I.
Introduction
A.
Definition
Marketing as a separately
practiced discipline by the publishing industry in general and in marketing
academic books or textbooks in particular has come a long way in the past ten
years. Selling and promoting
textbooks have always been concrete activities that have been practiced by
publishers with vigour. Today there
probably is no major publisher that does not have a marketing director, product
managers, product co-ordinators, market research managers and various other
personnel concerning themselves with marketing activities.
Some of the reasons for this change are:
1.
The publishing
industry was largely family-owned and relatively insular tending to perpetuate
the traditions of the people in the industry.
2.
The last ten
years have been a multitude of acquisitions of publishers by non-publishers
providing different kinds of expertise and talents.
3.
The pressure to
stay profitable in a highly inflationary period has required more emphasis on
the marketing management and financial aspects rather than traditional editorial
aspects of publishing.
Professor Hughes in his textbook on Marketing Management defines
marketing as: "Marketing are those activities that relate an organization
successfully to its environment. The
main activities are the identification of current needs: the development of
products and services to meet these needs: pricing ; the distribution of goods
to the market place; and, the communication of the ability of the products and
services to meet these needs:. Applied
to marketing of textbooks the activities can be restated as: The conduct of
market research to establish the need for textbooks in general and type of
textbook in particular, the writing or acqisition of textbook manuscripts and
their development into textbooks, the pricing of textbooks, the distribution of
textbooks to the market place, and the communication of the developed textbooks,
ability to meet the needs of the educator. This,
of course, is a very broad definition, but indicates the true nature of the
process, namely; marketing must pervade all activities of an organization if it
is to be successfully practiced. In
a sense, "Marketing is Publishing".
Success, of course, may mean different things to different publishers,
depending on the nature and goals of the organization, i.e., profit, non-profit,
social, educational, etc. My
comments are mainly intended for profit seeking textbook publishers, though some
of the principles will be applicable to others.
B.
Philosophies
While most
publishers agree on the basic principles of marketing, it is the philosophy of
the overall concept as implemented by marketing people tthat determines the
results. These philosophies vary
among practioners.
The traditional approach has been publicity, advertising, and promotion
with an emphasis on the essence of the book equal sales.
The book must present the best in its kind.
If it is a historical novel, it has got to be the best historical novel,
if it is a how-do book, it has to be the best how-to-do book, if it is a
suspense story, it has got to be the best chiller suspense story, and, of
course, if it is a textbook on marketing, it must be the best marketing textbook
in existence.
Another view places the quality of the product to fulfill the market
needs at the center of marketing activity. The
market research effort must make sure that whatever is published serves the
information needs of the target market. If
you are going to publish a general economics book the question what are the
instructor's needs must be answered, i.e., a general economics text with
emphasis on economics text surveying the subject or a text with emphasis on
economics concepts: macro-economic, micro-economic or both; high or low reading
level; economics of a capitalist or socialist system; emphasis on developing or
developed industrial states, etc.
A third point of view expresses that credibility, coordination, and
follow-through are the determining strategy.
Each book must progress through a campaign that establishes credibility,
the proper advertising to interested academics and sales staff, coordination of
publicity with availability of books and promotion to the academics with proper
follow-up by the sales staff. Several
book publishers are beginning to regard books like any other product, from a
marketing point of view, and emphasize the merchandising and distribution
aspects of the market place. Books
should be distributed in the same manner as toothpaste, soap and other consumer
products reaching the total potential market instead of reaching only a few
through booksellers. Not only should
books be distributed through different outlets, such as department stores,
supermarkets, etc., the same books should be directed towards different markets
through different imprints, such as cloth
bound for libraries paper backs for the use of students etc.
The ideal philosophy of marketing textbooks is perhaps a balanced
approach that recognizes both traditional and innovative marketing activities. Each
textbook must be treated as a special product serving special needs and keeping
in mind the basic goals of 1) fulfilling the need of the particular educator; 2)
being innovative enough to fulfill that need better than the competitor in all
aspects regarding the product and service provided to the educator and 3)
meeting the information needs of students.
II.
The marketing plan
A.
Market Research
Market research and
analysis should include information on the following for long term planning; the
social, economic, political and technical environment for educational text
books, i.e., trends education enrollments, purchasing power of the students,
textbook budgets, and political influences that may disturb the education
learning process. The annual
marketing plan should provide information on:
1.
The general
demand for textbooks by discipline
2.
Trends for
specific courses
3.
The selection
of target markets to publish.
4.
Analysis of
competitive textbooks and posture of competitors in the market place and likely
to be introduced.
5.
Analysis of
opportunities and problems connected with the particular textbook to be
introduced, such as recognition factor and market requirements.
6.
The
establishment of marketing goals, i.e., market share to be attained within
specific time frame (first year, second year, etc).
