Brand: Amazon
Product: Kindle DX
Target: Students and Newspaper Readers
Rating: ***
Reviewer: David Vinjamuri

Description:
Amazon today launched the Kindle DX, a new eBook reader with a larger screen than the recently introduced Kindle 2.  The screen measures 8.5″ x 11″, the size of a sheet of ordinary notebook paper.  The device retails for $489 and appears initially to be targeted at students and newspaper readers.  Amazon has concluded deals with a number of textbook publishers as well as several universities including Case Western University, Pace, Princeton, Reed, Darden School at the University of Virginia, and Arizona State University.

What Works:
The Kindle DX will undoubtedly be revolutionary for students if textbook prices can be lowered enough to compensate for the cost of the device.  Parents and orthopedists will ultimately thank Amazon as younger children ultimately adopt the device and ditch absurdly heavy backpacks.

The bigger news about the Kindle DX is that it shows that there is still a slim chance that traditional newspapers might avoid extinction if they act quickly and decisively.  The availability of newspaper content for free on the Internet, the defection of classified advertising to Craig Newmark ’s brainchild craigslist as well as the increasing use of Google News and Google search by consumers to source news have combined to put newspapers in a dangerous state.  A number of smaller papers have closed and even giants like the New York Times show signs of weakness.

Large screen eBook readers like the Kindle DX show a possible path to salvation.  By eliminating the cost of printing and distribution and making the screen large enough to accomodate some advertising, the Kindle DX may persuade readers to subscribe to newspapers again.  Like the Kindle 2, the Kindle DX has a 3G wireless cell chip in it that allows newspapers and books to be downloaded immediately without connection to a computer.  The Kindle DX also has a more substantial web browser - presumably to allow the newspaper advertising to be more funtional for advertisers.

The concept is good.  This reviewer often reads the NY Times on the Kindle 2 long before he ventures to the lobby of his manhattan building to discover which creative new place the delivery company for the Wall Street Journal has deposited the paper.

What Doesn’t:

Amazon is not helping itself with the absurdly high price for the Kindle DX of $489.  This makes the Kindle DX more expensive than most netbook computers which allow readers to wirelessly read newspapers for free, as well as accomplishing other tasks the Kindle DX cannot do.  While this is also true of the Kindle 2, the Kindle 2’s size makes it feel more like the replacement for a paperback book.  Amazon may be able to achieve economies of scale for the Kindle DX simply by pursuing it as a textbook replacement, for which it is better suited at the pricepoint.  But it will not create a breakthrough for newspapers without a minimum 50% price drop.

Amazon also touted newspaper partnerships which would help subsidize the cost of the device with a long-term subscription.  This turns out to have been more wishful thinking than substance, as the New York Times announced these subsidies would only be available for rural readers who could not get home delivery.   This is really a missed opportunity for the newspaper industry which should be supporting these new devices in every way possible (free reader with three year subscription, anyone?).  Instead the New York Times continues on with the stone age marketing techniques that brought us the classic ploy of penetration pricing (offering new subscribers lower prices for a short time), thus assuring that the most loyal readers will be punished with the highest prices.  The Times business managers should peer from the top floor of their new building over to Sony-BMG and the ruins of the rest of the music industry to understand what happens when an industry fails to adapt its revenue model to technology.

Branding Bottom Line:
Amazon introduces an amazing innovation for the citizens of Monaco.

Brand: Amazon Fishbowl (Amazon.com)
Execution: Web Video
Link: Click Here
Target: Amazon Users
Rating: *****
Reviewer: David

Description:
Amazon introduces a weekly talk show airing only on the Amazon homepage featuring comedian Bill Maher and interviews with authors, musicians and filmmakers. The first episode which began airing this week features bestselling author Dean Koontz, Darnelia Russell, Ward Serrill and a performance from the Dixie Chicks.

What Works:
Amazon joins the web video fray in a novel an unexpected way that turns the concepts of ‘retailer’ and ‘content provider’ upside down. From a branding perspective, Amazon is trying to solve a classic retailer dilemma - how to become a more regular destination for already-loyal users. Since Amazon cannot sell milk, it was forced to be more creative. The Amazon Fishbowl is a clever and creative solution to this dilemma. The idea itself is good but not unforseeable, but the execution is excellent. If Amazon had picked a lesser talent, or less-known talent to host the Fishbowl, the result would almost certainly be failure. But Bill Maher is an inspired choice (although not perfect as he seems to be something of a technophobe himself and constantly refers to the show as being ‘on the computer’ which sounds to this advertising blog about as anachronistic as saying ‘going steady’ would be) and gives Amazon Fishbowl instant gravitas that it could not have commanded with an unknown or b-lister.

Amazon also shows its savvy with good integration between the interviewees and their products. When Dean Koontz is being interviewed, you can buy his book by clicking on a link just below the video window. This is a great example of closed-loop marketing.

Another smart touch by Amazon was to create an advertising model for Fishbowl. Instead of supporting the show entirely on their own, Amazon sold commercial advertising in Fishbowl and Cingular is the first advertiser (with a spot we reviewed this week). This is obviously a smart cost-saving move for Amazon, but it shows a great deal of institutional wisdom as well. If Amazon had left the Fishbowl to survive on its own without advertisers, the value of the programming would come down to very narrow metrics, like increased user return rates and purchase rates of the featured products. There would also be the danger of turning Amazon Fishbowl into a high school public access channel effort, where the quality of the programming would be in continual peril of degrading depending on the political whims within the organization.

By creating a revenue base for the show, Amazon makes it its own business, and gives it a chance to command the attention and respect it deserves within the organization. This keeps the stage clear for future innovation and continued investment in the media property.

What Doesn’t:
Amazon cannot assume that this program will find a nitch solely on the strength of Bill Maher’s personality. There is a fine line separating a show with interesting author, director and artist interviews and an Amazon version of the Home Shopping Network where the viewer is being un-subtly prodded to buy whatever Amazon is trying to get rid of that week. Like any other brand, Amazon fishbowl must decide what it stands for, what its attitude is and how it will be perceived by viewers and carefully stick with that positioning over time. The novelty of Fishbowl along with its placement on the Amazon home page will give it a solid viewership for the time being. To survive in the long run, however, Fishbowl will have to find and fill a need for its viewers.

Branding Bottom Line:
Somehow Amazon uses TV on the Internet to sell books. We still wish we had bought stock.