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On Amazon, Publishers, and Book Prices

photo 150x150 On Amazon, Publishers, and Book Prices leanI’m an avid book buyer, book reader, and published book author. Amazon is one of my favorite places to shop, not just for books. I first bought a book from Amazon back in 1997 before I went to MIT.

There has been a lot of controversy over Amazon fighting with Hachette, a major publisher. Hachette accuses of Amazon of being a bully and Amazon accuses Hachette of charging too much for eBooks. Amazon wants publishers to price their Kindle books at $9.99, not $14,99 or $19.99.

Unlike some authors, I tend to side with Amazon in this fight. I’d love to see lower prices for eBooks, including my own.

eBooks vs. Paper Books

Why does Amazon want publishers to charge $9.99 for a Kindle book? There are many good reasons, as articulated by Amazon in an email I received from them.

While I believe prices are set by the market (not as a function of your production costs), Amazon raises good points about profit margins and price sensitivity. Margins are different on eBooks than paper books, as Amazon says:

With an e-book, there’s no printing, no over-printing, no need to forecast, no returns, no lost sales due to out of stock, no warehousing costs, no transportation costs, and there is no secondary market – e-books cannot be resold as used books. E-books can and should be less expensive.

There’s so much waste in the production of paper books. There’s a fixed cost to produce a book – the cost of editing, cover design, marketing, etc. – whether you sell one copy or a million. The variable costs for a paper book include the cost of paper, printing, and shipping. That variable cost doesn’t exist for an eBook (there’s a cost of storing and transmitting the book, which is borne by Amazon). Because paper books are normally produced in large batches, they are produced to a forecast – and that forecast is usually wrong. It’s said that 40% of the books ever printed have their covers torn off and then get destroyed because they didn’t sell.

In the Lean “Profit = Price – Cost” equation… you can have the same profit margin at a lower price if your costs are lower… which they are with an eBook.

The challenge is determining the market price. It’s easy to know your costs and then tack on some profit margin… but you might then be charging too much or too little.

Amazon points out that eBooks don’t just compete against paper books, they compete against other forms of entertainment, which are often priced lower.

Amazon says:

Many inside the echo-chamber of the industry often draw the box too small. They think books only compete against books. But in reality, books compete against mobile games, television, movies, Facebook, blogs, free news sites and more. If we want a healthy reading culture, we have to work hard to be sure books actually are competitive against these other media types, and a big part of that is working hard to make books less expensive.

This broader competition for time and attention drives the market price for eBooks down and publishers should realize that. Even books like might compete with podcasts, webinars, blogs and other free or inexpensive content.

Lower Prices Can Actually Benefit Everybody

I’ve studied economics and I have an MBA, so I understand a bit about “price elasticity” and “price sensitivity.” Sometimes you maximize your profit (the absolute number of dollars, not just the percentage margin) by charging a lower price.

Amazon explains why:

 We’ve quantified the price elasticity of e-books from repeated measurements across many titles.

For every copy an e-book would sell at $14.99, it would sell 1.74 copies if priced at $9.99. So, for example, if customers would buy 100,000 copies of a particular e-book at $14.99, then customers would buy 174,000 copies of that same e-book at $9.99. Total revenue at $14.99 would be $1,499,000. Total revenue at $9.99 is $1,738,000.

The important thing to note here is that the lower price is good for all parties involved: the customer is paying 33% less and the author is getting a royalty check 16% larger and being read by an audience that’s 74% larger. The pie is simply bigger.

Because the production of an eBook is just about 100% fixed cost, any book you sell at any price is pure profit compared to the variable cost (which is just about zero).

Authors don’t just write books to make money. We write books to help spread ideas. Having 74% more readers is awesome. Now, my books aren’t “entertainment” reading – they are practical and useful books. I make money from speaking and consulting, really. Books spread ideas and help create opportunities for me that far exceed book royalties (remember that traditional publishers only pay 15% royalties to authors like me).  Yup, my books might cost $50 or $60, but I only get 15% of that (and the royalty is split 50/50 with my co-author for the Healthcare Kaizen books).

My publisher chooses even higher prices than $14.99 or $19.99.

My three books and their current list prices (set by the publisher):

Because Amazon sometimes chooses to discount books, you can buy the paperback of The Executive Guide to Healthcare Kaizen for $24.95 in paperback form and the Kindle version costs $2 more. That’s insane. I wish I publisher would set a $9.99 price for that book.

