The Kobo Aura HD is the most recent e-reader the Toronto based company has produced. It certainly buckles the trend of the standard six inch device that seems to be the industry standard. In a very short period of time, the Aura now accounts for over 25% of the company’s overall hardware sales, and is poised grow even more, as the availability in international markets starts to increase.
Sameer Hasan, Director, Product Management, gushed about the severe departure from the standard design Kobo employed with the Aura. He mentioned, “If the Kobo Glo was compared to a paperback novel, the Aura is much akin to a hardcover. Customers seem to identify with this larger display, and despite the premium price, it is selling very well.” One of the things that makes the Aura HD unique is the back of the case. In the first few generations of the Kobo line of eReaders they used to rely more heavily on outside design firms. Today that reliance has shifted more towards a talented in-house design team, while still partnering with firms like IDEO. The Aura, certainly bears no resemblance to previous iterations of hardware, that all used a quilted back. Sameer said, “The design references the simplest of things, like folded paper or the spine of a book. Ergonomically, the design allows the pads of your fingers to rest against the gentle angles for a good grip”.
Kobo has consistently stayed in the media limelight due to its aggressive strategy of international expansion. Michael Tamblyn, the Chief Content Officer at Kobo explained their strategy. “Normally when we enter a new market, we start off with the local publishers, small presses and top publishers that market ebooks in that country. We then send over key personal that have at least 20 years experience in book rights and have a well established connection base to tap into. Once we have publishers on-board that offer ebooks in whatever local language we are going after, we go where the book buyers are. It does not make sense to offer our hardware in tech electronic stores, because our base of customers are book buyers. I would much rather sell one e-reader to a book lover, than three to a tech enthusiast. This is why we normally partner with bookstores, and put our e-readers side by side with physical books.”
Shortcovers was the digital book ecosystem that was apart of the Indigo organization around five years ago. It was established to give the bookstore chain a viable entry point to start selling ebooks. The company transformed into Kobo and had millions of dollars invested into them by Indigo and a few other partners. Last year, the Company was picked up by Japanese e-commerce website Rakuten. How much say does Rakuten have in the business practices of Kobo? Michael explained, “The main reason why the Rakuten deal made sense is because our vision of the company fell in line with theirs. We don’t receive mandates from them and they mainly let our business run autonomously. One of the ways we benefit is the sharing of technology to really allows us to grow up fast. They have poured millions of dollars into features like Search, and various databases that really help us manage our company more effectively.” Kobo has since expanded the Toronto headquarters and now has close to 500 employees.
There are a few big markets that Kobo is very interested in expanding into next, but present a myriad of challenges. India is one big market they are trying to break into, but the publishing market has not embraced digital yet. This challenges Kobo to educate the publishing community on the merits of digital and uses their own metrics and statistics on how similar markets have blossomed by embracing ebooks. The bigger the market, like India and China, the longer it takes to break into.
Kobo certainly has the ebook ecosystem nailed down, with over three million titles and thousands of graphic novels, comic books, and manga. The obvious next step is digital magazines and kids books. Many people use the Kobo ARC, the companies second iteration Android tablet, but many more use the Kobo app for iOS, Blackberry, and Android. This gives the company an established base of people who use a full color screen, which makes the prospect of magazines extremely viable. This is a new market for Kobo, and presents challenges in talking to a new segment of the industry, but by this summer we should expect a new section of magazines in the Kobo bookstore.