For our Move to Digital series, we are featuring a few articles from Katherine Molina, the first of which was published last week. Katherine is a recent M.B.A. graduate from the MIT Sloan School of Management, where she studied the business of innovation, education and entrepreneurship. She lives in New York City.
|Option||Typical price||Where to buy|
|Purchase a new print textbook||High, typically between 80-100% of SRP||Brick-and-mortar stores, publisher websites, retail websites|
|Purchase a used print textbook||Low to moderate, depending on age and condition. 15-75% of SRP.||Brick-and-mortar stores, retail websites, exchange websites, student listservs and personal connections|
|Rent a print textbook (new or used, no guarantee)||Low, usually hovering at 40-45% of SRP for one term use. Price varies with length of rental.||Online rental and textbook-specific websites (Chegg, BookRenter, etc.), and a growing number of on-campus college bookstores|
|Purchase an eTextbook||Mid-high range, varies by site.||Online retailers, publisher websites, and some in-store pilot programs at Barnes & Noble-operated campus bookstores through the NookStudy program.|
|“Rent” an eTextbook||Lower range, varies by site and by length of rental term (most often 140-180 days, ranges from 60-540 days)|
In the wild, other options include purchasing an older or international edition of an assigned book, or not purchasing anything at all (relying on friends, library copies, or simply hoping the book is not integral to passing the course).
- Students who opt for permanent-access eTextbooks are not necessarily going to be the same kind of students who take advantage of digital “rental” options. Access and license terms for eTextbooks has been a hot topic among textbook publishers, the debate exacerbated by the fact that unlike trade books, many textbooks do “expire” or become outdated after a certain number of years and the fact that students tend to only need these products for a fixed amount of time (typically a semester or a year at best). Publishers are grappling with access, updating and particularly price conundrums related to “permanent” eTextbook access—should they include “updates” as revisions are published? For how long, and how can they build this into the price? As mentioned here at TBG earlier, Nature recently offered an elegant and particularly consumer-friendly solution for a particular Biology textbook, but this does not seem to be a one-size-fits-all dilemma. With this in mind, it’s worthwhile for publishers to remember that “permanent access” buyers are out there, and may have different requirements and desires from students only looking at temporary options.
- Temporary-access options are highly competitive – and may become more so as both print and digital “rentals” gain popularity. Both options are, for the moment, hovering in the same price range between 40-60% of SRP and both cater to a group of price-sensitive consumers who are willing to make certain trade-offs in terms of access and resale options in exchange for lower up-front prices. Right now, both options suffer from a lack of truly broad availability (not all textbooks can be found with rental options, the same goes for digital versions in any form) – although both are expanding their base of titles rapidly. Temporary-access eTextbooks have some immediate advantages over print rentals (instant access and the possibility of access codes to other digital resources, which print purchases also offer but print rentals often lack). There is no evidence that this will become a winner-takes-all situation for either format; that seems unlikely for at least the next 5-7 years. But if one format does turn out to choke out the other, other parts of the industry will feel it. Print rentals feed inventory into the used book market and the rental industry will help keep that market on life support even as it squeezes the overall number of used book sales. Digital eTextbook rentals offer no such consolation to the used market, and a big change in the used market means an equally important shift in product and pricing strategy for publishers and retailers alike.
The survey described here was written with support from Pearson Education, as a part of a 2011 Master’s thesis at MIT Sloan School of Management on “Digital Asset Pricing in the Textbook Industry.” A PDF copy of the survey methodology and results can be found online here. The full thesis is here.