Amazon’s “Buy Button” Policy

The publishing world is all abuzz with the latest Amazon change. It has to do with Amazon’s “Buy Button” policy change in regards to new books sold on the site.

A Little History

Last November, Amazon began allowed third-party book re-sellers to “win” buy buttons on book pages. Third-party re-sellers on Amazon can win a buy button by meeting various criteria outlined by Amazon, which includes price, availability, and delivery time (see https://goo.gl/11yc37).

The program is only open to new books, defined by Amazon as “brand-new, unused, unread copy in perfect condition. The dust cover and original protective wrapping, if any, is intact. All supplementary materials are included and all access codes for electronic material, if applicable, are valid and/or in working condition.”

Amazon has long allowed third-party sellers to compete with Amazon for the sale of new items. Up until last year, books were exempt from this program with Amazon selling the publisher’s copy of a book as the first listed seller. Interestingly, Amazon currently does not sell or stream copies of other copyrighted works—movies and television programs—that are distributed by anyone other than the authorized distributor. In other words, third party sellers cannot sell these copyrighted new works.

The Concern

Of course, publishers are concerned that they will not get their fair share of retail price for new books sold by third-party sellers on Amazon. Where do these third-party sellers get their books? Generally, not from the publishers. Publishers and authors make the most money from books sold directly through Amazon because these books are purchased directly from them (although sometimes through the publisher’s distributor).

Many authors and publishers have also expressed concern that the books being listed as “new” by third-party sellers are not really “new”. If you believe your book (or anyone’s book) is being sold as “new” by a third-party seller—but really isn’t a new book—you can file a complaint with Amazon (see https://goo.gl/aqfw5P).

Speculation

Anytime Amazon makes a major policy change, many speculate as to the motivation behind the move. Two theories are being kicked around.

  1. Amazon is trying to expand its POD offering and wants to encourage publishers and authors to use its POD services. After all, it appears that, for the most part, books sold via Createspace and IngramSpark still have Amazon as the primary “buy” button.
  2. The other speculated motivation is that Amazon wants to reduce their storage and labor costs by giving preference to third-party buyers. In doing so, Amazon will have less books to stock and move in their warehouses.

Personally, I also wonder how much Amazon just changes things up every so often to stay in the news. Every change brings lots of buzz, so the strategy seems to work if that is what they are after.

As a consumer who buys books on Amazon, I find the third-party buy button very annoying. It makes me have to double and triple check that I am actually buying the book from Amazon and not a third-party seller that will make me pay shipping.

I would love to hear if and how Amazon’s buy button policy has effected your book listing and sales on the site.

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Amazon: Christian Authors Beware

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Amazon: Christian Authors Beware

Amazon is a massive giant and growing. Consider the following facts:

  • Half of all U.S. households are subscribed to Amazon Prime.
  • Half of all online shopping searches start directly on Amazon.
  • Amazon captures nearly one in every two dollars that Americans spend online.
  • Amazon sells more books and toys than any retailer online or off.
  • Amazon sells 67% of all ebooks and 64% of online print book sales.

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As an author, you cannot ignore Amazon.

Recently, the Institute for Local Self Reliance (ILSR) published the results of a study they conducted. The study “Amazon’s Stranglehold: How the Company’s Tightening Grip is Stifling Competition, Eroding Jobs, and Threatening Communities” provides in-depth details on how Amazon is monopolizing the economy, undermining job growth, and weakening communities. Consider a few more interesting factoids:

  • Amazon increasingly controls the underlying infrastructure of the economy.
  • Amazon’s Marketplace for third-party sellers has become the dominant platform for digital commerce.
  • Amazon’s Web Services division provides the cloud computing backbone for much of the country, powering everyone from Netflix to the CIA.

ILSR warns that Amazon’s power as a gatekeeper in our economy will increasingly have negative consequences. One example ILSR sites is that “Amazon’s power to manipulate what products we encounter is especially concerning in the book industry, where it now commands more than half of sales, and where it can stifle the exchange of ideas simply by removing a book from its search and recommendation algorithms, as it did two years ago, in its dispute with the publisher Hachette.”

