03 July 2011

The Product is the Package

Much has been talked about the publishing industry; the impending downfall of print books, ebook pricing, DRM and so much more, ...so much, that I am reluctant to even add my two cents. Regardless (or irregardless as I sometimes like to say), here is my humble opinion on some of the issues facing the industry.

First, let me clearly state my bias; I am digital publisher with a focus on transmedia storytelling and distributor of digital content. I believe strongly that, barring some global internet shortage, digital is the future of everything... it just needs some sorting out still.

Now, I'm also of the age where I have a massive collection of vinyl, which I still listen to regularly while working in my office (when there's nobody else here). I also have a pretty good collection of first edition print books from each of my favourite authors. So, I have more than an appreciation for analog formats, I still engage with them regularly.

This engagement and tangible experience is why I don’t see print books ever dying. But, I think their sales will decline gradually over the next 5 years as ebooks continue to take off and erode the print market. This will see a rise in exclusive print runs, special editions and fewer and fewer titles seeing any ink at all.

So, what’s the matter with a decline in pulp and an increase in 1’s and 0’s it’s just a trade off, right? Well, no. As this transition takes place, millions of sales dollars are at stake and all traditional publishers are in the same boat. At this time, consumers don’t see ebooks as having the same value as printed books – but it’s the same product, isn’t it? Well, no. Consumers perceive digital assets as having a very low value which is a huge obstacle when selling them something such as an ebook.

I suppose if we can increase a readers’ perception of value we could maintain a price level on ebooks that offers a sustainable environment for publishing as well. Sure, but to do this, we need to really understand what we’re selling and demonstrate to readers a tangible experience worth paying for.

When you break it down, books are nothing more than packaging. No product is. Now, the publisher and author will tell you, ‘the content is what you're buying, not the packaging’. I say this is dead wrong. Most are under the assumption that the packaging is what the content resides in, and while technically that’s true, without the packaging, there’s not much left to sell or for the consumer to connect and engage with other than maybe 95,000 words, and that can be saved as a .txt file.

If 20 years in marketing consumer products and brands has taught me anything, it's that people buy packaging. Sure, some will argue this, including consumers themselves, but in the end this is what it comes down to... people buy packaging.

And, what exactly is packaging?

It's the wrapper, the container, the vessel that the content is presented in. My definition of packaging is a little more vast than that of perhaps a dictionary, or well, you. But, packaging to me includes many things and encompasses everything you are trading your hard earned dollars for. Good product packaging should include some sort of tangible remnant or an artifact of the product and/or allow you to engage with the product, offering you an experience that you associate with that product.

While listening to a good old-fashioned record, I can read the liner notes and marvel at the cover art – this is packaging at it’s best. The better sound quality and this visceral, visual, tangible packaging experience is why artists and record companies are releasing on vinyl again… there’s a premium price attached, but it’s well worth it.

Having just paid $40.00 for the new, beautifully designed Strokes 10 song LP – the packaging was beautiful and the experience of opening it, handling it and engaging with it while it plays is worth every penny spent. Now, as a digital album, it’s $9.99 – same songs, but there’s no further experience or added value… just listenting. It’s priced right. Heck, at .99¢ a song and I’ll probably pick that version up too so I can listen to it in the car.

For 4 times the price, the music publisher has offered me an experience by creating packaging around the digital asset. (and, don’t for a minute think this wasn’t digital first, just as books are typed into a digital environment, then typeset and printed analog in a book, so too is music). The wrapper or packaging of the digital product is where the perceived value is for the consumer.

In the case of the good old print book, the packaging was done in the form of subtle, beautifully designed text, printed on crisp, porous papers that were easy on the eyes but spoke of quality and importance. This was further packaged with stitched eight page signatures and set into a hard back cover, the linen stretched taut, folded and glued with precision - so much so that the average reader didn't give the construction of it a second thought - it just came that way, it was perfectly bound and solid. The linen was hot foil stamped with the title and author's name. Then this is all finished with a gloss-laminated dust-jacket with embossed text and a perforated price tag inside the fold. I think you get the picture, when you fork over $38.00 for this book, it's not for the 95,000 words inside, it's for the packaging.

