Follett's prediction of digital learning

Follett Higher Education group recently published a white paper titled “Are Textbooks Dead?” that assesses the evolution of course materials and the future of digital learning.   This is a must read for everyone involved in the course materials business.  Here are some quotes and highlights of the paper that are consistent with the messages of this blog for the past few years.

“As the campus appetite for digital materials increases, it stands to reason that publishers and providers will concentrate first on evolving a select group of textbooks because they are most widely used and produce the most revenue.”

i.e., large adoptions will move to digital first because of economies of scale and effect. 

Follett predicts that there will be two paths for digital: Native Digital and Enhanced Print.  We have traditionally referred to Native Digital as "born digital," but agree that Follett's labeling in this report is more consistent with the more common terminology that has evolved.  Enhanced Print takes the "PDF-equivalent" digital and "enhances" it with multimedia or other elements.  Inkling textbooks might be an example in this category.  From there, Follett has some interesting discussion within the report.  For example, their comparison of the two paths:

Native Digital

PACE OF GROWTH:  Faster

DISCIPLINES: Problem-based with linear learning

PURCHASE DECISION: Faculty select

BENEFITS: Better student performance; Engagement and retention; Adaptive learning;

Enhance Print

PACE OF GROWTH: Slower

DISCIPLINES: Theory-based with conceptual learning

PURCHASE DECISION: Student select

BENEFITS: Efficiency; Cost and social learning with ability to share notes and link to additional resources

Within the paper Follett provides their prediction for how course materials will evolve. The report provides an interesting table outlining the evolution, along with several other great charts and graphs.  Finally, in the report Follett proposes seven key considerations for decision makers on campus:

1. Develop a strategy to address issues surfacing as course materials evolve from print to digital. 
2. Give key stakeholders a chance to bring their ideas and concerns into the decision-making process, a collaboration that offers the best prospect for practical solutions and long-term success.
3. Consider IT support when making digital course material choices – both how the material might work in conjunction with existing campus technology and also how much time students and faculty will require to become familiar with the platform.
4. Standardize platforms and applications adopted and used by faculty and students, minimizing IT support and reducing learning curve.
5. Take advantage of the campus bookstore’s ability to leverage established relationships with publishers, soliciting and vetting faculty adoptions, then aggregating and making them conveniently available.
6. Guard against quickly adopting technology because of pressure from industry “noise.”
7. Be willing to relinquish the past.

 A very solid set of recommendations and advice, consistent with our prior recommendations.  The Follett report should definitely be on every store's reading list as they prepare and engage in their course materials strategy discussion.

Ten Things Stores Can Do

With the ICBA meeting just past us, and CAMEX just a couple weeks away, I thought now might be a good time to highlight Jeff Nelson's recommendations for "Ten Things Stores Can Do To Drive the Course Materials Future." The list originally appeared on the ICBA blog a few months ago, and I have been meaning to blog on it for a while. Across the documents I have seen Jeff produce, I continually admire much his careful thinking and way of capturing ideas in a parsimoneous way -- while still hitting the important stuff.  The full essay is worth the read. 
Here is the original introduction:

Those without the experience of working outside the institution can easily overlook the established advantages we can capitalize upon, campus services that can be enhanced, and value-added strengths that can be built upon. The basics include offering convenience and customer service, facilitating communication with faculty and students, collaborating with strategic partners, managing consolidated transactions, and controlling costs.

While offering valued services to faculty, students, administrators, and other course material stakeholders proves competency, capability, and credibility, this is not enough. To ensure a position of strength for the course materials future, collegiate retailers must consider forward thinking strategies and be open to new ways of thinking. The list that follows represents contemporary actions that can be taken to drive the future of course materials.

Here is the list:
     1. Think & Read Strategically.
     2. Pursue Digital Options.

     3. Pursue Textbook Affordability Initiatives.  

     4. Engage Actively with Higher Ed.
     5. Seek Collaborative Opportunities.
     6. Consider Alternative Success Measures.

