One of the things that all the hoopla surrounding Amazon vs. Hachette is obfuscating is that the internet isn’t just changing publishing–it’s changing every type of commerce. I’m not all that interested in the controversy surrounding the negotiations, for all the same reasons that I wasn’t interested back when Barnes and Noble did the same thing to S&S… we cannot know what’s really going on, who’s doing what, who’s pulling PR stunts to sway the public vs. who’s the “victim” here. And honestly, if a corporation has to resort to “victim” status to win the war, they’ve already lost. Not necessarily because their customers will leave right away, and not necessarily because they’re going to lose money immediately… but because “victim” status means they have not innovated. They have not gotten out ahead of the curve. In the world of business competition, there are thousands of businesses who fail because their business models are stagnant. They fail to innovate, they fail to see that others are innovating and take advantage of that, and they fail to see that the customer base’s expectations are changing. You cannot stay in business in today’s technological world by doing everything the exact same way you did it forty years ago. Not if you really want to be here forty years from now.

I read a couple of interesting articles yesterday in Entrepreneur Magazine about innovation, and one specifically about three brands that are dying — Quizznos, Sbarro, and Radio Shack, and of the three, the two latter brands depended heavily on mall traffic — traffic that is down by more than half in a lot of malls. And it’s not just Amazon that’s the culprit. People buy online directly from the companies, now — they buy their Apple or Dell computers online. (No one screamed that we should boycott them and stick with Radio Shack.) Sbarro’s sales have fallen through the floor (they’re in bankruptcy) because pizza-by-the-slice has gone by the wayside; people can call in for delivery, or go online for delivery, or buy plenty of very good cook-at-home options. Or they’re eating healthier. The world changed around Sbarro–offering better quality, better ease-of-use–and Sbarro failed to change with it. Worse, they failed to anticipate change and did not innovate within their own model.

Yesterday, I picked up my mail and had tennis shoes from Zappos, a yoga mat from the mat maker, a t-shirt from a small Etsy vendor, a gift for someone that I ordered from a printer in Michigan, and some gadget that my husband wanted from a binocular store. All purchased directly.

Now that the malls are dying off, a lot of small towns are seeing the resurgence of mom and pop stores, because when people can get all of the generic stuff from online shopping, and they save money, they have more to spend locally. (At least, that is what I’m seeing here.) Those stores which are doing really well have a unique service angle to them, that lagniappe (something extra) that keeps their customers coming back. There’s my favorite children’s store in the Quarter (NOLA Kids) which always has unique toys / clothes for kids that I can’t find elsewhere. Her prices are slightly higher, but I think it’s worth it for the unique factor.

There are some fine indie bookstores that (at least, from the outside) seem to be holding their own — like Seattle Mystery Bookshop, and Murder by the Book in Houston, and here in NOLA, Garden District Book Shop. They have all carved out a voice for themselves, offer unique services, and really pay attention to their customers. They are innovating within their models, and they’re catering to their customer’s needs.

That’s the only really interesting thing about the Hachette vs. Amazon battle going on–will Hachette come out of this having figured out how to better innovate, how to improve their own model, to better serve their customers, the readers. (Their customers used to be the bookstores–especially the big chain stores. They had to satisfy one buyer from B&N, one from Borders, etc., and then buyers from the smaller chains. Now, they have to think more globally–the customers, the readers.)

I like Hachette. I particularly like Grand Central, one of their imprints–they put out a lot of good books. They have terrific editors there. I want to see them last. But “winning” against Amazon isn’t where the focus should be, in my humble opinion. It should be, “how can we do what Amazon is doing, but better, smarter, within our own model?” And again, we don’t know–maybe they are trying to innovate to better serve their customer without destroying their own producers. That’s their challenge, now, and I think the outcome will signal a sea change for the industry as a whole.

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4 thoughts on “Innovation”

  1. Hachette is a publisher. not a retailer. Your comparison of other retailers is incoherent. Hachette innovates every day–by finding new authors, publishing books in areas that have not been written about before, breaking new authors out into an audience, trying new promotional avenues, using new e-book technology, finding ways to produce books more efficiently. No publisher is ever going to do what Amazon does, only better. No publisher wants to.

  2. Well, you can make that argument all you want, but there are plenty of manufacturers out there who’ve done the same thing — they find goods, produce goods, and prior to the internet revolution, they did not sell their goods directly — they sold through a retailer. And that has failed many of them (Radio Shack being one of them, which is mentioned in the article). There are many more who have become retailers, to their advantage. The time when a company can sit back and say, “We’re not a retailer” is probably over. And I disagree that no publisher wants to do what Amazon is doing; a few years ago, Macmillan started selling direct, and other publishers put up buy links. They aren’t well publicized, and they aren’t innovative to the point of luring customers away from Amazon, but the question should be why on earth wouldn’tthey? At this point, the internet has changed the landscape. If they aren’t figuring out a way to take advantage of that, I think it’s going to bite them in the assets later.

    Edited to add — here’s proof that some publishers do want to be retailers (or, if “want” is too strong, at least recognize the need in this new tech age): Harper Collins

  3. Dean, innovation usually involves breaking new ground. Discovering new authors is not a particularly ground breaking phenomenon, since it’s been going on for, oh, I don’t know, several centuries.

    As for ebooks, when I was traditionally publishing, I had to TELL my Big 5 publisher that they should also release my books in digital form. The bus had long passed the station and they were running to catch up to it.

    I think you also conveniently forget that big publishing got together and tried to start an online retailing site. Harlequin has been selling their books online for years, and—as Toni points out—HarperCollins has just opened their own store.

    While I think Harper is a bit late to the game, THAT’S exactly how publishers should have been innovating years ago, rather than sticking to the same old business model they’d been following for decades. While many of us saw digital as the future—especially after watching it happen with music, and later with movies—publishers buried their heads in the sand and are now playing catch-up.

    I LIKE publishers. I worked with many great people when I wrote and published over a dozen books with them and I don’t want to see them fail.

    But innovators they are not.

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