Monday, February 13, 2012

Amazon Will Destroy You

I've been hearing a lot of whiny bitching on the interwebs over the past year.

"Amazon is going to put Big 6 publishers out of business!"

"Amazon is a bully!"

"Amazon is going to destroy bookstores!"

"Amazon engages in unfair business practices!"

"Amazon is the devil!"

"Amazon is going to monopolize the industry, then force all authors to work in labor camps for 6 cents an hour!"

"Amazon is going to invent a car that is fueled by the screams of puppies!"

"Amazon is going to take over the world!"

That last one is probably true.

I just got back from Seattle with my cohorts Blake Crouch and Barry Eisler, and we met with some key players in Amazon's various publishing endeavors.

None of them discussed anything confidential with us. We pretty much just ate and drank and had fun. And it also pretty much confirmed what I've known for a while now.

Amazon is going to destroy the Big 6, destroy bookstores, destroy 95% of all agents, destroy distributors (Ingram, Baker & Taylor), and revolutionize the publishing industry by becoming the dominant force.

If you are any of the above I mentioned, you probably want to blame Amazon.

You'd be wrong.

Most of the blame falls upon that person you see in the mirror.

Some of it falls on your customers and authors, who like Amazon more than they like you because Amazon treats us better than you ever did.

Blaming Amazon for your eventual downfall is like blaming a lion for being king of the jungle.

If you don't like apex predators, get the hell out of the food chain.

Here's the thing, all you whiners. You had your shot. And you blew it.

Hardcovers cost too much. So do paperbacks. As media goes, paper books cost too many dollars per hour of entertainment they provide.

The return policy for books is archaic, wasteful, and stupid. It encourages overspending, overbuying, and underselling.

Underestimating the importance of digital was suicide. Then trying to prevent its widespread adoption via windowing titles, the agency model, high prices, and DRM was just throwing gas on a fire.

Treating authors like shit, when authors are essential to the process, is bad business.

Treating readers like shit, when readers are essential to the process, is bad business.

Bookstores and publishers and distributors are NOT essential to the process. You should have evolved.

Why didn't the Big 6 invent online bookstores and ereaders? Why didn't the ABA?

Amazon INNOVATES. That's the thing you whiners don't understand. They're not dominating because they undercut you on price. Price is just one way to please customers. Service is another. Value is another. But the biggest one is technology.

Anyone can sell for cheap. Not anyone can single-handedly jump-start the digital revolution. Not everyone can create an online store that is not only a pleasure to shop at, but where it is fun to spend time.

Amazon is going to eat you all for lunch because they aren't thinking about how to make money tomorrow. They're thinking about how to make money in 2018.

They're doing all the stuff you never did--hell, they're doing stuff that you never even thought of. They're all about pushing it forward. They're all about gathering and analyzing data. They're all about challenging themselves to do better, to focus on the future, to learn from the past. They're all about pleasing the customer (and I heard from no less than half a dozen Amazonians that they consider authors to be their customers.)

They experiment. They change. They evolve.

Are they perfect? Hardly. Show me a business, no matter how tiny, that is perfect. In fact, show me a person who is perfect. We all make mistakes as we strive to better ourselves.

But when Amazon makes a mistake, they own it. They don't compile mistake upon mistake until an industry is satisfied with an 80% return rate for books and a maximum of 17.5% royalties for authors and a $35 price tag for the new Stephen King.

It's easy to hate your competition, especially when the competition is kicking your ass.

But do you innovate?

Do you push the industry into the future, or try to protect the past?

I'm not seeing any innovation. At best, I'm seeing imitation. At worst, I'm seeing whiners.

"Poor me! Someone does my job better than I do!"

"My girlfriend likes another guy more than me because he's smarter, nicer-looking, and treats her better!"

My advice: if you're sick of getting beaten up, go to the gym and start training.

For years I've been telling publishers and booksellers how they can compete. I haven't seen any of them follow any of my suggestions.

But guess what? I've spent hours talking to Amazon. And Amazon listened. They took notes. And I've seen them adopt my suggestions. Many times. And I'm not the only one they're listening to.

An open mind beats a closed mind, every single time. Once you start blaming, you've lost.

Winners don't blame. Winners don't whine.

Winners keep at it until they win.

And to Amazon: don't worry about the blamers and the whiners and the haters and the naysayers.

History is written by the victors.

It was great hanging out with you Amazon folks. And as always, thanks for listening. ;)