Wednesday, August 16, 2006

It's a Business, After All

Following my post about Harlequin yesterday, I received an email that read: "Some . . . have commented that publishing houses have become too focused on numbers, less focused on readers, and doesn't this [post] support that statement? 'cause it sounds like Harlequin totally missed the reader with a marketing fumble."

The questioner was repeating a statement I've heard many times before. "Publishers are more interested in the bottom line than in the quality of their product." "Why aren't publishers looking for quality manuscripts?"

I think those questions miss the real point: Publishing IS and ALWAYS has been a business. Publishers who don't treat it like a business don't stay in business long.

Having said that, it does make a difference whether the business in question is a privately-owned enterprise or a publicly-held one. Publicly-held companies must answer to their shareholders. And unhappy stockholders can be very vocal. Look at the problems Time Warner has had with its stockholders about AOL over the last few years. A single dissident stockholder (Carl Icahn who, with partners, owns 3% of the company's stock) caused Time Warner enormous problems. I wrote extensively about this last winter (see my blogs for December 12th and 13th).

A private company (of which there are fewer and fewer publishers these days--Kensington leaps to mind) can make decisions that are more long-term in nature. They can take more chances and stick with a plan-of-action despite initial failures. As an example, Kensington was the first of the print publishers to begin producing erotic romance under its Brava label. They've now expanded into a second erotic romance label, Aphrodisia. I'm not sure that this could have happened in a publicly-held company BEFORE it became a trend.

Earlier this week, I wrote about "Who Owns What" on my blog. The vast majority of publishing houses are now owned by big media companies. The tendency of such publishers is to go with a sure thing: big name authors or the trend of the day (read here: the currently popular genre). It takes courage and insight to steer a different path.

Back to Harlequin and my questioner. One caveat: The following is opinion only, and I could be wrong. Take what I say as you find it and discard what doesn't make sense.

Harlequin is a special case. It built its fortune on two things: formulaic romances and the convenience of its massive book clubs. The romance industry is moving away from both those things. Women (and increasingly men) are interested in off-beat, heroines/heroes with attitude and quirks. In addition, electronic publishing now gives readers the convenience and immediacy that the book clubs once did PLUS the additional benefit of more choice.

Harlequin is trying to change. Unfortunately, it is very hard to break out of a mold that has historically been successful. The company's knee-jerk reaction of shutting down Bombshell followed predictably on the heels of a bad financial quarter. Stockholders want to see changes and so, the company makes changes.

I actually think Bombshell was a remarkable innovation for Harlequin. Unfortunately, Harlequin's lack of experience with something that new and different led to a failure in seeing it all the way through from conception to execution. They created something that could have been a success, but either they didn't understand what that meant or they didn't explain their plan to the people (right down to the booksellers) who would be responsible for implementing their new strategy. Therein lies the failure. You can't introduce a new product without a complete vision of how it will fit into your overall continuum.

Was Bombshell new and innovative? Yes. Was it marketed poorly? Yes. Will Harlequin learn anything from this experience or fall back on the tried and true? Only time will tell.

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