains like PC World (distribution which includes even the keenly priced Vox table at only €139 which packs a fair punch relative to the Leaf) but name recognition is low and no BOOKSELLERS seem to be on board except WH Smiths whose High Street retail presence in Ireland consists of one concession in Arnotts. Without a convincing way to reach the readers how will Kobo convert them from print to digital?

Nook‘s plans are mystifying though the company does seem to be offering to ship tablets and ereaders to Ireland from its UK Nook site. If Kobo has a name recognition problem I wager Nook’s is far, far worse in Ireland. Nook then faces a huge challenge in establishing a name, a brand and a conversion strategy in Ireland.

Apple is the only competitor with some chance of making gains in 2012, with the iPad mini, but in truth I suspect that device will not be a book readers choice. I’ll wait to see.

The truth is though that all these companies could have acted more forcefully in Ireland at any time, it’s a small, English language territory with pretty friendly tax arrangements. It was inaction when the time called for action that led them to where they are now.

The costs of inaction for the major Amazon rivals are first and foremost that a local competitor in a small local market looks set to steal a march on them. It seems so very unlikely but it’s really happening (I wonder who will be the first to pondering buying out the Eason operation should it prove successful?).

In an English language market that could easily be technologically serviced from the UK or US (as Amazon does with Kindle) so long as the retailer made a small commitment on the ground marketing and brand building and converting print readers to digital, a small bookseller with great physical footprint and footfall but not much by way of a digital track record might just, strangely, be a leader in this shift from print to digital in Ireland.

We always do things a little differently here!

Eoin

The Future Of Publishing In Microcosm | The Increasing Internationalization Of Irish Publishing

Yesterday I was a little unfair to Easons for the pronouncements of the company’s spokesperson and the tone of the article on its ebook strategy which suggested the company was about to embark on a  mission to build a rival platform to B&N and Amazon, something that would surely have been a valiant, if doomed, effort.

When I thought about it for the rest of the day though it got me thinking about just how much ebooks are changing the profile of book publishing and bookselling and how quickly that is happening. For instance I am almost certain of two things about the Irish ebook market:

1) That foreign based platforms and retailers account for the majority of sales (Amazon, Apple, Kobo, Sony etc)

2) That like in the print world UK publishers (and their local imprints) publish the majority of ebooks bought in Ireland both in terms of units and revenue

I’m also close to certain about a third item, but without evidence I cannot prove it, here it goes anyway:

3) That US-based publishers sell more units (and I don’t doubt generate more revenue) from ebooks in Ireland than domestic Irish publishers do and are perhaps second only to the UK publishers (and their Irish imprints)

The first and the last points there are pretty radical statements. The first represents a huge change to the Irish experience of the book industry. Right now in print terms, most books bought by Irish consumers are sold to them by Irish retailers, Easons the principle one but others like Dubray, The Book Centres, Kenny’s, O’Mahony’s, Hughes & Hughes and many many others. That is despite the growth of physical sales through Amazon and the internationally owned (except for Dunnes Stores) supermarket chains. The wholesale and distribution businesses are also heavily Irish owned (with some British presence, increasingly on the Library supply side of things).

The Difference Digital Makes

But the situation is dramatically different on the ebook side of the house. Easons is the only ebook retailer of note in the Irish context (others should shout out if I’ve unfairly missed them out). On the ebook distribution side, EpubDirect are the only (and admittedly impressive) crew actually making a go of that business and even they don’t make up for the fact that the majority of ebooks sold in Ireland will have been distributed through other channels.

