Harry Lindsol’s TextBook Decision:An eBook or a TraditionalCollege Textbook?

ASSIGNMENT QUESTIONS
1. Describe the competing business models of traditional textbooks and etextbooks. How do the customer value propositions of the two textbook formats compare? How are the profit formulas of paper textbooks and etextbooks different?
Traditional textbooks:
- Depends on acquisition editors.
- On authors and professors.
- Representitive business modle.
- Taking into consideration printing costs, shipping costs and row material costs.
- Taking into consideration the competietion with local book stores and used books market. eTextbooks: - It will depend as well on acquisition editors, prfessors and authors.
- Representatives are enrolled into promoting online platform.
- Will get rid from raw material costs such as priniting, paper and ink.
- Will get rid from the competition of used books market and local book stores.

Customers will value buying a traditional textbook from two perspectives; one is the easiness of reading the book and taking notes and at the same time they can sell it back to the used books market for a discounted price. They could have even save some money by renting the book or buying a used one. However, different editions were introducd frequently, which was an obstacle to them on this regard.

On the other hand, customers may value buying an etexbook in another way. First, the buying price would less than a traditional textbook. Also, they could have many books in a simple device that will not exceed half pound weight.

Traditional textbooks: for a traditional textbook, the publisher will get 50% of its selling price by selling it to retailers. Out of this 50%, the publisher needs to pay around 10% for printing costs and raw material, while 15% would be paid as royalties to authors.
On the other hand, in etextbooks, publishers would get 70% of the selling price by selling it to retailers. Publishers also will get rid from the 10% they used to pay for printing and raw material. However, publishers would pay 25% royalties to authors which is more than the traditional textbooks. Finally, it shall be noted that the selling price in traditional textbooks were higher than the selling price of etextbooks.

2. How do textbook platforms that include online tutorials affect the customer value proposition of textbooks? Does the addition of such online materials affect the profit formula for a textbook? Explain.
The textbook platforms were used as an important tool in order to promote a book over another. The professors' mutual interest was to bring a book where their students would benefit the most. It would be really helpful for students and professors as well to have a technique that will assist and evaluate the student's learning process. The Learn Smart system was a creative tool which helped the students to learn more efficiently and more effectiveness.
Of course, an addition of such online material and tool would increase the customers' perception for the value and it will for sure affects the formula of profit for a textbook. This would be considered as part of the marketing for a textbook. The profit formula for a traditional textbook would consider 10% for material, printing and marketing. With the use of such creative tools, the allocated 10% for marketing and etc would have been used efficiently.

3. What is competition like in the textbook industry? Which of the five competitive forces seems strongest? Which of the five forces is weakest?
The competition is between five competitive forces, which are international publishers, big bookstore retailers, second hand users (students), local bookstores and authors & writers.
I believe the strongest force would be the international well known publishers because they are the key chain in this process starting from hiring authors to write books and ending with distributing the books into retailers. They manage any new editions and control the starting selling price. The weakest force would the local bookstores cause they represent a middleman who can be easily eliminated and overcome in this process.

4. What factors are driving change in the textbook industry? What is your assessment of the impact of these driving forces of change?
There are many factors such as:
- The competition with the used books market. The textbook industry was developed to eliminate the used books market and rental book shops.
- The need to update/introduce new editions. There was a need for a textbook industry that will allow updating/editing books in an efficient way and short time.
- The evolution of tablets led to huge effect on textbook industry by introducing etextbooks.
- The factor of cost saving in terms of paper, ink, printing and shipping.

All of those factors played an important role in textbook industry. I believe the trend nowadays is into e-learning and hence the leaders in textbook industry would have kept themselves updated with the latest market trends especially that the competition in really difficult in this field. Any competitor will explore new ways to acquire market share and obtain any comtetive edge over their rivals.

5. What are the key factors of success in the textbook industry? List and discuss the resources and competitive capabilities are required to achieve success in the industry?

6. What competitive advantage or disadvantage might an eBooks only textbook publisher have relative to McGraw-Hill, Pearson, and other large international publishers?
Advantage:
- No printing or paper cost.
- Eliminate used book/rental books competitors.
- Lighter weight.
Dieadvantage:
- Not able to highlight/take notes.
- The colors of a book.
- The need for an internet.

7. What are your recommendations to Professor Lindsol concerning his interest in launching a new venture specializing in etextbooks?
As mentioned in the case study, the largest profit is targeted in the academic textbooks. Hence, more marketing shall be done at professors' level and students' level as well. After all, the students are the end user. Maybe a considerable attention shall be given to what students might be interested in. If students were convinced about the advantages of textbook system, then they would ask for it.