Yes, there are less expensive options for “renting” my Kindle books, since they are classified as textbooks by Amazon. I’m happy people can take advantage of that option (although I have NO IDEA how my publisher or I get paid off of that).

My Publisher Jacks Up Prices Each Year

I’ve battled, privately, with Productivity Press, over the annual inflation in paperback book prices.

Healthcare Kaizen was released in June 2012 at a $59.95 price. The book is not inexpensive to produce. It has over 200+ full color images and examples, so it’s printed on a thick, glossy paper. The book weighs 4.5 pounds. I hope people get far more than $60 of value out of the book.

The price was increased to $62.95 for 2014. Why? Old habits in the publishing industry, I guess. Is the book more popular than it was before? Is the market price higher? Or, are they just jacking up the price? Maybe a book like mine isn’t as price sensitive as a mass market fiction thriller. Maybe the people who pay $60 for my book would also be willing to pay $100 if that’s what the market bears. Maybe I wouldn’t sell more copies if it was priced at $40.

I don’t know the formula the publisher uses. I don’t know what the cost to print each copy is. I bet they set their prices more on the “old” non-Lean formula of Price = Actual Cost + Desired Profit.

Lean Hospitals has seen even more inflation (ironic, consider the cost inflation. It was originally released in 2008 at a list price of $45. The price has been raised $2 or $3 each year it seems… to  $47.95, $49.95, $52.95, and now $55.95. The second edition, released in 2011, has more content, but the print is smaller, so the page count and production costs should be the same as before. Yet, the price keeps going up. The publisher is thankfully discounting it 20% currently, to just under… $45.

If the price is based on the production cost… the price for Lean Hospitals should be FAR lower than Healthcare Kaizen since it’s a black and white book with fewer pages. I think the publisher has just gotten in the habit of increasing the price each year.  As an author, I’m not involved in those discussions.

I hope the publisher is analyzing the data to see how sales are affected over time. If the price increases hurts sales and overall profits, they should stop increasing the price. I only get data from the publisher twice a year along with a royalty payment. Amazon provide nice charts that show trends over time… but only for the books that they sell. The publisher sends dense thick tables that almost obscure the overall data more than providing clarity.

If I were self publishing (paper books and Kindle books), I’d see the costs… I’d get to make pricing decisions that might make more sense (and I’d keep more than 15%). You can see why self publishing is an increasingly popular option for people.

What do you think about book prices in general? The prices for my books? Would your organization buy a bunch of them if the price was lower? Maybe everybody wins. Please leave a comment.


mark graban lean blog On Amazon, Publishers, and Book Prices leanAbout LeanBlog.org: Mark Graban is a consultant, author, and speaker in the “lean healthcare” methodology. Mark is author of the Shingo Award-winning books Lean Hospitals and Healthcare Kaizen, as well as the new Executive Guide to Healthcare Kaizen. Mark is also the VP of Customer Success for the technology company KaiNexus.

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26 Comments on "On Amazon, Publishers, and Book Prices"

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  1. Bob Emiliani
    Twitter:
    says:

    Here’s why I made the decision to self-publish my books starting in 2002 http://www.bobemiliani.com/why-i-self-publish/

    It comes down to Respect for People: Better quality, more responsive to customers, etc. I’m very happy with my decision (18 books and counting!).
    Bob Emiliani recently posted..Shingijutsu-KaizenMy Profile

  2. Ville Kilkku
    Twitter:
    says:

    Sorry to say Mark, but the prices of your books are outrageous. I do realize that you have had nothing to do with that though!

    I have purchased around 100 non-fiction ebooks in the past three years, on subjects such as Lean, project management, sales, and social collaboration. Of those books, THREE have cost as much or more than your cheapest book: Smalley’s and Sobek’s seminal “Understanding A3 Thinking”, PMI’s PMBOK Guide (the industry standard project management framework), and Nagle’s “Strategy and Tactics of Pricing” (which is pretty much THE book on pricing).

    Books from Rother, Liker, Ohno, and Womack are all around $20 each – and for some reason books on Lean tend to be somewhat more expensive than top-quality books on sales or project management, for example, many of which are available for around $15.

    Self-publishing is a major threat for traditional publishers. Here is one resource you may find relevant to the ongoing Hachette-Amazon battle – Hachette’s investor day presentation from May 2014.

