Kobo: What Do eBook Customers Really, Really Want? (Tools of Change 2011)

1. Michael Tamblyn @mtamblyn
2. EVP Content, Sales & Merchandising @kobo
3. 20 minutes
4. Four users
5. how we look at readers and reading
6. and to answer the question:
7. “What happens when...
8. ...a group of reading-obsessed technophiles...
9. ...get their hands on the richest data set...
10. ...in the history of the book industry?”
11. A bit about Kobo
12. global ebook retailer
13. 2M+ registered users
14. 200 countries
15. 34,300 employees 24,100 employees 170 employees!!
16. #1!
17. May 2010 $149
18. Cloud
19. obsessed
20. segments
21. Geography Reading Platform Pricepoint Tolerance Reading History Lifetime Value Free vs. Paid
22. can get complicated quickly
23. vs.
24. vs.
25. <$5 80% free
26. <$5 80% free ~$11 100% paid
27. complicated
28. 4 users
29. eInk Reading Machine
30. eInk Reading Machine Gold-A Kobo2 Jun-2010 Fiction 100% Paid
32. eInk Reading Machine Gold-A Most valuable Lifetime Value cohort Kobo2 Jun-2010 Fiction 100% Paid
33. eInk Reading Machine Gold-A Most valuable Lifetime Value cohort Kobo2 Cohort Gold Jun-2010 Silver Fiction Bronze 100% Paid
34. eInk Reading Machine Gold-A Most valuable Lifetime Value cohort Kobo2 Cohort Gold 1st Day Average 7 orders / Jun-2010 $35 $25 month Silver Fiction Bronze 100% Paid
36. eInk Reading Machine Gold-A Most Productive Sales Channels (% conversion) Kobo2 1. Web 2. Kobo eReader Jun-2010 3. Kobo-powered Readers 4. iPad 5. Android Fiction 6. iPhone 100% Paid
38. eInk Reading Machine Gold-A Kobo2 Purchase frequency is increasing Jun-2010 overall. eBook buying is accelerating. Fiction 100% Paid
39. eInk Reading Machine Gold-A A customer who starts in Kobo2 June 2010 buys 44% more in their ﬁrst month as a customer Jun-2010 than a customer who started Fiction Dec 2009. 100% Paid
40. eInk Reading Machine Gold-A Kobo2 A customer joining Nov. 2010 buys 70% more in their ﬁrst Jun-2010 month than a Dec 2009 customer. Fiction 100% Paid
41. eInk Reading Machine Gold-A Why? Kobo2 Better apps Better devices Jun-2010 Better marketing Fiction More titles Better customers 100% Paid
42. Gold-A Kobo2 Jun-2010 Fiction 100% Paid
43. Health Religion Business eInk Reading Machine Gold-A Juvenile Fiction & YA Kobo2 Jun-2010 Biography Fiction History Self- Fami help ly 100% Paid
44. Gold-A Kobo2 Jun-2010 Fiction 100% Paid
45. Small-screen Reader Bronze-E iPhone Nov-10 Romance paid+free
47. Small-screen Reader Bronze-E Largest segment in terms of numbers iPhone Nov-10 Romance paid+free
48. Small-screen Reader Bronze-E Largest segment in terms of numbers iPhone Cohort Gold Nov-10 Silver Romance Bronze paid+free
49. Small-screen Reader Bronze-E Largest segment in terms of numbers iPhone Cohort Gold Nov-10 Silver 1st Day Average 1 order / Romance Bronze $15 $11 month paid+free
51. Small-screen Reader Bronze-E Least Productive Sales Channel (% conversion) iPhone 1. Web 2. Kobo eReader Nov-10 3. Kobo-powered Readers 4. iPad 5. Android Romance 6. iPhone paid+free
52. Small-screen Reader Bronze-E iPhone Small screen device = Nov-10 lower price-point tolerance. Romance paid+free
53. Bronze-E iPhone Nov-10 Romance 50% paid
54. Actual Selling Price vs. Purchasing Platform Can$10.00 8.84 8.53 Can$7.50 7.80 7.92 7.85 7.82 Bronze-E 7.42 6.81 Can$5.00 iPhone P Can$2.50 Nov-10 Can$0 All d der p oid b ne rry iPa kto We Romance o kbe r Rea iPh And Des c oe Bla Kob 50% paid