Christian authors, do not take this warning lightly. ISLR is on to something very important here. Amazon is not a Christian company, nor are they friendly to Christian books. Yes, Amazon lists almost every book for sale on its website, but that does not mean that the company is sympathetic toward Christian books. In fact, the opposite is true.

A member of Christian Small Publishers Association (CSPA) recently brought this to my attention. This gentleman had published an ebook on prayer via the Kindle Direct Publishing program. He then signed up to use Amazon’s Marketing Services to run an ad campaign on his book. Amazon denied his ad campaign and cited their “Creative Acceptance Policy”.

I urge you to go to Amazon and read this policy. This policy states the following:

  • Unacceptable Books: Books with content that is threatening, abusive, harassing, or that advocates or discriminates against a protected group, whether based on race, color, national origin, religion, disability, sex, sexual orientation, disability, age or any other category.
  • Restricted Ad Content and Books: There are several customer experience sensitive categories that are not appropriate for a general audience. The following categories may be restricted from the homepage and Kindle E-reader placements: Religious or spiritual content.

In addition, the email that Amazon sent this author stated, “we are unable to approve your ad if it contains overtly religious or spiritual ad copy, images, or symbols (for example, the Star of David, a crucifix, the Star and Crescent).”

I believe that moving forward, Amazon will increasingly restrict religious content on their site through the means mentioned above. Personally, I find it sad that the Christian Retail Industry has not done more to embrace small publishers and independent Christian authors. In not doing so, they have partly been responsible for the rise in Amazon’s power, as these publishers and authors were forced to rely on Amazon for book placement and sales.

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Amazon is Not a Distributor

Last week I had the death flu. As I lay in my bed for four days in a cough-raked body in a fever-induced state of mind, I began to ponder the important questions. Questions like “When will ISIS be stopped?” and “How far will the Chinese economy fall and what impact will that have on economies around the World?” Then came the question, “Why do so many self-published authors think that Amazon is a distributor?” With that my brain said, “There’s a blog post,” and I knew I was on the road to recovery.

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Does Walmart buy books from Target to sell in their stores? Does Lifeway buy books from Family Christian to sell in their stores? Of course not. If one retailer bought product from another retailer, they would not make any money and would go under.

If you asked bookstore owners and managers who their biggest competitor is, many would say Amazon. That’s right. Amazon is a bookstore. It happens to be the largest bookstore in terms of sales in the United States. It is not a distributor.

Yet, so many independently-published authors seem to think that Amazon is a distributor. When I ask authors to list their distributor, many say Amazon. Why would a bookstore buy books from their largest competitor? That would simply help Amazon grow bigger and put the bookstore out of business.

Bookstores buy books from distributors, not their competition. Distributors sell books to bookstores at a discount, usually at 40 to 45 percent off the retail price. The bookstore then sells the book for the full retail price, keeping this 40 to 45 percent of retail price as their profit.

The larger distributors (and wholesalers) that bookstores buy books from are:

  • Ingram
  • Baker & Taylor
  • IPG
  • BookMasters
  • Spring Arbor (Christian bookstores)
  • STL (Christian bookstores)
  • Anchor Distributors (Christian bookstores)

There are also a myriad of smaller distributors around the country. Getting a bookstore to stock an independently published title is an uphill battle to start with. Unless your book is listed with a major distributor, you often don’t have a prayer of having bookstores stock your title.

Bookstores do not buy books from Amazon. Although, they will purchase the book directly from the publisher or author if a customer has asked the store to special order a book that is not listed in the bookstore’s distributor’s database.

So, if you are an independently published author and someone asks you who distributes your book, don’t say Amazon. That is where consumers buy books, not retailers.

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Amazon’s Price Fixing Attempt

This past weekend, I received a letter from Amazon.com. I know that I am not the only one who received this letter. I believe Amazon sent the letter to all Kindle Direct Publishing authors. Most likely, you received the letter too.

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I am dumbfounded that Amazon has turned to independent authors to try to get them to apply pressure on a major publisher to lower its ebook prices.

I urge you not to get sucked into Amazon’s argument. If Amazon can begin to dictate the price of ebooks, then you, as an independent author, will soon not have the ability to set the price for your own books either. Isn’t that one of the reasons you independently published in the first place—to have more control over the whole process, including price?

