PSPR 208 by Karen Bergh
for Prof. Nina Bronk Kellner August 5, 2010
―The book is so highly evolved that it disappears when you’re reading - all that remains is the author’s world. This became our top design objective for the Kindle.‖ ~Jeff Bezos, President & CEO of Amazon.com
Convenience of an on-the-go device that allows you to download and read books, magazines, newspapers (instead of schlepping around a ―heap‖ of materials) and is classified as a consumer (electronic) product
After-sale service includes the download of Amazon‘s Kindle-formatted content. Plus, Amazon offers free Kindle reading apps for those who want to buy and read Kindle books on their iPhone, iPod, Blackberry, Mac, PC, or iPad. Every Kindle comes with 1-year mfgr. warranty.
Introduced in November 2007, Kindle is an e-reader developed by Amazon.com to allow easy access to a vast library of electronic books to be downloaded from the Internet and read on the device. Over 90,000 books were available for download at launch. [Now more than 550,000 titles] Each Kindle downloads books wirelessly using a built-in Sprint EVDO antenna (―Whispernet‖) Before introducing its second version in February 2009, the first generation Kindle sold out at more than 410,000 units (about $200 million in revenue)
In terms of additional features, Kindle owners can also send files to Amazon to be converted and published onto the Kindle, and can access blogs, newspapers, websites, and web-based email through the Kindle‘s browser. Uses ―electronic paper‖ display technology, which does not rely on a backlight to illuminate its pixels Its ―electrophoretic‖ displays are used in some cell phones to reduce glare on the screen, and on competitive products such as the Barnes & Noble Nook, Sony Librie, Sony Reader, and iRex iLiad e-readers It boasts a relatively long battery life, a free wireless connection to Amazon's extensive online bookstore, and a screen that is easy on the eyes
Kindle: Product Life Cycle
2007 introduction of the Kindle
moved e-book readers from introduction to growth stage
Typically would not compete on price
but focus on building brand awareness through promotion at this stage Apple‘s introduction of the iPad in 2010
was a game-changer, forcing the e-reader products into a premature ―maturity stage‖ (Amazon battles this, you will see) June 21, 2010 decrease in pricing for both
Amazon ‗s Kindle, Barnes&Noble‘s Nook e-book (and other competitors‘ similar limited feature products) indicates rapid compression in the Product Life Cycle (PLC)
The Kindle was introduced at $359 To calculate its value proposition, estimate the cost to
purchase, say, one bestseller per month. To buy them as hard copy products, the cost would be approximately $168.15. The cost for the same books using the e-reader version is approximately $109.11. So if you read one book per month, and you subtract the cost of the Kindle, your net savings per year is approximately $59.04. To wipe out the cost of the Kindle completely, the consumer would need to buy and read six books per month to recover the cost of the device.
Amazon‘s Kindle marketers (and CEO Jeff Bezos) have clung
tenaciously to the notion that their e-reader, with its grayscale and ―easy to read‖ screen technology, presents a superior product for ―serious readers‖1 Kindle's target buyer is considered a person ―who reads so much that they have ceased instilling books and periodicals with nostalgic value…yet not so much that they are rarely far enough from a computer to really need a separate device.‖2 Amazon’s Kindle is currently targeted to a select consumer market of undifferentiated “avid readers,” and can strategically...