The Emporium Book Publishing Company: Revenue, Pricing and Business Models Report


The Emporium Book Publishing Company: Revenue, Pricing and Business Models Report



Overall, the internet offers reliable business platform. Today, many businesses use the internet to get in touch with consumers, suppliers, business partners, and other stakeholders. Book publishers have also recognized the role of the internet in modern business operations (Schiffrin, 2000). Consequently, there are several companies which provide online book publishing services. The Book Emporium is an example of a company that provides online book publishing services. It is a small organization whose primary business goal is to provide online publishing services to science books’ authors.

The Book emporium has encountered serious financial challenges in the past. Such challenges have resulted from destructive business competition and unfavorable economic trends. Consequently, the company intends to expand its business in a bid to reduce the risks and uncertainties involved in the electronic book publishing business. Therefore the organization intends to expand into services such as book editing, online book publishing, standard cover design, bespoke cover design, online marketing, and online book sales. The objective of this paper is to help the organization to formulate a satisfactory pricing strategy, revenue model, and business model that could assist the organization to achieve long term business success and sustainable financial growth. Finally, the paper will describe a suitable pricing strategy that the organization could use to receive payments from customers. The paper will include the advantages of the pricing strategy, the strategy’s limitations, and how the payment mechanism ensures that company’s bank accounts are secure.



Emporium Company: Pestle Analysis

Political Environment

The use of the internet and the online technology has expanded steadily. Essentially, online information environment has become an integral component of modern lifestyle (Elkin-Koren & Salzberger, 2004). However, such expansion has generated several negative political and legal implications for online book companies. According to Daft and Marcic (2013), businesses which serve international markets are often bound by complex political environments. For instance, most jurisdictions have set up stringent laws against people and business organizations who do not adhere to the laws regulating patents and trademarks in such jurisdictions (Martin & Tian, 2010). Unfortunately, the rise in the number of those who can access internet resources has increased tremendously in the previous decades.

Such trend has made increased the number and magnitude of risks associated with the misuse of patents and trademarks. As a result, online book companies have encountered several law suits and trade mark cases in the recent past.  Mostly, people engage in piracy where they make copies of other people’s works without permission from the owners of the articles. Such dynamics has made online book companies become more cautious when transacting business with the stakeholders in order to minimize the number of controversial trade mark law suits that are made against them. For instance, most online publishers force freelancers to commit to the terms and conditions of electronic trade mark and patent. Freelancers who do not commit to such terms are often not allowed to access online publishing services.

Economic Environment

The extensive use of the internet technology has changed the economic dynamics of online book publishing business.  According to Clark and Philips (2008), the book publishing business has become less competitive because online and non electronic book publishing companies have engaged in mergers and acquisitions. The profits generated by online publishing companies have reduced because the internet resource has become cheap and affordable.

Moreover, people can easily access reading materials from websites and other online academic materials. Such fact has reduced the demand for online books; thereby affecting the profitability of online book publishing firms. Nonetheless, the intensive use of the internet has also impacted online books companies and other online organizations positively (Sweeney & Sweeney, 2011). Business organizations use the internet, digital versions of magazines and newspapers to advertise their products. Such commodities have increased the profits of online book publishing companies to some extent. Moreover, the use of electronic editions of article and books enables the economy to save a considerable amount of money and wastages; thereby increasing the total utility to online book consumers. This is because the use of online books enables the economy to avoid wastages and black market operations.

Technological development has enhanced use of electronic commercial techniques to conduct business. According to Sudweeks (2013), electronic commerce has become a vital concept in modern business world.  The rise of electronic (long distance) learning programs has increased the importance of electronic books.  Many students can take their lecturers through YouTube and other electronic methods without getting into physical classrooms. Such trend has increased the demand of online versions of electronic books, articles, and other academic materials. According to Wetherly and Otter (2011), companies which conduct online businesses can use Facebook and other social media sites to conduct business. Such strategy can assist the Emporium book company access more customers via the internet.

Socio- Cultural Environment

The socio cultural environment created by the digital technology includes the social forums that bring together. Generally, the book and article publishing industry has encountered several changes (Clark and Philips, 2008).  For instance, the internet technology has enabled online publishing companies and other stakeholders to create the library. The has enabled people to share ideas about online books, make informed reviews of online books, and appraise the content of such books.

Such online libraries enable online authors and publishers to identify the books and articles which are demanded by consumers. According to Clark and Philips (2008), the globalization of the book publishing business has increased the social and economic stakes associated with online publishing business.  Similarly, Elkin-Koren and Salzberger (2004) noted that the widespread use of the internet has changed the socio cultural norms, and new web of community with distinct social and intellectual attributes. In this regard, extensive use of the internet enables online books companies to expand their market niche and overall sales. For instance, Clark and Philips (2008) noted that the success of online book companies depends on the personal relationship of such companies with authors, illustrators, customers, and other online stakeholders.

