| |

I’m an author, journalist and one of the UK’s social media pioneers. Here I write about publishing, self-publishing and crowdfunding. I am also the author of Argleton, a novelette about a mysterious town that appears on digital maps but doesn’t exist in reality. I self-published via Kickstarter and Amazon Kindle, and am negotiating my way through the publishing world and exploring new business models for entrepreneurial authors along the way. As a freelance journalist, I have written about social media and technology for FirstPost.com, The Guardian, CIO Magazine and Computer Weekly.

Contact Suw Charman-Anderson

The author is a Forbes contributor. The opinions expressed are those of the writer.

Loading...
Business 10,645 views

Half of Amazon Book Sales are Planned Purchases

The Media Briefing’s Digital Media Strategies conference is going on in London this week. Although I couldn’t go, I’ve been able to follow along via Twitter and a couple of tweets have really stood out.

48 percent of Amazon sales are planned search and purchase, not browsing

Interesting stats from Douglas McCabe showing that Amazon shoppers largely go in and buy. Recommendation engine is only a small part.

The speaker was Douglas McCabe, COO of Enders Analysis, who had other interesting points to make yesterday about the use of data, online market demographics and measuring success. But this single statistic, that nearly half of Amazon’s book sales come from people who already know what they want and are simply using Amazon as a way to get it, has huge implications.

UPDATE 22/2/13: Thad McIlroy posted a couple of relevant links in the comments, one from Shelf Awareness, who provide some more details on Codex Group’s report:

After conducting more than 250,000 interviews about reading behavior since 2004, Codex has found that a major shift has taken place in discovery in the past two years, as digital books have become a significant part of the book world.

Two years ago, 35% of book purchases were made because readers found out about a book in bricks-and-mortar bookstores, the single-largest site of discovery. This year, that figure has dropped to 17%, a reflection both of the closing of Borders and the rise of e-readers. In the same period, personal recommendations grew the most, to 22% from 14%. Some three-quarters of personal recommendations are made in person, while the rest come by e-mail (8%), phone (7%), Facebook (4%) and other social networks (3%).

The other from Melville House’s Kevin Murphy who said:

Even though it’s not news that more and more readers are becoming “hybrid” readers, meaning they read and learn about books both online and off, the Codex study shows us that despite the hubbub, digital discovery does not carry as much weight as personal recommendations.

I’d recommend reading both links for more details on the Codex Group report that I, sadly, don’t have access to. They makes for fascinating reading!

It’s well known that book lovers are quite happy to spend time in a bricks-and-mortar bookshop to see what sort of interesting titles they find and then go home to buy on Amazon where the prices are often cheaper. Indeed, it’s been identified as such a significant problem that HarperCollins CEO Victoria Barnsley recently made the interesting suggestion that bookshops ought to charge people to come in and browse, an idea that has had a somewhat chilly reception.

48 percent of Amazon book choices are pre-planned

Click to enlarge

Self-publishers often think themselves unaffected by ‘planned search and purchase’, not least because for most of us the idea of having our books in a bookshop feels like a distant dream. The assumption that self-publishers work to is that the key to cracking Amazon is to rank highly in their recommendation algorithm and many pixels are spilt by self-publishing bloggers telling us how to do exactly that.

But McCabe’s statistics show that only a piddling 10 percent of Amazon book choices are made because of its ‘bought this/also bought’ recommendation engine. Bestseller and top 100 lists influence 17 percent of book choices, with 12 percent down to promotions, deals, or low prices. Only 3 percent came through browsing categories. Planned search by author or topic, however, makes up a whopping 48 percent of all book choices.

The title of McCabe’s slide is “Amazon – only the end of the funnel, so far?”, and it’s an important point for self-publishers to take to heart. Amazon is a destination for purchase, the place you funnel your fans to, not a discovery mechanism in and of itself. People are simply not browsing for books based on Amazon’s recommendations, not in any significant numbers.

Self-published authors have limited resources for promotion and these figures show that you should focus not on trying to woo Amazon’s algorithm, but on building awareness outside of Amazon. Rather than hoping to gain traction within that 10 percent of people who pay attention to Amazon’s recommendations, or trying to crowbar your title into bestseller or top 100 lists, you should be focusing on building an independent fan base. No one can search for your books if they don’t know you exist.

I’ve written before about how self-publishers, and traditional publishers for that matter, should refocus on direct sales in order to collect valuable customer data. These stats bolster that position — if the majority of Amazon’s sales come from planned search, that indicates a clear intention to buy on the part of the searcher. That intention has been formed outside of Amazon, perhaps due to reviews, social media or word of mouth. And once your readers have formed an intention to buy, you can take action to funnel them to your own shop. For those of a rebellious nature who’d like to give Amazon the two fingers, that’s reassuring.

Post Your Comment

Please or sign up to comment.