    That document really made me question Hachette’s motives: they are attempting to control prices and achieve sufficient economies of scale to keep both the retailers and the authors under control. Does that sound like a company you would like to be in a business relationship with as an author?

    Some reports also indicate that the market share of self-published books has increased significantly:
    * http://www.theguardian.com/books/2014/jun/13/self-publishing-boom-lifts-sales-18m-titles-300m
    * http://authorearnings.com/report/july-2014-author-earnings-report/

    Overall, it is a fascinating time to be following the publishing industry! From a Lean point of view, it seems that the publishing industry has lost its way to create value for the customers, and self-publishing is responding better to market needs. Yet, in such turbulent times, all paths are still open.
    Ville Kilkku recently posted..10 examples of serendipity in social businessMy Profile

    • Mark Graban
      Twitter:
      says:

      Thanks for recognizing that the prices are not my fault. I don’t set the prices. I wish they were lower.

      Productivity Press seems to think they “have to” set the prices high because they sell in lower volumes than the bigger publishers, like McGraw Hill, that sell mass market books (like Jeff Liker’s books). Maybe they sell fewer copies because the prices are high?

      There was no back and forth with the publisher about the price, such as “well, if you choose to do black and white pictures, we can price it at $45 instead of $60).

      It doesn’t explain why the Kindle prices are so damn high.

      Publishing is stuck in some very old mindsets, including the 15% royalty. That leverage over the author came from the days when the publishers owned the printing presses and authors had no other options. Nowadays, the publisher outsources the printing and many other functions. Yet, it’s still 15%. Authors have choices and vote with their feet.

      That’s not to mention the SLOW value streams in publishing. You submit a manuscript and get a finished book maybe nine months later. Batch and queue… keep every silo busy. Slow slow slow.
      Mark Graban recently posted..Lean Post: Standardization is a Countermeasure, Not a GoalMy Profile

  3. Mark Graban
    Twitter:
    says:

    One other thought and some data on the two “Healthcare Kaizen” books.

    One reason I wanted to do the “Executive Guide” was to have something at a lower price. That book is $25 to $29… and has a lot of great content on key concepts of continuous improvement and the role of leaders.

    Joe and I want ideas to spread. We hoped that, with the two choices in books, that an organization might buy a BUNCH of the cheaper book and a handful of the bigger how-to practitioner guide.

    It hasn’t worked that way. The $60 book outsells the $25-30 book, generally. There could be a number of reasons for that beyond price.

    See a chart from Amazon (which doesn’t include sales from any other stores or direct publisher sales). Note: I’ve obscured exact numbers:

    Maybe we should have called it the “Manager’s Guide to Healthcare Kaizen” because maybe executives just aren’t interested in this topic?

    I get a sales report from the publisher later this month that includes the last six months. I might report back here based on that.
    Mark Graban recently posted..What I’m Reading: Diner Muda, No Blame at Etsy, Toyota Treats Cancer Faster, etc.My Profile

  4. This subject definitely touches a nerve with me. Books like anything else are only worth what someone is willing to pay. However the e-book format should and is dramatically bringing down the price of most books. I’m a reader not a writer and have no more space for books in my house so I’m moving to kindle. So far so my transition has been good.

    My biggest complaint is the textbook cartel! Have 3 kids in college and it blows my mind the prices and how they change editions each year to keep prices high. Now professors are writing their own books and making students buy them! Colleges are requiring standard textbooks edited specifically for them so you can’t buy cheap used generic ones on Amazon. Come on how much has Calculus changed in the last 10 years! Requiring a new edition each year is ridiculous! One eBook written by a professor could be used for years and a $25.00 charge added to cost of class for each student taking course would be reasonable. Affordability for student and revenue for school or Professor win-win. Until then joining the textbook writing cartel is the way to go.

    • Mark Graban
      Twitter:
      says:

      I’m sure that’s annoying and frustrating with the textbooks. Forcing “custom editions” is what other retailers do on other physical products… custom SKUs that are sometimes just different packaging or different quantities so they don’t have an apples-to-apples price match against some other store.

      I think retailers (and publishers) should strive to provide real value to customers. I think Amazon does that. Of course, the suppliers to Amazon (much as WalMart’s suppliers) complain about the 800 pound gorilla throwing their weight around. Well, everybody wants to be the 800 pound gorilla, eh? Sometimes it’s the publishers.

