Do you read more today, or less than you did 10 years ago? For most of us, the answer is more. Our ever present access to email and texting means we watch less TV, and pick up more from reading. Of course, we read a lot less paper than we used to – books are falling more out of favor every year – and the plight of newspapers and magazines is rocky. For traditional book publishers like Random House, Pearson, et.al. as well as periodical publishers like Tribune Corporation or News Corp. there is a lot of concern about survivability. But it's not because we're reading less. It's because the market has shifted, and people are reading differently.
What should a publisher focus upon? Words. Content. A recent Harvard Business School web discussion "HBS Cases: iPads, Kindles, and the Close of a chapter in Book Publishing" highlights that the role of a publisher is to find really good stuff that people want to read. The author, former CEO of Random House, points out that a publisher's job is to edit content into the format which makes it easiest to understand and digest. A good publisher aids us in our seeking knowledge, or enjoyment. But most publishers have completely lost sight of that goal, instead focusing on printing. Books, magazines and newspapers. Keep the presses busy, and the old supply chain filled.
In the business lifecycle we start with the Wellspring of ideas. When something catches hold, we enter the Rapids of growth. That's great, because growth is a fun place to be. But when markets start shifting then things go flat. We think slowness is our fault, so we work harder at what we've always done – but the cause is a market shift so the hard work makes little difference. We drift into the Swamp, where we are so overwhelmed with all the problems from no to negative growth that we forget what our original purpose was (we get so busy fighting alligators and killing mosquitoes that we forget the mission was to drain the swamp!) Eventually resources are depleted and we slide into the Whirlpool of failure.
Publishers are now in the Swamp. Cutting costs, focusing on "big deals" (like bidding wars to publish a book by a celebrity like Sarah Palin), and spending all kinds of time dealing with the supply chain. As the HBS article explains, while iPad and Kindle represent an opportunity for incremental growth – and new revenue – by feeding people content when they want it where they want it and how they want it – the publishers are in a pitched battle to slow electronic publishing. The publishers are trying to Defend & Extend their old process of printing, and distributing, paper. They want to defend their old Success Formula. And in doing so, they've completely lost sight of the opportunity digital publishing offers!
A paper published on the University of Missouri web site "What Happens When Newspapers Cut Back on Marketing Investments? An Empirical Analysis" is extremely enlightening. With ad spending down, in an effort to "save" the business, they are cutting editorial. Yet, this is creating a vicious cycle of decline (a Whirlpool is emerging.)
- Newsroom cuts are the most costly on revenue. More than cutting sales or distribution, cutting content led to the greatest loss. Duh! Of course. Readers are there for content – not for ads or distribution! Talk about forgetting your purpose.
- The bigger the cuts, the impact on revenues gets progressively worse! Remember what I said about creating a whirlpool? When you cut what people want, you hasten demise.
- Newsroom cuts are most costly on profit. Not only does revenue decline, but of all cost cuts the content cutting not only takes away readers – but quickly advertisers as well. Advertisers depend on content to draw people to their ads. Otherwise all you have is an ad tabloid – remember?
My book publisher is Pearson. Eighteen months ago I proposed that we take Create Marketplace Disruption and turn it into 16 short stand-alone mini-books. People could then buy just part of the book, as it suits their needs. Sell these for $1 or $2 each strictly as electronic downloads. That idea flew about as far as the famed dodo. Financial Times Press sells books I was reminded. No interest in this other wacky idea I proposed.
But I'm confident that for most of you, the idea of nice short readings – like say a blog – is a lot more appealing than digesting a 225 page book. People don't want less words, they just want things differently. That's why I do public speaking and workshops – because many of us don't want all the detail of the book and appreciate receiving the content in another format.
So, do you know what direction your market is headed? Are you moving forward to meet emerging needs and preferences? Or are you trying to defend & extend the way you've historically done business? For most publishers, the current direction spells disaster – failure. Learn from their mistakes, Disrupt your approach and find some White Space to learn how you can make money and grow!