Forbes writers have the ability to call out member comments they find particularly interesting. Called-out comments are highlighted across the Forbes network. You'll be notified if your comment is called out.

  • On the one hand, this doesn’t surprise me. On the other, I have actual statistics on the titles we have published more than 100 of them at this point, (Booktrope Publishing) that indicate this is not completely true.

    We routinely get our books to the top of the “free” lists and see a prolonged sales spike following the promotion, and over time a sales trend. Most of our authors are debut authors when they first come to us. While we do a lot of work outside of Amazon (on social media in particular), the Amazon promotions (free and paid) make a huge difference not just on an individual title, but over the catalog of books for the author. I should also say that most paid ads we have employed have only been successful when used in conjunction with one of these promotional efforts. On their own, I have found ads to be largely ineffective. If I had seen this pattern on only a couple of books, I would say it was an anomaly, but I have seen it time and time again over the last two years.

  • Suw Charman-Anderson Suw Charman-Anderson, Contributor 2 years ago

    I don’t think that your data contradicts what McCabe was saying at all. Indeed, he says promotions are responsible for 12% of book sales choices and Top X/Bestseller lists for 17%, so they clearly do work in influencing people’s book choices.

    But if you promote your Amazon promotions outside of Amazon, it might be that people are seeing your promotion then searching for the book/author, rather than stumbling upon them using Amazon’s recommendation engine. I just took advantage of a promotion by Nick Spalding, but only because he Tweeted about it. So the promotion had an impact on my decision of whether I should buy, but my decision on what to buy was made outside of Amazon and I used a pre-planned search to find the books I wanted.

    What you’d have to do in order to test McCabe’s numbers would be to poll your readers and find out how they make their book-buying decisions for Amazon, using the same categories as Codex Group did.

  • Kathy Meis Kathy Meis 2 years ago

    An excellent article that I’ll be sharing with our community at Bublish. Perhaps the most important point you make is that authors are missing the opportunity to capture and learn from crucial sales and marketing data by not creating their own discovery to sales funnel…a task infinitely less complicated in the Digital Age. We live in a world where authors will need to sell more books over time in order to make up for the downward pressure on the price of eBooks. Having the marketing and sales information (such as emails) necessary to nurture a long-term relationship with their readers will be key an author’s success.

  • Evren Kiefer Evren Kiefer 2 years ago

    This makes a nice dent in the value of Amazon as a discovery mechanism. What about delivery though? Amazon still makes it easy to purchase and read eBooks.

    In all the solutions that I know, selling direct means offering files for download. It takes a certain level of technical knowledge to transfer the files to the device and/or to the reader app’s database. For example, in the case of Aldiko on Android, getting an ePub from an outside source, the file must be saved to the device and then imported to the app’s database.

    And then, there’s the lack of interoperable file formats for eBooks which adds yet another layer of complexity.

    Selling direct is still a pretty bold choice to make unless one’s sure that their audience is tech-saavy. It makes sense for «A Book Apart» to sell their eBooks and English paperbacks directly because they have a large following of web designers.

    What percentage of eReader owners know how to get third-party files on their device? Are there solutions to make that easier for them?

  • Suw Charman-Anderson Suw Charman-Anderson, Contributor 2 years ago

    Direct sales of ebooks is easy peasy now, thanks to services like Ganxy and DPD, which I covered in this blog post. And if one is self-publishing and producing different formats for ebooks anyway, then you just upload all formats and people choose whichever one they want. There really are no significant barriers to directly selling ebooks these days: If you can read and comprehend a form on a website, and you’ve got your ebook files, then it’s just a matter of typing and clicking. If, as a self-publisher, you’re using an intermediary that does the transformation to ebook formats for you, then either download one of each when it’s all done, or get someone to convert them for you – it’s not that expensive.

    As for eReader owners, you can email files to Kindle, and managing a Nook is as simple as plugging it in and dragging and dropping your files. They probably could make it easier, but again, it isn’t that difficult.

    Although, and more to the point, just because it is easy doesn’t mean that people know how to do it. Which gives me an idea for a survey!

  • Evren Kiefer Evren Kiefer 2 years ago

    Thank you for your reply and the link. This post had escaped my notice.

    A survey about this topic would be great. Do tell if I can help publicize and circulate it. Looking forward to the results :)

  • Mark Thornton Mark Thornton 2 years ago

    Thanks very much for a really excellent article – I think your analysis is spot on. As an indie bookshop in the UK, we’re trying to see how we fit into the ‘new’ book trade that is emerging (as a matter or urgency+survival) and our intuition (which seems to be backed up by the numbers you state) is that we still have a very important role in terms of the browsing experience, curated selection and discoverability. The trick will be ensuring that this continues long-term as a viable business – but I’m glad to say that, together with the good community stuff we do plus events, that seems to be working.

