THE DEMAND CURVE FOR BOOKS. In the review I linked to yesterday Elizabeth Kolbert views the findings of behavioral economics as demonstrating the failures of economic theory. She begins her review with an anecdote in which she is persuaded by an offer of free shipping from Amazon to buy a book for her twins that she would not otherwise have bought. She concludes from this that: “I had cost myself $12.91.†She then suggests that the real question posed by the book is “why we persist in accepting economic theory.†Kids, I hope the objection that “her twins do have a book they chose at a lower price†occurred to you. An economist might look at her purchase as a simple move along her individual demand curve: Amazon offered her a lower price for a delivered book, and she decided to buy one at the lower price.
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I go back and forth in this kind of thinking all the time! I engage in long debates involving price, effort, and whether to buy the book now or later. Is there even a point in deferring my purchase of a book? A new release book at Barnes & Noble is often its cheapest for its first couple of weeks on the shelf. You don’t get another break in price until it comes out in paperback. In the meantime, does inflation go up enough that waiting makes your book cheaper? I sincerely don’t think so.
Most of my indecision revolves around making purchases Barnes & Noble or Amazon.com. As I love books and come from a family that loves books, I have free shipping from Amazon (Amazon Prime) and a Barnes & Noble discount card. Thanks to having a boyfriend who also loves books, I happen to spend a lot of time browsing Barnes & Noble just for fun. Invariably I find books there that I am very interested in buying. I look at the price, imagine that my card takes 10 to 15% off the book, and then wonder if Amazon has the book for less. Lee gets out his iPhone and looks up the price on Amazon. Almost always Amazon has a much better price even with B&N’s discount; books that cost $22 at B&N cost $17 at Amazon. In that case, I buy from Amazon. The only thing that changes my mind is whether I have a B&N coupon for an additional percent off… or if I am so keen on the book I want to read it RIGHT NOW instead of waiting two or three days. I can’t remember this happening but I’m sure it has.
During the whole B&N vs. Amazon debate in my head, I also feel guilty for not buying from my local independent store. Almost all authors and industry professionals such as literary agents and editors revel in “indies” and talk about how the big box bookstores are a terrible influence on the publishing industry, how mid-list authors are slowly becoming extinct. I feel terrible about this; however, as a consumer, the prices and convenience of big-box bookstores cannot be beat. They provide me with good feelings and a good experience. Amazon has EXCELLENT customer service. Why should I not reward them for that?
I’m normally one to champion the convenience cost of walking right in and picking up what you want in a store, but the Amazon site for the iPhone has dissuaded me from buying quite a few books in store. Someday you might be able to take a picture of the barcode and have the book’s page pop up immediately. Ubiquitous Internet access and devices that use it are a great thing, in my nerdy book.
The opposite is true of places like electronics retailers. You don’t go in to listen to a salesperson’s spiel–you’ve looked up what you want online and go right to it in the store. This is probably more in line with Annalisa’s comment than the original post. Sorry.