Without this packaging, what are those words worth?

Surely there is a price to be paid for something that someone has spend so many hours creating. A team of people were involved in the creation of the digital asset, surely their time is worth something. Unfortunate as it is, if the consumer can’t see it they have challenges understanding it’s value.

In the case of ebooks, there is no packaging. Or, rather the packaging that does exist is 'owned' by the digital reader or store front, and that has little to do with the publisher or author. It also has little to do with the reader and the experience with the product is controlled by the retailer or the device, who has varied interests in your experience outside of the text you are reading. In essence, the retailer and devices own the packaging through the digital storefront – your enjoyment and experience is secondary to volume.

So, if this is the case, if it’s true that consumers buy packaging and not the product itself, and what little packaging exists is controlled by the retailer and device, how do you go about pricing something with no packaging, if packaging is what the consumer has been indoctrinated into purchasing?

Consumers expectations sans-packaging are low, which is why digital content has suffered the label of being worth less, but not worthless. They still want the product, they’ll even pay for it, but not at a premium. ‘It's just a digital asset – what can it be worth?’ We've all heard this. Most of us have seen what 95,000 words looks like in a .doc file, some of us have put them there. Take the time spent typing all those words away and what do you have? All you have is text that can be copied and pasted like a funny image on the web, it’s void of value – until you introduce experience and packaging.

The same goes for any digital asset. We need to be inventive to create experiences around digital products to make money with them.

Digital assets are all the same; we used to purchase Lettraset sheets, sometimes hundreds of them for specific client fonts. There was value inherent each time you rubbed out a letter. Fonts used to be packaged – now, you just select a different font from your toolbar. The end product is the same, the experience is different, less valued. Ergo, in the consumers mind, it should be priced less.

In Apple's App Store, the Apps range from free to $899. The device is the packaging, you experience each app though it and the varying degrees at which the software manipulates and displays the data… or slingshots birds. The point is that you are constantly interacting and engaging with this digital asset and that’s the where the perceived value is. This is similar to cloud based apps – maybe you remember when software was packaged in a box with instructions and a CD or two, you may also remember, there was a much higher retail price.

I think you get the point – the product is the package.

Until this issue of packaging gets resolved, publishers have been willing to look at many ways to maintain a price that defies perceived value on the digital asset they call ebooks. They crave a price that is closer to the heavily packaged print book.

Two ways that have been explored by publishers and debated endlessly are DRM and Enhanced ebooks.

Personally, I’m not a fan of DRM, I feel it undermines the trust the author and publisher have with the reader and quite frankly, I’ve paid for my product (or packaging) and I’ll do with it as I please. Jumping through hoops to access content or restricting access to devices does not make for that same carefree enjoyment and experience you get with a physical product. I know why publishers want DRM on their products, but I would rather see them incorporate some ‘packaging’.
I need to applaud the Pottermore project for bringing ‘social DRM’ into the spotlight, a process where the readers personal information is embedded into the product as a way to prevent copy – this is a far less intrusive and acceptable form of protection than anything I have seen so far.
The other method employed by publishers to create more value on their ebook properties is enhanced versions. Enhancements come in various forms, from the inclusion of video or audio and web links or a full on transmedia experience. Enhancement is where I think publishers need to focus their attention. This is as close to ‘packaging’ as you’re going to get in the digital space – creating experiences around the 95,000 words demonstrates value and commands a higher price.

My company has decided to focus on the transmedia storytelling side of things, and with my background in consumer packaging and brand experiences, we should be able to create that elusive engagement with the reader, providing some tangible experience that they will want to explore again and again.

At the end of the day, consumers want to feel good about the purchases they made and purchasing things makes them happy. Packaging is validation of money well spent.

Packaged in this blog, what do you value my 1791 words at?

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