Wottakar’s The Panda Says “No” Oliver Bretz 24 November 2006

Non-price effects – Do not listen to Economists! Difficult to predict, difficult to model, difficult to quantify

Upstream Price Effects

Some non-price effects have price elements: Reduce number of 3 for 2 offers Replace all £7.99 titles in the 3 for 2 with £6.99 titles Replace a good book in a 3 for 2 with a bad book Reduce size of 3 for 2 table Move 3 for 2 table to a dark or inaccessible part of the store

Other Q factors: Shopping experience (lighting, heating, shop fit-out) Competent staff Author signings Child-friendly environment Eclectic choice

R&D Competition:

Development of an Author:

Some non-price evidence: Store refurbishments (“anti-competitor works”) and book signings Higher proportion of more experienced staff in overlap stores One publisher spent more than 80% of total marketing spend through specialist retailers Over 500 titles per year were promoted by Ottaker’s and not Waterstone’s

A specific example:

Conclusion

Wottakar’s The Panda Says “No” Oliver Bretz 24 November 2006 www.cliffordchance.com Clifford Chance, 10 Upper Bank Street, Canary Wharf, London, E14 5JJ, UK © Clifford Chance LLP 2005 Clifford Chance Limited Liability Partnership UK-1039220-v1