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From the Scholarly Kitchen

Rival Ecosystems: The Increasingly Porous Boundary between Institutional and Consumer Markets

August 20, 2018  |  By

Originally published in The Scholarly Kitchen on August 20, 2018

As I mentioned in an earlier blog post, we are continuing to expand and analyze the data for the Ithaka S + R Library Acquisition Patterns project. We have already established one important item, namely, Amazon has become a significant supplier of print books to academic libraries. Just how significant remains to be seen, but it is already clear that Amazon, the consummate consumer marketer, is now making headway in institutional markets. This raises the question as to whether these markets can be viewed as distinct any more, or whether the line that separates them is becoming porous.

Mountain lion; puma crouched and staring on tree limb

Indulge me, please, in an anecdote. Our kids grew up in coastal California, about 50 yards from a nature preserve where there was an occasional spotting of mountain lions. At the top of our street there was a sign at the entrance to the park, which warned people about the mountain lions and provided safety tips (“Raise your hands over your heads,” etc.) My young son saw the sign and asked me, “Daddy, the mountain lion won’t come on this side of the sign, right?”

Like a mountain lion, Jeff Bezos does not read signs telling him where he can and cannot go. He is supposed to be in the business of selling books and a multitude of other things directly to consumers. Institutional markets are supposed to be served by companies that focus on libraries as customers. After all, libraries require special handling, do they not? They require special materials to accompany book purchases and have long-standing relationships with specialized vendors. But then Amazon comes along with an entirely new value proposition, focusing on speed of delivery, pricing, and customer service, and suddenly those venerable vendor relationships don’t seem like much. The skills of the consumer marketer become increasingly relevant to institutional customers.

Oddly, when most people think about this subject, they assume that things will move in the opposite direction — that is, they believe that institutional materials will be of great value in consumer markets. This is a truly nutty idea, but like the myth that vaccines cause autism, you cannot shake this idea out of the head of someone who believes it. I often wonder if the people who talk about new paradigms for scholarly publishing have actually ever looked at a scholarly publication. I just pulled print copies of Transactions of the ASABE (American Society of Agricultural and Biological Engineers) and The New England Journal of Medicine off my shelf. How many years of study would it take for me to get even a superficial understanding of any of the articles in these volumes? (Example: “Runoff Water Quality Characteristics following Swine Slurry Application under Broadcast and Injected Conditions.”) Scholarly materials are written for other scholars, and no dream of a better world can instantly train a mass consumer market to a level sufficient to comprehend what scholars are writing about. Besides, there is always the alternative to pass the time with Netflix and chill.

Moving in the other direction, however — from consumer to institutional markets — can be possible because systems optimized for consumer markets have to jump over a much higher bar in all aspects except editorial. Ease of use, ease of purchase: these things count for something, and these are precisely the properties Amazon brings to the party.

What this suggests to me is that institutional marketers of books, companies like ProQuest and EBSCO, may have to develop services that go head to head with Amazon or risk losing market share to the world’s richest man. The evidence is already in that libraries want to purchase some (some, not all) of their print books one at a time rather than through approval plans; and many libraries are not content simply to purchase digital aggregations. Amazon has found a willing set of customers in libraries.

This is yet another reason to develop an academic bookstore — perhaps a joint venture from EBSCO and ProQuest? — something that Leann Wilson and Marshall Poe wrote about in the Kitchen recently; and I have taken multiple stabs at this idea myself (see here, for example), but have not been able to raise any interest in the university press community, which continues to puzzle me.

What’s at issue here is whether the academy is a world apart or lives in the very same world as other organizations. If the latter is the case, not being prepared to compete with organizations that are not academic in nature could leave academic ecosystems vulnerable to new players. Shouldn’t we at least raise our hands over our heads?

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Joseph Esposito

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Joe Esposito is Senior Partner at Clarke & Esposito where he specializes in strategy in the areas of digital media, publishing, and education technology. Joe has previously served as the CEO of three companies—Encyclopaedia Britannica, Tribal Voice, and SRI Consulting See Full Bio

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