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How the French are attempting to stop the inevitable in business model innovation

June 21, 2013 - Innovation

Couple of months ago, the French government pleaded to install a new tax on tablets and smartphones to fund culture. Now, the French government have turned their arrows toward Amazon.com.

Amazon.com should supposedly be forbidden to give discounts over 5% of the recommended retail price and is not allowed to provide free shipping to protect local small book retailers. This is an action that is entirely futile, since it is based on the notion that the only reason why small book stores are struggling to survive due to better prices of Amazon.com. Besides the fact that such measures of the French government to protect small book stores are futile, it seems to be a move which will delay business model innovation in general.

Real reasons why small book stores are losing besides price:

1. Convenience:

Although I too enjoy the charm and pleasure to visit a local book store and browse through random books, it is just so much easier to order books online.

2. Product range:

When somebody recommends a book that is either old or is just a bit more obscure than a global bestseller, I want to be able to get it as soon as possible. Nothing is more disappointing then to go to the local book store, ask for a particular book, and being told that they can order it for you, but it will take x number of weeks. Online book stores, due to their lower operating costs, have the luxury of being able to have a lot wider product range (long-tail business model).

3. Social engagement:

Not that it is the most important, however, online book stores provide reviews of people that have read the book you want to buy already. Now this shouldn’t be the turn-off for you to buy the book, because hey, you want to read the book, who cares about everyone else right? All kidding aside, mass reviews of books do help you to determine whether it is the book you were looking for.

 

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