Russian Digital Publishing Industry Talk, Non-Fiction Fair Moscow

On 2 December, Enhanced Editions’ co-founder Peter Collingridge led a seminar in Moscow, entitled “Digital Innovation in Publishing”, as part of a joint collaboration between the British Council, the Academia Rossia, the Federal Agency for Press and Mass Communications, and The London Book Fair.

Peter spoke for about thirty minutes on three topics:

1. “The 21st Century Landscape in Publishing”: observations on the current environment
2. “The 21st Century Publishing House”: what we think a digital publishing house looks like
3. “The 21st Century reader”: insights from our user analytics

before being interviewed by Vladimir Kharitonov , who recently wrote up the exchange (in Russian).

The talk is reproduced below in full.

Hello, my name is Peter Collingridge, and I am co-founder of Enhanced Editions, a digital publisher in the UK. I am honoured and delighted to be here in Moscow today and thank you for coming along to hear what I have to say.

I have worked in publishing for 13 years, and whilst I have also enjoyed traditional publishing roles including that of an editor, I have spent much of this time innovating through technology, something I am very passionate about.

I’m going to talk today about (1) how the publishing industry is changing in the UK, (2) and how we are addressing that change. I’ll also (3) be sharing some data and insights about how readers engage with our projects.

1. Landscape

Today’s emerging consumer – “Generation Y”, or those born between 1980 and 2000 – is spending less time reading, or consuming “old media”, and much more time with a screen (or two or three screens!) in front of them.

As this image from the Economist magazine shows, whilst media consumption is going up, books are losing out in the war for attention with the internet, social media, and computer games.

From my understanding of the pressures on the russian publishing industry, this will not come as a surprise to you.

As a senior executive at Amazon recently said, the challenge is not the tension between print and ebooks, it is between books and all other media.

All of the media industries have been struggling to make the transition from analogue to digital, whether it is the music, film, or publishing industries. However this transition is being driven by a ravenous new generation who was “born digital”.

By 2015, publishing industry executives estimate that between 20-50% of books sold in the US will be digital. Other countries will not be far behind. The UK is estimated to be 12-18 months behind the US, and mainland Europe about the same behind the UK.

The shift to digital will be characterised by a number of seismic shifts, but perhaps the most fundamental is that the “customer” will cease being a bookshop, and becomes individual readers. Publishing will no longer be “Business to Business (B2B)” but “Business to Consumer (B2C)”.

This shift to digital radically alters how consumers find, buy, consume, and discuss books; it makes the publishing supply chain of today completely redundant, and it calls into question both the role of publishers and the very definition of a “book”.

Like the music and film industries before it, book publishers are failing to address the opportunities made by the shift, putting themselves at the very real risk of being disrupted by nimble and ambitious new entrants that are better suited to the new environment.

We have seen from other industries how the biggest players are not immune from disruption at the hands of ambitious new entrants.

Critically, authors do not feel that publishers are best representing their interests at this difficult time. This is a video we made asking famous children’s author Philip Pullman, how it feels to be an author in the middle of publishing’s crisis in 2010:

Unsurprisingly, the dissatisfaction mentioned by Mr Pullman is spreading to author’s agents.

Earlier this year Andrew Wylie – the infamous literary agent for some of the most prestigious authors in the world including Vladimir Nabokov and Salman Rushdie – sought us out to help him launch digital imprint Odyssey Editions.

Odyssey bypassed Wylie’s traditional publishers and allowed him to sell his ebooks direct to consumers. The publishing industry was shocked and horrified. The Guardian newspaper described it as “The End of the Publishing World”; it was without doubt the most discussed publishing event of 2010.

Our role was to produce an end-to-end digital strategy, including the identity, design and production of the ebooks and website.

This called upon a broad range of our experiences within publishing and digital production.

So, we are seeing a lot of change: change in readers, who have new expectations and needs; change in the industry with new entrants, a shakeup in expectations and roles; and changing business models, where nothing is sacred.

And it is amidst this change where my company, Enhanced Editions, fits in.

2. The 21st Century Publisher

Enhanced Editions’ ambition is to be at the forefront of publishing in the digital age. Today, we work with publishers in two different – but interconnected – ways.

Our first core activity is making digital book Apps for the iPhone and iPad that create new and unique types of reading experiences for a 21st century audience; our second is developing consumer facing strategies that take advantage of the opportunities of the web.

We did this for two reasons:

Firstly. In the UK, book prices are being driven down by aggressive retailers. We foresaw that ebooks would suffer the same fate. So we wanted to look at whether ebooks could be “enhanced” to offer “premium” experiences that customers would consider worth paying a decent price for.

Secondly. eBook reading devices are very boring: they are slow, monochromatic, and do only one thing.

Compared to the iPhone, they look prehistoric, and struggle to connect with a Generation Y audience who crave sophisticated experiences.

We wanted to invent the ebooks that looked like the books of the future, and which would connect with Generation Y.

We released our first app in September 2009 for rock star Nick Cave’s novel The Death of Bunny Munro. This app combined the ebook, audiobook, a soundtrack written by Nick, and an RSS newsfeed that updated readers on news about the book and about Nick and his live performances.

