A December 2011 report by Deloitte on the educational publishing market points to the fundamental market shift – digitization, the changing preferences of younger readers to e-books, and the massively reduced cost and time to market provided by “print-on-demand” publishing technology.
The institutional education market – K-12 and tertiary education – has been somewhat protected with highly targeted publisher sales forces catering to the specific needs of educational institutions and the close professor-author-publisher relationship. At the post-graduate level we see venerable institutions like Harvard offering MBA programs online accessible anyplace and anytime with full digital content and tutoring arrangements.
When you look at the general market the shift is even more spectacular. Amazon now sells more e-books than physical books. The economics for a traditional large publisher requires at least 10,000 copies to be sold in the first year for a new book to be considered worthwhile. The production time is 4-6 months means that many topical books can be outdated by the time they hit the shelves ofr the kindle or iPad. Sale of 50,000 copies are required for the book to be considered commercially successful. It has become a high-risk business.
Traditional publishing companies are being disrupted because the basis of competition in publishing has fundamentally changed. Authors have many more options to publish from self-publishing at low cost, to specialist niche publishers to the much slower, tradition-tied major publishing houses. Readers could care less about the brand of the publisher on the book. Also, a majority are using the e-book format. The change is fundamental and irreversible.
Recommended for YouWebcast: The Art of Growth Hacking: Gaining Early Traction by Doing Things that Don't Scale
Penguin has recognized this shift and is one of the first companies to purchase a substantial print-on-demand publishing house for self-published authors – called AuthorHouse. Others must follow or they will be disrupted by this technology and market shift.
Most traditional publishers know this, but what is needed to reinvent themselves? They must develop peripheral vision as a cultural attribute that enables them to see current and future market shifts. They need much more of a global perspective and collaborative model than the traditional country market fiefdoms that artificially protect geographic markets with local production. What is even more critical is a market focused adaptive culture in which people in the organization can make the mindset shift as well as the customer focused practices relevant to delivering value to the new markets.
We can think of today’s print-on-demand (POD) technology as a disruptive technology that is fundamentally changing the business model needed to be a successful publisher. The POD technology is easy to get, but what many traditional publishers don’t have is the customer culture needed to reinvent the business. Those that don’t have it or don’t rapidly develop it will die.
Does your company have the market focused adaptive culture needed to survive fundamental market shifts?