Amazon recently started giving resellers offering new books star treatment on its website — a move that some publishers and authors say could cut into their revenue.
Amazon.com has found a new way to irk book publishers.
In March, it began giving U.S. resellers offering new books on its website the ability to be featured in the so-called “buy box,” the default purchase button that’s the most coveted piece of real estate on the e-commerce giant’s online emporium.
The tweak doesn’t seem radical — in fact, the rest of Amazon’s freewheeling marketplace has long worked that way, with third-party merchants vying with each other and Amazon for top billing on the site.
But publishers and some authors say it could end up costing them money, as resellers can peddle heavily discounted books or even, some allege, slightly used copies that unscrupulous vendors may want to pass off as new. That arguably cuts into publishers’ own sales of new books, which is how they, and their authors, make a living.
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Amazon says only brand-new copies with intact dust covers and wrapping can be sold as new by third parties. Books with “bargain” or any other markings or labels can’t be sold as “new.”
“We want customers to buy with confidence anytime they make a purchase on Amazon and require all sellers to sell authentic products,” an Amazon spokeswoman said in a statement. To ensure that, Amazon uses “a variety of methods,” including asking for invoices, the spokeswoman said.
The Authors’ Guild, a professional organization representing writers, issued a strongly worded statement that says the “buy-box” move “has the potential to decimate authors’ and publishers’ earnings” from many books. It’s the same argument the guild brandished in 2002, unsuccessfully, against an early Amazon disruption — the sale of used books over the internet.
Big publishers are monitoring closely what kind of impact the latest move will have on their bottom line, which seems more significant for books on the so-called backlist, older books that are still in print. It’s certainly ruffled feathers in a sector that often butts heads with Amazon.
“My bottom-line issue is that Amazon is always pushing publishers into corners,” says Brooke Warner, the co-founder of She Writes Press, who last March penned a piece in the Huffington Post to decry the new Amazon policy.
Furthermore, it underscores what seem like clashing world views. Amazon focuses on pleasing customers, while many in the publishing industry consider themselves arbiters of culture that should be highly valued by readers.
“I don’t think books are like other products,” Warner said.
Life outside the box
The “buy box” is the square on Amazon’s website with the button that reads “add to cart.” Its occupant is selected through a combination of factors — which Amazon says include price, availability, shipping performance and good ratings from customers. It usually reaps the lion’s share of sales for that particular item.
Merchants peddling wares on Amazon have long used price-tracking robots, paid consultants and prayer to beat competitors, including Amazon itself, into that sanctum.
Amazon has an incentive to feature highly ranked merchants prominently because they have become a fundamental cash cow for the company. The fees Amazon charges third-party sellers accounted for $6.4 billion in revenue in the first quarter of 2017, or about 18 percent of the company’s total revenue.
Until recently, the buy box for new books had been treated differently: Amazon always reserved it for its own inventory of books, which came directly from the publishers. But in November, in an announcement that Warner now says sounded “sort of innocuous,” Amazon said it was ending that privilege.
A few months later, one of the authors published by Warner’s imprint noticed that her book was not for sale from the publisher on Amazon’s website. When Warner checked, she found that it was there — but “under the view line,” meaning that another seller had become the default source for the same book.
According to Warner, this means that someone else is getting a sale that in her view should go to her publishing company and the author.
The books that are affected the most by Amazon’s tweak are those that have been out for more than six months, and those that sell infrequently, said Dan Lubart, president of data consultancy Iobyte Solutions, who was hired by several publishers to study the issue.
Third-party sellers were in the buy box for more than 10 percent of the backlist titles Lubart has reviewed. It’s unclear why — perhaps older books are more prone to being picked up by resellers at big discounts, Lubart said.
Lubart also discovered an odd thing: In about half the cases, the reseller only had one copy for sale. It’s unclear what this means. The economics are also a mystery, which, according to Lubart, raises questions about the legitimacy of the sourcing.
“In a lot of cases these third-party sellers are selling these books substantially cheaper than Amazon,” Lubart said. “Either they’re losing money or they’re getting them in other ways,” such as wholesaler discounts or free copies distributed by the publisher and somehow acquired by the reseller.
There’s also the question of whether some of these books are really new.
Not so new
Lubart says that some of the publishers he works for have ordered allegedly new books from resellers, and in a few cases, received slightly used copies, which goes against Amazon’s policy.
It can be hard to tell whether a book is really new, says Peter Hildick-Smith, president of Codex Group, a publishing consultancy. And even if they’re able to, readers will “take a bit of wear if the price is right.”
The sprawling nature of Amazon’s marketplace makes it difficult to police, even if the company says it tightly enforces rules. Some aggrieved parties feel they have to take things into their own hands.
Warner, the publisher, says one of her authors found a reseller describing a copy of her book as both “new” and as an advance review copy. After being contacted by the author, the reseller said the book would be taken off the website.
“Maybe this is Amazon’s thing, but it puts all the impetus on the publisher and/or author to monitor the marketplace,” Warner said.
Amazon said that its policy states that “only new books are eligible to win the Buy Box and we move quickly to address any violations.”
“We take this policy seriously and actively investigate claims,” the company said.