Here is a short video we made introducing the app:

Trade magazine The Bookseller described the app as “the moment digital publishing came of age”; it received a number of awards, and, most importantly, spent 2 months at the top of the books rankings on the Apps store, a ringing endorsement from users.

Since then we have made over 30 apps for some of the largest publishers in the world including Hachette, HarperCollins, and Random House. Most of the titles we have produced are in the literary fiction genre.

Our second core activity is planning and producing websites, online communities, and other web-based tools that enable our clients to engage their readers and build relationships on a one-to-one basis.

This is an essential capability for the digital world, and one that publishing has historically been very poor at developing. It couldn’t be more important in a B2C world.

In September, we developed an online writing competition for Mills and Boon to help it appeal to a younger audience who love this kind of user participation. The site attracted over 1m page views in three weeks, with over 850 entries – 3 times the size of targets.

Over the past 10 years, the team at Enhanced Editions has built over 45 publishing and community websites, with tens of millions of visitors. In this time we have gained great insight into what works, what doesn’t – and how you have to keep on experimenting to make digital products better. However at the core of this activity is a relentless focus on the user.

3. The 21st Century Reader

One big part of building good websites is tracking your user’s activity, and using that data to make informed decisions on how to improve a service. And this is the third thing I’d like to share with you: what we know about electronic reading so far.

When we founded Enhanced Editions we knew that, alongside a compelling reading experience, insight into user behaviour needed to be a core part of our approach. That’s because for as long as we have worked with the web, we have been collecting and acting upon data.

Technology-based companies like Google & Amazon have been using customer data from day one. Make no mistake – analytics are hugely important to these guys’ success. Compare publisher’s attitude – one built on intuition – to that of Jeff Bezos, built on data.

My business partner Rhys Cazenove worked at Comedy Central building branded video sites such as The Daily Show and South Park, which drove revenue from advertising. They used data from analytics to help increase traffic and visitor retention, and ultimately revenues. He brings that experience to ebooks.

So. What are Analytics?

Analytics are the customer feedback loops that help you make smarter decisions in an ever changing digital landscape. And they come from lots of different sources. By paying attention to them, you can improve your strategy and effectiveness.

In our apps, we track everything we can about usage. What features people use, what their favourite font sizes are, whether they like video, how long they spend reading, at what time. The data has often borne out our instincts, but it has also surprised us.

For example – people’s reading habits vary for different books. While commuting hours are popular across all books, people LOVE reading Nick Cave’s Bunny Munro between one and two AM. On the other hand, Dreams From My Father by Barack Obama seems to be a lunchtime favourite (but is read for nearly four times as long).

The average use of an iPhone app is less than 5 mins. Happily, the average time that people use our apps in a single sitting is around 24 minutes. Perhaps we can confidently say that people enjoy reading on the small screen – we are certainly engaging them.

Similarly the feature set we put together seems to resonate. For example, our synchronised audio features are incredibly popular. Integrated video clips have also been popular, but not as much as audio, interestingly. In other apps, video usage often tails off dramatically.

Another hugely popular feature is the news feed, which we can update at any point. The idea here was to encourage customers to keep engaged and return to the app. Again the app store average is a 5% retention after 1 month. Our apps retain over 20% of active customers.

Moving out of the app usage, by triangulating sales and web analytics, we can piece together purchasing drivers. For example here we can see the direct correlation between media coverage and downloads of both the free and paid-for versions of the app.

One of the most staggering insights was sales in Norway, which were off the scale and comparable to Canada. It turns out that this combination of factors was responsible: eBook prices are maintained in Norway, so our app actually came in as cheaper than that; the media is not very diverse and we enjoyed a full-page article in Dagbladet. Finally the population is highly English literate.

We recently upgraded our software to work on the iPad. What is interesting here is that we appear to be really engaging users on the iPhone – sessions last on average well over an hour. But on the iPad – which you might have thought is a device better suited to reading – session time is half that of the iPhone.

Interestingly, our apps demonstrate four times the engagement of other apps in the “books” category of apps; with a very high level of loyalty and repeat visits.

Whilst these iPad data are very early, we think that it is fascinating to compare the audiences on different devices.

We also monitor what is being said on Twitter about us – and just in case any of this seems a little “Big Brother” to you, users can opt out of analytics at any point.

4. Sum up

So, through a combination of innovative products and analysis of our users’ activities, we are beginning to piece together a picture of the 21st century reader.

We think that this activity: innovation, user-focus – combined with the traditional values of editorial curation – will be found in the successful publishing houses of the 21st century.

Innovation is difficult, and it doesn’t always work, and I’d like to end with a quote from Samuel Beckett extolling the virtues of failure.

I’d urge you all to “fail better” in the path to becoming a publishing houses of the 21st century.

My thanks for your attention – if you’d like to get in touch please do.

My thanks to The British Council in London and Moscow also for inviting me here to Russia and showing me such a fantastic city. I can’t wait to come back!