7.
Establishment
of the marketing mix, i.e., the key features of the title, the price,
advertising and personal selling, the channels of distribution.
8.
Evaluation and
control of the marketing plan throughout the life-cycle of the textbook, i.e.,
budget versus actual performance.
The following are marketing information sources which should be used as
appropriate:
1.
In-house
historical sales data by textbook and series, value quantities, territories,
institutions, sales representatives, percentage of market, etc.
2.
In-house
marketing files as to curriculums, enrollments, trends, developments in
particular disciplines, special market surveys conducted, etc.
3.
Outside
statistical sources such as governmental statistics, general publications, such
as trade and academic journals, special studies published by educators,
consultants and special research institutions.
4.
In-house and
outside available statistics on royalties, plant manufacturing, editorial,
advertising, promotion, selling, fulfillment, remuneration, inventory turnover,
travel and general and administrative costs.
B.
Marketing mix
The question of the proper mix for a particular title is one of the most
important problem to solve because the financial resources available for product
development, distribution, promotion, and sales effort are limited.
Decisions affecting the product become compromises between product,
price, marketing and distribution effort.
C.
The product (Textbook)
Depending on the type of textbook, the expense relationship should be
appropriate to the needs that a particular text is to meet.
The textbook should present numerous benefits that will fulfill the
teacher's overriding need to facilitate better learning by the student.
More attention and expense may have to be applied to a chemistry or
biology text in terms of the physical product that for an introductory account
text. A balance must be struck
between simplicity and interesting features.
Pedagogical as well as organizational development, proper utilization of
graphs and pictures, reading level, utilization of colours, use of examples,
problems, etc. Because the market is
interested in satisfying needs, it is more important that already at the stage
of development of a manuscript, there is sufficient recognition of the needs of
the educator and student as perceived through research and experience by the
marketer as opposed to the editor.
It may very well be that psychologists prefer certain colours while
accountants or chemists prefer others. Business
and financial people may be more comfortable with graphs and statistics rather
than pictures. All the
characteristics of the physical product must be appropriate for the specific
market segment as well as the specific course requirements.
The elaborativeness of the physical product is also limited by the size
of the market segment that the product is designed for the still meet profit
objectives. A title to compete in
the large introductory business market for four year colleges and universities
will be able to absorb more plan and marketing expense than a title positioned
to fill the needs of a course in grammatical structures of the German language.
This is exactly the crucial dilemma that the marketer faces.
What features must a specific text have in order to be the "best
text in the market for a particular course" without making it too costly to
meet the financial goals. The
spectrum extends from the total learning package including a textbook both in
hardbound and paperbound as well as a student tutor workbook, a student learning
guide, an instructor's guide, audio cassettes, testing materials, transparencies
masters, etc., to a simple black and white paper text.
D.
Profit goals and pricing
Top management must layout
clearly what goals the company considers most crucial so that the marketing plan
can be aligned with these goals, i.e., profit on sales, percentage return on
investment or assets or equity, pay-back period over a number of years, market
share increase, earning per share, break-even etc.
One normally cannot attain all objectives simultaneously, trade-offs have
to be decided upon.
One frequent inconsistency in a statement of profit of goals is: to
maximize profits and sales. It is
impossible to attain these goals simultaneously because of general sales
behaviour and the concept of price elasticity, i.e., in order to sell more
units, all other items being equal, you normally must make a reduction in price.
It is important to establish at the outset whether maximization of
profits or market share is the more important goal.
Market share may very well be the more important goal at the beginning of
the life-cycle in order to introduce the produce into the market.
On the other hand, if the product already has a greater recognition
factor and a large market share (well accepted title that is being revised)
maximization of profits may be a more desired goal.
It is important that the desired objective is followed throughout the
marketing process.
In textbook publishing, price determination is chiefly influenced by
competitive factors as the demand for the product in terms of supply and demand
concepts tends to be inelastic. A
price reduction will not normally produce a permanent greater percentage change
in sales quantities. Assuming two
textbooks of equal need satisfaction value, a reduction in price will initially
increase the share of the market. However,
if the competition follows suit after a certain period, the market shares will
equalize because the demand for a particular title is finite due to course
enrollment levels. As both
publishers have reduced the price without gaining additional permanent quantity
sales, they have both cut their profit margins.
Therefore, textbook pricing tends to be cost-plus based on price
strategy. All costs in developing
and marketing a particular title are estimated and a desired profit margin is
added to arrive at the proper price. As
long as this price is not substantially above competitors price for a similar
title, it becomes the price determinant. This,
of course, makes for very competitive pricing, unless your textbook is so unique
as to represent a monopoly.
Percentage
change in sales
Price
Elasticity
If the price elasticity is
greater than one this means that a percentage decrease in price produces a
greater percentage decrease in price produces a greater percentage increase in
sales. Conversely, if the percentage
change in sales quantity is less than the percentage change in price the price
elasticity value will be less than one.
