Friday, March 4, 2011

Condé Nast's tablet app transition will test its new pricing strategy, as well as the loyalty of its current customers

Starting next week, and continuing throughout this month, Condé Nast will roll out all new apps for its titles currently found in the iTunes App Store. The move will force its current customers to download all new apps, while keeping the old apps to house previously bought issues.
The move is necessitated by the publisher's decision to go with the Adobe Digital Publishing Suite rather continue on its own native app development path. The first app to appear will be Glamour early next week. According Peter Kafka of the WSJ, Condé Nast will be pricing the app at a discount, 99 cents, in order to try and attract downloads.

Much has been made of the pricing strategy being employed by Condé Nast, now raising single copy prices to match those of print, but this will be an ongoing debate -- are single issues sales of tablet editions that same as single issue sales of print? Is there a legitimate reason to discount tablet edition single copy sales when the publisher is getting dinged 30 percent by Apple?

The feedback from the market may be confusing some publishers. After the initial launch of the iPad in April of last year there was real enthusiasm voiced by iPad owners for new magazine and newspaper offerings. Some publishers enjoyed initially good sales -- Wired, for instance.

But the question in the back of my mind was "are these new readers really going to turn into long term customers?" I didn't think so, but also knew that until the iPad, and other tablets, had sufficient penetration of the reading public, this was the audience that exists today and there was not much publishers could do about it.
And what was (is) that audience? Younger, mostly male, early tech adopters, etc. The perfect audience for Vanity Fair?

But now we are almost a year into the tablet era and the market is slowly maturing. The people I see checking out iPad at retail outlets are more a cross-section of the consuming public -- a bit less tech-savvy, that's for sure, but probably the more typical newspaper or magazine customer.

A couple of weeks ago Condé Nast released an iPad app for Vogue. Priced at 99 cents, the app is actually just a specialty publication, not a complete issue, but its subject (Lady Gaga) and its low price has led to overwhelmingly good reviews in the App Store. Soon we'll see if an all-new, app, built using the Adobe Digital Publishing Suite, and priced like a newsstand bought print edition will get the same reviews -- I doubt it seriously. But that alone won't be a sign that the strategy is a failure, Condé Nast will have to look at the sales numbers and judge for themselves.