      When I’ve taught Junior Achievement, I always emphasize the idea that something costs what people are willing to pay. It’s not a matter of whether something “should” cost a certain price… it just is. The art of setting prices includes understanding that not all customers are the same. I cringe to think that somebody would choose an alternative, like a cheaper “Lean Six Sigma” book that I don’t think is as good (sorry to sound arrogant… it’s pride in authorship). When prices are too high for a customer or customers, they either don’t buy or they find an alternative.

      Sounds like the college students have no alternative.

    • Bob Emiliani
      Twitter:
      says:

      RE: College textbook prices/editions

      I don’t use textbooks in any of my courses. I use “found materials” laying around instead for reading. Not using a textbook is more work for the professor, but much better for the students. I do what’s best for students.
      Bob Emiliani recently posted..Lean in Higher EducationMy Profile

  5. Good, thorough post as always, Mark. I, too, am quite concerned with the price increases Productivity Press (CRC Press) keeps levying on my books. I, too, have been keeping my displeasure private until now. From a customer value perspective, it makes absolutely no sense and erodes our ability to reach readers, which is the reason why we write. If production or marketing expenses are rising each year, then use Lean analysis and improvement to reduce expenses. Don’t keep asking customers to pay for it.

    On the textbook front, terrible problem akin to patients paying $25 for a Q-tip while in the hospital. Cartel is a good term for both problems.

    • Mark Graban
      Twitter:
      says:

      Well said, Karen. It’s the old mindset (seen in MANY industries) that says “our costs have gone up, therefore we HAVE to increase costs.” That only works in the short term. It’s bad business and bad economics.

      You say it more clearly and succinctly than I do… if costs go up, then you have to figure out how to reduce costs where you can.

      I still think about the dumb restaurants and bars that tried selling margaritas with LEMON juice instead of lime juice because the price of limes went up. They realized they couldn’t just raise prices on margaritas (because there are plenty of other drinks that don’t call for lime juice). But, totally distorting the product… it’s no longer a margarita with lemon juice.

      The bars and restaurants should find ways to reduce waste. Maybe not cutting up and wasting as many limes or not wasting as much of some other supply… you 1) take care of your customers and 2) find the right ways to get costs down.

      http://www.leanblog.org/2014/05/lime-shortages-cost-price-and-lean/

      Productivity Press needs to practice what their authors preach.
      Mark Graban recently posted..That Moment When You Realize a Potential Client CEO is a Deming DiscipleMy Profile

  6. Mark Graban
    Twitter:
    says:

    Here is my original order I placed for a copy of my book through Amazon in August 2008 – the price was $40.50. I found an email from my publisher that says the original list price was $45 (although I think it was $44.95).


    Mark Graban recently posted..That Moment When You Realize a Potential Client CEO is a Deming DiscipleMy Profile

  7. Paul Everett says:

    I remember being in college from 1955-1962, more or less (I dropped out for a while to earn money to go back). If I spent $30 for ALL my textbooks I felt I was being raped (I was in Forest Products and Industrial Engineering, minor). My engineering drawing set cost $30 and that was in 1957. Tuition and fees: $75 per quarter. Dorm room and meals $175/qtr. All at the U of W in Seattle. Anyway, even allowing for inflation, colleges have NOT kept their costs in control because they don’t have to do so. The whole system is sick with its wealth made on the backs of students in debt for many years. It is bordering on criminal, imho.

    One of the insanities is the many basket weaving and other virtually useless courses that clog up the catalog AND create tenured professors for five students. Major pruning is needed.

    So, as much as I admire Productivity Press and Norm Bodek for what he did for Lean, their prices are just outrageously insane. But, that’s capitalism and the system we live in. I hope that Amazon wins and that books become more affordable. Kindle is great but I sure like to hold a book in my hand. They are jamming up my house, however. I’m thinking of donating my entire Lean library (about 90 books) to the one of the local colleges for their library, IF they want them. I even wonder if they have a clue about it. Just haven’t gotten around to it yet. Many of those are Productivity books at $50 or more a pop.

    Great thread, Mark.

    • Mark Graban
      Twitter:
      says:

      Hi Paul-

      Colleges actually have great price inflation than healthcare in recent years, if you can believe it. The colleges jack up their prices (and they’re bloated full of administrators) and the government just loans more money and the cycle continues.

      Note on Productivity Press — Norman sold that business a long time ago. They are now part of the CRC Press publishing conglomerate (the ones who publish textbooks and the famous Chemistry handbook).

