Presented by Bowker and AAP October 22, 2009

Survey Type: Online Length: Between 60-75 questions Frequency: Monthly Annual Consumer Sample 36,000 book buyers Selected according to Age, Gender, Income, Household size, and location balanced to US Census Representing an annual view of 120,000 book purchases and 80,000 shopping occasions

Survey

Type: Online

Length: Between 60-75 questions

Frequency: Monthly

Annual Consumer Sample

36,000 book buyers

Selected according to Age, Gender, Income, Household size, and location balanced to US Census

Representing an annual view of 120,000 book purchases and 80,000 shopping occasions

MarketTools, Inc: Panel management & data collection Clients include: P&G, Microsoft, Bank of America Management Science Associates, Inc (MSA): Data Processing & Software provider (INsight TM ) Statistical Validation, Analysis, and Weighting Clients include: ESPN, Kraft, Time-Warner Bowker Bibliographic & Database Expertise Bibliographic and Classification Data Match Business Analysts

MarketTools, Inc:

Panel management & data collection

Clients include: P&G, Microsoft, Bank of America

Management Science Associates, Inc (MSA):

Data Processing & Software provider (INsight TM )

Statistical Validation, Analysis, and Weighting

Clients include: ESPN, Kraft, Time-Warner

Bowker Bibliographic & Database Expertise

Bibliographic and Classification Data Match

Business Analysts

The “Big Picture” Know Thy Customer

Bob Dylan

Bob Dylan

The Consumer has become King! Consumers define the marketplace

1) Economy 2) Time on other Activities 3) Product Selection

1) Economy

2) Time on other Activities

3) Product Selection

Economy

Book Buyers as % of US Population

2007…… The apex of retail spending Culmination of expanded stores and Amazon.com coming into it’s own Harry Potter effect

2007……

The apex of retail spending

Culmination of expanded stores and Amazon.com coming into it’s own

Harry Potter effect

2008…… Economic decline sets in esp. in Q4 Spending cut backs in all sectors Online activities take-off Decline in readership

2008……

Economic decline sets in esp. in Q4

Spending cut backs in all sectors

Online activities take-off

Decline in readership

Economic uncertainty deepens Conflicting signs of economic turnaround? More titles available – longer “Long Tail” – especially with growth of POD The ebook: breakout year, or “flash in the pan”?

Economic uncertainty deepens

Conflicting signs of economic turnaround?

More titles available – longer “Long Tail” – especially with growth of POD

The ebook: breakout year, or “flash in the pan”?

… and they are more likely than men to swap or buy used, rather than cut back on overall buying.

Time

Before 1975, consumer had 8 choices for entertainment and information Today, consumers have 21 choices for entertainment and information 1975 2009

Before 1975, consumer had 8 choices for entertainment and information

Shows relative number of hours that book buyers spend on these activities per week

Where can Publishers and Authors reach their buyers??? Online is the key!

Social Networking 55% of heavy / moderate buyers are ‘socializing’ online

Product Selection

AAP $ Change 1H09 vs 1H08 (net sales) A.S.P. 1H2008 A.S.P. 1H09 % Change Units/ Buyer % Change Units/ Occasion Adult Hardcover -15.5% $13.07 $14.55 -39% -10% Adult Paperback -11.2% $11.17 $10.28 -38% -17% Adult Mass Mkt, -5.3% $5.90 $5.39 -27% -10% All Ebook +173.9% $17.74 $8.30 +52% +28%

$6.25 price differential avg. selling price 1H ‘09 – Hardcover vs. E-Book

E-Book Unit/Sales… 0.6% / 1.9% 2008 1.5% / 1.2% 1 st Half 2009 Source PubTrack Consumer

E-Book Sales Growth by Age … 183% Growth rate of E-Book sales to buyers over 50 Source PubTrack Consumer

Source PubTrack Consumer

Average Income by Device (000) 2009 YTD Source PubTrack Consumer

2009 YTD Source PubTrack Consumer

Source PubTrack Consumer Likelihood to Buy E-Reader: Total Very likely Somewhat likely Not likely - no interest Already own All Book Buyers 100% 4% 7% 23% 1.50% % Male 43% 58% 51% 47% 52% Mean Age 42.0 33.1 35.0 43.3 44.3

Fiction/Non-Fict show declines in share….. While Juvenile and Religion pick up the slack

Fiction/Non-Fict show declines in share…..

While Juvenile and Religion pick up the slack

So while female teenagers buy more books….. Males average spending on books works out the same.

So while female teenagers buy more books…..

Males average spending on books works out the same.

Thank You! Kelly Gallagher Vice President Publishing Services Bowker [email_address] 908.425.7689 Twitter – bookbuyrinsight For more information on Consumer information visit – www.bookconsumer.com Tina Jordan Vice President AAP [email_address] 212-255-0200