60. Small-screen Reader Bronze-E iPhone Small screen device = Nov-10 less likely to stick around Romance paid+free
61. Small-screen Reader Bronze-E iPhone Nov-10 churn Romance paid+free
62. Small-screen Reader Bronze-E Platform User Longevity 1. Kobo eReader iPhone 2. Kobo-powered 3rd-party eReader 3. Desktop Nov-10 4. Android 5. Web Romance 6. iPad 7. iPhone 8. Blackberry paid+free
68. Histori cal Erotica Mystery Small-screen Reader General Bronze-E Romance iPhone Nov-10 Romance Science Fiction Literary paid+free
70. iPad Socialite Gold-B iPad Dec-10 General 90% paid
72. iPad Socialite Gold-B Not as good as the Reading Machine, but still pretty great. iPad Dec-10 General 90% paid
73. iPad Socialite Gold-B Not as good as the Reading Machine, but still pretty great. iPad Cohort Dec-10 Gold Silver General Bronze 90% paid
74. iPad Socialite Gold-B Not as good as the Reading Machine, but still pretty great. iPad Cohort Dec-10 1st Day Average 4.5 orders / Gold $22 $16 month Silver General Bronze 90% paid
76. December 2010
77. (just launched for iPhone too!)
78. How does social change eReading?
79. Quite a lot.
80. 33% more time in app
81. Reading behaviour at different times of day
82. Average Time in App vs. “Time of Day” Awards 60% 45% 30% 15% 0% -15% -30% -45% -60% mute ch hift Hour time or Lun yard S Prime e Com Happy ooks f Grave Kill th I Eat B
84. Average Time in App vs. “Time of Day” Awards 60% 7-9am 45% 30% 15% 0% -15% -30% -45% -60% mute ch hift Hour time or Lun yard S Prime e Com Happy ooks f Grave Kill th I Eat B
85. Average Time in App vs. “Time of Day” Awards 60% m m-n o o n -9a 9a 7 45% 30% 15% 0% -15% -30% -45% -60% mute ch hift Hour time or Lun yard S Prime e Com Happy ooks f Grave Kill th I Eat B
86. Average Time in App vs. “Time of Day” Awards 60% m m-n o o n -9a 9a 7 45% 12 -2pm 30% 15% 0% -15% -30% -45% -60% mute ch hift Hour time or Lun yard S Prime e Com Happy ooks f Grave Kill th I Eat B
87. Average Time in App vs. “Time of Day” Awards 60% m m-n o o n -9a 9a 7 45% 12 -2pm 30% 2- 4pm 15% 0% -15% -30% -45% -60% mute ch hift Hour time or Lun yard S Prime e Com Happy ooks f Grave Kill th I Eat B
90. Average Time in App vs. “Time of Day” Awards 60% 45% 30% 15% 6-8pm 0% -15% -30% -45% -60% mute ch hift Hour time or Lun yard S Prime e Com Happy ooks f Grave Kill th I Eat B
91. Average Time in App vs. “Time of Day” Awards 60% 45% 30% 15% 6-8pm am 12-1 0% -15% -30% -45% -60% mute ch hift Hour time or Lun yard S Prime e Com Happy ooks f Grave Kill th I Eat B
92. Average Time in App vs. “Time of Day” Awards 60% 45% 30% 15% 6-8pm am 12-1 8-10pm 0% -15% -30% -45% -60% mute ch hift Hour time or Lun yard S Prime e Com Happy ooks f Grave Kill th I Eat B
93. Average Time in App vs. “Time of Day” Awards 60% 45% 30% 15% 6-8pm am 12-1 8-10pm0-12pm 0% 1 -15% -30% -45% -60% mute ch hift Hour time or Lun yard S Prime e Com Happy ooks f Grave Kill th I Eat B
94. Bet ter i nB ed Prim etim e Sle epin g In Hap py H our Afte rno o nR ush Hou r Pla ying Hoo ky I Ea t Bo oks for Lun ch Kill the Com mu te Number of Awards Issued Gra vey ard Shi ft Wit chin gH our
95. Bet ter i nB ed Prim etim e Sle epin g In Hap py H our Afte rno o nR ush Hou r Pla ying Hoo ky I Ea t Bo oks for Lun ch Kill the Com mu te Number of Awards Issued Gra vey ard Shi ft Wit chin gH our
96. 1 Bet ter i nB 0-1 ed Prim 2pm etim e Sle epin g In Hap py H our Afte rno o nR ush Hou r Pla ying Hoo ky I Ea t Bo oks for Lun ch Kill the Com mu te Number of Awards Issued Gra vey ard Shi ft Wit chin gH our