      Mark
      Mark Graban recently posted..That Moment When You Realize a Potential Client CEO is a Deming DiscipleMy Profile

      • Paul Everett says:

        Yes, I can believe that, Mark. A few years back I did a compound growth rate on the cost of college at the U of W since 1955, for a live-on-campus student, not home student. In 1955 it cost me $1,065 to attend a full year. Yes, there weren’t many extras. I took the newspaper (Times) for the news. Had a portable manual typewriter and slide rule, and the engineering drawing set. Pretty spare compared to what students need to go to college these days. But, given that, I compounded what the U of W costs for one year. More than 6%, compound. That means costs double every 12 years. Making 34,000 for the 2015 school year. Right in line with actual costs. TWICE the rate of inflation. They are out of control.

    • Bob Emiliani
      Twitter:
      says:

      RE: basket weaving and other virtually useless courses

      Historically, this has been a case of bad management: The process for creating educational services is poor. So, universities tend to overproduce both courses and degree programs in the hope that some will become popular among students and payers. Over time, universities offer much more than they are capable of delivering with both high quality and low cost. Some are working to reduce/consolidate courses and programs and improve the process so that courses and degree programs serve actual needs.
      Bob Emiliani recently posted..Lean In Higher EducationMy Profile

  8. Bob Graban says:

    In today’s Wall Street Journal (http://online.wsj.com/articles/amazon-hachette-e-book-pricing-battle-continues-1407708761?KEYWORDS=amazon), Hachette claims “[...]Amazon’s preferred price for e-books of $9.99 doesn’t reflect the costs of producing titles, including marketing, royalties and other expenses.”

    That doesn’t sound like Mark’s case with Productivity Press and the alleged value added by the publisher. It seems like the greatest benefit to authors, at least the “famous ones” that Hachette represents, such as Stephen King, Paul Auster and Jennifer Egan, is that they are lavishly promoted and the publishers have the power to tell people what is “in fashion”.

    The Top 10 bestsellers list reminds me of when there were only 3 TV networks and we all watched the same show and talked about it the next day at school. There is still some of that going on with TV entertainment, but I would like to think that the choice of what to read (or watch on TV) should be wide, and e-publishing and self-publishing can keep books such as “Healthcare Kaizen” from being priced like orphan drugs.

  9. Kris Hallan says:

    I just bought the Lead with Respect eBook because it was only $9.99. I think I would have purchased it eventually either way but when I realized it was that cheap, I jumped on it. If it had been $19.99 I probably would have gotten the paperback (for $30) at some time in the future. I prefer something solid that I can borrow to someone else when it comes to fiction but it isn’t worth $20.

    Great book. Finished it this weekend. I will be telling people all week about how good it is AND telling them how cheap and easy it is to get on Amazon. I hope 3 or 4 people will buy it this week because of what I tell them…

  10. Jessica Fleck says:

    As a lean facilitator at a hospital, a recently published romance author (under a pen name) and a member of the Romance Writers of America (PAN), I’m torn on this. There’s a lot of discussion over the autonomy of a publisher to put the book out at a price they believe will turn a profit, and even those who self-publish who wish to list at a higher price point for whatever the reason. Who’s decision should it be – the publisher representing the interest of the author or the vendor selling the product?

    Even though the price of creating an ebook is less than a paper or hardback, it still requires the same cover artist, editor, legal, copy editor, and marketing that all books do. And yes,you’re correct – each additional ebook does not require that much cost to produce. But there’s some other considerations. I think of it in terms similar to new medications or vaccines. For every author that sells 10,000 copies a month, there are multiple that do not hit that threshold and potentially cost the publisher more than they make. It often takes multiple books for an author to become successful enough to live off their royalities, and new authors are seen as an investment in some houses. Profits from better known authors make it possible for authors like me to get my books out.

    As for pricing structure – I have to admit, paying fifty bucks for some books does irk me…but at least I’m able to choose what I’m willing to pay for. As the consumer, I determine the value by choosing to buy or not to buy. For some authors, I pay 7.99 for a new release, for others 12.99. I even pay the fifty bucks for a Lean book when I believe it’s worth my money. I pay for the perception of quality, and hope my gamble pays off. From my experience with my publisher, the prices weren’t arbitrarily set, but the result of actual data. My price point was selected based on numbers that indicated a “sweet spot” for lesser known writers after a series of trials with other pricing options.

