Figured I’d talk about something I’ve noticed, which is the creation of new apps and websites, the first mover advantage and the difficulty in making people change habits and actions, due to the increased mental load.

We all know what this means, we’ve all done it after all. But let’s talk about this in more detail.

New Apps, Websites and Services

There’s been quite a few new apps, like Yonder or Zory or new audiobook sites out there and distributors like Bookfunnel for audio and ebook delivery. There are also a lot of serial websites that have formed that are attempting to take on spaces like Wattpad, RoyalRoad, Tapas and the like, like Vella.

Here’s the thing, many of these services will fail. It’s a very difficult thing, with many of these services because they have to manage two different customer groups – the vendors or suppliers and the customers / readers / users.

For these apps, or websites, the easy part is finding vendors / suppliers (comparatively speaking). You just need to throw enough money at the problem and you’ll end up with what you need, whether it’s by giving more royalties, offering to pay for content in the creation or making deals to existing suppliers.

However, the problem is, and the great difficulty are the customers. Getting them to come over, you need to get enough of the supplied product (in our case, enough books or audiobooks or stories) so that they are interested. However, just having product is insufficient, you actually need to overcome their switching cost.

Switching Costs

Every time you make someone do something new, it adds to their mental load. To get them to do something new, you have to make them pay the switching cost of doing so. The degree of switching cost depends on the degree of unfamiliarity there is in the tasks.

Depending on the mental load on the consumer, you might not be able to get them to switch.

Think of it like filling a jug and the amount of switching cost just another cup of water. If they’re already close to overfilling, if you try to pour more water in, it’ll just overflow. So your goal is to reduce the switching cost to your new service, but getting them to switch is not always guaranteed. Which means you’ll need to market to a lot of readers, a lot of customers, until they decide to use your new service.

It’s why customer acquisition in such things are so expensive and the hardest part. It’s where many apps or websites or the like fall down, running out of money long before they can make enough people use their service.

First Mover Advantage

Here’s where being first to market makes a huge difference. Because you’re new, you’re offering a service or content or something, you can get vendors much cheaper and customers much easier. You basically don’t have to fight to acquire mindshare from other websites/etc. in your space.

This mindshare / first mover advantage doesn’t have to be in a whole industry either. You can have a subset of an industry, so long as it’s big enough, and do well. For example, Royal Road isn’t the first mover in giving free fiction or making it possible for individuals to post their free fiction. But because they managed to acquire such a large number of writers in the LitRPG side, it managed to become the defacto place within that industry.

Now, anyone trying to acquire their readerbase is likely to fail.

Same reason why knocking off Amazon right now or even Audible is so difficult.

Then Why Change? Or How Can You?

Yet, knowing all this, people like me are creating websites of our own. We’re using Bookfunnel to deliver ebooks and audiobooks, other sites and apps are coming up to challenge the current market leaders. Why? If we know it’s hard, likely to fail, why?

Firstly, we haven’t talked about the other side of the puzzle. Many of those who have locked in audience, who have gained these first mover advantages, they have taken to enshiftification of their product. ACX is a great example, where you could get up to 70% royalty rates to begin with and now we’re down to 25% if we’re non-exclusive. Amazon has made it harder and harder to keep our books on their site, taking out accounts, reducing KENP page reads and making books harder to find.

It’s all a major pain, for the vendors. Switching cost for vendors has decreased so much, because the benefits for us have disappeared. For us, a lot of the time, financially, we are sometimes better off building our own systems, have our own control rather than rely on these other sites.

And because they’ve enshitified themselves, to both suppliers and customers, they’ve reduced the switching cost, creating an opportunity. At least, some of them (Audible, Amazon) while others aren’t there yet.

On top of all this, as content creators, we have one advantage. If you can create a close enough relationship, if you can create a product that is in demand sufficiently that acquiring it is greater than the switching cost, you can pull people over.  It’s something you see in the streaming business right now, where people like HBO, Prime, etc. are spending a ton of money to acquire content that ‘has to be seen’. Stranger Things, Lord of the Rings, the Boys, Yellowstone, Ted Lasso, etc. are prime examples of this strategy in play.

Of course, for those of us without billions of dollars of backing, or aren’t super popular, we can only take our time and build our customer base slowly. We can only chip away, taking the people whose mental load are low enough that they can deal with the switching cost, who desire our work enough to try out new systems and who will then stick around as we go along.

Which is why it’s good to keep an eye on your finances and not waste your funds too quickly.


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