97. 1 Bet ter i nB 0-1 ed Prim etim e 8-10 Sle epin g In 2pm pm Hap py H our Afte rno o nR ush Hou r Pla ying Hoo ky I Ea t Bo oks for Lun ch Kill the Com mu te Number of Awards Issued Gra vey ard Shi ft Wit chin gH our
98. 8pm-midnight ebook shopping primetime
99. The Freegan
100. The Freegan *Freegan Website Apr-10 Fiction 100% free
101. The Freegan *Freegan Website Apr-10 Fiction 100% free
102. The Freegan *Freegan “Below Bronze-F” Website Apr-10 Fiction 100% free
103. The Freegan Bronze-F Website Apr-10 Fiction 100% free
104. Free Books Accessed The Freegan Bronze-F Website Apr-10 Web ne roid iPad ed ktop rry der iPho wer kbe a And Des eRe -po Blac Fiction o o Kob Kob 100% free
105. Side-loading Zero investment International
106. Not everyone who reads free books is a freegan.
107. Lots are paygans.
108. Customers with Free Books The Freegan Bronze-F Website Apr-10 Fiction e es es es es es es es es im im im im im im im im tim 1t 2t 3t 4t 5t 6t 7t 8t 9+ 100% free Number of Free Books in Library Customers with FreeBooks
109. Customers with Free Books eBook Training wheels The Freegan Bronze-F Website Apr-10 Fiction e es es es es es es es es im im im im im im im im tim 1t 2t 3t 4t 5t 6t 7t 8t 9+ 100% free Number of Free Books in Library Customers with FreeBooks
110. Customers with Free Books eBook Training wheels The Freegan Bronze-F “I Jane Austen” Website Apr-10 Fiction e es es es es es es es es im im im im im im im im tim 1t 2t 3t 4t 5t 6t 7t 8t 9+ 100% free Number of Free Books in Library Customers with FreeBooks
111. Customers with Free Books eBook Training wheels The Freegan Bronze-F “I Jane Austen” Website Apr-10 Fiction e es es es es es es es es im im im im im im im im tim 1t 2t 3t 4t 5t 6t 7t 8t 9+ 100% free Number of Free Books in Library Customers with FreeBooks
112. Customers with Free Books eBook Training wheels The Freegan Bronze-F “I Jane Austen” “Freegans” Website Apr-10 Fiction e es es es es es es es es im im im im im im im im tim 1t 2t 3t 4t 5t 6t 7t 8t 9+ 100% free Number of Free Books in Library Customers with FreeBooks
113. 1t im e 2t im es 100% free 3t im es 4t im es 5t im es 6t im es Customers with FreeBooks 7t im es 8t im es 9-1 4t im es 15 Number of Free Books in Library -25 Customers with Free Books tim 26 es -50 tim 51 es -10 0t Mo im re es tha n1 00 tim es
114. 1t im e 2t im es 100% free 3t im es 4t im es 5t im es 6t im es Customers with FreeBooks 7t im es “Freegans” 8t im es 9-1 4t im es 15 Number of Free Books in Library -25 Customers with Free Books tim 26 es -50 tim 51 es -10 0t Mo im re es tha n1 00 tim es
115. Customers with Free Books Freegan Librarians “Freegans” e es es es es es es es es es es es es im im im im im im im im im tim tim im tim 1t 2t 3t 4t 5t 6t 7t 8t 4t 0t -25 -50 00 9-1 -10 n1 15 26 51 tha Number of Free Books in Library re 100% free Mo Customers with FreeBooks
116. Customers with Free Books Freegan Freegan Librarians Hoarders “Freegans” e es es es es es es es es es es es es im im im im im im im im im tim tim im tim 1t 2t 3t 4t 5t 6t 7t 8t 4t 0t -25 -50 00 9-1 -10 n1 15 26 51 tha Number of Free Books in Library re 100% free Mo Customers with FreeBooks
117. The Freegan *Freegan Website Apr-10 Fiction to Mar keting Res istant 100% free
118. Why?
119. make reading better
120. know the reader, sales will follow.
121. Michael Tamblyn | @mtamblyn | mt@kobo.com