    The biggest complaint I’ve heard from other writers is the issue of Amazon now having the right to set a price point at whatever they want and the tactics they’ve resorted to with Hatchette (not shipping books and not allowing pre-orders). What would we say if Finish Line put a cap on the price of all Nikes? Aren’t some sneakers just worth more than others because of a style? Or is a sneaker, a sneaker, a sneaker? What about cookies at Whole Foods? I pay more for certain brands (Milano, anyone?) than I do others – same as I pay more for books from certain authors than others. The great thing is – if the author dislikes the price point their publisher set they have the option not to sign the contract and find another publisher or self-pub. It’s actually much harder for writers to walk away from Amazon, who by far carries the ebook industry.

    As for silos in the publishing world with long lead times . . . I’ve come to understand a few things. Much like healthcare – it’s not always easy to standardize areas with high variation, and some publishers are better than others. Some books take considerably longer than others to edit, and the creative muse may not always be timely in delivering the product.
    But there’s always room for improvement.

    • Mark Graban
      Twitter:
      says:

      Thanks for your comments, Jessica, and congrats on your book!

      You bring up a lot of great points and questions.

      Many of my beefs are with my publisher choosing prices that I think are very high. I still think we’d sell more books and make more money if they lowered the price. The Kindle price is FAR beyond the guidelines that Amazon even wants.

      When I have self-published blog compilation books on Amazon, I see that, as the author, I can set the price at whatever point I want. Amazon offers a 70% royalty if your price is $9.99 or less (royalty of $6.99). I could charge $14.99, but then I’d get a 35% royalty (netting only $5.24 per book).

      Thanks to the lack of transparency in the publishing industry, I don’t know what percentage the publisher gets paid and if 15% of that flows through to me (it’s made even more complicated when Amazon decided, on their own, to start doing shorter-term “rentals” of my book… which does bring the prices down, considerably, which is what I hoped for).

      I realize that publishers accuse Amazon of punishing them for high Kindle prices by making their paper books unavailable for pre-order, claiming they are out of stock, etc. That’s not cool.

      I realize that one reason publishers get such a high percentage of the cut is that they are taking the risk with the upfront cost of book editing, production, etc. 40% of all printed paper books get returned and shredded… so the publishers aren’t doing a good job of predicting which titles the market wants or how many they will want to buy. They sort of roll the dice like venture capitalists.

      I think the publishing industry could learn a lot of lessons from LeanPub.com, where you can post a book that you haven’t written and ask people how much they’re willing to pay and you can gauge demand that way. I’ve used LeanPub in some experiments (and listen to my podcasts with the co-founders). If I have a successful book, I shouldn’t be punished to subsidize the books that flop. There are many authors who have proven market demand through LeanPub.com and then have taken their book to a “real publisher.” That reduces the risk for the publishers and it’s something they should do more of.

      People accuse Amazon of being a predatory bully… but, ironically, the Feds went after Apple for alleged “price fixing” and really slapped them… which was probably a win for Amazon, which was really already the dominant player by far.

      Authors don’t like retailers setting “maximum” prices. Many electronics manufacturers have tried mandating “minimum” prices and bully the retailers. I guess that’s the hard-knock game of business.

      It’s hard to respond to all of your points in this format… but thanks for adding so much to the discussion and good luck with your book(s)!
      Mark Graban recently posted..What I’m Reading: Diner Muda, No Blame at Etsy, Toyota Treats Cancer Faster, etc.My Profile

  11. Mark Graban
    Twitter:
    says:

    Ironically, this post and my next one (about Fake Lean and “Muppets Most Wanted“) intersect in this news story:

    With Disney Dispute, Has Amazon Gone Too Far?

    I wondered why the movie had been available for pre-order as Digital Video, but not as DVD or Blu-Ray. It wasn’t a technical glitch. It was Amazon playing hardball with Disney, by not allowing pre-orders. Same playbook as they used with Hachette. Disney owns the Muppets now, hence them being caught up in this dispute.

    You can’t argue that, in the short term, Amazon is being customer focused when they do things like this. Long-term, they claim to be customer focused by wanting lower prices…
    Mark Graban recently posted..My Cogent, Academic Analysis of the “Fake Lean” Problem & “Muppets Most Wanted”My Profile

  12. John Hunter
    Twitter:
    says:

    In the question of who is right between Amazon and publishers I side with neither. In this specific issue, as far as I understand it, I think Amazon is more wrong.