     7. Seek Customer Satisfaction & Loyalty. 
     8. Track Market Share Not Just Top Line Revenue.
     9. Don't Be Afraid to Act Decisively.
     10. BE Your Future.

This is a great list, with even better content to go with it.  The full essay should be required reading for most stores.  #10 really sums the others up though.  There are basic business practices we should be engaged in because they are the right thing to do -- both as mission-driven organizations, and business managers concerned with providing value to our stakeholders -- starting with students and faculty.

Retail Transparency- What does it mean for you?

Here’s an interesting read  that speaks to retailers getting ready for new technologies that  will bring new store transparency.  The author, having recently attended NRF Big Show, says that now that stores have the technologies available that will give the same opportunities to reach shoppers and influence their behavior as in digital channels, stores will need to make the necessary changes in order to take advantage of the insights this new retail transparency brings.   

Some of the technologies in the article talks about Bluetooth tracking, Wi-Fi-based tracking, heat maps, interactive digital signs, targeted ads deployed within the store, point of sale at the shelf, and various combinations of these are all available in turning the store black box into as formidable of a competitor as the e-Commerce site.  These new tools will let stores know much more about the operations of the store than ever before but all the new data and analytics will not mean much if retailers do not take action based on them. 

“In this era of transparency, it's not enough to solicit feedback from shoppers - passionate or otherwise. Just like people get frustrated with negative product reviews that don't result in any correction of product flaws, they will get frustrated with getting asked for advice about "their" store and then having that advice ignored. Not all advice has to be taken, but if it's not taken, there should be some acknowledgement and a brief explanation of why that particular idea is difficult or not the highest priority.”

Here are three recommendations from the article:

1. 1.       Measure store managers on sales conversion rates based on minutes spent per customer, not on sales per hour and labor as a percent of sales.
2. 2.       Connect store managers and employees to each other.
3. 3.       Look at how the store can market itself.

The first two may seem less relevant within the college store industry today, but the third hits home.  College stores must increase their capability and sophistication at "telling their story" both on and off campus.  Stores must market themselves in new ways focusing on value and outcomes wherever possible.

Beyond the Bookstore for Publishers

Yet another sign that it is time for stores to change many of their traditional ways of doing business.  A recent article encourages publishers to increase sales and profit through non-bookstore marketing, particularly in light of the trend toward decreased unit sales in print books from traditional outlets.   Here is an excerpt from the article:

“Given the choice, there are advantages to focusing only on non-bookstore marketing.  Here you can sell your content in any format – e-books, printed books, audio books or booklets.  You can also sell it in many more places, including retailers, libraries, corporations, schools and associations.  And in nonretail segments, book sales are sold on a non-returnable basis and you are generally paid more quickly.  If that were not enough, even more benefits accrue through special sales.” 

Here are ten reasons why the author says publishers should invest in the non-bookstore markets.  You can read the details of each recommendation in the article.

1) Compete in a marketplace larger in size than the bookstore segment.

2) Experience growth that is virtually limitless.

3) Take your titles to the potential buyers rather than waiting for them to go to a bookstore.

4) Reduce the competition.

5) Minimize discounting since buyers do not have immediate access to competitive pricing.

6) Sell books on a non-returnable basis.

7) Stimulate increased exposure. 

8) Increase your flexibility in negotiations

9) Improved cash flow, since some businesses purchase your products at list price.

10) Do what you do best.

Now I am sure many stores could articulate reasons back to publishers to encourage continued investment in the channel.  A couple obvious arguments come to my mind, however, that is not the thrust or focus of this posting.  The point here is that stores that want to succeed in the future must look at the trends and begin transitioning to new markets.  Continuing on a path to merely extend or defend what we have always done is a fast path down the spiral of decline.  We must rethink our value, or not be surprised when those who were once our partners are suddenly our competitors.  To paraphrase Wayne Gretzky once again, we must learn to skate to where the puck will be -- not where it is now or has been in the past. 