Profit seeking enterprises seek to maximize profits.
However, to do so the marginal costs that are applicable to a change in
additional units must be taken into consideration to determine the proper price.
Thus:
Price
=
Price Elasticity =
1 + Price Elasticity
Marginal
costs
If elasticity is
minus 4, the mark-up to maximize profits is minus 4 divided by 1 minus 4, 1.333.
If the marginal cost of the product is Rs.10.00 a price of 13.33 will
maximize profits. Of course, the
main problem is to establish the price elasticity factor.
Very little research has been done in the area of pricing designed to
increase demand rather than adapt to existing demand.
Price elasticity can be established by using regression techniques based
on historical data, experiments in laboratory situations or surveys.
However, very little has been published of what has been done in the
textbook publishing industry to establish proper factors.
E.Promotion
and personal selling
Generally the teacher decides which book will serve as the major textbook
for a particular course. This, of
course, means that the market target is the educator whose needs and desires
must be met. Presumably, his needs
and desires in a textbook are the same as those of the student, namely, an
effective learning tool. There are
essentially five main methods to introduce the textbook to the prospective
adoptor:
1.
Direct mail of
explanatory materials abut the textbook.
2.
Providing
complimentary copy of the product itself.
3.
Personal
calling.
4.
Advertisements
in trade journals.
5.
Attendance at
association meetings / exhibitions in institutions.
6.
Review of
textbooks in journals etc.
A publisher may decide to use all five methods or any one of them
depending on what he considers to be the most cost effective way of promoting a
particular publisher. In general,
small publishers with relatively small lists will opt for the direct mail and
advertisement in trade journals approach, selecting their target audience
through specific mailing lists and spending a large percentage of marketing
funds on elaborate brochures that outline the features of the text, independent
sales representatives and book moniles are also available that may represent a
number of publishers. The problem
here, of course, is that it s difficult for those representatives to be properly
trained and know the product in depth. However,
they can at least make sure the instructor knows about the existence of the
product.
Another determined factor most cost-effective method and is the size of
the market segment. If the size of
the market is too small to afford the cost of a personal sales call, then direct
mail communication should be utilized or sampling a copy of the textbook.
Another fact to consider is, how many new titles are expected to be on
the market a year. If your title is
the only new text, providing a sample copy may be an effective
enough tool as the instructor is most likely to look at it.
However, if 15 new titles on the same subject are going to be on the
market there is no assurance that sample copy will be looked at in detail to
assure adoption. Timing of the
communication is also of key importance. A direct mail brochure at the beginning
of the semester when the professor is not interested in considering a new text
may wind up in the wastebasket. Therefore,
such materials must be mailed at the beginning of the second semester when
adoption considerations are made. If
a sample copy is to be provided, brochures should reach the adoptor at least one
month before arrival of the text in order to perk his interest.
The brochure should highlight those attributes of the textbook which
market research indicated fulfills specific needs of the educator.
In addition, it should establish credibility that the textbook really
does provide what the brochure says it does.
Textual sample may highlight particular elements such as pedagogy, easy
to understand language, easy to understand theories and concepts, key terms,
summaries, texts, easy to understand graphs, study aids, etc.
Advertisements in trade journals are generally most effective to
establish recognition factor rather than sell the text.
The design should be eye-catching and the content harmonize with other
promotional materials.
It is generally accepted by textbook publishers that the most effective
way to promote the major texts is through an emphasis on personal selling in
addition to advertisements, providing effective brochures and complimentary
copies. Assuming that you have
published a quality textbook, there is nothing better to sell the educator but
the product itself. Therefore, a
major marketing objective is to have the educator look at your textbook in
detail. As you are most interested
in having him find those attributes of the text that are of particular interest
to him or her, it is necessary to first obtain what these are for this
particular educator. This, of
course, is where the value of a personal call can be maximized by an experienced
representative to first ascertain through general discussion and specific
interview questions with the educator what his or her particular needs are.
It then becomes easy to point out the specific features that provide need
fulfillment and credibility that this particular text is the most appropriate.
The representative should act as a consultant to the educator in solving
his/her teaching problems through adopting the most effective text.
The decision of how to promote the total list should be made before
hiring and training the sales staff as the marketing mix decided upon for the
various titles will determine the size and make-up of the sales staff required.
If the new list is largely made up of major introductory texts, a larger
staff is required. If the list is
heavy on junior and senior level course, a larger in house promotion staff may
be required. The make-up of the
sales staff in terms of experiene will determine the capability of training
inexperienced new staff and the mix of experienced versus inexperienced sales
staff that will be required.
