You'd think that Kobo was the only company selling e-readers into the Canadian market

[scrapking]

I've been participating in the forums here for a year, and following e-reading with some interest since the '90s, so I have a good handle on what's out there, and yet I can't help but observe the near total domination of the Canadian e-reading market by Kobo.

Kobo's marketshare was already almost at 50% in Canada life to date (overcoming the lead Sony and Amazon had from launching earlier than Kobo), and 55% in the 6 months ending August 2012. And that was all before the Kobo Glo was even announced, let alone released.

In the past when looking through flyers you would see a lot of Amazon and Sony e-readers in them. Whether it was The Source, or Staples, or Future Shop, or Best Buy, you almost always saw a Sony Reader, and sometimes an Amazon one. You might occasionally see a Kobo.

In the flyers that came in the mail today:

- Future Shop had a half-page spread on e-readers, 80% of which was Kobo (the only exception being a single Sony Reader) and accessories.

- Ditto with Best Buy (all four current Kobo offerings, including the Arc, taking up most of the space, and a single Sony Reader off to the side).

- Staples also had a big spread on Kobo readers, and no competing products were listed.

- Then there was The Source. In the past The Source has largely pushed Amazon offerings in my experience, especially the Kindle Touch. I remember walking past a Source once and seeing a Kindle poster taller than I was (and I'm 6'1") in the window. Not this time. There was a ten great gifts ideas flyer on the outside, with Kobo e-readers being one of those ten suggestions, but that was wrapped around their regular flyer which listed all three Kobo e-ink offerings inside in a half-page display, plus a re-iteration of the Glo near the back of this flyer-within-the-flyer. That's three separate references to Kobo in this week's offering from The Source.

What's made the difference? Obviously they're recognising that Canadians have embraced Kobo in a huge way, and I think the final straw was Kobo being the only major player in the Canadian market with a front-lit e-reader.

If you knew little about e-readers and were going to buy an e-reader as a gift for someone, what looking at those flyers would tell you is that Kobo's the only serious contender in the Canadian market. Whether that's even true or not, it would be hard to get any other impression.

It's astonishing. Is there anywhere else in the world where Amazon beat a competitor to market with the Kindle, only to have the Kindle later be surpassed (and not only surpassed, soundly trounced)?

Obviously I like Kobo, but I'm also a businessperson myself and I've been fascinated by the business behind this. My observation is that partnering with bricks-and-mortar stores that sell books is the key. Sony has partnered with Future Shop and other tech and office supply stores for years in Canada, and had early success with that, but then Kobo comes along and (because of their relationship with a dominant bookstore chain) passes them in marketshare crazy fast. Nook in the U.S. wouldn't be the strong second place contender it is without B&N, I don't think. Kobo's launched itself into the lead in France through its partnership with FNAC (and, though FNAC sells tech products too, they do also sell a lot of books). Even Amazon's Kindle success was on the backs of selling it to site visitors looking for books, I think, rather than site visitors looking for tech products.

I've long been fascinated by business, and it's interesting to see the aforementioned tech-store strategy be eclipsed by a bookstore strategy.

Sorry for the long post for those uninterested in the Canadian market, or those uninterested in the business of e-reading.

[speakingtohe]

I am Canadian and while it is great to see a device developed by a Canadian company make good, we alos must remeber that they are now owned by the Japanese.

I am pretty sure though that kindle is still more recognized in Canada. Regardless if I am using my Sony or my Kobo ereader, people still ask me how I like my kindle.

And the source still seems to prominently feature the kindle in its own display and in Source mall stores salespeople don't seem to know what a kobo ereader is.

Future Shop and Staples have Kobo readers on display, but rarely do their demo models work. Not kobo's fault of course, but not good advertising. On Black Friday I showed a woman looking for a Christmas gift my Kobo mini as the demo ones did not work. She said it was nice but decided on ordering a kindle online. Oh well.

Helen

[scrapking]

Originally Posted by speakingtohe

I am Canadian and while it is great to see a device developed by a Canadian company make good, we alos must remeber that they are now owned by the Japanese.