Editor's Notes

\n

We eat\n

\n

We&#x2019;re doing a ton of stuff with social, but having now seen 5 social presentations, we may come out of this all feeling that &#x201C;Hell is other readers.&#x201D;\n

\n

3rd most popular eReading app for the iPhone (# 34,300 employees, #, #)\nAlso The first ebookstore for the (#)\n

&#x2026;\nThe first ebookstore for (#)\n

&#x2026;\nThe first eInk device for (#)\n

\nThe first ebookstore in the (#)\n

(cloud)\n

We are obsessed with reading, with the reader, with how they behave, about their characteristics. \n

Making assumptions about the &#x201C;typical&#x201D; digital reader is incredibly difficult. Instead, we try to look for meaningful segments, smaller groups that do have some consistent behaviours.\n

\n

Because it isn&#x2019;t just how is a consumer from the UK different than a consumer from HK.\n

Or do you sell differently to a romance buyer in UK than a thriller reader in Hong Kong.\n

or is there a difference between a reader who...\n\n

it gets complicated. So to give a sense of the way that we look at some of these different combinations, I&#x2019;ve pulled out some samples.\n

\n

I&#x2019;ll spend a bit of time with each one. We&#x2019;ll look at some of the data that is especially relevant to that user and along the way, you&#x2019;ll hopefully get a sense of both what we&#x2019;re finding interesting right now and how our understanding of the digital reading is evolving.\n\n

She is an eInk Reading Machine. And here are some of the things we know about her.\n\n

\n\n

She has been with us since June 2010. She probably had a first edition Kobo eReader and has since upgraded to a 2nd edition Kobo. We look at when people joined very closely and are starting to see some interesting patterns there. Generally, we can say that (#)\n\n

\n\n

The last one is important. Our suspicion is that we&#x2019;re not just moving more people from print to digital. We&#x2019;re moving more heavy readers from print to digital more quickly.\n\n

\n\n

She also tends to buy just about everything she reads. Now we distort that a bit by preloading free books onto the eReader, but as far as her ongoing consumption goes, she&#x2019;s a full on customer with a big focus on new releases.\n\n

\n\n

Talk about why -- lots of testing, app trialing, large percentage of apps that are installed are not used.\n\n

\n\n

(#) Smartphone users, generally, are much more sensitive to price than those on (#) larger-screen devices.\n(#) Android sits in between them because we see both phone and tablet users through the same platform. And the Web is almost exactly the same as the average, which makes sense because people buy on the web for all of their devices.\n\n\n\n

\n

It&#x2019;s an area with a huge number of factors and very hard to generalize\n(#-circle) Smartphones see a lot of people who use for a while, but then migrate to another platform. Or who use it as a second reading platform supplementing an eInk or tablet device.\nBut it isn&#x2019;t screensize. # iPad users come and go while Android users stick around.\nAnd (#) eInk devices and dedicated eReaders generally outperform multi-function devices in terms of overall user longevity\n

