Lagardère Publishing CEO Arnaud Nourry gave an interview to Scroll.in this weekend that showed both that he was remarkably ignorant about his products as well as how and why consumers value his products.
FYI: Lagardère is the parent company for Hachette Book Group (US) and Hachette (UK), and Hachette Livre (France).
The interview also showed that his PR staff needs to be fired (Nourry should never have been allowed to say this).
It’s been a little over ten years since ebooks came to the market in the form of Kindle. You mentioned a small decline – do you think the market has plateaued? Are there formats other than ebooks that publishers should be looking at?
There are two different geographies to look at for this. In the US and UK, the ebook market is about 20% of the total book market, everywhere else it is 5%-7% because in these places the prices never went down to such a level that the ebook market would get significant traction. I think the plateau, or rather slight decline, that we’re seeing in the US and UK is not going to reverse. It’s the limit of the ebook format. The ebook is a stupid product. It is exactly the same as print, except it’s electronic. There is no creativity, no enhancement, no real digital experience. We, as publishers, have not done a great job going digital. We’ve tried. We’ve tried enhanced or enriched ebooks – didn’t work. We’ve tried apps, websites with our content – we have one or two successes among a hundred failures. I’m talking about the entire industry. We’ve not done very well.
I’m convinced there is something we can invent using our content and digital properties beyond ebooks but I reached the conclusion that we don’t really have the skills and talents in our companies because publishers and editors are accustomed to picking a manuscript and creating a design on a flat page. They don’t really know the full potential of 3-D and digital. So we acquired three video game companies in the last two years to attract talent from different industries and see how we can nurture one another and how we can go beyond the ebook on digital. We need to offer different experiences to our consumers.
One could bristle in reflexive annoyance over Nourry dissing ebooks, but the bigger story is what this says about Nourry.
Edit: I thought everyone knew this, but no, ebook sales have not plateaued. Hachette's sales are low because Hachette keeps their ebook prices high. If you check the Author Earnings report, you will see that ebooks make up a significant part of the market. And it’s not just a tiny group of readers who like ebooks; almost all of romance has gone digital, as well as around half of the SF market.
This guy understands so little about ebooks that it is almost frightening.
Edit: When he calls ebooks stupid, what he really means they are dumb, as in the opposite of a smart product like an enhanced ebook. This is true, epubs are simple dumb files, but that is what consumers want (and Nourry won't sell consumers what they want).
Basic market research will tell you why consumers like a product and how they use it, but if Hachette has access to that research then the info is not making its way to Nourry. As a result, he is blindly leading Hachette down multiple wrong paths.
They've tried enhanced ebooks, ebook apps, and even ebooks on websites, all because Nourry doesn't understand ebooks as a product. And soon they will be trying video games.
Let me say that again so it sinks in.
The CEO of a major multi-national book publishing conglomerate does not understand his company's products or his company's markets.
This point is so mind-boggling because it is really not that hard to find out why consumers like ebooks: just go ask them.
Consumers like ebooks because we can change the font size. We like ebooks because we can carry a hundred ebooks on a smartphone. We also like being able to search the text, add notes that are can later be accessed from a web browser, and easily share those notes with other readers.
Edit: As Andrew Rhomberg pointed out on Twitter and a reader explained in the comment section of this post, readers like ebooks because they are the exact same stories we already read, only with a few extra minor improvements.
All of these opinions are both obvious and readily available from the nearest ebook fan - including the ones that work for Nourry.
What is especially weird about this story is not just the lack of understanding but also that one would think Nourry has staffers who use ebooks constantly, and yet he has never listened to them explain why they like ebooks.
And this is the CEO of a company with annual revenues around 2.2 billion euros, folks.
Nourry has been the CEO of Lagardère Publishing since 2003, which means that every decision he has made about ebooks in that time has been based on him not understanding the first thing about ebooks.
Do you know that stereotype about legacy publishing companies being dinosaurs that don't understand the first thing about their business?
Nourry has just shown us that there is a lot of truth behind the stereotype.
Chew on that.