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Off-the-wall ideas
ArticlesGeorge Lukas has bought the movie rights to our wars with Iraq for $50
billion.
As part of the contract, the US government agreed to rename the first
one Gulf War IV, and the present one Gulf War V.
And Lukas agreed to refer to them in advertising as GW IV and GW V.
:-)
Back in the early days of the Web, Amazon was the creative leader in electronic commerce -- the first online store to reach high sales volume and high visibility. They changed book selling and book publishing -- turning a stuffy tradition-bound industry into an exciting high tech venture.
Their Amazon Associates program made it very easy to become an Amazon partner -- putting links on your Web site that pointed to specific books at Amazon, and getting paid referral fees if customers following those links bought books. Using any Web space at all -- including the free space that ISPs give their customers -- you could set up a pseudo bookstore of your own, posting reviews and comments about books that you liked, and getting paid if people followed your recommendations. Sure, the payments were low -- 15% of revenue -- but you didn't need to have inventory, or fill orders; you didn't need to do anything but sign up for the program and put the links on your pages.
Over the years, they have reduced the referral fees, and prevented partners from buying books at Amazon using their own links to collect the referral fee (which used to offset the shipping cost). Now the typical fee is a trivial 5%, with lots of messy complicated terms intended to prod "associates" into promoting the sales of non-book products and into putting obnoxious graphic Amazon ads on their pages. In many cases, it's no longer worth the effort.
Very early, they went out of their way to make literary and rare works readily available to the general public. They didn't limit themselves to the books available from any store through the standard book distributors. Rather they reached out to small publishers with their Amazon Advantage program. The terms were tough financially. The publisher had to give them a 55% discount, and the books were sold consignment-style (Amazon keeps the inventory in their warehouse and only pays the publisher after a book has been sold to a consumer). You wind up having to wait for 2-3 months after the sale of an item before you get paid. But this program gets you into their online catalog -- which is now probably used far more often than Books in Print by librarians and book lovers all over the world. And your listing appears with the label "ships within 24 hours." Even now, after more than half a dozen years of Amazon's success with it, Barnes and Nobles still doesn't offer anything comparable. But rather than promote this competitive advantage and public service, Amazon is now cutting back on the program, squeezing their publishing partners even tighter than before. Originally, their insistence that every book have an ISBN (International Standard Book Number) was not much of a problem, but R.R. Bowker, the supplier of such numbers has gone from assigning those numbers for free (which is common in countries outside the US) to charging hundreds of dollars. And starting a couple years ago, Amazon has been requiring that bar codes of the ISBN appear on your books -- adding more cost and hassle. Now they say that starting May 1, 2003, they'll start charging an annual fee to participate in the Advantage program, now estimated at $49.95.
One other innovative program remains intact -- Amazon Marketplace. This allows anyone who has a book for sale (a publisher with new copies or a reader with a second-hand copy) to offer it for sale through Amazon. There is no fee to post such an item. When buyers look at the discription pages for books, they see a choice of buying the same item at a discounted price. That link takes the customer to a listing of these alternate book sellers. Buyers use their credit cards to buy from Amazon, with a standard shipping charge automatically added. Hence the seller doesn't need to have a merchant credit card account. Amazon takes a reasonable percentage of the sale price as its fee. It's even easy to participate -- just click on "Sell yours here" from the description page of any book and fill in a few quick forms. The problem is that only books which already appear in Amazon's catalog are eligible for inclusion in Amazon Marketplace. So as small publishers get squeezed out of Advantage, they lose their opportunity to sell their titles by way of Marketplace.
In the early days, Amazon was flexible and creative. If you had a problem with one of their policies, you could get their attention with a clearly reasoned email; and often they would make exceptions. For instance, way back around 1996, they made an exception to let me sell books on computer diskette through their Advantage program, and we went back and forth a few times to arrive at a mutually acceptable way of packaging those diskettes so they could handle them efficiently in their warehouse and shipping operations.
Now they operate much more like a typical large bureaucratic business -- hence the imposition of an annual fee for Advantage that will bring them very little revenue and chase away thousands of previously loyal partners.
Rather than assessing a fee, they should come up with creative ways that partners could help them reduce costs and increase sales, including linking the Advantage and Associates programs and making it easy to put Amazon search boxes on their Web pages. But no, they are (for now) rejecting such suggestions and plowing ahead arrogantly, imposing their annual fee on people and companies that have been their friends for years. By so doing they are sending a message that they no longer care about small publishers.
And recently at the entry page to the Amazon Advantage site, they posted, unobtrusively, new legal terms that literally say that Amazon has non-exclusive rights to any and all content submitted to Amazon through this program -- in perpetuity and transferrable to anyone else.
