Why did Sony Reader Touch outsell Pocket Edition?

Sony, earlier in the year, revealed that they saw a quadrupling of sales during the 2009 holiday period, when compared with the 2008 holiday season. They also mentioned they were surprised to see the $299 Sony Reader Touch Edition sell more than the $199 Sony Pocket Edition.

The latter insight has been bothering me for a long, long time.

How could a $299 eReader outsell a $199 eReader?

The holy grail for people who think eReaders can’t take off is that eReaders are priced too high. They want eReaders for $150 and $100 and some even want $50 eReaders.

Yet, here we have a $299 eReader outselling a $199 eReader.

Take a look at videos of the two eReaders at my Kindle vs Sony Touch review post and Kindle vs Sony Pocket Edition post.

Each reader has its own strengths -

  • The Touch Edition has touch, freehand drawing, a larger screen (6″ compared to the pocket edition’s 5″ screen), a SD card slot (and a Memory Stick PRO Duo slot), a built-in dictionary, and it supports audio.
  • The Pocket Edition has better screen contrast (the pocket edition has best contrast of all ereaders, touch edition suffers a bit from glare due to the touch layer), it’s $100 cheaper, it’s lighter and more compact.

The reason why the Touch Edition outsold the Pocket Edition eludes me – all the experts and analysts say price is critical and the Pocket Edition is $100 cheaper.

How could it possibly sell less?    

Should eReader companies ignore the $100 price targets analysts are setting?

If eReader companies listen to the people claiming that the secret is a $100 eReader with no frills they might end up like the Pocket Edition i.e. getting outsold by a more expensive eReader that offers better value for money.

  1. Is the demand for $100 eReaders fuelled primarily by people who won’t ever really buy an eReader?
  2. Is it fuelled by people who might buy an eReader but will never buy enough eBooks to help Books and Publishing?

People certainly don’t seem to be buying cheaper eReaders – Why then are analysts claiming lower prices are the secret?

What possible explanation is there for a $199 eReader being outsold by a $299 eReader that is only somewhat better?

Is there a big, huge gulf – We either pay $299 or we pay $99.

Perhaps there are millions of people just waiting for eReaders to drop below $100 and won’t buy an eReader before that – even at $101.

Or is it that we are approaching things from the completely wrong angle – Perhaps people who read a lot are willing to spend $250 or $300 for an exceptional eReader. Perhaps what they really want is an exceptionally good eReader at a price that’s good value for their money.

What is the real eReader target market and what is their ideal price?

Should we be looking at only people who read more than a book a month.

We have a lot of people buying $259 and $299 eReaders. We have many people with multiple eReaders. We have lots of people upgrading their eReader every year.

Perhaps it’s time to focus on the best eReader for these people – these people are the real customers and they are the future of books and publishing.

Perhaps the aim should be to create a perfect product for the core target audience of readers and not to create a sub-standard $100 toy eReader for the entire population of the world – the majority of whom don’t even read.

The $100 eReader and the magical tens of millions of people who would buy it might just be figments of our imagination. They might just be people who don’t value books and reading – We create a $99 eReader and they either won’t buy it or not use it often enough to be valuable customers.

When people say they want $100 eReaders are they saying ‘That’s what I’d pay and I’ll definitely buy one’ or are they saying ‘An eReader is only worth $100 and I’d never buy one’.

Perhaps a $250 price is the best test of customers having good intent.

8 Responses

  1. Maybe touchscreens are just that exciting to a lot of people.

  2. It seems that the upgrades in hardware appear to be worth it for $100, at least to the buyers. If you’re already spending $200 on an ereader, it isn’t that much of a mental hurdle to justify the nicer one. (SImilar to the buying dynamics with a 16gb vs. 8gb ipod or iphone, etc).

    Maybe the pocket reader is defined as what it is *not* (the touch edition: bigger, fancier, touch screen) than what it is.

  3. i don’t get why people are surprised by the notion that highlighting, circling, and annotating is marginal functionality. for many they are not bells & whistles: their absence is simply a deal-killer. i’m not excited about touchscreens per se, but the fact that i could circle stuff with a stylus and make notes in my own handwriting is appealing, mainly because it would be quicker than typing.

  4. Screen size and customer age matter. Most other people I see with eReaders on my commuter train are over 40 — way over. As geezers, we need to be able to adjust font size without having to over-sacrifice the number of lines displayed per “page” (no one wants to click or swipe too frequently). We are also less price-sensitive, and are willing to pay the extra for the features we know will make the purchase actually worth it. A 5-inch screen would not cut it for me, even if the price of the Pocket Edition dropped below $100. Nor did I think the 6-inch screens of the Touch Edition or the Kindle 2 or the Nook adequate. Therefore, my dilemma was over the Daily Edition (7 inch screen and finally a WiFi by Sony, with note taking ability, a free cover and stylus, and lots of memory capacity), the awaited iPad (10 inch screen and all its advertised wonders, many of which I am too codgerly to want to use), and the DX (9.7 inch screen, Amazon’s vaster library, finally global WiFi, and enough memory for all I’ll read before upgrading again and/or dying). I picked the DX, at a reduced price on eBay, knowing it’s less likely than the iPad to get routinely stolen by my kids, and choosing the extra screen size as being more important to my use needs than note-taking ability. I also use the read-to-me feature while driving. Some might view that choice as being the least economically sensible (the highest price per dedicated use option), but for me it was about what best delivers what I want FOR that dedicated use, viewing any expenditure at all as a luxury splurge beyond what I’d pay for paper books. Until I run through the entire canon of human civilization’s literature, after all, it’s reading fine books that I want to do, rather than play games, email, surf graphics-based web sites, or scratch my own notes. Perhaps the reason companies and marketers are surprised by results like those you mention is that they forget that notwithstanding the fact that our aged demographic is not one coveted by advertisers, we do spend money, sometimes even on ourselves and not just on our kids, and what we buy does not easily fit into the traditional sales-tactice niches of sex appeal, status, or power that they teach you on Madison Avenue. We are the semi-moneyed dorks that almost no one caters to, and we like it that way.

  5. It’s not a new thing. When there are two models offered, many people tend to choose the more expensive one even if they normally wouldn’t spend money on it if it was the only choice. I can’t find the links right now but there were several similar stories with other products and companies. Must be some psychological thing with perceived value.

    • building on what igorsk wrote having the entry product at $199 can get people to look at the category who would not with a higher pricepoint ($299 here for Sony) and some will buy up. The Sony line-up is the classic good, better, best consumer product offering. Good = low entry price point, best = all the features you can want, best = somewhere in between. Typically the better product sells the most units as people think they are getting a better feature set/product for a little more money than the good product but don’t have to spend at the level of the best product.

  6. Early adopters are going to go for the touch-screen and not care about a $100 difference.

    Here’s the thing about the price point — at $250-300 I will buy only 1 device, and wait for the next generations. At $99, if I like it, i will buy 5 devices (one for each member of the family).

    You can’t keep selling the same device at $250-300, the price-insensitive early adopters will run out. You do an arms race for better/faster/smaller/new must-have feature (color?), or you compete on price.

  7. And look at this in a 3 way comparison.

    Many people paid $50 more than the Kindle for touch-screen.

    Few people paid $50 less than the Kindle for sacrificing 1″ in screen size, audio support and dictionary support.

    Sony has now cut the price of the Pocket to $169.

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