    I don’t publish my book, Management Matters, on Amazon because they wouldn’t let me sell it how I wanted. They want to add on all sorts of restrictions instead of just selling my book.

    I do like being a customer of Amazon. But they are pretty obnoxious about being the seller of your books. They don’t just want to provide a platform for users to buy your product or service. They want to control your business and how you do business if they are going to sell your product. Which seems absolutely crazy to me. But they have lots of customers they can direct to your door so I understand why people choose to let Amazon dictate the terms of how the seller will run their business in order to get access to those customers.

    I also find the annoying ever increasing book prices to be stupid and counter to my interests (for my father’s book, where I get royalties). I would rather sell more copies and get a lower cut per copy but the publisher relentlessly jacks up the price. As an author you can about maximizing your income and likely maximizing the spread of your ideas. The publisher cares about maximize their overall revenue (which isn’t the same as maximizing one book’s revenue) and also their bias it toward higher net profit per book even if that reduces the market for the book. The publisher also doesn’t make it available electronically which is also annoying.

    I am perfectly happy to avoid both publishers and Amazon as an author. I imagine that decision is much more difficult if you count on your earnings from your writing. I would be happy to make it available through Amazon if they just wanted to sell it not dictate how I chose to operate (LeanPub is a great platform for authors that allows you to control how you will behave and has cool features like letting you set a suggested retail price but also letting users decide what they want to pay).
    John Hunter recently posted..Practicing Mistake-Promoting Instead of Mistake-Proofing at AppleMy Profile

  13. Rick Foreman says:

    Great discussion as usual. It makes me glad, I nailed a copy of your book early on in the DFW area. We typically use books from what I believe are key lean contributors for internal book clubs/master mind study groups. We may take at least 100 team members through the process and the cost is really high based upon all the discussions mentioned. We have Karen’s latest book listed in our phase 3 learning for lean leaders and although no one is quite ready to work through this level, the anticipated cost through Productivity or Amazon is steep. Some of us use the Kindle version but even that is really high as Mark mentioned for his books. A really good discusion about customer value and the challenges of some industries in respect for people. As an avid lean reader and learner, I’ll keep digesting the fine work of that you lean leaders keep bringing forward.

    • Mark Graban
      Twitter:
      says:

      Thanks, Rick. Publishers need to realize that if the price of a book is too high, an alternative is that people share copies and pass them around instead of buying more copies.

      If a group had a budget of $250 for books, would they buy 5 copies at $50, but buy 10 copies if the book was $25 a copy?

      That’s totally fine to share books, of course! As an author, you want to sell copies, but you also want to spread ideas, so I’m happy you’re using books in groups of 100, regardless of how many copies you buy
      Mark Graban recently posted..Why “More Nurses” Isn’t the Best Way to Solve What Ails HealthcareMy Profile

      • Rick Foreman says:

        Mark;
        You’re absolutely right. We like to allow folks to keep books to reference back and extend learning. Yet, not everyone is prone to follow this process and we definitely reach out to share. Either way, we believe the book club/mastermind process developed here provides a deeper engaged value for building a learning culture.

  14. Mark Graban
    Twitter:
    says:

    John Shook, CEO of the Lean Enterprise Institute, wrote this recently in his “e-letter.

    P.S. I’m sorry to report that the strong-arm tactics that Amazon has been applying to larger publishers has now spilled over to its practices with a small not-for-profit institute — LEI. Should you go to the main product page for a print copy of Lead With Respect on Amazon, you will see a prominent message from Amazon that this product is “Temporarily out of stock.” Unfortunately this is not true. We have done everything we can to supply the book to Amazon, and have worked diligently and in good faith for the past three weeks to remedy this situation. Customers who placed orders with Amazon directly in late July are still waiting for the company to fulfill these orders despite the fact that it has physical copies available, victims in this company’s campaign to convert all printed material to $9.99 ebooks over which they have complete control. You do have other purchasing choices. This book is available in print from LEI. We also sell it as a third party vendor on Amazon, a link you can access here. (And, given the way that Amazon has been behaving, I would suggest that you consider other ebook formats as a purchasing option.)

    That’s not cool if Amazon is basically lying about being “out of stock” as to drive buyers to Kindle books.
    Mark Graban recently posted..Why “More Nurses” Isn’t the Best Way to Solve What Ails HealthcareMy Profile

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