AAP Report Posits a Future With More Direct-to-Consumer Sales

"It's 2004. Do you know where your book business is?" was the theme of a presentation by Kosmo Kalliarekos of the Parthenon Group to the 2004 Association of American Publishers (AAP) General Annual Meeting in February.

The report examined "two core dimensions" fueling the evolution of the publishing market -- proximity to the customer and use of content -- for the education, professional, and trade publishing segments. The presentation outlined both the ways each segment has changed and the challenges they face in the future.

The professional publishing segment, which has made the most of new digital technology, and where the sales force most often sells directly to end-users, was described as the most profitable segment, with high growth. Conversely, the report describes trade publishing as the "largest, most fragmented, and relatively lowest growth segment." To change this situation, among other things, the study suggests that trade publishers open channels of direct communication with customers to gain insight for future product development and to foster new distribution models, such as direct sales.

The report also provided data on trends affecting trade publishers' margins, including escalating author advances, the development of publishing programs by large-scale bookstores, and the growing used-book market as it affects frontlist sales.