Amazon has rolled out a makeover for their successful book consignment program, Amazon Advantage. The old annual membership fee—$29.95—is now $99 per publisher, per year, billable in May (beginning 2016). Like the old fee, this is deducted from sales or can be paid by check.
Understandably, more than tripling the fee raises the questions: Is it worth it? Are their alternatives?
This presents a dilemma for publishers with one or even a handful of books. As every indie publisher knows, distribution on Amazon is often critical for small publishers and Advantage offers 3 strong benefits:
- The ability to offer print books for pre-order.
- Presentation parity with big publishers. Meaning, the presentation of your book on Amazon looks no different than a book from a major publisher. (e.g. your book is available for free shipping to Prime customers.)
- A way to sell books printed by someone other than CreateSpace or IngramSpark.
The email that arrived from Amazon touted several so called benefits and included details about new marketing programs. According to Amazon these marketing programs were previously reserved for Amazon’s biggest vendors.
Evaluating the 10 Amazon Advantage Benefits: Do they make sense for your books?
Some of this is Amazon spin, some of it legit. Before you jump on board, or get too excited, read through my comments about their benefits to decide whether the $99 price makes sense for your publishing business.
- Pre-order. Advantage is still the easiest (if not the only) way to make your print book available on Amazon for pre-sale. This by itself is a powerful incentive for a publisher to join the program. Alternatives/Options: There is no cost or restriction for offering your Kindle eBook for sale via pre-order.
- Amazon Marketing Services (AMS). Amazon Marketing Services allows publishers to advertise books using pay-per-click ads. This is a self-service tool not unlike Google Adwords and can be used to promote a range of products, not just books. But read the fine print about requirements before initiating your campaign. They current require a budget of at least $100. Alternatives/Options: AMS is also available to KDP Select participants, the KDP marketing program that requires a 90 day exclusive distribution commitment.
- Vine Reviews. Vine reviewers have been selected by Amazon based on the quality of their reviews and how helpful the reviews are to other customers. The reviewer gets a special badge by their name but there is no research suggesting that shoppers trust those reviews more than others (also see my post on reviews for the Content Marketing Institute). But let’s say they are worth it. Amazon says Eligible items can be enrolled in Vine starting at $1500 per title. Not exactly small change for small publishers. Alternatives/Options: Consider using NetGalley to reach potential reviewers for a price that is far less than Amazon’s. IBPA members enjoy special benefits. Btw, an IBPA membership, a book listing on NetGalley, and a Kirkus review is still less than $1500 and arguably a better value.
- A+ Detail Pages. What Amazon says: The “A+” detail page is a deluxe detail page featuring advanced formatting and rich media content to enhance the customer shopping experience and convince customers to buy your product. You can have all this for “only” $600 per title. Alternatives/Options: I know from past experience that we could use some advanced HTML formatting to improve the presentation of a listing; tags for bold, italics, and line breaks. They are tricky to get right but the Amazon support team is always there to help. It is unclear if this remains part of the new Advantage, or now goes away.
- Pricing Discounts. This one looks promising. Publishers fund and create a coupon for customers to use as an immediate discount off of the Amazon selling price. It is a self-service program and for each book sold, the publisher pays a $0.08 redemption fee and $0.17 clipping fee for the coupon (coupon pricing subject to change). This is in addition to the discount you offer, for example 10%. Alternatives/Options: You can of course do this directly from your own website but to my knowledge, this is the only program of its kind on Amazon.
Other benefits they claim in their announcement letter
- Amazon-branded offer. Nothing new here. Amazon is simply calling attention to the fact that their message “ships and sold by Amazon” is good for your customers. Indeed, this is important and is no doubt the reason why many publishers that used to use Ingram POD exclusively now also use CreateSpace to avoid their book showing Temporarily Out of Stock or Ships in [x days] messages.
- Pricing Systems. This is an Amazon term for praising their low price and that any discount comes out of their margin. If you are selling direct, or through other retailers, you no doubt find this to be a big negative because your other retail partners have a hard time competing with Amazon’s prices. (Explanation: you always get your wholesale price no matter what discount, if any, Amazon offers. The exception is if you offer your book at better terms to another retailer in which case Amazon reserves the right to price match—at your expense.)
- Purchase order forecasting. Amazon claims that they help you manage your inventory by predicting when they need books. Debatable. For one of our clients they over-ordered and we got stuck with the extra shipping fees. To make matters worse, they send back books if they over-stock and never tell you when that might happen. Who likes unexpected returns?
- Fast vendor support. Okay, they do have good customer service. They claim 18 hour response times.
- No inventory or storage fees. I am unaware of any bookseller that charges publishers a shelf-rental fee so it seems like a stretch to call this a benefit. Granted, there is a cost to Amazon but the benefit seems to accrue to them in support of a strong customer service reputation for fast delivery. Also, it isn’t like we can store any number of books we want. It is not uncommon to receive a PO from Amazon for say 3 books, and other PO a week later for say 3 more. The shipping expenses kill margins and call into question benefit number 8 above.