Electronic books have changed the landscape of book markets and readership: how consumers search for books, choose, buy, and read them. However, if anyone anticipated electronic books to lead to the elimination of books in print, this prediction so far (i.e., after more than a decade) has not come close to materialising. An electronic edition remains mostly an addition to a print book edition. Nonetheless, the introduction of a book in digital format seems to have changed the perception of value of books, and how books are priced. In this article I consider two primary properties, physical and intellectual, defining a book: format (i.e., print in hardcover or paperback, electronic) and content of the book, respectively.

An electronic edition of a book eliminates the costs of production of physical copies. Yet the essence of the book remains encapsulated in its creative and intellectual content as generated by its author(s). This is foremost the source of value of a book; an electronic book represents this value most close to its core. Hence even the price of an electronic book cannot go below the value of contribution of its content. It is the portion of price consumers pay for the intellectual property embodied in the book, and for which the authors receive their royalties.

There are of course additional activities in preparing a book for publication that add value, such as linguistic editing and proof-reading, graphic editing and visual design (e.g., embedding pictures, photos, charts). They are performed to ameliorate the quality and reading experience of the book in any format it will appear. In other words, this value added to content is expected to be included in the price regardless of the book’s format. On top of this comes the value of obtaining a printed book, in hardcover or paperback; we may regard it a third layer of perceived value, and price, which has not gone away with the arrival of the digital book format. We would not wish to undermine here the pleasure and convenience of holding a book, passing through its pages, and reading from print; for some books the benefits are more tangible and meaningful (e.g., scholarly, art, classic literature) than for others (e.g., pocketbook novels or thrillers).

• The acquisition and reading of electronic books is further entangled with the possession of an electronic reader (e.g., Kindle by Amazon.com, Nook by Barnes & Noble). Although using a screen-based device designed specially for reading an electronic book edition is not strictly a technical requirement, in practice access to many digital books is conditioned on prior purchase and possession of a compatible electronic reader. The add-on value of an electronic reader, and its effects on the marketing of electronic book editions, is beyond the scope of this article.

The question of how prices of hardcover, paperback and electronic books relate to each other makes an intriguing issue for studying. These are alternative versions of essentially the same book content, wherein very often two of the formats, or all three of them, compete with each other, and it is important to understand the price differentials between them. As I show below, the price differentials are not fixed; instead they appear to be nuanced, depending on the combination of formats available to consumers.

It should be noted that versions of principally the same book in different formats are not necessarily identical — adjustments made in editing and visual design may make them appear different, and they may even differ in volume of content (e.g., a book in hardcover could be more comprehensive with more graphics). Thereby, differences in price may account for differences in editing that extend beyond the format of the book edition, print or digital.

In order to uncover some regularities in price differences between the book formats, I performed a mini-study of books in the field of marketing, and associated fields. While reviewing books retrieved on Amazon UK, the prices (in pounds sterling) that appear in the top boxes on a book webpage were recorded for any of the three formats available. It has to be noted that the sample of 169 book titles included in analyses was not randomly selected. Yet, the books were selected in a way that reflects how a user of the Amazon website might search and consider books in the target topic of interest. The books were retrieved by searching for key words specifying various sub-classes of ‘marketing’ (like sample strata), including for example ‘management’ (18), ‘strategy’ (12), ‘product’ (14), ‘brand’ (13), ‘communication’ (12), ‘pricing’ (13), and ‘digital’ (10), as well as ‘marketing analytics’ (19), ‘advertising’ (17) and ‘consumer behaviour’ (10). The data collection was conducted between July and November 2019.

Several books were selected in each primary category {the (n) figures denoted above} after a short review of each book page. Both scholar or academic books (particularly textbooks) and books for management and business practice were included. Some of the knowledge books aimed at the general public may be viewed as scholarly (e.g., introducing a concept model, insights based on original research), appropriate for academics, managers and professionals in marketing. The search looked for books published from 1995 to 2019, yet most of the books included are from the years 2010-2019 (~90%), with particularly greater representation of books published from 2016 onwards (53%, mode 2017 n=30). The books originate from some fifty publishers (e.g., John Wiley & Sons, Pearson, McGraw-Hill Education, Kogan Page, Routledge, SAGE Publications).