I am pretty sure though that kindle is still more recognized in Canada. Regardless if I am using my Sony or my Kobo ereader, people still ask me how I like my kindle.

You're right, not that it seems to be doing Amazon a lot of good. Every time Ipsos Reid does their Mobilogy study, more people express intention to buy Kindles than any other brand of e-reader, but every subsequent study shows more Kobo e-readers selling than anything else (more than 2:1 over Kindles). That tells me that the uninitiated know about Kindle, but as people start diving in to it they end up getting Kobo (more often than not).

And Canada got the better half of the deal between Kobo and Rakuten. Most of the jobs are in Canada. In theory the profits would go to Japan, if there ever are any. It's hard to profit in an industry where you sell your e-readers at, or below, cost to consumers, and where capital investments into new devices, new software, etc., are ever-present.

[RobertJSawyer]

My editor at Penguin Group (Canada) says the Kobo ebookstore sells far more ebooks in Canada than does Kindle.

[speakingtohe]

Originally Posted by scrapking

You're right, not that it seems to be doing Amazon a lot of good. Every time Ipsos Reid does their Mobilogy study, more people express intention to buy Kindles than any other brand of e-reader, but every subsequent study shows more Kobo e-readers selling than anything else (more than 2:1 over Kindles). That tells me that the uninitiated know about Kindle, but as people start diving in to it they end up getting Kobo (more often than not).

And Canada got the better half of the deal between Kobo and Rakuten. Most of the jobs are in Canada. In theory the profits would go to Japan, if there ever are any. It's hard to profit in an industry where you sell your e-readers at, or below, cost to consumers, and where capital investments into new devices, new software, etc., are ever-present.

Well Kobo Mini was very cheap during black Friday and it is a far better reader IMO than kindle. Plus you can download library books I am sure if Kobo stays on the ball they will surpass kindle. I just doubt it will be this year.

Kobo readers have been around for a while and lower priced than most. Till the Glo and the Mini it was a pretty flat market. They generally underpriced the market and were still going nowhere until recently when they produced a better product and marketed internationally. I just hope they keep it up.

Helen

[scrapking]

Originally Posted by RobertJSawyer

My editor at Penguin Group (Canada) says the Kobo ebookstore sells far more ebooks in Canada than does Kindle.

Holy crap, I didn't know you were on the site here! I was a huge fan of Flashforward on TV, and gifted the book to my partner who loved it. Thanks for replying to the thread.

Interesting what your editor at Penguin said, but it makes sense given Kobo is on the verge of having an outright majority of the e-reader market in Canada (they were up to 48% by August 2012, nearly triple where they were two years earlier).

That's quite the impressive list of e-readers, BTW. Which one do you prefer?

[speakingtohe]

Originally Posted by RobertJSawyer

My editor at Penguin Group (Canada) says the Kobo ebookstore sells far more ebooks in Canada than does Kindle.

Would these be all ebooks or just Penguin ebooks. Do you have a statistical reference? I know at least 10 people who buy kindle books regularly. More than one a week. No-one I know has ever bought a Kobo book. Not that that means anything but I find it hard to believe that Kobo sells more actual ebooks anywhere than Amazon. If they did I would expect them to be announcing it.

Perhaps your editor would furnish us with a link to the ebook sales figures in Canada for kobo and Amazon?

Helen

[everklear]

I'll add an anecdote to the (small) pile.

Sidebar: I won't buy e-books with DRM that cannot be stripped out relatively easily. I do buy the books I read, but I'm not interested in losing access to them in the future because technology shifts or a company goes out of business.

I've bought perhaps thirty to forty books from Kobo in the last three-ish years. In that same time I've bought two from Amazon, two from Sony, and one from B&N.

[Canuck_in_Japan]

Most of my books come from Kobo because that's where I get the best deals.

[Quexos]

I guess it makes sense that Kobo sells well in Canada. There is always a nationalistic fiber in people that plays a part. I guess Sony sells better in Japan and Apple sells better in the United States, see my point?

Now the Glo is one of the best readers out there so that alone is good reason for good sales. At this point I wonder how well the Glo will do in the US.

[llcj]

My buying habits are in line with everklear's and Canuk_in_Japan's.

