Advertising on E‑readers Predicted to Grow

Once considered the latest tech toy for the well-​heeled literary set, e‑readers continue to grow in popularity. The devices face stiff competition from multifunction tablets but analysts see a steady market for e‑readers. As a result, manufacturers continue to upgrade, release and promote new models and this format is attracting the attention of advertisers who seek to influence consumers through yet another new media format.

This year, about 20 million U.S. consumers will own e‑readers. That figure comprises 8.7% of U.S. adults. And by the end of next year, eMarketer analysts see the number of e‑readers rising to 12% of the U.S. adult market or a total of 28.9 million units.

Market growth can be explained by a number of factors. First, Amazon has made a deliberate attempt to reach more readers. The company’s latest model is lower priced, ad supported and a big seller  for  consumers who “are eager for affordable no-​frills devices,” says Paul Verna, eMarketer senior analyst. Meanwhile, Barnes & Noble has been reaching for the higher end of the e‑reader market with its NOOK Color device. The increased competition in the market has driven the average price of e‑readers down by between 20–25%.

As advertisers consider the merits of placing marketing messages on e‑readers, the size of the audience will be important. Verna points to Nielsen data which indicates that 33% of consumers share their e‑reader devices. This sharing means that messages on e‑readers could reach far more than the 20.6 million device owners.

For now, marketers are waiting to see if Amazon has success with its ad-​support Kindle model. Analysts say a big success will leave to “a land grab among the e‑readers.”  This intense advertiser interest may help to explain why Liberty Media recently bid on Barnes & Noble.

[Source: Sharp Growth in E‑reader Penetration. Emarketer​.com. 25 May 2011. Web. 6 Jun. 2011; Kawamoto, Dawn. Has amazon Kicked Off Another E‑Reader Price War. Dailyfinance​.com. 12 Apr. 2011. Web. 6 Jun. 2011] 
Kathy Crosett
Kathy is the Vice President of Research for SalesFuel. She holds a Masters in Business Administration from the University of Vermont and oversees a staff of researchers, writers and content providers for SalesFuel. Previously, she was co-​owner of several small businesses in the health care services sector.