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Valitse kohde. - VALITSE KOHDE. VALITSE KOHDE. EBOOK MARKET OF THE USA Litnet case Author/s: Andrii Tytenko eSAVONIA UNIVERSITY OF APPLIED SCIENCES THESIS Abstract Field of Study Social Sciences, Business and Administration Degree Programme Degree Programme in International Business Author(s) Andrii Tytenko Title of Thesis eBook market of the USA: Litnet case Date 14.12.2019 Pages/Appendices 49 Supervisor(s) Virpi Oksanen, Ari Pitkänen Client Organisation /Partners Litnet Abstract The eBook market in the USA is the largest English-speaking eBook market. The purpose of the thesis was to do profound research on the eBook market in the USA for the case company Litnet. The importance of this research derives from the case company’s interest in the market. The research conducted for Litnet was made by utiliZing several marketing research frameworks such as PEST analysis, Porter’s Five Forces model, and SWOT analysis. Both qualitative and quantitative research methods were applied in the study. The research discovered that the overall attractiveness of the US market is high for Litnet. The research showed that the industry infrastructure is favourable. The market is characterized by a high level of rivalry and low en- trance barriers. There are different models of eBooks distribution, such as traditional per copy sales, subscription services, and pay per chapter services. The market may experience pressure from audiobooks and print books sales. Litnet may use the differentiation strategy to escape the direct competition in the market. The research gives an overview of the eBook market in the USA and analyses prerequisites for Litnet's possible market strate- gies. Keywords Market research, eBooks, literature, literary market, USA, eCommerce, PEST, Porter’s Five Forces, SWOT 3 (49) CONTENTS 1 INTRODUCTION ................................................................................................................. 4 2 CONDUCTING MARKET RESEARCH ...................................................................................... 5 2.1 Types of research and sources ................................................................................................. 5 2.2 Research paradigms and methods ............................................................................................ 6 2.3 PEST analysis theory ............................................................................................................... 7 2.4 Porter’s Five Forces model theory ............................................................................................. 8 2.5 SWOT analysis theory .............................................................................................................. 9 3 CONDUCTING MARKET RESEARCH FOR LITNET ................................................................. 12 3.1 Litnet overview ....................................................................................................................... 12 3.2 Conducting PEST analysis for Litnet ......................................................................................... 13 3.2.1 Political and Economic environments ............................................................................ 13 3.2.2 Social and Technological environments ......................................................................... 19 3.2.3 PEST analysis summary ............................................................................................... 25 3.3 Competitors overview ............................................................................................................. 26 3.4 Creating Porter’s Five Forces model for the case company ......................................................... 34 3.5 Conducting a SWOT analysis for Litnet ..................................................................................... 37 4 SUMMARY ........................................................................................................................ 41 REFERENCES ......................................................................................................................... 43 4 (49) 1 INTRODUCTION The USA eBook market is the largest English-speaking eBook market. It reached $5,4 billion in 2018, and it is projected to continue growing (Statista 2019b). It is a relatively young market that grew from the traditional printed books market. The eBooks appeared as a result of advancement in the customer electronic devices and correspond with the global trend of digitalization. The purpose of the thesis is to create profound research on the eBook market of the USA for the case company Litnet. The importance of this research derives from the case company’s needs. More specifically, the company is interested in the successful growth in the English-speaking eBook mar- kets and the USA is the largest of them all. Therefore, the thesis topic was chosen as a result of the Litnet’s development needs, which were understood during the professional internship in the com- pany. The company is based in Europe, so there could be some lack of understanding for successful future operations of the distant market as the one of the USA. The topic can also present some in- terest to those who work closely with the USA eCommerce market, and literature market in general because the research will also investigate some of their aspects. In this research, the academic theory base is reviewed and applied. The research for Litnet will be made utiliZing marketing research frameworks such as PEST analysis, Porter’s Five Forces model, and SWOT analysis. There will be applied both qualitative and quantitative research methods for the study. The research will be commenced with the overview of the case company Litnet to get an un- derstanding of the company's operations and position in the different markets. The PEST analysis will give a clear understanding of the political, economic, social, and technological environment of the USA eBook market. The competitor's overview will discover the main industry actors. Porter's Five Forces model will help to better understand the eBook industry. The SWOT analysis will provide a practical implication of the previously discovered external analysis and will connect it to the Lit- net’s internal environment while suggesting some strategies and helping to avoid possible mistakes. All the findings and the research process will be later summariZed and reflected in the Conclusions part of the thesis. The findings of the research shall be used further for planning and implementing practical decisions based on reliable evidence. It shall allow managers to make better decisions connected to business development and operating in the USA market. The meaningful market intelligence gained through the research could help to make new strategies and to facilitate Litnet with establishing itself in the market. 5 (49) 2 CONDUCTING MARKET RESEARCH In this work, market research will be made. For this reason, the needed theory base has to be re- viewed before it can be applied. The process of research means collecting, analyzing, and interpret- ing information to obtain new knowledge about the subject (Leedy & Ormrod 2001, 2). 2.1 Types of research and sources Research can be of two types – primary and secondary research. Primary research means that new knowledge is derived from first-hand interactions with a subject (observation, examination, investi- gation). Secondary research means the usage of other searchers’ findings in the research. These can be studying the existing articles, books etc. (Clarke 2005.) To conduct research, one needs to use different sources of information. There are two types of all sources: documentary and non-documentary sources. The non-documentary sources are those that don’t exist in the documented form. However, they can provide important knowledge about some event or concepts. They include conversations between colleagues or industry professionals. (Varsh- ney 2011.) The documentary sources exist in the form of documents, generally published or recorded. Three types of documentary sources can be used in research: primary, secondary and tertiary. The pri- mary documentary sources are the records with the original research and developmental findings. This kind of sources is often not properly organiZed. The primary sources in the market research are research reports, periodicals, patents statistics. (Varshney 2011.) The secondary documentary sources consist or refer to the primary documentary sources. It is pre- sented by organized or modified information from primary sources for some purpose of research. The secondary sources do not provide any additional information, comparing to the primary sources. They include textbooks, monographs, and bibliographies. Tertiary documented sources do not con- tain knowledge in themselves but help with the search of the needed primary and secondary sources. The tertiary sources include guides to works, yearbooks, and bibliographies to bibliog- raphies. (Varshney 2011.) As a rule, primary sources provide more reliable information than secondary. Therefore, the searcher should prefer primary sources to secondary and tertiary when it is possible. For this rea- son, the searcher should always try to find the primary sources in the research references. (Varsh- ney 2011.) However, most research writings use all types of research sources (Clarke 2005). There- fore, in this research, the primary sources have to be used when possible. 6 (49) 2.2 Research paradigms and methods
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