You can argue the toss over why this is the case but several factors loom large:

1) Irish publishers have been slow to digitize their content (though they are getting there now)

2) Irish retailers have been slow to embrace the web (except for a few notable exceptions) and slower to embrace eCommerce (again a  few notable exceptions aside) and, finally, even slower again to embrace ebook retailing

3) The costs of developing ebook platforms, ebook retailing sites and ebook distribution systems are high, the Irish market is small, while it might have been possible to forecast the potential to gain customers outside of the island, it is a difficult result to actually achieve (which makes EpubDirect’s success all the more impressive) which mitigates against anyone investing in them

In terms of sales, while UK publishers and their Irish based imprints have come to dominate the book trade, significant numbers of books published by Irish houses continue to sell in print form and account for anything between 15-25% of the trade. With ebooks however, sales from publishers whose books would not traditionally have been made available in Irish territory is increasingly likely. For instance a US published book that does well but might not get a print deal outside of the US has as much (if not more) opportunity to sell in Ireland as any other ebook, the key is whether it is high in bestseller/popular lists or promoted by the retailer for some reason

The only ebook store that really seems to cater specifically for the Irish ebook market is Apple’s iTunes so when Irish publishers do start to make content available they have to fight against ALL the published content there is, not just all the domestically published content and all the UK published content as they do in the print world. Further the people making decisions about ebook merchandising are rarely based in Ireland as once they were (or indeed still are in the print world) and therefore open to some discussion or indeed charm (not inconsiderable amounts of which the Irish are possessed).  You see the problem.

The Outside Context Problem

The Irish publishing industry is fast running into what might be described as some fashion of an ‘Outside Context Problem‘ wherein the new arrivals on the scene are vastly superior in terms of abilities, vastly superior in terms of resources and possessed of superior technology. While some of the participants in the market might grasp the nature of the problem and respond as effectively as they can, the truth is that the disparity in attributes makes success unlikely and the new threat is very much an existential one.

Which sounds very dramatic but think of it this way. The Irish consumer market for trade books is around €150 million a year and 15 million units all in. Suppose only 30% shifts digital over time or €45 million and 4.5 million units. That would leave only €105 million up for grabs for Irish retailers in print form and 10.5 million units. The impact on stores, book publishers and other market participants would be pretty dramatic. There would be closures and job losses and the industry would be considerably weaker. And that’s just the impact on the retail side of the trade. The impact on the publishing side of the trade is unknowable, but there is little doubt that it would be significant and would probably be negative for the domestic publishers (see my earlier paragraph on why). The UK publishers will probably cede sales to US-based publishers, especially if US publishers seek to enforce global ebook rights deals on authors.

We are probably headed in the direction of 30% digital pretty quickly. If we even approach the kind of conversion to digital sales that seems to be happening in the US or even the UK, we can expect that 30% figure to be a reality by 2015. By then the Irish industry will have changed radically and will become almost unstoppably more international not just in terms of the books that sell her, but also in terms of those who sell them. US publishers will probably be the second biggest publishers of ebooks bought by Irish readers (if not the first having overtaken the UK).

There’s interesting evidence of this too from the other side of the fence. The AAP reported that ‘total eBook net sales revenue [for US publisher] for 2011 was $21.5 million, a gain of 332.6% over 2010; this represents 3.4 million eBook units sold in 2011, up 303.3%.’

Frustratingly the APP did not share details for Ireland (those were contained in the full report but not as a single territory, rather as part of a larger group of English language territories) so we don’t know how well those publishers are doing here. Still, we can assume that they did well relative to the size of the market.

What’s more, Ireland and the story of change in the publishing industry really acts as a microcosm for the rest of the English language publishing industry (indeed it acts as a microcosm for any small market which shares a language with a much larger market be it French or German or Spanish or Chinese).

In some ways the whole industry is encountering the ‘Outside Context Problem’ I mentioned earlier as software and technology firms move into a traditionally physical business, but for larger companies, responding can be easier because of their scale and their resources make for a wider context as it were. It’s the small markets where the combination of these larger players and the changes in technology make for such a difficult problem.

Beautiful day here in Dublin!
Eoin

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Interestingly (or maybe just interesting for me) I wrote some time ago about the impact of divergent rates of digital growth on small markets, and in many ways this post is all about that impact. The increasing internationalization of the Irish publishing industry is driven by the very issue I highlighted: Divergent Growth Rates In Digital.

