Distribution: Channels & Logistics
a retailer, in this case, Amazon, integrates backwards with the intent of
attracting suppliers (authors with brand names) and the expectation of
utilizing other outlets (traditional bookstores) for full distribution of its
products. In this case, the largest traditional bookstore chain, which also has
a significant online business, has decided not to stock Amazon’s products in
the hope of discouraging authors from signing publication contracts with
Amazon. Effective distribution channels call for vertical cooperation, here
among authors and their agents, publishers, and retail outlets. But vertical
integration invites conflicts.
Answer the following Questions
Was Amazon wise to get into publishing in addition to its
very strong position in retailing new and used books? Explain your answer.
If you were a popular author of children’s fiction (with a
successful past relationship with a traditional publisher) and your agent
(another member of the book publishing channel) asked you whether to approach
Amazon regarding the publication of your latest project, what would you say?
Why?
Would it matter if you were working on your first book and
had no previous relationship with an editor or publisher? If “yes.”
why would this make a difference?
In your judgment, do you think that either Amazon or Barnes
& Noble are likely to change the strategic decisions reported in this
article? Why?
ScholarMatic: Explanation & Answer
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