The timing and type of sales training required, again, depends on the
experience level of the sales staff and the mix of the list in terms of new
versus backlist titles. In
experienced sales staff will need basic training in sales and organizational
techniques, administrative procedures, product knowledge, and general knowledge
of the company. Experienced sales
representatives will need training only in product knowledge of new texts and
new sales techniques and administrative procedures to be introduced.
Consideration of the academic year is important, which starts in early
September and ends in early June. This
makes the summer months ideal for vocations, special assignments, such as
book-store relations, research and
basic training for new sales staff. July
and August represent a good period to train inexperienced recruits.
This is also a very busy time for bookstores and particularly appropriate
for the representative to be of assistance in helping the bookstore manager with
any later ordering or getting stock. September
is normally a time when professors and instructors do not want to be bothered
unless they have a particular problem with an adopted text from the publisher.
This is a good time to introduce all sales staff to new administrative
measures and sales techniques as well as introducing the new list of titles to
be promoted. Guidelines should be
laid out as to which new and backlist titles are to be heavily promoted through
personal calling, sampling and availability of titles.
Promotional materials on texts to be promoted through personal calling
such as fact sheets and product kits should be available to help the
representative in his product knowledge and selling effort.
As adoption decisions are normally finalized during the middle to end of
the second semester, it is most cost-effective to utilize the semester break as
a major sales training period for all sales staff to:
1.
Get marketing
feedback from the sales force as to books that have been published so as to
possibly re-position the textbook in the market.
2.
Further
increase the product knowledge of the titles to be heavily promoted effectively.
3.
Re-establish
the most pertinent features of the texts to be promoted.
4.
Create general
enthusiasm for the list and total sales effort.
5.
Reward
exceptional performance in the previous year.
As publishing textbooks is a very creative and complex undertaking, each
title or title series needs during both its development and marketing-cycle the
co-ordination of manufacturing, marketing, financial and editorial consideration
which can easily be lost in a large publishing organization.
Some publishers have found it successful to create small publishing
groups, normally designed by discipline groupings, such as hardside, softside,
business and computer science or even further detailed as to specific
disciplines to assure that all of these aspects receive the proper attention.
The product manager or a financially oriented person can play a vital
role to assure an effective balance between the various considerations.
F.
Ware housing and distribution
Ware housing of books in
tropical climates has to be done very carefully.
If books are stored in hot humid conditions over a long period they tend
to get warped through absorption of moisture.
Binding adhesive tends to come off. Therefore
it is desirable to use either air conditioned ware houses or dehumidifying
equipment.
Distribution of books to
booksellers and through booksellers to end-users is one of the most important
aspects of book marketing.
In the case of textbooks
the bookseller does not generally play a very important role in demand creation.
Most bookshops usually stock those textbooks which are prescribed by the
professor or the teacher.
But the bookseller does play an important role in ensuring that the
student get the books they need in time. For
most textbook publishers, the bookseller provides an important avenue for
getting a feedback on their product.
In the case of more general and the reference material, the bookseller
plays a key role in creating demand for books.
If a publisher's books are nicely displayed in a bookshop, they are bound
to attract the attention of any casual visitor and as a result sell.
Libraries make most of heir acquisitions through booksellers.
Hence, availability of books with booksellers is a pre-requisite for
getting books sold to libraries.
The relationship between a publisher and a bookseller is centred around
the following:
a)
Regular supply of promotional material brochures, dust jackets, posters,
etc. by the publisher to the bookseller.
b)
Supply of checklists, order forms, catalogues by the publisher to the
bookseller.
c)
Obtaining orders either by direct contact or through mail from
booksellers.
d)
Agreeing to terms of business-credit, discount etc.
e)
Reviewing booksellers inventory of publisher's books.
f)
Training of bookseller's staff for product knowledge.
G.
Use of computers
With the increased
capabilities of computers and the attendent price decreases in computer hardware
and software, there are number of uses of the computer that publishers normally
employ and that are of particular help in the marketing area:
1.
Sales
statistics, such as title sales, title series sales, by territory, by customer
per representative, etc.
2.
Sales history,
forecasting modules.
3.
Statistics as
to both budgeted as well as actual costs.
4.
Manufacturing
cost analysis.
5.
Profit and loss
analysis.
6.
Pricing
analysis by changing the royalty formula, manufacturing costs, standard
overhead, plant expense, marketing expenses, and estimated market share.
7.
Compiling
reports and analysis.
8.
Inventory
status reports and turnover analysis.
9.
Travel expense
reports and analysis.
10.
Computerized
typesetting.
11.
On line order
entry.
12.
On line title
information.
H.
Marketing tools
Catalogue
Checklist
Order Forms
Price List
Dust jacket
Publicity brochures
News magazine
Advertisements
Exhibition special display
Promotion by author
Complimentary copies
Personal visits, meetings, etc.