In their letter, Amazon states:

“We want lower e-book prices. Hachette does not. Many e-books are being released at $14.99 and even $19.99. That is unjustifiably high for an e-book. With an e-book, there’s no printing, no over-printing, no need to forecast, no returns, no lost sales due to out of stock, no warehousing costs, no transportation costs, and there is no secondary market – e-books cannot be resold as used books. E-books can and should be less expensive.”

I am outraged at a number of statements Amazon makes.

First, who determines what an “unjustifiably high” price is? The book seller, the publishers, or the consumer? In a free market economy, it should be the consumer, not the book seller.

Second, “E-books can and should be less expensive” than print books. The reason Amazon gives for this is that there are no printing costs. There is a flagrant error in thinking here. The price of a print book is not solely based on the cost to print the book. Sometimes, the information in the book drives the price. For example, specialty books that contain information that cannot be found elsewhere are priced higher than the average fiction book even if the cost to print is the same. In these cases, the consumer is paying for the information.

Third, Amazon states, “Hachette has already been caught illegally colluding with its competitors to raise e-book prices.” What Amazon doesn’t remind you is that the collusion had to do with steps these publishers took to stop Amazon from steeply discounting their ebooks. It had to do with something called the “Agency Pricing” model which was different from the “Wholesale” model. With the Agency Pricing model, retailers could not discount books the same as with the Wholesale model. Needless to say, the DOJ lawsuit threw out the Agency Pricing model. Therefore, Amazon has the ability to discount ebooks, like they do with print books. Instead, Amazon is trying to get Hachette to lower its prices so it won’t have to discount ebooks and, as a result, keep more money from each ebook sale.

Fouth, Amazon wants authors to send Hachette letters stating, “We have noted your illegal collusion. Please stop working so hard to overcharge for ebooks. They can and should be less expensive.” I think instead, we should be sending letters to Amazon stating, “Monopolies are still illegal in the United States. The main reason monopolies are illegal is because such entities get into price fixing. Price fixing is an agreement between participants on the same side in a market to buy or sell a product service, or commodity only at a fixed price, or maintain the market conditions such that the price is maintained at a given level. Whether a price is fixed high or low, it is still price fixing. Your misguided attempt to get Hachette to lower their pricing is an attempt at price fixing, plain and simple.”

Do not be deceived. Amazon does not care about the consumer and offering “affordable” ebooks to consumers. It is a business. Amazon only cares about profits and what will bring it the most benefit.

Needless to say, I will not be sending a letter to Hachette. I for one, still believe in and will stand for a free market economy.

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Are Reviews Really Important?

As the director of Christian Small Publishers Association (CSPA), I get all sorts of interesting requests. What many of CSPA’s member publishers don’t realize is that we are at work behind the scenes promoting our members and their books in all sorts of ways.

For example, I recently received a call from the director of a funeral home. This gentleman was looking for books on grief and loss that he could use with clients who were burying loved ones. He wanted to purchase said books in bulk and then give them to the people using the funeral home’s services.

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I, of course, immediately let him know of a couple books by our current and past members on grief and loss and coping with this issue. I also told our member publishers about the opportunity and invited them to send this gentleman review copies of any books they would like considered.

One of the books I was going to recommend to this funeral director was a book by a small publisher who is no longer a member of CSPA. I thought the book fit well with the request and was willing to help out both our previous member publishers and this gentleman in this fashion.

However, when I went to this publisher’s website, I found that the link for the book went directly to Amazon. To my dismay, this book did not have one single review posted on Amazon. Interestingly, the author had put endorsements on the back cover of the book, but somehow had never taken the time to make sure these endorsements got onto Amazon. I have to admit, I was reluctant to recommend the book when there was not one single review on Amazon.

You see, as a book person, I don’t buy books that do not have any reviews. A lack of reviews on Amazon signals that either the book is not good or that no one is reading it. Either way, the message about the book is negative.

To be honest, I think this independently published author just did not take the time to market her book. Obviously, she did not encourage people to post their thoughts about the book on Amazon. Nor did she use one of CSPA’s services such as BookCrash (our books-for-bloggers review program) to make sure that her book had reviews on Amazon.

If you are a publisher of an author, please listen: Make sure you get some reviews for your book on Amazon. It is an important marketing tool that you should not miss using.

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