E-reader Distribution Deals Kindle Sales Beyond A Nook

Wednesday, April 28th, 2010
By Ross Rubin, Executive Director, Industry Analysis

Visit Amazon.com’s home page and you’ll learn that the Kindle is the retailer’s best-selling product (even beating out 50″+ rear-projection televisions). That’s not too surprising given the momentum of the category as well as its shipping-friendly dimensions. But the Kindle’s success at Amazon has also been helped by the device being sold exclusively there, whereas Amazon must compete with other retailers for nearly all of its other products.

Still, that exclusivity has made it difficult for consumers who would like to kick the Kindle’s keyboard before buying the product, an advantage that Amazon’s old rival Barnes & Noble has — and is exploiting — with its Nook device. While the Nook also began as a device distributed exclusively via its retailer, both products will now be sold indirectly, with the Nook on the shelves at Best Buy and the Kindle coming to Target.

 
The expanded distribution makes sense given the state of the e-reader market. Like other portable digital content devices, such as MP3 players, e-readers are high-tech products that appeal to consumers at Best Buy, and the retailer is devoting shelf space to them. However, like digital picture frames, they are also lifestyle products that have relatively strong appeal for women, hence the Target fit. NPD’s research has also indicated that e-readers are popular gift items, and having e-readers present at these retailers will enable them to partake further of the fourth-quarter frenzy of the holiday sales season.

 
Ultimately, both Amazon and Barnes & Noble care more about their digital bookstores than their digital book readers. Barnes & Noble, for example, is also the default bookstore on the forthcoming Plastic Logic and RCA devices, and Amazon, of course, will be happy to sell you a book to read on your iPad as well as on its Kindle. By opening up distribution, these retailers maximize their potential to sell more of their literary candy by having their candy machines in the homes of consumers who might not be as inclined to visit a physical or online bookseller. It also sets the stage for having a broader, more mainstream variety of content available to e-readers beyond bestsellers.

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1. The WIRE: Week of April 26, 2010 | Out of the Box — April 30, 2010 @ 6:22 pm

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