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[12 comments]

Heavy Demand as Amazon Rolls Out Kindle DX

June 22, 2009

By George Anderson

Amazon.com isn't releasing numbers on its Kindle sales but it has to be pleased with initial demand for the new larger DX version of the book reader, which was temporarily listed as out-of-stock on the e-tailer's website.

The DX, which comes with a 9.7-inch screen and retails for $489 versus the $359 six-inch Kindle 2, started shipping on June 10. Amazon said it would have more of the units in stock by June 17. The six-inch Kindle remains in stock and available for immediate shipment.

Amazon spokeswoman Cinthia Portugal, told TechFlash, "Due to heavy customer demand, new orders placed today will begin shipping to those customers in approximately two days. We will prioritize new orders on a first-come, first-served basis, so customers interested in buying a Kindle DX should still order immediately to reserve their place in line."

Discussion Question: Do you see e-books on the same trajectory as other industry-changing gadgets such as the iPod and iPhone? Or will e-books be more of a niche business? How will traditional book sales be affected?

FINANCIALS:     [NASDAQ:AMZN]

Discussion Questions



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Comments:

It may come down to a generational issue. E-books answer the needs of two generations--aging Boomers who can adjust type size, reduce glare and save money on book purchases and younger readers who value content over the feel of a book. I have a Kindle 2 and--especially for more ephemeral reads--it's great.

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Ryan Mathews, Founder, ceo, Black Monk Consulting

I see the Kindle appealing mainly to students and mass transit commuters. Other than that, I'd rather have a book in hand.

Students will especially benefit from these types of products in the long run. The ability to have all of your textbooks stored on one light device rather than lugging them around will do away with a lot of back pain. I remember my days of lugging around backpacks full of books necessary to get me through my day in school. I always had a full backpack from elementary school through to college. It was necessary but, it wasn't fun!

'BrooklynBabe'

I completely adore my Kindle; one of the best purchases I've made (though of course, I have the early version and am now weighing the upgrade). That said, as Google and others explore ways to bring print media to smart phones, Kindles and other reading devices will have to up the feature ante in order to stay relevant. I can't see reading a book off of an iPhone; it's hard enough for me to read content on websites without continually moving it around and shifting views; however, these developments do promise to further fragment the market.

I don't see print media going away entirely but I can tell you that once you go Kindle, you never go back.

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Carol Spieckerman, President, newmarketbuilders

E-books offer a better experience for several groups of people. For business travelers, it's a great way to get all the books you have been meaning to read "on board" in a very efficient way. For busy, book-loving people, it is just a convenient way to have the titles you want on hand. For people on the go, its nice not to have the extra weight to carry. Have heard reports of summer back-packers taking their Kindles on multi-week treks and "recharging" every few days--so much easier they said, then carrying books with them.

With Amazon's enormous collection of titles. this makes terrific sense as a business opportunity. Kindles will not replace books, but likely will add new growth by adding convenience to a growing consumer audience.

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Anne Bieler, Sr. Associate, Packaging and Technology Integrated Solutions

Personally, I print out almost everything I want to read that comes online. I would not be drawn to a Kindle type product. But, I don't have an iPod, either. So while I may not be an anomaly to my generation, I certainly am to the public at large.

I teach in an MBA program. Easily half of the students have downloaded their textbooks to their computers (netbooks). Why? They are cheaper that way (less than 1/2 as much) and they can always have them with them. As this student generation matures, they will be reading books on a screen just as they read other communication. Carrying a book around will be foreign to them.

I also ride the subway in NYC. I never saw a Kindle in use on the subway six months ago. Today, there are as many people reading Kindles as are reading books. Though this is not a scientific sample, it does tell me that reading a Kindle is very acceptable.

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Gene Detroyer, Entrepreneur, Advisor, Consultant, Professor, Independent

The Kindle can be held like a book but is not a computer. Netbooks can be used to read material (though not held like a book), but are also a computer. The price is comparable. These products appeal to different consumers. Do those buying a Kindle want a netbook? Do those buying a netbook want a Kindle? Probably because they like technology. Do they want the other product enough to pay for it? Not all of them. Will they both be break-out products? Possibly but not yet.

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Camille P. Schuster, Ph.D., President, Global Collaborations, Inc.

It's a great idea, and it will grow in share over time. But the numbers do not suggest the Kindle will ever reach iPhone or iPod status. For one thing, everyone talks on the phone and listens to music, but not everyone reads. Sad but true....

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Jonathan Marek, Senior Vice President, Applied Predictive Technologies

e-books like Amazon's Kindle will continue to gain share as they become better known and appear at more moderate pricing. This is inevitable as these are CE goods and many makers are now planning them at these lower prices and we will have competition and discounting to drive downward. Like e-Commerce itself a large proportion of the population is increasingly comfortable with what are some clear advantages. Not all, not all as I too love a book, but with so much to read these make sense and enhancements of the technology will enable covers, pictures and more to make the experience even more rich than paper. One must understand that Amazon's strategy is to open a market. While they like selling Kindle, the like electronic delivery much more. Costs are way down with volume and like all other things this too will move once great platforms are available at value prices.

Robert Heiblim, Principal, RH Associates

I think one key point that is missing in this discussion, is that Kindle allows you to access your e-books as well as your online feeds, such as this discussion. It will bring in all of your online feeds--blogs, news, e-books for easy reading. So it really becomes your portable central reading device for all of your news and reading materials.

Now, if they would only make it available in CANADA!!!

Rick Boretsky, Retail Data Integration Specialist, RIBA Retail (www.ribaretail.com)

I'm not sure about the analogy. iPod was like a better version of Walkman, and iPhone is really a souped up cell phone. In other words, they were part of a technology progression. The Kindle has totally different ergonomics from books. Maybe it will hit a tipping point, but not for me.

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Joel Rubinson, President, Rubinson Partners, Inc.

It's the natural progression of technology. The impact will be immense: from the traditional book distribution channel protecting its turf to product advancements and new competitors to students no longer needing backpacks.

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Christopher P. Ramey, President, Affluent Insights

Just like the iPod changed the landscape of music listening, the Kindle has potential to do the same for reading. Both offer similar benefits -- portability, variety and convenience. As more and more books migrate to the Kindle, you will see an increased penetration of this device and other e-readers.

The difference is indeed generational, as another blogger noted. Younger readers are often more comfortable reading on a screen than a book, and those who wax poetic about the "feel and smell of the paper of a newly bound book" are clearly in the decline.

The real question is whether the Kindle can achieve the level of ubiquity that the iPod has achieved. The price points are not that dissimilar, and the Kindle has the benefit of facilitating downloads through wireless rather than through the computer. I believe that the Amazon brand is so strong that only a concerted effort on behalf of the publishers can hinder the Kindle's success.

See the cover article in Fast Company this month for additional perspectives.

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Mark Price, Managing Partner, M Squared Group, Inc.

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