The natural world is dictated by one simple rule: survival of the fittest. The survival of an organism or an ecosystem is determined by its ability to compete and adapt to change. This same rule is true for the business world. Companies only prosper if they are able to compete with those around them and adapt to changes in the market. One ecosystem which is currently being tested is the publishing industry. Because it was designed based on the business practices of the 20th century, the publishing world is struggling to adapt to the new challenges presented by the 21st century. If the publishing industry was completely recreated to fit the new era, there are many changes that would need to be made. To match the demands of the 21st century, all of the publishing departments would need to place greater focus on the digital realm of publishing, decreasing their dependence on physical stores. In addition, publishers would need to strengthen their relationships with their readers and authors and gain more control over the online market.
Despite the radical changes over the past forty years to the publishing industry, the main departments in a traditional publishing house still serve a purpose in the 21st century, even if some of their members have lost their relevance. If the publishing ecosystem was redesigned from scratch, these departments would still need to exist in some capacity. However, some of the departments’ roles would be either reduced or revised, while other departments would rise in prominence. For example, editing departments would more or less stay the same. Even though publishing is shifting more towards the creation of digital books instead of physical ones, publishing houses still need editors to proofread the raw text provided by authors. The only change to the editing department would be to contract more of the editing out to freelance copyeditors who would be paid per project. This would help publishers save money and would allow copyeditors to work for multiple companies at once.
Another section that would stay relatively the same is the design department. Just like editing, proper design is still important. Even with the advent of the digital book, books still need to contain a certain level of artistry. Buyers are more likely to support publishers who produce quality goods. Ebooks have covers, just like printed books, and these covers need to be created by professionals who understand how best to market a book. Even though digital books are becoming more popular than printed books, they still have to have an attractive layout and font, or readers will not want to buy them. The only difference is that the designers will need to design layouts and illustrations that can be easily formatted into the ebooks.
The two main departments that will need to change are the publicity and sales departments. With increasing numbers of both independent and chain bookstores going out of business, trade sales representatives are less important. If the publishing ecosystem was redesigned to fit the 21st century, sales departments would be smaller, with more attention placed on selling stock to online stores like Amazon and Better World Books. There would still be a small group of trade salesmen who would work with the remaining bookstores. Despite their reduced population, bookstores represent a sizeable percentage of publishers’ sales, and neglecting them entirely could ruin publishing houses.
In addition to arranging their staff differently, sales departments would also use different sales methods. One of the reasons why Amazon is so successful is because it practices targeted advertising. Amazon tracks each customer’s preferences and uses this information in order to offer recommendations that have been specifically designed to match each individual buyer. Laurie Burkitt, a contributor to Forbes Magazine, recommends that publishers begin to use the same methods. Citing a survey on the effectiveness of targeted advertising, she writes, “The survey, conducted with 12 advertising networks, shows that conversion rates for the targeted ads are 6.8%, compared to 2.8% for the nontargeted. That means that consumers who click on ads targeted specifically to them are more than twice as likely to buy the advertised product” (“Behavioral”). By using targeted advertisements, publishers will increase their sales.
Just as the redesigned sales departments would use the vast stores of information available on the web to better target potential buyers, the new publicity departments would use the internet to spread awareness of upcoming titles, increasing their visibility in an over-crowded market. In the past, publishers have focused entirely on the authors and retailers, ignoring the customers. If the publishing ecosystem was rebuilt for today’s society, much more emphasis would have to be placed on building relationships with the readers who support the industry. By releasing regular newsletters, offering discounts to loyal customers, and keeping track of their readers’ preferences, publishers could increase the support of their customers. In the 20th century, publishers were able to get away with ignoring individual readers and focusing entirely on the information provided to them by retailers. However, this mentality needs to change if publishers want to maintain the support of their readers. In addition to restructuring their departments, publishing houses also need to change their approach with their authors, particularly in the area of royalties. Publishing companies must offer higher ebook royalties if they want to keep authors from publishing ebooks on their own. Self-publishing digital books are becoming easier every day. If publishers do not increase the authors’ ebook royalties, they will start losing clients who would rather risk self-publishing for better returns on their work. As e-books gain more popularity and publishers make more money off of them, authors are starting to speak out against the reduced ebook royalties. As more and more writers protest the low royalties, publishers are in increasing danger of losing their current authors and turning away new clients.
According to The Guardian’s article on ebook royalties, authors in the United Kingdom are uniting in their demands for increased royalties (Flood). Tom Holland, the chair of the Society of Authors, states: “Most publishers are insisting they should control ebook rights and this will be written into standard contracts. I think it’s an entirely reasonable position to take, so long as the royalties and returns on ebooks are fair and proper and reasonable. If they are not, I suspect we may well find very big-name authors, such as J.K. Rowling or Dan Brown, will go their own way” (Flood). American publishers face the same decision as publishers in the United Kingdom. If they continue to offer lower royalties for ebooks, they may lose some of their biggest clients.
The final thing that would need to change in the publishing world is the relationship between Amazon and publishers. Because the current system bases bargaining power on the number of resources controlled by a company, Amazon has been able to force publishers into offering steadily higher discounts. In order to curb Amazon’s ability to control the price of books, publishers need to stand together. In the United Kingdom, the Net Book Agreement once set a limit on how much a retailer could discount its books. It was designed to keep retailers from driving down the price of books and damaging the publishing industry (Thompson 51). Now, American publishers are facing a single corporation with considerable power over the market. To stop Amazon from taking advantage of the system, publishers need set up an agreement that places a limit on discounts for online stores like Amazon. If all of the publishers stick together, it will be harder for Amazon to pressure them into offering increased discounts. By setting a ceiling on discounts, publishers will be able to control the prices of their books again.
The book publishing industry is facing new challenges every day, primarily because it was not designed to compete in the 21st century. When publishing houses were created, publishers had no way of knowing what the future would hold. If it was possible to start over and rebuild the publishing industry to better suit the demands of the digital age, publishers would have a much better chance of surviving without suffering too much collateral damage. While it is possible that the publishing ecosystem will be able to adapt regardless of its outdated design, it will have to significantly alter its business practices if it wishes to survive. However, as nature has proven time and time again, so long as there is life, there is hope. If publishers adjust their departments to better suit the digital age, pay more attention to their readers, and work together to keep control of the market, they may still have a chance at survival.
Burkitt, Laurie. “Behavioral Ads Offer A Windfall For Marketers, Publishers.” Forbes. Forbes Magazine, 24 Mar. 2010. Web. 31 July 2015.
Flood, Alison. “Ebook Deals ‘Not Remotely Fair’ on Authors.” The Guardian. Guardian News and Media Ltd., 12 July 2010. Web. 30 July 2015.
Thompson, John B. Merchants of Culture: The Publishing Business in the Twenty-first Century. NY, NY: Plume, 2012. Print.