This paper analyzes the Xerox Book-in-Time system through a marketing strategy lens, drawing on the Harvard Business School case study #9-599-119. The analysis examines the cost advantages the Book-in-Time equipment offers publishers, estimates the size of the on-demand book market using conversion potential data, evaluates two strategic options available to Xerox — remaining an equipment supplier versus entering book production directly — and proposes a hybrid strategy combining equipment sales with a targeted acquisition or joint venture in the publishing industry.
At its core, the appeal of the Book-in-Time system is a matter of costs. The Xerox Book-in-Time equipment allows a publishing company to produce a 300-page book for $7 — a price point that was previously achievable only for print runs larger than 1,000 copies. Publishing costs, which can account for up to 20% of a book's total cost (including paper and binding), would be significantly reduced, creating the possibility of an increased profit margin.
The Book-in-Time solution is one of the most efficient options available to publishing companies operating in the on-demand, short-run segment. The primary reason is that the Xerox solution delivers a clear cost advantage precisely on this segment of the market, where small print runs have historically been prohibitively expensive.
Looking at the case study's Table E — which provides an analysis of on-demand conversion potential — several long-run categories emerge as targets for the equipment Xerox provides. Subscription references, for example, carry a 100% conversion potential, though they represent only 1% of the overall market. College textbooks, university press titles, and professional textbooks all have a 50% demand conversion potential.
To estimate the total addressable market for Book-in-Time, one must account for conversion potential in addition to the raw number of books published. Applying these figures, the on-demand market can be estimated at approximately 600,000 books per year.
Xerox has two distinct options at this point, given the capabilities of the Book-in-Time system. Both were clearly articulated by the company's senior managers.
"Equipment-only vs. entering book production"
"Hybrid equipment sales plus publishing joint venture"
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