Family Christian Bookstores Joins the Lemming Stampede to Pimp for Kobo
Remember last week when I reported that Family Christian Bookstores had signed up as Kobo’s latest US retail partner? The partnership was formally announced today, and FCB is already selling Kobo hardware on their website.
That was fast.
FCB now lists the Kobo Mini and Kobo Touch on their website, and they also show that the Kobo Glo and Kobo Arc are coming in the next couple months. This chain is also planning to sell the hardware in all281 stores across the US, but they will not be selling Kobo ebooks. Instead they will act as an affiliate and send customers to Kobo’s website to buy ebooks.
This is going to put FCB in the same position as the ABA members who just started selling Kobo hardware in the past few weeks. Like the indie booksellers who make up the American Bookseller Association, FCB is showrooming and providing sales support Kobo in exchange for an affiliate’s fee on future ebook sales.
Earlier today MobyLives, the house blog of Melville Publishing, heaped much scorn on the UK bookstore chain Waterstones for basically being Amazon’s lackey while at the same time praising the ABA for having a nearly identical relationship with Kobo. (Lots of people in publishing are blinded by their hatred of Amazon.)
As I see it, none of the junior partners are going to come out ahead in the long run. All are handing any long term relationship with their ebook-buying customer over to Kobo or Amazon, and as soon as the Kobo and or Amazon decide they don’t need a brick-and-mortar partner any more they will walk away with everything.
Lyman November 21, 2012 um 12:28 pm
" … As I see it, none of the junior partners are going to come out ahead in the long run. All are handing any long term relationship with their ebook-buying customer … "
Not sure you read the article you mention as being blind. There is a relationship if "showroom and sell" the ereader. Customers come back to the store. Long term that is the only way indy bookstores are going to survive. They need people to come into their stores so they can 'pitch' books to them. If no one comes to the store then that’s not going to happen.
Additionally, Amazon sells both books and e-books. Kobo just sells ebooks. The indie bookstores were always going to loose with respect to e-books since they don’t sell them and vast majority don’t really have resources to break into that competitive market. Most are getting $0.00 from ebooks now. Even getting $0.05 or $0.10 is a step up.
Nate Hoffelder November 21, 2012 um 1:04 pm
I did read it – just read it again. MobyLives lauded indies while castigating Waterstones even though the technical details of the relationships are functionally identical. Either they didn’t do their research or they are ignoring that simple fact. If one relationship is bad then so is the other.
What’s more, not all retailers are convinced this kind of partnership is bad (they could be right). Target, for example, only sells Nooks in store and appears to have a deal with B&N similar to the one which the indies and Waterstones have with Kobo and Amazon. The senior management at Target seem to think they are coming out ahead.
And most importantly, if your definition of a long term relationship is valid then MobyLives is doubly wrong for attacking Google for ending the indie bookseller partnership earlier this year.
oj829 November 21, 2012 um 12:51 pm
What will get people back in the stores – the specialty ones, at least – is realizing that not everything can be downloaded, and sometimes you have to, or want to, buy real books.
But Kobo books are not a part of the indie store’s inventory – once @ Kobo, shoppers have had a carnival barker draw them next door in the mall.
If I can’t "add that hardback" that the store carries to my shopping cart on impulse…
If I can’t "pick up in store" an order….
If, well, lots of things actually…
then I might as well be shopping at Amazon and not bother with Kobo at all.
Kobo is in a suicide pact with itself if it tries to further erode the physical bookstore market.
oj829 November 21, 2012 um 12:55 pm
As for the economics of it all, I encourage you to find the week-old antecedent to this article about the FCB. There was only one comment on that article – mine – and I’m not whoring it, honestly, but it has some interesting detail on what my purchase of 2 Kobo books meant to the indie I’m supposedly supporting.
Nate Hoffelder November 21, 2012 um 1:07 pm
You showed that the indies are basically getting an affiliate’s fee from Kobo:
That’s not a hell of a lot of money.
oj829 November 21, 2012 um 1:24 pm
That’s not a hell of a lot of money.
