A non-Amazon ebook seller finally tries something to actually compete

posted in: Publishing | 0

Link.

Kobo has launched a loyalty program.  It’s a pretty standard loyalty program, where you sign up, spend money, and get rewards back as they accumulate based on your spending.  What’s unique is it’s one of, if not the, first one done in the ebook seller realm.  It specifically rewards customers for concentrating their purchases at Kobo.

I sampled a few listings off the Kobo website, just some titles I randomly picked off the pages of their new ‘show points price’ page.  It did make me click into each title individually that I checked to get the actual money price.  These are all ebooks.  But I came up with this:

A fantasy novel for $6.99, Kobo Price $6.29, 3600 points.
A literary novel for $14.99, Kobo Price $11.99, 6800 points.
A paranormal box set for $0.99 (on sale, normally $5.99), 2400 points
A romance box set for $1.99, 2400 points
A mystery romance novel for $0.99, 2400 points

The program doesn’t allow points to be spent for agency priced books.  This is almost certainly because agency pricing doesn’t allow discounting.  “The price is set by the publisher” means exactly that.  Also, even if there is some sort of a loophole where Kobo would be allowed to trade ‘points’ for one of the titles, the publishers still want their cash.  And since agency prices are pretty high, Kobo would be in a position to have to shell out for an expensive ebook in real money to square accounts with the trad side.  I couldn’t find anything about how Kobo handles indie books paid for in points.  I’ll keep looking.

Other than the lack of indie author back-end details, the main thing I noticed about this program is Kobo doesn’t appear to be following any common formula that I could figure out with regards to price-to-points ratio.  It looks like they’ve just set points values, and they are what they are.  Indie books seemed to cost fewer points than non-indie ones; at least, from what I could tell.  I’m not exactly sure how this squares with their “points can’t be spent on agency priced books” rule . . . maybe they’re only setting points for trad books that are not using an agency pricing scheme?

That aside, the ‘trick’ with this program is the point values.  Even if someone pays $10 for a VIP membership, which doubles the rate of point acquisition and also offers a 10% discount on purchases, the reward requires a lot of money be spent.  Even a 2400 point book will cost $12 to earn; and from my quick review it looks like most of those 2400 level books will be indie priced in the friendly sub three dollar range.  The more expensive six and seven thousand point books move your spending level up to $30 or $35.  And that $12 doubles to $24 for a non-VIP Kobo customer; and the $30 to $35 goes to $60 to $70.  Kobo can adjust point values at any time, and I know of no loyalty program that doesn’t tweak and adjust itself in reaction to what customers do with it.  That’s not bad, or good; it just is.  Something to keep in mind.

The clear and obvious goal here is to try and lure non-Kobo customers over to Kobo.  It does almost nothing for Kobo if their existing customers pile onto this; except act as a thank you to them.  What the company obvious wants, as any beginning Marketing or Business student could tell you, is to pull new customers in to grow sales.  The question is; will it work?  Another, equally important question is, what will be the response from the other ebook sellers?  Amazon and Apple and Google Play being the ones that count; will they make some sort of counter, or will they just trust in the size of their brands to plow forward with no changes?

Time will tell.

I will say this though.  One thread that’s been running through the indie author community for a few years now is “support the non-Amazon retailers”.  The thrust of this thread has always focused on how ‘bad’ it would be for indie authors to not spread their books across as many sales platforms as possible.  I won’t bore you with the minutia of the argument, but that’s basically the pro-wide position in a thimble.  My response has always been that it’s not up to indie authors to ‘support’ any ebook seller.  Our job is to write books; it’s up to the sellers to sell them for us.  Sure we do our own marketing, make deals, and so forth; but it’s not my job to prop up any, or any multiple, e-tailer(s).  It’s their job to grow their own business.  It’s their job to protect and build their own platforms.  Not mine.

So while I’m not sure I personally plan to participate in Kobo’s new Super Points program, I am glad to (finally) see one of the name e-tailers actually doing something to try and support themselves.  To compete, to grow, to draw attention and entice customers in.  That’s what they’re damn well supposed to be doing; building themselves up.  Not sitting on the sidelines whining about how things aren’t fair.  Competing, like grown ups.  This move is at least some demonstration of how they’re trying to act like a responsible business and tend their own shop.  And it’s refreshing, regardless of what I personally do with my purchases.