Analyzing the Random House Response to Amazon's Kindle

This case study analyzes the impact of Amazon's Kindle on the book publishing industry, focusing on the response of Random House. It examines the digital disruption caused by the Kindle, which revolutionized book reading and distribution. The analysis covers the Kindle's innovative strategy, including its product lifecycle, and the impact on industry participants like printers, wholesalers, and retailers. The study highlights Amazon's approach to innovation, risk-taking, and market dominance, contrasting it with the challenges faced by traditional publishers. It discusses the Kindle's success factors, such as timing and customer satisfaction, and concludes by assessing the long-term implications of this digital transformation on the book industry, emphasizing the need for strategic adaptation by publishers to meet the evolving demands of consumers in the digital age. The case study uses references to support its arguments and provide a comprehensive understanding of the subject.

Case Analysis: The Random House
Response to the Kindle
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Introduction
Book publishing industry constituted a large industry that was subjected to threat in Christmas
2009 with introduction of Kindle (Anand, 2011). Revolution of digital format in book reading
techniques and methods with announcement of Amazon’s electronic reading formats overnight
changed the entire business of book publishing companies. The innovation though started by
Amazon was subsequently followed by a companies as Apple that looked onto new segment for
devising products strategies. The scope of the above innovation is analysed in this case analysis
to provide more detailed attributes regarding the same.
Case Analysis
Bok publishing industry involved a number of participants who made profits from selling of
books. It involved printer, wholesaler, retailer, distributor along with several other participants as
well. With introduction of ebooks prices of such books went down substantially. Kindle by
Amazon was a Digital Disruption strategy that aimed to change the entire methods used in
reading books. The entire value chain and profitability of the book publishing industry had to
undergo a revolution in order to accommodate the change. Jeff Bezos ordered a number of
ebooks from various publishing companies but at lower prices.
Amazon was primarily a book selling company that forayed into retailing business some time
ago. Kindle was an extension of the already existing business of Amazon and to provide
customer delight (PETZOLD, 2008). With this type of innovation, Amazon was able to
restructure and revolutionize the entire book publishing industry.
Kindle was unlike any other innovation that had an evolution. It allowed its customers with the
feeling of holding book in their hands. It also continued to purchasing books and updating their
stock similar ways that it earlier did business. Though Kindle is a risky idea as Amazon tried to
popularize the only idea of e-books but its brand name allowed to establish itself. Through
calculated risks taking, it devised a new segment of the market from its incubator of innovation.
Amazon did not sacrifice on its Cash Cows by stopping innovation. Rather it increased a product
line to enhance ranking from existing customer base. It was not an incremental improvisation
rather a new technique to re-establish its market dominance.
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E-books had been in existence for quite some time but it has adoption attribute to make an old
idea new again. Amazon made its customers look at a e-book reading in a new format by
providing convenience (Loebbecke, 2010). This business strategy of Amazon proved to be a
powerful idea to attract people and recapture benefits. Similar innovations had earlier been done
as Apple to its music, Ebay did to its auction.
Product Lifecycle Analysis of Kindle depicts a rather long curve starting with launching of the
product. Though the Kindle does not look attractive as the iPhone but it’s a product that can
provide its user value. It provides its customers access to 80,000 odd books within touch of a
finger. Aesthetic proposition is not a component for Amazon rather catering to its basic
functionality is the primary concern.
Innovative Strategy of Amazon proves that it’s not a new gizmo, but rather makes millions of
books available to customers on the touch of a finger. Amazon believed that they wanted to sell a
solution rather than an aesthetic product. Its performance and customer satisfaction has been
rated better PDA and laptops. The launch time for the product was also perfect as it was offered
during Christmas and could be presented as a Christmas gift. It allowed customers right frame of
mind to purchase the product, hence timing greatly influenced the product’s success.
Conclusion
Analysing innovative strategy of Amazon it can be said that it was not an overnight revolution of
products rather gradual. Amazon plans to introduce and add books gradually in Kindle allowing
greater access to its readers. Amazon ordered a number of books to be made available online but
that innovative process was more progressive in nature. The innovation left several book
publishers rather in a state of anguish at they were at a loss of devising strategy that could meet
the challenge. The innovation had rapidly transformed the entire experience of book reading and
allowed Amazon with an opportunity to provide interaction with its own products to customers.
This innovation was an extension of Amazon with its products in the market to build greater
brand name rather than popularizing itself through its regular bestsellers.
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Reference Lists
Anand, B. N. (2011). The Random House Response to the Kindle. addition to examining
changes within this particular industry, the case is useful to highlight certain general
issues involved in any corporate strategic change process, particularly: understanding the
impact of e.
Loebbecke, C. S. (2010). Innovating for the mobile end-user market: Amazon's Kindle 2 strategy
as emerging business model. In Mobile Business and 2010 Ninth Global Mobility
Roundtable (ICMB-GMR). 2010 Ninth International Conference on (pp. 51-57). IEEE.
PETZOLD, N. J. (2008). Hybrid Value Creation as a strategic response to Disruptive Change.
The case of Amazon’s Kindle. Managing Disruption and Destabilisation.
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