Choosing the Right Script for Your Store

Here’s a great article titled “7 Steps For Creating Disruptive New Retail Experience,” in Fast Company’s Co.Design’s November newsletter.

To provide your customers the experience that will stand out from mundane shopping practice you have to look beyond the subject of design to sociology, economics, organizational behavior, and even theater, the article suggest.   By finding the intersection of these fields we can find the right script for your store.   “Scripts” are unwritten and unspoken shared rules that govern how people act that guide our day-to-day behaviors and interactions, according to the story.  Scripts are the reason why people behave similarly at the DMV and at holiday parties.

The article suggests seven principles that will help you design and choose the right script for your store.

1. Experience design is not about luxury- It’s not always about “Premium” ideas.  Think about Southwest Airlines and how they combine heart, humor, and efficiency to air travel.
2. Start with empathy- Stepping into the customer’s shoes.  Good example is Harley Davidson because they employee bikers.
3. Do you own thing- Find authentic sources of connection with your customers and stick to them.   Think about Target
4. Utilize all elements of theater- Think of the whole shopping experience as a “play,” including casts, costumes, set, and props.  Good example is Starbucks.
5. Use different incentives to create different behaviors- Provide employees with right incentives like what Saturn did by employing salaried salespeople and eliminated the stereotypical sleazy car salesman.
6. The devil is in the trade-offs- Managing the trade-offs is crucial to finding the script with a character that separate you from the rest.
7. Evolve to stay relevant- Always experiment with new ideas and be ready to change to meet people’s needs.

Retail Systems Research Report on the State of the Store

Retail Systems Research continues to produce interesting and relevant stories and reports for retailers in an age of technology.  In one recent report RSR discusses their annual study on the "state of the store" or retailing.  Here is a quick quip:

Our findings consistently show retailers understand the importance of creating a better in-store shopping experience for their customers. However, in 2010 it became clear that armed with more technology than most store employees and managers, the consumer was crafting her own experience – and much of it was outside the boundaries of the store’s four walls. The question is no longer, “How can we make the in-store experience as satisfying as the web?” It has become, “How can we make our stores more significant than showrooms for on-line merchants?”

As stores think more about increasing traffic, and providing more and more products and services online, several of the lessons within the report are worth examining.  Key lessons in this year's report seem to focus on the importance of making sure that the people on the floor are educated in the products being offered.  The report also discusses the importance of using technology in retail to engage customers, and in doing so available technologies can drive customers to the store rather than away from it. 

The 29 page report is available for free with site registration and is worth the time to download and read. There is more than one actionable takeaway that retailers can pull from the piece.

Educational Publishing at Work

Today's post is a guest-posting by Veronica Gancov. Veronica is the new Digital Media Specialist within NACS Media Solutions. She joined us in February and is leading some of our work in the regional print-on-demand area. Veronica will likely become a regular guest blogger to the CITE. While this first posting is publisher-focused, I think many stores will see the parallels in, and implications for, educational retail.

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I recently attended BISG's “Educational Publishing at Work” webinar. The panelists included Charlene Gaynor, CEO, The Association of Educational Publishers; Michael Ross, SVP, Encyclopaedia Britannica; and Christian Schamberger, VP of Operations, Mercury Book Printing. The webinar raised many interesting points, the first being that since students today are “natives” of digital technology, such as the internet, video games and mobile technology, teachers need to adapt and become more tech savvy in their teaching methods in order to reach these students. Likewise, as teachers must, Publishers today must adapt to digital technology in order to maintain their business standing and reach those students as well. New business models must be written, and new delivery systems must be explored in order to stay current and relevant in the wake of the digital age.