When I bought my ereader I considered Kindle, Sony, and Kobo products. I went with Kobo because I prefer its UI and physical form to the others and that I am able to borrow from libraries with it. Also, my sister-in-law had one and had no issues with it; this fact helped with my decision.

To me, it seems that as Amazon has released the Kindle PW before it has ironed out its lighting problems it is seeing the Kobo Glo as real competition.

[ashan]

I was thinking today about the prices of the kobo units. Last year Kobo touch started at 100£ if I remember correctly and after some months got to 79£, while the Kindle touch remained around 100£. Now the Kindle PW is 109£ and the Glo is 99£, that means we pay more for Kobo just because of Amazon setting the prices high for their devices.
I mean in 4-5 months the Glo will be sold at 80£.

[jackie_w]

Well then... you'd need to decide whether 4-5 months worth of reading on the very nice (IMO) Kobo is worth 20 quid. Bargain, I'd say. What other hobby can you indulge in for 4-5 months for that price (...please don't answer that)

[JD Gumby]

Originally Posted by speakingtohe

I am pretty sure though that kindle is still more recognized in Canada. Regardless if I am using my Sony or my Kobo ereader, people still ask me how I like my kindle.

That's because "Kindle" has pretty much been genericized to mean "ebook reader", much like "Kleenex" is for facial tissues, or "Xerox" was for photocopy machines (took Xerox the better part of 20 years to stop that - and I'm betting they now regret it as I can't remember the last time I saw a Xerox product of any sort on the market :P), or "Polaroid" for the old self-developing photographs and cameras, or "Google" for Web searches, or "Velcro" for the hook-and-loop fasteners, etc., etc...

[robko]

Originally Posted by scrapking

Obviously I like Kobo, but I'm also a businessperson myself and I've been fascinated by the business behind this. My observation is that partnering with bricks-and-mortar stores that sell books is the key. Sony has partnered with Future Shop and other tech and office supply stores for years in Canada, and had early success with that, but then Kobo comes along and (because of their relationship with a dominant bookstore chain) passes them in marketshare crazy fast. Nook in the U.S. wouldn't be the strong second place contender it is without B&N, I don't think. Kobo's launched itself into the lead in France through its partnership with FNAC (and, though FNAC sells tech products too, they do also sell a lot of books). Even Amazon's Kindle success was on the backs of selling it to site visitors looking for books, I think, rather than site visitors looking for tech products.

I agree with you on most of your post, but I think you missed (or at least didn't give enough credit to) one key factor in Canada: the price of the Original Kobo. It was (literally) 1/2 the price of any other reader on the market and got it down to a point where the average consumer was willing to bite on it. Albeit it wasn't very polished and was a pretty weak offering compared to today, but it was IMHO a game changer in that it forced all the others to drop prices which made e-readers more mainstream.

I think the fact that while Amazon was theoretically available in Canada, between the price and limited availability (had to order it online, couldn't check it out hands on) and delayed international release of new versions, it hurt Kindles chances. Which ties into exactly what you said about having the Kobo available in a bricks and mortar BOOK store -- i.e. where your target market (readers) is drawn to anyway. This captures a likely target market that may never have thought about e-reading and therefore didn't seek out the alternatives at an electronics store. But when you could try it hands on and realize that it really was like reading a book (not like reading on a backlit device) helped sell them.
For sure Kobo being the only frontlit e-reader currently available in Canada (without jumping through hoops) has to be putting them in a really good position for this Christmas season.

As for Kobo's e-book marketshare in Canada I'd be shocked if they didn't have over 50%. If they have 50+ percent of the hardware, by default I'd guess at least 70% of people with a Kobo reader are going to buy from Kobo because they don't realize they can buy elsewhere or convenience/fear of figuring out how to buy elsewhere. There is also the perception vs. reality thing going on. Apple always seems to come up along with Amazon when people are talking about e-books. It's interesting to see an article in The Economist being talked about in the MR General Discussions forums puts their e-book marketshare in the U.S. at 5% (with Amazon at over 2/3's). I don't know if that puts Apple in #2 or where, but they are barely a player.