Easons Will NOT Be Building A Platform For Ebooks Anytime Soon

Waterstones decided to team up with Amazon and one of most compelling reasons for that was the sheer cost of developing an ereader and a fully fledged ebook platform (just look at B&N’s capital expenditure and increased costs and their need for cash to support their successful Nook business, hence their deal with Microsoft). Which is why reading the paragraphs below make so little sense:

Ireland’s largest book retailer, Easons, revealed plans yesterday to enter the market as well. “We are not getting into bed with Amazon, that is for certain,” a spokesman said.

“But as part of a €20m plan to modernise our entire chain, we will be providing live wi-fi in our stores from this summer and dedicated e-book areas which will permit customers to download e-books from our website. The next phase of this process is to launch our own Easons branded e-reader.”

Rival

This means that the Irish market leader will follow in the steps of the US market leader, Barnes and Noble, which has already developed its own digital reading device to rival the Amazon one.

via Hodges Figgis and Easons to sell rival e-books – Irish, Business – Independent.ie.

If B&N struggled to build a platform and needed $300 million and a Microsoft partnership, and Waterstones joined forces with Amazon, some portion of a €20 million modernisation fund simply wont be enough to do it for Easons, even given a smaller market.

Unless
That is unless the spokesperson simply meant that Easons would use a white label ebook reader with an Eason logo on the outside. That wouldn’t be the worst idea ever, but it certainly does not mean Easons will be following in B&N’s steps!

As Philip Jones, deputy editor of The Bookseller, commented on Twitter:

A nice, nice day here in Dublin,
Eoin 

Easons upgraded website

Eoin Purcell

credit where it is due
Easons have upgraded their website in time for Christmas. The search function is better (though still not great) and browsing is a lot better. They even offer a review feature which makes a very nice change to the static sites of the past (even if Amazon have had such features for years.

It still has a way to go to match my favourite website for book sales, but it is a vast improvement on their previous site.

Having a tech focussed day,
Eoin

Eason & buyers . .

Eoin Purcell

Why Easons is important
If you work in publishing in Ireland, you have to work with Easons. I say that, not to attack them or to slight them, it is simply fact. Easons stores are located in nearly every major urban centre from Athlone to Roscommon and nearly everywhere in between.

But it is not just their brand name stores you have to consider when you think about Easons. Equally important is their wholesale third party customers. These stores range from large independent bookstores to newsagents who sell mostly magazines.

They will mostly order new releases with little prompting (in ones and twos at first but more if they sell) but, especially for a company with a backlist like Mercier’s, it is important that these stores are supplied with your backlist titles and Easons are the key player in making that happen. The bible for those booksellers (and Easons Managers) is the monthly Booknews magazine. Getting your cover info and bookdata correct and into the Booknews on deadline is therefore pretty vital.

Some news of note . .
All of this is by way of bringing a nice end to a story I mentioned recently, that Eoin McHugh Eason Head Buyer. The Bookseller reports today that Easons have reorganized their buyers to take account of that:

Maria Dickenson, who has been with the Irish retailer for nine years, has been appointed head of buying. David O’Callaghan is now general book manager
alongside his existing role as children’s buyer. He will be responsible for bestseller stock management.

Both O’Callaghan and Dickenson will report to Tom Owens, books director.

There is more but it gets complicated so I will leave it out. The point I want to make before I sign off though, is that it will entail a slight shift in the selection of books on Easons shelves. An often forgotten bias in publishing is the retail book buyers bias. I just hope it works our way.

Still even if it doesn’t it’ll be a fun challenge
Eoin

Irish Publishing & Transworld

Eoin Purcell

I mentioned before
About the challenges of independent publishing in Ireland. Well the news has just broken about Transworld entering the Irish market:

Transworld has revealed plans to set up a new subsidiary company in Ireland, headed by Eason’s head buyer Eoin McHugh. Transworld Ireland will launch with its first list in 2008, focusing on Irish writers or books about Irish issues. McHugh, who joins the company as publisher in September, will report to senior publishing director Francesca Liversidge.

Good for them. Eoin McHugh is pretty well known in the trade (Easons controls a lots the booksales so he would be) and respected too. Looks like a good move on their part to hire him. It will be interesting to see their first list in 2008.

Anticpating
Eoin

Just for the laugh: here is the Hoff @ an Easons signing.