Lead article in May 2017 Issue of The Writing Entrepeneur
How damaging is Amazon's buy box policy for indie publishers?
The big news this month has been the impact of Amazon's Buy Back Policy on Indie Publishers. Experts are debating back and forth on whether this policy hurts, has no impact or helps indie publishers. Most seem to have developed a “let's see approach.”
After some digging, here is a recap on the state of this debate now that we are coming to the end of the month.
I've included an image of Amazon's buy box at this top of this article. It is the little shopping cart box next to your print book when someone goes to order your book.
What has Amazon's box policy been until now?
To understand the changes to Amazon's buy box policy you need to know that Amazon competes with third party vendors. The little box next to each item sold on Amazon credits the sale, and therefore a percentage of the revenue to a specific seller. Previously, when an author or indie publisher listed their book with Amazon, all new sales went to the author and publisher. Used book sales went to whichever third-party seller offered a combination of volume sales, high customer satisfaction, and lower price.
Amazon wants to make money. They do that by selling in volume, and they sell in volume by keeping the price low. Therefore, for used books, Amazon's buy box sales credit went to the third-party that Amazon thought would generate the most volume and overall sales revenue for Amazon.
How has Amazon's buy box policy changed?
The reason Amazon's buy box policy makes indie publishers nervous states that “sellers of new books to be the ‘featured offer' on a book's detail page, which means that our (Amazon's) bookstore now works like the rest of Amazon, where third-party sellers compete with Amazon for the sale of new items. Only offers for new books are eligible to be featured.”
Amazon believes if the book is new it must have been bought from the publisher or from a distributor that bought the book from the publisher. Either the way, the publisher, and author were paid for their work. That makes sense, and many in the indie publishing space are saying that authors have never gotten revenue from used books, so nothing has changed. The author gets paid for the first sale and is no worse off.
How does Amazon know the books are new?
That is the big question. According to various online articles, some authors are suspicious that unscrupulous vendors may take print books that look new but are not new. Brook Warner in her May 4, 2017, article on Huffington Post tells the story that she typed in a few of her backlist books. The only listings she found were from third-party sellers. The actual publisher had been removed as an eligible seller without being notified. (To be an eligible seller you must have a certain volume of sales. Hard for new author/indie publishers.) For another of her backlist books, she found her publisher – listed as the fourth book. (Here is a hint: if you want to buy from the author/publisher look for the “Add to Cart” by Amazon with Prime.) Brook Warner found a three-fold price difference between the publisher's price and the buy box price. And yet the books were supposed to be new. How did this happen? She speculated that publishers post “in new condition” rather than “new books.”
How would Amazon know if the book was new or not? With Print on Demand, there is no shrink wrapping of books, so what is new is hard to prove.
Don't panic over Amazon's buy box policy change
It is soon to panic about the end of indie publishing with Amazon. If Amazon doesn't provide indie publishers with benefits, writers will put their new books on someone savvy enough to step in and play fair with authors. However, do keep an eye on Amazon's buy box policy as well as any other changes the online retailer might implement.
Have you changed your distribution strategy as a result of Amazon's buy box policy changes?
Don't put your books only on Amazon. Make sure you are distributing your books to other online retailers too. If you haven't heard of Draft2Digital, check them out as they distribute to several online distributors. And remember, whenever an onine retailer changes the rules in such a way that hurts clients, (i.e., authors in our case,) that creates a market opportunity for someone to step in and offer authors a better deal.
What do you think about Amazon's buy box policy change? Have questions? Post your thoughts on our Facebook page.