    We also have another hat – advising local authors on how best to promote their books. I think for non-fiction (how-to, subject-driven titles) these fit nicely into the search-driven world we now live in. After that it’s all about identifying need, positioning your keywords, and developing your reputation and hoping the area’s not too competitive. But for fiction…I believe authors need to take a much more holistic, long-term, multi-channel approach which must end up with a proper publisher, editorial input and a physical book. Therefore authors must be prepared to recruit readers and fans over the long-term, in a variety of spheres (schools, bookshops, cafes, blogs, Amazon) and see this as their long-term journey to being a professional author. Otherwise it’s just a hobby.

  • The author of this post is committing a common statistical fallacy. The ecological fallacy, in this case, involves making inferences about individual writers based on aggregate statistics about book sales. It is compounded by the nature of book sales. At any given time, the vast majority of book sales come from a tiny number of writers. In fiction, it is quite common for the top five writers to account for 90%of sales.

    Whether or not the author’s advice is correct (I have no opinion on that topic), the statistics quoted provide no information to support the advice. The aggregate statistics on book sales will be almost entirely determined by a handful of bestsellers. All that these numbers can tell us is that people who buy bestsellers mostly know that they are going to buy that book before they get to Amazon. I find that unsurprising to say the least. Now, the report that 10% of Amazon’s sales comes “Also bought” recommendations seems incredibly high to me. If that’s true, it argues for more, not less, focus on that algorithm.

    To be sure, your book showing up on the “Also bought” list will generate less sales for you than, say, Stephen King, but still that is an amazing statistic. It probably means that over 5% of all fiction sales in the U.S. come from Amazon’s algorithm and most of those sales are sales that wouldn’t have been made any other way. Think about that for a minute…

  • Suw Charman-Anderson Suw Charman-Anderson, Contributor 2 years ago

    It’s actually not about book sales stats, but about how people decide which book to buy. These are not actually the same thing, though they may seem like it. Bestsellers may account for vast volumes of sales, but there’s still a question of how people decide whether or not to buy that bestseller.

    I think you do raise an interesting question though, and it’s one of the lack of granularity in these stats as to which types of books people are discovering and how. I actually think you can’t conclude from these stats that it’s the bestsellers that are driving direct search – surely they are more likely to show up in the recommendation engine, which would lead us to believe that those recommendations should account for more of the book purchase choices? If I buy a horror book by another author, surely I am more likely to see a bestseller from Stephen King in the ‘also bought’, and thus that mode of discovery should be a bigger share of the pie?

    I still stand by my advice: Authors should cultivate their audiences outside of Amazon and not rely on Amazon’s recommendation engine to drive their sales.

  • J. R. Tomlin J. R. Tomlin 2 years ago

    No, because you would have gone to Amazon looking for Stephen King and typed his name into the search field. If you are a horror reader, you don’t need to “discover” Stephen King. It is Michael Wallace’s name in the also boughts that brings about a discovery. You are also assuming there is no overlap, that I might not do a search and ALSO notice a name on the AB list. Or that a reader might search on my name because they bought the first of my trilogy but notice that I have a stand alone novel by looking at the AB list.

    Those stats don’t prove what you are saying they do and they certainly do not prove that a majority search since only 48% do that according to the findings. I suggest doing a little simple math. Take the estimated number of Amazon customers and figure out 10% of that is. It might open your eyes to why people (who are well aware of these statistics) worry about Amazon algorithms.
http://www.forbes.com/sites/suwcharmananderson/2013/02/20/half-of-amazon-book-sales-are-planned-purchases/?commentId=comment_blogAndPostId/blog/comment/1910-928-591
www.forbes.com
crawl=CC-MAIN-2015-27
102681
application/http; msgtype=response
sha1:SKLWAA3ZIKB4PXHE3UXR6MBWOK3RQMNZ
<urn:uuid:2ddc6f5a-7bec-40ae-97e6-f53f595da500>
2015-07-08T00:11:23Z
23.0.160.24
sha1:JFJ3WTOYJAVKUBLVN5T5SOE7AOIWSNJD
<urn:uuid:c01deb15-f703-4b33-a69d-ce782d96c92e>
http://www.forbes.com/sites/suwcharmananderson/2013/02/20/half-of-amazon-book-sales-are-planned-purchases/?commentId=comment_blogAndPostId/blog/comment/1910-928-591
response
<urn:uuid:fc8c52c5-ac5a-4d13-9b08-236ef4958752>
robots: classic
hostname: ip-10-179-60-89.ec2.internal
software: Nutch 1.6 (CC)/CC WarcExport 1.0
isPartOf: CC-MAIN-2015-27
operator: CommonCrawl Admin
description: Wide crawl of the web for June 2015
publisher: CommonCrawl
format: WARC File Format 1.0
conformsTo: http://bibnum.bnf.fr/WARC/WARC_ISO_28500_version1_latestdraft.pdf