While eInk consumers are big fiction readers generally, Small screen readers are especially strong consumers of genre fiction sub-categories like sci-fi, fantasy and mystery. But especially (#) romance.\n

They also have a strong propensity to go hunting for free titles, but we&#x2019;ll talk more about that in a bit.\n

\n

This person is an iPad user who came on in December. That means we know even more about this user than we do about users on other platforms. As many of you know...\n

\n

Reading Life, a social experience integrated into our reading experience for iPad.\n

\n

One of the options that you have is to connect to Facebook so that you can share some of the events from your reading life with your friends. People that turn this on\n

spend 33% more time in app, most of it reading.\n

We also give badges and awards to people depending on the time of day they read, whether it&#x2019;s on the way to work\n

or at night in bed\n

or at lunch time.\n

\n

((explain what this shows...)\nThe biggest surprise we found in looking at this data was that our assumptions about when and how long people read were completely wrong.\n* ((had thought - late nights, more reading. Daytime, more time-pressured.))\nWhen we looked at people who were consistently reading during the day #\nKill the Commute (#) Sleeping In (#) I Eat Books for Lunch (#) Playing Hooky (#) - they were spending way more time reading (#)\n

than the people reading at night (#) Happy Hour (#), Witching Hour (#), Primetime (#) and with people reading at &#x201C;bedtime&#x201D; Better in Bed (#) spending 42% less time reading per session than the average. This was a big shock to us. A lot of us have this preconception that the book industry is kinda powered by the bedside table, and by the almighty trinity of Beach, Bath, and Bed. But this would suggest that at least 2 of those -- Bath time and Bed time -- might not be where people spend as much time reading.\n

But where the preconception holds is that it is still the time when *the most people spend time reading. More people get their reading time in during those hours between 8pm and midnight.\nIt is also still where we see people do most of their *buying.\n

\n

The first thing you&#x2019;ll notice is that they don&#x2019;t even sit in our pricing cohorts. And they aren&#x2019;t consumers per se. The freegan is like Dark Matter - they are this vast bulk of downloaders who barely show up on our radar.\n

Web is far and away the chosen content consumption platform (#) of the Freegan. ((Talk about that distribution)) Now that&#x2019;s for a number of reasons...\n

\n

This is a graph of people who are both ebook *purchasers* and free content consumers. Most ebook buyers read (or at least start) at least 1 free book first. We see them in a few distinct groups.\n# eBook training wheels\n# I heart Jane Austen (and the Brontes and maybe a little tolstoy)\n\n

# But way at the other end we have these interesting guys we call (#) the Freegans. Most of what they read is free. They actively seek it. They look for new good free stuff.\n\n

en we go a little more fine-grained\nFreegans - just some people who can find 10 free books they like. Lots of those. Generally more functional - &#x201C;these are the books I like&#x201D;\nFreegan librarians. Want to have lots of books in their accounts, on their shelves. From them, we get a lot of requests for the ability to categorize their collections, more discovery options...\n# Freegan Hoarders - almost compulsive desire to stuff their library with free books. Even though they&#x2019;re all available any time they want. Even though they could never read them all. In some cases, thousands of books.\n\n

\n

\n\n

\n

For the first time in a long time, we aren&#x2019;t just thinking about what goes inside books or how they are designed or how they are marketed. We&#x2019;re thinking about the reading experience itself. How can we make that experience easier, more enjoyable.\n

And how can we do it while keeping in mind that there are lots of different kinds of people who all have their own definition of what reading is.\n\n

When you get down to it, we are fighting for those tiny slices of people&#x2019;s day. The more enjoyable we can make that, the more we can enhance that experience, the better we&#x2019;ll be.\n

\n

Kobo: What Do eBook Customers Really, Really Want? (Tools of Change 2011)

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Kobo: What Do eBook Customers Really, Really Want? (Tools of Change 2011)

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