That was (and is) precisely my point.
Nate Hoffelder November 21, 2012 um 1:52 pm
And thanks for doing the sluething. It confirms what I always suspected.
oj829 November 21, 2012 um 1:29 pm
FWIW, I still buy Google books from my indie. While that deal officially sunsets in January, and plenty of stores have already retired it, mine has not and from what I know of it, the economics of the Google side are a lot better for the store than the Kobo ones.
I admit I have never heard precise details from my particular indie about his Google money, but I’ve seen articles hinting that stores saw a steady 10% of retail price.
Isles November 21, 2012 um 1:31 pm
I wonder what percentages these Kobo 'partners' are receiving from the eBooks and devices they sell. I can’t imagine that they are too great for the booksellers, considering the tight margins on both.
It seems like Kobo is the one getting the best perks out of this deal with bookstores across the nation acting as Kobo showrooms. It really is a brilliant marketing strategy, especially since the Kindle has been removed from most of the brick-and-mortar retailers it partnered with in the past. You can’t buy the Kindle from Target or Walmart anymore, Target citing a "conflict of interest." Maybe Amazon has done so much to alienate physical stores that it will be quite difficult for them to sell in this venue in the future. Kobo can make up some ground in this area.
oj829 November 21, 2012 um 1:38 pm
The 5% margin on ABA-sold Kobo hardware was no state secret. Also no secret that the distributor (Ingram) is being very generous with return options on the FIRST hardware SHIPMENT ONLY.
Once the Kobo hardware is available far and wide via e-tailers – particularly those $200 Arcs, already tailored to a finicky audience – any bookstore who has taken on too many is going to be breaking out into a cold, cold sweat.
Isles November 21, 2012 um 1:59 pm
Yeah, I have to imagine that the Arcs will be a very risky investment for the independent bookseller who offers them. The Kobo Arc has never been a popular 7″ tablet. They took a step in the right direction when they became Google certified (enabling access to the Google Play Store), but their new Android skin, called "Tapestries," might turn off some Android purists. The Arc has competitive specs, but it just isn’t very well known. Out of the dozens of tablet users I come into contact with over the past year, I have never seen one with a Kobo Vox. Most people who want a 7″ tablet will default to the Kindle Fire or Nexus 7 anyway. The eReaders will have enough trouble selling (most indie bookstore shoppers want physical books), but the tablets could be dangerous.
oj829 November 21, 2012 um 2:10 pm
Oddly enough, it’s the rear-facing speakers which keep me away from the Nexus. The Arc will have front-facing speakers and be – relatively – lightweight at about 12 ounces. Me likey.
Among people paying attention, though, you’re right – the Vox was such a curse no one will want to hear from Kobo although the Arc does seem to be a much-improved beast. But I was watching this youtube promo of a matronly bookstore-owner showing one off, and I was shouting at the screen "Don’t do it! Go back!"
Patrick November 22, 2012 um 9:35 pm
The Kobo Arc has never been a popular tablet? It just came out. You mean in the week it’s not been out it’s not been popular? 😛
The Vox wasn’t popular because it was antiquated by the time it was released. But the Arc has pretty much the same stats as the Nexus 7 and Fire and…almost all the other 7 inch tablets out. In the end it comes down to what ecosystem you’re buying from. Hopefully, at some point, during this tablet race, it’ll become more about the actual tablet and less about who you buy your media from.
yuzutea November 21, 2012 um 5:33 pm
Leaving the question of whether this is profitable for the bookstores or for Kobo aside for the moment, I can’t imagine many people will be wanting to buy a new e-reader at this point in the game. I think the market is pretty saturated and most people who buy a lot of books and want an e-reader already have one. If booksellers are smart, though, they’ll only carry the e-ink reader and not the tablet.