Gaynor's main point was that moving products from print to digital will be one of the top five strategies for impacting the bottom line of any publishing company. She also believes that “free is your friend,” and that supplying some free content is also good for your bottom line, as sales have been proven to increase when some content is given out for free. Gaynor also recommends hiring for a digital future, in other words, choosing people who are technology minded and can see the benefits of digital progress.

Encyclopaedia Britannica has been around since 1768. Ross commented on how change is a must in order to stay relevant. In addition to pursuing digital formats such as online databases, print sets, ebooks, and e-learning solutions for all age groups and readers, Encyclopaedia Britannica strives to provide specific curriculum products for everyone from Pre-K to college and university students. Ross stresses that pricing must be kept low and attainable for everyone, and that subscription models, in particular automatic renewals, work for his company. He stresses that Publishers interested in switching to a digital format must establish a 5 year strategy, and that they need to hire people who will move their digital strategy forward.

Schamberger said that “times can look bleak for printers who do not adapt to the current economy and technology.” Mercury is no stranger to change, and has grown from a printing press in someone’s basement, to a successful printer with three print divisions: Offset, Book, and Fulfillment. Mercury is adapting to the economy and new technologies by continuing to invest in new digital printing technologies, such as inkjet printers that are faster, increase automation, incur cheaper costs, and enable enormous volume capability. He also sees Print on Demand as a great way for printers to fulfill a need in the market. He says that publishers need the flexibility to offer both an electronic format of a product as well as a printed product, and says that they must embrace new technologies and partner with printers who have, as well as challenging traditional thinking and norms.

Learning from Amazon

BNet had an interesting piece a couple months ago on 6 ecommerce strategies Amazon uses that other retailers should adopt. Most of these effect discoverability of the store's products within search engines -- part of SEO or search engine optimization strategies. (Yes, yet another type of technology-based strategy with real business implications for you to think about). No surprises in the list from the article, but something for stores to think about as they evaluate their own e-commerce tools:

1. Let your customers help keep your website fresh
2. Get more control over your listings in Google
3. Win on long-tail key phrases
4. Make it easy to find things
5. Personalize the experience
6. Anticipate customers' questions

All good topics and strategies to improve customer engagement (#1), improve visibility to customers (#2-4), and improve the customer experience (#4-6).

Store Options with a changing distribution chain

There was a good piece in the MACS 2011 newsletter on the "truth about course materials" and how stores can remain a part of the distribution chain written by Allyson Manet from Cengage. As stores see shifts away from traditional media and channels to new products and approaches, Allyson suggests some strategies to move stores towards competing better with online competition.

While she does not say it directly, part of the implied message is that booksellers must look above the day-to-day activities of store operations to think strategically about their present and their future. I once heard this referred to as the "tyranny of the tactical," but thinking strategically is critically important for the survival of an organization in an increasingly competitive landscape.

Among Allyson's more direct suggestions to stores are:

1. Be comprehensive -- serving as a reliable aggregator of course materials information is one of the core advantages for most stores. If students require something to be successful in the classroom, you should be able to provide it.

2. Be Reliable -- ensure that what students get from your store is what they really need to be successful in the classroom. Allyson points to a recent NACS study that shows confidence that they are buying the right product ranks almost as high to students as price as they decide where to buy their course materials. Reliability is also a traditioanl core strength of campus stores.

3. Be Flexible -- students will search. You capture more sales when you make more options available. Rental and e-books are no longer an option. At the same time, using price comparison is essential, because students will do that anyway and lack of transparency on the part of the store both erodes trust and pushes customers to look elsewhere before they make their buying decision. At that point you must work to get them back. Flexibility is a core strength that stores need to embed within their DNA.

4. Be Noticeable -- many students are not aware of the options stores provide. One NACS study found that nearly half of students did not know if the campus store provided e-books or not. Stores cannot assume awareness on the part of students or faculty in terms of the services they provide or the benefits they return to the student and institutional community. Stores must be increasingly proactive in their marketing communications and conduct awareness campaigns.