• The mean prices for book formats, considered each separately, are as follows: Hardcover £72.4 (SD=49.5, n=89); Paperback £38.3 (SD=19.5, n=128); Kindle eBook £30.0 (SD=14.8, n=137).

When looking at pairs of formats offered simultaneously, it is revealed that the paperback book and Kindle eBook are the closest in price, exhibiting the smallest price difference on average, in nominal and relative terms (see Table 1). The price of the print paperback book is 18% above the price of an electronic Kindle eBook edition. This is also the most frequent pair of book formats. The hardcover print book is about double the price of the Kindle eBook. The hardcover format is the most expensive format on average, and is also more than twice the average price of a book in paperback.

Yet, we also can notice that when Hardcover is matched with Paperback its price is even higher, reaching £102, than when it is paired with Kindle eBook, with Hardcover’s mean price of £70. In fact, the price of Hardcover seems to be biased upwards even more than Paperback’s price, when co-offered. This apparent ‘anomaly’ is of consequence and we will return to it in attempt to explain the variation through the next analyses.

Book Format 1	Book Format 2	Difference	Corr. ; n
Paperback £36.5	eBook £30.9	£5.5 18%	r=0.87; n=100
Hardcover £70.6	eBook £31.1	£39.5 127%	r=0.63; n=77
Hardcover £102.5	Paperback £42.3	£60.2 142%	r=0.41; n=49

Let us look more specifically at books in which all three formats are available as options: that allows us to observe price differentials when the three formats “compete” between themselves, and the paired comparisons refer to a set of the same book titles. However, the results are considered more cautiously because they apply to only 41 cases. The comparisons in this setting (Table 2) show that prices of books in Hardcover stand out as higher above prices of both their Paperback (155%) and eBook (196%) editions. Furthermore, it appears from results presented thus far that the price of a hardcover book is accentuated, raised upwards, particularly in the presence of a paperback book option.

Book Format 1	Book Format 2	Difference
Paperback £39.9	eBook £34.4	£5.5 16%
Hardcover £101.8	eBook £34.4	£67.4 196%
Hardcover £101.8	Paperback £39.9	£61.9 155%

The paperback and electronic alternatives of a book title are more price competitive, and therefore it could be more a matter of convenience for the reader which of these formats one prefers. The printed book may be less comfortable to carry around but readers may still feel more at ease holding a physical book and reading from it than from a screen, probably smaller from the size of a paper page. For Kindle eBooks, one has to purchase first the Kindle electronic reader, so we need to take its price into account too (but the marginal cost should drop as one acquires more books). The price premium a consumer has to pay for obtaining a hardcover book compared with the paperback version could be more critical. A hardcover book is likely to be heavier and more burdening to carry and handle, but a book in this format is more likely to be preserved well over time than a paperback book, so the reader has to consider for how long one intends to keep and use the book for its content. In addition, hardcover editions may be printed in higher quality, and include more content and visual images. For students requiring textbooks, the benefits a hardcover edition may offer could be excessive, especially considering its price premium.

The prices are examined next from a different view angle. Among the book titles in the sample, 15% are offered in a single format (n=25); the majority of titles, 61%, are available in any two of the formats concerned — hardcover, paperback, or digital eBook (n=103); another 24% of the titles are offered in all three alternative formats (n=41). The book titles are thus divided into three groups by the size of choice set with respect to the type of book format.

Across three possible pairs of formats, Chart 1 displays a clear, and expected, ranking of prices, from the top of Hardcover (£48), through Paperback (£36.5), down to lower cost Kindle eBook (£28). This contrasts with the increased gap in price between the Hardcover format and the Paperback and eBook formats when three book formats are available for purchase (see also Table 2). It is notable that the mean prices for Paperback and eBook remain rather stable and only the mean price of Hardcover shows a hike (apparently pushed upwards by books priced £100-200).