Nonetheless, online libraries also generate negative impacts on the performance of online book publishing companies. For instance, such companies are likely to lose customers and money when readers make negative opinions about their books.

Technological Environment

Online book publishing companies depend entirely on the internet and social networking technology. According to Clark and Philips, “the application of new technologies in the production of books, selling and marketing, and the extent of pervasiveness of the internet has numerous implications on the performance of online book publishing companies” (2008, p.8).  The emergence of electronic books has expanded the market for books tremendously (Clark & Philips, 2008). Modern mobile applications also support electronic transactions such as purchasing online books. For instance, the invention of the iBook applications for iPad mobile phones enhanced the electronic sale of books. Generally, technology is dynamic. This is because inventions and innovations enable the society to generate new technologies continuously. Unfortunately, such change in technology may affect market performance of the electronic book companies.

Legal Environment

Business firms which conduct online businesses are bound by international cyber laws. For example, business firms using their web sites to conduct businesses are often bound by the legal laws of the business partners’ countries of residence (Goldscheider, 2002). Moreover, the Emporium Company and other online book publishing companies are bound by the intellectual property rights. The society does not have a uniform and effective method of imposing laws and regulations that protect property rights (Cross & Miller, 2007). The presence of ineffective laws about property rights has increased the risks and uncertainties associated with online book publishing business.

Revenue Strategies for the Business

The revenue models describe the ways through which a business firm plans to generate revenue (Allen, 2011). Pricing strategy is an important concept for any business organization. This is because the kind of pricing strategy adopted by an organization directly affects the organization’s revenues and long term business performance (Longenecker, Petty, Palich & Hoy, 2013). Pricing strategy involves management issues such as setting price levels, managing price discounts, and establishing comprehensive pricing structures that enable the business to achieve sustainable business performance (Smith, 2012).  Basically, four main types of revenue models which are often used by business firms to generate revenue include the recurring revenue, transactional revenue, project revenue, and service revenue. According to Longenecker, Alich, and Hoy (2012), the appropriate revenue model should be formulated based on the nature and the number of the company’s revenue sources.

The Emporium books company will use different pricing strategies for each of its products in order to enable the company to maximize revenues in the long run. For instance, the company will use the transactional revenue pricing strategy for the standard cover design. The transactional revenue approach is suitable for commodities whose sales projections can be predicted easily (Osterwalde & Pigneur, 2013). Basically, the Emporium Book s company can easily predict sale projection for its Bespoke cover design services. The company can use previous sales records and its market share to estimate the number of its loyal customers, and the number of orders that it is likely to get from such customers.

The company will also apply the service revenue model to carry out is business initiatives. Essentially, the service model is usually used by business organizations which provide services (sterwalder & Pigneur, 2013). Such revenue model would be revenant as far as the provision of online marketing services is concerned. The Emporium Company will charge revenues based on the time that the company’s advert stays its website. In addition, the Emporium Company will use the project revenue model to facilitate some of its business programs. The company will commit some of its revenue on long term projects. The company will formulate projects which target specific consumer groups through such specialized projects.

Emporium Company: Pricing strategies

The two common pricing strategies used by business firms are fixed pricing and dynamic pricing. The Emporium Company will use both fixed and dynamic pricing strategies to carry out its business activities. Such pricing strategy will enable the company to remain flexible and responsive to the changing technological business environment. This implies that some of the company’s commodities will have fixed prices while others will have varied prices based on the product attribute and type of customer. For instance, the company will use segmented discrimination pricing strategy for its online editing and publishing.

The company’s loyal and long term customers will pay relatively small amount of money compared to first time customers. Such strategy will enable the company to retain its loyal customers; thereby enabling it to generate sustainable profits in the long run. On the other hand, the company will use standard prices to design standard and bespoke covers. Essentially, the cost of designing the Bespoke and standard covers does not vary considerably. The company will use volume based pricing approach for selling its online books. The company will design a comprehensive mechanism of imposing discounts on the prices of books. The discount system will ensure that customers who purchase the company’s books in bulk enjoy the economies of scale associated with such voluminous purchases. However, the company will put in place special offers and gifts to loyal consumers of its online books.

The volume based pricing approach is simple to implement because the prices are expressed as a function of revenue. Moreover, the company will complement its fixed pricing strategies with a number of dynamic pricing approaches to increase the organization’s long-term profits. Basically, the company will use a negotiated pricing approach in charging the consumers for services such as online publishing services and online marketing.

