The Impact of Ebook Distribution on Print Sales: Analysis of a Natural Experiment

Management Science, Forthcoming

30 Pages Posted: 29 Nov 2011 Last revised: 14 Dec 2017

See all articles by Hailiang Chen

Hailiang Chen

The University of Hong Kong - Faculty of Business and Economics

Yu Jeffrey Hu

Georgia Institute of Technology - Scheller College of Business

Michael D. Smith

Carnegie Mellon University - H. John Heinz III School of Public Policy and Management

Date Written: August 2017

Abstract

Digital distribution introduces many new strategic questions for the creative industries, notably how the use of new digital channels will impact sales in established channels. We analyze this question in the context of ebook and hardcover sales by exploiting a natural experiment that exogenously delayed the release of a publisher’s new Kindle ebooks in April and May 2010. Using new books released simultaneously in ebook and print formats in March and June 2010 as the control group, we find that delaying ebook availability results in a 43.8% decrease in ebook sales but no increase in print book sales on Amazon.com or among other online or offline retailers. We also find that the decrease in ebook sales is greater for books with less pre-release buzz. Together we find no evidence of strong cannibalization between print books and ebooks in the short term, and no support for the sequential distribution of books in print versions followed by ebook versions.

Keywords: Digital distribution, channel, publishing industry, natural experiment

Suggested Citation

Chen, Hailiang and Hu, Yu Jeffrey and Smith, Michael D., The Impact of Ebook Distribution on Print Sales: Analysis of a Natural Experiment (August 2017). Management Science, Forthcoming. Available at SSRN: https://ssrn.com/abstract=1966115 or http://dx.doi.org/10.2139/ssrn.1966115

Hailiang Chen

The University of Hong Kong - Faculty of Business and Economics ( email )

K. K. Leung Building
University of Hong Kong
Hong Kong

HOME PAGE: http://www.fbe.hku.hk/people/academic/hailiang-chen

Yu Jeffrey Hu

Georgia Institute of Technology - Scheller College of Business ( email )

800 West Peachtree St.
Atlanta, GA 30308
United States

Michael D. Smith (Contact Author)

Carnegie Mellon University - H. John Heinz III School of Public Policy and Management ( email )

Pittsburgh, PA 15213-3890
United States

HOME PAGE: http://www.heinz.cmu.edu/~mds

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