Monthly Archives: April 2013

Amazon and Goodreads: Machiavelli Would Be Proud

Don and Derek

The Book Kahuna and his Corgi, Derek!

I read with interest the Jeremy Greenfield article What Will Amazon Do With Goodreads? on the Digital Book World website and thought long and hard before I came up with an answer.  Before I give my answer though, I wanted to touch on a few key points as precursors.

A Company Vision

Otis Chandler spoke at the PubWest conference in Keystone this past October.  His message was one of an independent and forward thinking corporate executive who was filling a social media niche based on client interactions about books.  He gave growth figures for the company that seemed to point to a trajectory that was into the stratosphere and beyond.  As a personal note, I have been a member of Goodreads since November of 2012, but I have not gotten into the full flavor of what the website is all about.  I do see why this company would be a major target for Amazon, as the number of people involved with this website skyrocketed off the charts in the previous 12 months.

Publishing Acquisitions: Why the Surprise?

Purchasing the competition is not a foreign practice in the world of books and publishing.  There was a certain cover/component printer in the 1980s and 1990s that purchased many of the companies that were the competition.  Sometimes these purchases were due to the acquired entity having newer printing equipment, but more times than not the acquisition took a major player off the table who could cut into the profit margin of the purchasing company.  This is CAPITALISM 101.  If the playing field is diverse enough so that you will not look like a monopoly to the US government, then all is fair in keeping your hand in play to maintain and grow your customer base.

Galapagos II

Corporate Darwinism dictates that those who play the game and have the cash reserves available must play with a Machiavellian zeal to win and be successful.  Otis Chandler played the game and built a company that could have been on the cusp of a revenue explosion, or may have been MySpace II in the next year or so.  The economic climate of companies on the web is changing at such a speed that sometimes you have to write your check now or there may be no payday tomorrow.  Chandler did what he needed to do at this point in time, and Amazon also took the reins and controlled the playing field as only the puppet-master Jeff Bezos can aptly do.

Why’d They Do It?

Will Amazon keep Goodreads as a viable entity going into the future?  I think in the short-term nothing will change.  I think Mr. Greenfield has made some excellent points with his list of possibilities:

“Here are some logical guesses:
1. Use the site’s data to augment and improve its own book recommendations.
2. Remove buy buttons for other retailers’ books.
3. Supplement its own reviews with Goodreads reviews.
4. Add Goodreads to its suite of marketing solutions for publishers.
5. Nothing. The company is growing quickly (nearly tripled in users since the end of 2011).”

In Conclusion…

My answer to this question is not as elucidating:  It Doesn’t Matter What Amazon Does With Goodreads!

Keeping this company out of the hands of everyone else while also strengthening the hand of consumer market-share was the coup in and of itself.  Amazon has already won the game in this round of the publishing wars.  My one question is:  Why did it take them so long to do this?

Kindle-on, Dudes!


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