Business organizations using the negotiated approach usually fix prices based on the prevailing market dynamics and the customers’ bargaining prowess. According to Mills (2002), the value that customers attach to a given commodity varies from one individual to another. This implies that customers with effective bargaining skills and/or power may purchase a commodity at a lower price compared to those with poor bargaining skills. Cryns (2002) asserts that discriminatory pricing strategy as a relevant management strategy that may enable a company to generate optimal profits.  The company will use such pricing approach for charging the consumers of the company’s book editing services.

Generally, the cost of editing book depends on several factors. For instance, the subject of the book, the depth of discussions, the complexity of concepts used in the book, and the general scope of the subject of discussion directly influences the time required to edit the book. Therefore, the company will consider such factors when computing the price to be charged for a given book. At the same time, the company will consider the demand of the book to be edited as well as the revenue that the client is likely to collect from the book when deciding on the price to price to be charged by the company.

Emporium Book Publishing Company Business Model

Business model refers to the entire mechanism and organization of business operations. The models often define how a company sells its products to consumers. According to Bastiaens, Baumol and Kramer, business models are considered as architecture for the product because it entails the flow of information, the business actors involved as well as the role of each actor (2010, p.31). Basically, there are four main types of business models: manufacturer, distributor, and retailers. The Emporium Company will act both as a retailer and a manufacturer. The company will partner with online book authors to sell online books. Moreover, the company will also edit books which have been authored by other people. In this regard, the company will operate as a retailer. However, the company will also sell some services as the primary provider of such services. For instance, the Emporium Company will design the cover pages. Similarly, the company will engage as a manufacturer by publishing books.

Emporium Book Publishing Company: Payment Strategies

The company will use electronic payment system to assist the company’s customers to make payments easily. The company will allow its customers to use credit cards to make payments. The credit card is very popular among online shoppers. According to Suresh and Paul (2010), debit cards are convenient due to the fact that debit card electronic system can be used in all parts of the world. The use of card verification number enhances the security of transactions conducted by the debit cards. According to Hong Kong Institute of bankers, “the detailed terms of the agreement between the issuer and the card holder are often stipulated in the cardholder agreement” (2013, p.134). The card verification number scrutinizes the verification number imposed on the signature and compares the number with the bank account details of the person who is making the payment.

In addition, the organizations which issue debit and credit cards have set strict terms and conditions that users of such payment systems are expected to use. For instance, credit card holders are often required to keep the cards in a safe and secure place in order to prevent third parties from accessing the personal identification number and other important card details. In addition, Hong Kong Institute of Bankers (2013) asserts that the credit card manufactures usually retain ownership rights over the cards. Therefore, they can cancel the card holder’s rights to use the card any time. Moreover, the principal card holders and the supplementary card holder are both responsible for the transaction cost as well as the indirect costs that are charged for using the credit card (Hong Kong Institute of Bankers, 2013).

Generally, operating a credit card payment system is cheap. According to Hong Kong Institute of Bankers (2013), a business organization which has sufficient funds does not need a special license in order to operate a credit card payment system. Therefore, the electronic card system is very effective. Moreover, the terms and conditions of debit card use clearly outline the distinction between merchants and credit card manufactures (Reuvid, 2005). Such distinction makes the legal processes associated with credit card use simple, straight forward, and definite. For instance, issuers of credit cards are often not responsible for any defective good or any other undesirable outcome of a credit card financial transaction. In other words “no claim made by the card holder against the merchant may be set – off or counter claimed against the issuer” (Hong Kong Institute of Bankers, 2013). Finally, the electronic card is effective because card holders are often supplied with monthly statements that outline their monthly transactions.

The company will supplement the electronic card payment system with net banking. The net banking is very efficient. This is because such type of banking does not need any physical card. However, one must have an internet enabled bank account in order to use the net banking services. Essentially, the net banking system uses the website of commercial banks and other relevant financial institutions to confirm the details of an individual. Banks have a systematic way of identifying the users of their internet banking methods. Today, commercial banks have introduced two factor authentication systems in order to increase the security of the transactions. In fact, it is believed that net banking is safer than the use of credit cards.


Operating online business such as online book publishing is very complicated. This is because online business relationships are very dynamic. Therefore, this paper has provided a comprehensive report that would enable the Emporium Company to achieve sustainable business success. The Emporium books company will use different pricing strategies for each of its products in order to enable the company to maximize revenues in the long run. The company will combine effective price discrimination and fixed pricing methods to formulate optimal prices for its services. Similarly, the company will serve as a producer and retailer in its business engagements. This implies that the company will serve and generate money from authors of online books and other companies. Finally, the Emporium books will use electronic card payment and net banking to receive payments. The two payment systems are convenient, reliable and efficient. Moreover, such payment systems are very secure.



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