"... you grant to Amazon.com and its affiliated
companies a royalty-free, nonexclusive, worldwide, perpetual, irrevocable
right and license to: (a) use, reproduce, perform, display, and distribute
any copyrightable works (e.g., creative text, images, and artwork),
trademarks, or trade names included in the Content; (b) adapt, modify,
reformat, and create derivative works of any Content; and (c) sublicense
the
foregoing rights."
Taken literally the terms mean that a small publisher (and publishers of electronic books are particularly vulnerable) hands over the rights to the content of their books by submitting the books to the program. Purportedly, that was not the intent of the terms. The terms were meant to apply to the promotional content -- like images of the covers of books and book excerpts -- that publishers submit to Amazon to help promote their sales of books. But the terms were quite clearly far more broad than that, and legally enforceable "in perpetuity" by whatever company may choose to pick up those rights in the future.
After a couple of weeks of pounding away at Amazon by email and spreading the word through email discussion groups, I finally got them to relent and to promise to edit those terms "with a better explanation." But it is sad that they ever considered forcing such terms on their partners.
Now whenever I get a communication from Amazon, I have to read carefully and suspiciously to figure out what they really mean and how their latest change is likely to hurt me and my business. I long for the good old days when every change from Amazon was for the better, and pioneered interesting new business models that we all could benefit from.
The volume of new applications intended to boost Internet business is overwhelming and the temptations are great. You could easily go broke checking out freeware and shareware, spending too much time and energy playing with the new stuff and too little generating business. So in self-defense, I went in the opposite direction -- it's probably been a year since I last checked out new software.
But this time I couldn't hold back.
I have an online store (http://store.yahoo.com/samizdat) where I sell plain-text books on CD ROM -- as many as a thousand books on a single CD. About 2500 people a day visit my main content site where I have lots of free information to attract them by way of search engines. About 1 in 25 of those visitors then go to my store. And only one in a hundred of my store visitors buys my CDs.
I've been putting all my energy into creating new CDs, which leads to customers buying more items, giving me more revenue per sale; and also into attracting more traffic through more and better content at my main site. But to grow my business quickly and substantially, I need to increase the conversion rate -- getting more store visitors to buy. Instead of just 1%, it would be reasonable to expect 2%, 3%, or even 5% of those store visitors to buy. But what can I do to make that happen?
Most people have never read a book on a CD. That's why the conversion rate is so low and also why most buyers today are blind -- the blind often use text-to-voice conversion on their computers to read plain text books. What to sighted people is bizarre and unusual, to the blind is commonplace. And once people have tried these CDs, they love them and come back for more. More than half the people who buy form my store come back to buy again and again. But those who are unfamiliar with the concept -- except for a very small number of pioneer early adopters -- just window shop. They are tempted and interested by the concept of buying a library for the price of a book, but they are reluctant to spend money on something so strange and, to them, untested.
I need a way to interact with those prospective customers -- the ones who have been tempted enough to enter my store. I need to be able to answer their questions, remove their doubts, and build a trusting relationship with them, quickly, effectively, and in realtime.
Back when my main business was consulting, I benefited from HumanClick software that alerted me when visitors were looking at selected Web pages of mine and that let me prompt them to initiate a chat session with me. That software was free until the company was bought by another company and became Live Person. The product and service are still great. I use Live Person as a customer whenever I need answers from the folks who run eBay. But it's too expensive for me to use for my own business.
A year ago, as I was starting to focus on my book CD business, Sitechattter, a HumanClick look-alike, appeared, as a service that cost $10 per month. I tried it for a few months, but it didn't bring me a single sale. It had several weaknesses. I didn't get any indication of when people were looking at my pages, and I had no way to prompt or tempt visitors to click on the icon that would initiate a chat with me.
A few days ago, I got a message from Sitechattter saying that they have added important new features. Now I can see when someone is looking at one of my Web pages, and see what page that person looked at last, which means that if they were using a search engine I can see what query led them to my business (since the query is part of the referring URL). More important, now I can initiate a chat session with a visitor, rather than waiting for visitors to start the conversation. And at no additional cost I can add Sitechattter to more than one Web site -- both my store and my main content site. The cost is now $30 per month -- more than I pay my Web host. But selling one additional CD per month would just about pay for that.
So now I've added Sitechattter to dozens of pages and I'm bombarding (and possibly annoying) visitors with my offers of live help and advice. At this point I'm confident in the workability of the software What's likely to matter now depends on me -- when should I initiate chats and how should I introduce myself to increase the likelihood that potential customers will answer and that the ensuing dialogue will lead to sales? It's likely to take weeks before I know whether this new application is going to boost my business many fold, or whether the ring alerting me of new visitors will interrupt me again and again, fruitlessly, and the stress of being "on call" will make me wish I'd never heard of this new opportunity.
Or at least that's waht I thought a few minutes ago. Before I had a chance to spellcheck this article, I got into a Sitechatter discussion with a distributor in Puerto Rico. Sounds very promising...
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