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Beth Cox Report: September 2014
Dear Loyal Readers, Authors, and Publishers,
Just recently (on Sept. 25, 2014), the Madison-based newspaper Isthmus published two heated articles about publishing and retail giant Amazon.com. Intrigued, I browsed both of them; they're freely available on the Isthmus website.
"Amazon Attacks", by Jim Hightower, is at
and "Amazon Forces Local Shop Owners to Shift Gears", by Judith Davidoff, is at
Both pieces are fairly negative toward Amazon, particularly with regard to how they siphon away sales revenue from multiple Madison businesses, not just Madison's bookstores ("book sales make up a mere 7% of Amazon's total business", notes "Amazon Attacks"). "Amazon Attacks" describes a few key factors that make Amazon's impact especially hard-hitting:
1) Sales taxes. For far too many years, online retailers like Amazon could get away with not charging the sales taxes that local shop owners have to charge, a price differential that gave them a competitive edge, and depressed state tax revenues. This appears to finally be changing; Wisconsin is currently one of 21 states that require Amazon to pay sales tax. The rest are listed at
2) Predatory pricing. Amazon has the resources to weather massive losses in order to undercut competitors long enough to drive them out of business. "Amazon Attacks" describes a chilling example in Amazon's one-sided war against Diapers.com.
3) Showrooming. This word describes an ongoing problem for brick-and-board retailers, whether they sell books, games, furniture, clothing, electronics, or any number of other products. "Customers" use the store to scout merchandise, possibly even taking salespeople's time to ask questions or get a demonstration; then the "customers" scan product codes into their cell phones, and leave without buying anything. These "customers" make their purchases online, and the retailer is reduced to being an unpaid "showroom".
All three of these issues are not exclusive to Amazon; it's just that Amazon is the 800-pound-gorilla of the online marketplace. A significantly less negative and more evenhanded portrayal of Amazon is in the (July 12, 2014) New York Times article, "Amazon, A Friendly Giant As Long As It's Fed" by David Streitfeld:
This fascinating article describes how Amazon dramatically changed the marketplace balance of power, particularly with regard to publishers. This isn't necessarily bad; Amazon currently offers a viable way for "little guys" in the writing world to earn a living, by publishing through Amazon or selling ebooks, when under the old publisher-driven model they might not have a prayer of quitting their day job.
One MBR employee literally did quit his day job (working for us!) to earn a living writing and publishing ebooks full-time, largely through Amazon. "Amazon, A Friendly Giant As Long As It's Fed" tells the story of another successful individual in a similar situation.
My personal view of Amazon is that they're not necessarily "good" or "bad", but they are definitely here to stay. It's worthwhile to have "a public conversation about their power," to quote "Amazon Attacks" one last time, and I worry that the 29 American states who do not require Amazon to pay sales tax are hurting themselves and the nation. But it's far too easy to think of complex economic issues and corporate entities in terms of black-and-white moralizing. Although "Amazon Attacks" raises salient points, their front-page image of a monstrous, all-devouring maw is... shall I say, over the top?
Perhaps the most pressing concern is: How can ordinary booksellers or merchants stay afloat in an ocean dominated by Amazon? "Amazon Forces Local Shop Owners to Shift Gears" offers one ray of hope, and that's in cultivating customer loyalty by providing services that an online retailer can't. Whether it's the ability to fix broken items, offering to giftwrap purchases to taste, or hosting local events (such as book clubs, poetry readings, role-playing games and more), the personal touch - experiences and aspects that can't be delivered via the mail - may be the best way local businesses can adapt to today's evolving marketplace.
On a lighter note, September's link of the month is Unshelved, a wonderfully funny, free online webcomic about libraries:
Begun in 2002, Unshelved is still going strong after 12 years! Their website/twitter feed recommends books to the public, and they currently have an "Unshelved Goes Digital" Kickstarter going (it's already met its minimum $5,000 goal and will be funded). Kickstarter backers can potentially receive Unshelved ebooks on little USB drives shaped like library card catalogs.
Finally, September's Review of the Month is about a marketing book especially for the 21st century and beyond:
Understanding Digital Marketing, third edition
Kogan Page USA
1518 Walnut Street, Suite 1100, Philadelphia, PA 19102
9780749471026, $29.95, www.koganpage.com
Understanding Digital Marketing: Marketing Strategies for Engaging the Digital Generation provides a fine, accessible guide to digital marketing and appears here in its third updated edition which has been completely revamped to reflect key changes in digital marketing strategies and the digital environment. New chapters incorporate the latest marketing metrics and show how to use digital media to achieve business success, covering everything from understanding how digital marketing channels work to honing a competitive edge in this market. The result is a powerful survey highly recommended for any business that would use the Internet as part of its marketing plan.
That's all for the September 2014 Beth Cox Report. Adapting to changing times and evolving markets isn't easy, but don't ever give up!
The Midwest Book Review
James A. Cox
Midwest Book Review
278 Orchard Drive
Oregon, WI 53575-1129
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