I’m also a bit confused about what’s in it for the booksellers. I suppose they must be regarding customers going over to ebooks as inevitable, and plan to sell just the books that are available as ebooks. This doesn’t seem like a viable long-term path, though, because more and more books are available as ebooks. Maybe this kind of deal would make the most sense for a used book store.
oj829 November 21, 2012 um 9:49 pm
I can’t imagine many people will be wanting to buy a new e-reader at this point in the game. I think the market is pretty saturated and most people who buy a lot of books and want an e-reader already have one.
"My" indie says they have zero customers who are into e-reading (er, excpet moi), but maybe that’s just what those customers are telling store staff as they gingerly pretend to not smell the stench of death.
I’m also a bit confused about what’s in it for the booksellers. I suppose they must be regarding customers going over to ebooks as inevitable, and plan to sell just the books that are available as ebooks. This doesn’t seem like a viable long-term path, though, because more and more books are available as ebooks.
Once the hurdle of getting a customer’s Kobo account (or device) linked to the affiliate store is overcome, there is (in an ideal world) the idea that there will be a permanent revenue stream for the affiliate as those Kobo customers buy Kobo books, EVEN if the customer never again visits the affiliate store’s website.
[Here I am holding my breath.]
But bottom line, — for all this Kobo-bashing (and yes, it would be great if they were better at what they do), everyone else has left the indies in the cold. (I really would love to know what Google’s friggin' problem was.) The ABA is trying to do SOMETHING. They’re providing a lot of web store support and maintenance for owners who don’t know a WiFi from a wiffle ball. The ABA – based in Connecticut – took a staffing hit from Sandy just as this project was really ramping up.
That doesn’t mean every store loves what’s happening – they don’t – but they themselves don’t have alternatives in hand ready to go live.
Eric Welch November 21, 2012 um 9:41 pm
Being a huge reader but also a hardware and software junkie and wanting to support the upstarts, I purchased about 30 books from Kobo, an equal number from Nook (along with a Nook color which I immediately rooted to get the full Android) in addition to my Kindle and Kindle books, and several books from Google and the iBookstore. What makes me keep running back to Amazon where I now buy exclusively, is their infrastructure: syncing always works, highlights always work, downloading always works, the Kindle Fire always works, the Kindle app works great across all my devices including my iPhone. None of the others can say that: their apps often fail, (the native Nook reader is pretty good, though), they have no highlighting capabilities, reviews are lacking, etc., etc. Amazon just does it better.
I want to support bookstores yet I keep running into experiences like this. My wife is an author and had just had a signing at the local B&N about 40 miles away. A week later, she asked me to run over and see if they had any books left. I checked the store’s computer which said they had 3 copies located in "Growth and Development" a gross shelving error since her book is YA fiction. I looked in G&D and couldn’t find them. I asked a staff member who checked the computer. Yup, 3 copies in G&D. She couldn’t find them either. I suggested we look in YA. Nothing there. Looked in YA fiction. Nothing there. So after 30 minutes of looking, we couldn’t find the books their computer said they had. She suggested I go home and order them online. As a test, I ordered one from Amazon that Saturday night and it was in my hands Monday morning. With a 20% discount. And no shipping charge. (I’m a Prime customer.) And you wonder why B&M stores are failing?
oj829 November 21, 2012 um 10:00 pm
FWIW, when I started buying e-books – and I was late to the game – my sole criterion was "Which store has the easiest-to-break DRM?" At the time, that was B&N. I pored and pored over message boards filled Amazon e-book customers whose tales of heartbreak and woe just trying to use their files swore me off the place as an e-book source. It was a hamster wheel that got changed on what seemed like a weekly basis.
But just like when iTunes launched, I kept the same promise I made back then: "If I can’t 'break it' and listen (read) where I want and when I want, I’m out." Steve Jobs didn’t need to know how many times I listened to Aretha Franklin sing "Respect", what time of day I was listening to it, or what the neighboring songs were in the playlist before and after. And Jeffie B. doesn’t need to know how long it’s taking me to finish the new Mary Wells bio.
Earth-shattering info? Nope.
Other software developments have lead me to ADE-"protected" stores.
Tyler November 21, 2012 um 10:37 pm
I am an athiest so I wont be buying a Kobo. Swear to God I wont!