Since the group of book titles with two formats available mixes different pairs of formats, it calls for going deeper and breaking-down this group into the different pairs possible: Hardcover-Paperback (5%, n=8), Hardcover-eBook (21%, n=36), and Paperback-eBook (35%, n=59). Curiously, as shown in Chart 2, when a Hardcover book is offered only as an alternative to an eBook, its price is moderately higher than the eBook’s (28% above). The price of Hardcover jumps much higher when the Paperback option is added as in the ‘All Three Formats’ group, marginalising the gap in prices of Paperback and eBook editions.

Indeed the group of titles offered in hardcover and paperback formats in the sample is very small and limits our ability to make inferences based on its book prices. Nevertheless, the difference in price (mean) provides additional corroboration that the inclusion of a Paperback option triggers a higher price of the Hardcover book rather than the digital eBook. Interestingly enough, the large majority of titles offering a pair of formats includes a Kindle eBook, to which we can add the titles offered in all three formats. Altogether, 80% of the book titles offer an eBook option in addition to one or both of the ‘classic’ formats, an indication of the rising prominence of electronic books (encouraged by Amazon).

• Note: Of the 25 book titles in a single format, 20 are in paperback format, 4 in hardcover, and just one eBook. We cannot say much on this group except that it seems consistent with the other findings in the sense that the price of Hardcover does not rise higher than Paperback’s when offered alone.

The prices of book formats seem to depend on context, that is, the alternative formats offered. This applies primarily to the prices of hardcover books. This can fit well with the long studied tendency of people to alter their preferences between choice alternatives depending on composition of the choice set. When a hardcover edition is offered as alternative only to a Kindle eBook, there does not seem to be a strong enough incentive to raise it too high (e.g., up to 50% higher) so as to keep it a competitively attractive option. Yet, when the options are the two ‘classic’ print formats, it is plausible to accentuate the ‘superiority’ of the hardcover format through price. Especially when all three formats are available, a greatly higher price of a hardcover book may increase particularly the attractiveness of the paperback option compared with an eBook (e.g., for those who still prefer print), or at least focus on the choice between those two options as more affordable and convenient book options.

Authors face an uneasy challenge where to set the price target for their book. A less familiar author, nearer the start of his or her career (e.g., academic, business), would probably aim to a lower price level to gain readers. Setting a higher price (including publication of a hardcover edition) would be more feasible and suitable for authors in more senior positions, better acknowledged and accredited in their field; they may also have more books previously published in their record (e.g., internationally acclaimed university professors and business leaders). Consumers-readers may use additional cues to inform their choices such as appraising tributes (e.g., on the back cover) or their impressions from reading parts of the book (e.g., looking inside print books in a store, using the ‘Look inside’ feature on Amazon online store).

Textbooks for students make a special case. Textbooks have become increasingly expensive over the years (since the 1970s) and harder for students to purchase for their courses. Furthermore, students are often not free to choose their course books, as these are selected by their professors, but they may choose how to obtain them. Students turn to alternative solutions such as renting books for a term or buying used copies and re-selling them later. The model for publishing and obtaining textbooks is set to continue changing, giving priority to electronic books (e.g., instead of issuing new editions every number of years making updates more continuously and dynamically, a new ‘digital first’ strategy launched by Pearson that sets the digital book as the base format for learning textbooks, and a print edition as complementary).

Although print books may stay with us for the long haul, the relative importance and preferences of print and electronic formats of books may shift, and modes of reading books will follow as a consequence. The models of publishing and marketing books are likely to change likewise. Foremost, it can be foreseen that the status and roles of printed hardcover books are going to be modified: they may become less common, more prestigious and lucrative, reserved for more specialised themes or topics. They may be offered as the more esteemed premium option (e.g., for special occasions and lifetime use), but often they would mostly advance, through pricing, the purchase by consumers of printed paperback books and electronic books. It should be interesting, and important, to follow how the ‘bookscape’ evolves.

Ron Ventura, Ph.D. (Marketing)