06 August 2005

The curious economics of a best seller

I usually wait until the paperback version of a book is published, before I buy it. This is not meanness; I prefer paperbacks. Easier to carry around (I'm usually carrying at least one book around with me). Easier to hold open in one hand (I'm often reading while cooking, or in a café, or travelling, or recalculating a large matrix of spreadsheets). More compact on the bookshelves (with bookshelf space always at a premium).

Yesterday, however, I decided that Harry Potter and the Half Blood Prince was going to have to be an exception. I only started reading these when the first three were already in paperback, because three small boys had appeared in the families of my stepdaughter and stepson and I thought I ought to educate myself. I enjoyed them, and have looked forward to each of the next two – but not so much so that I needed to break the "wait for paperback" rule. When this one appeared, I assumed that the same would be true ... but I'd forgotten that, in the interregnum since book five, two of those small boys had moved into the age when they would read the books (rather than just watching the films) themselves. So, without reading it, I knew (stop reading, NOW if you haven't read it yet and don't want your surprise spoiled) that the much preleaked major character death is no less than Dumbledore. More information was being offered unasked at regular intervals. Then my friend Dirk (not a small boy, but a magazine editor of roughly my own age) mentioned that the killer is Snape; but if he hadn't sone so, the small boys would have done so in not time. Unless I read it soon, I will have no surprises left to discover.

So: the decision was made. I would go out today and buy the hardback. When the paperback comes out, I will buy that for the long term and find someone onto whom I can pass on the hardback. And here is the real point of this post: the strange economics of a best seller.

I said, above, that buying paperbacks isn't meanness; but they are nevertheless usually cheaper than hardbacks. Not in the case of Ms Rowling's boy wizard, however. You can, of course, pay full whack (£16·99 in the UK for this particular book; that's about €27 or US$30), but you may well have to look around before you find somewhere to do so. Most bookshops discount it, to bring in the punters – because Harry Potter has reintroduced reading to a television and computer game generation, so catch a Potter fan and you may have caught a new long term customer. The big chains, of course, can afford to discount it more than the small independent. Some chains discount it more than others. And many stores which don't normally sell books at all will sell this one as a loss leader.

At this point I tangle with my conscience. In the normal way of things, I always go first to an independent when buying a book. If they don't have it, I either order it (if there is no urgency) or go on to a small chain. After the small chain, the large one. If I can't get it at any of them, or need it more quickly that their order systems allow, I go to Amazon. This way of things means I pay more for my books than need be ... but I sleep at night and, more selfishly, contribute to the continued existence of shops which give me good service, advice, and hands on caressing of books. In the present case I will follow that routine when the paperback comes out, but decided (after much wringing of hands) to pick up the interim hardback for as little as possible.

The independent offered it at £11·99. Somewhat awkwardly, I slid off to a high street chain to see what their price tag was. I had it in mind to look at bigger chains as well, when I'm in the nearest big city next Tuesday. Then I stopped at the supermarket for some odd and ends.

The supermarket had a stack of books nominally marked down to £7·97, about half the cover price. But a sign hanging above them announced a "Saturday Special" reduction to half of that – £3·98. I picked on up, dropped it in my trolley, and went on around the shopping. There was another surprise in store, though. Checking my till receipt later, at home, I found that it had been further marked down at the till – to £1·99 (about €3.20 or US$3.60), less than one eighth of the face value. Now, I don't have a detailed knowledge of book publishing costs but I do know that a 600 page hardback novel is way above that level.

When the paperback appears, this aggressive discounting will not happen. The big rush to buy will have passed, and the book will sell at the same price as others – probably £7·99 (€14, US$13). So, the real cost of the hardback works out at between a quarter and a half of the paperback ... which stands all the traditional economics of book publishing on their head.

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