Kobo has signed a deal with Walmart to set up an ebook and audiobook service for the US supermarket giant that will also see Kobo’e e-reading devices sold in Walmart stores and online.
It represents another step in Kobo’s business policy of establishing strategic alliances in various markets. For example, in January 2017 the company took over the Tolino ebook technology platform in Germany, teaming up with a conglomeration of book retailers. Shortly after that move, it set up the Kobo Plus ebook subscription service in the Netherlands and Belgium in a joint venture with local publishers.
Kobo recently added an audiobook subscription scheme which undercuts Amazon’s Audible deal by 33%. After a month’s free trial, the price of a Kobo audiobook monthly subscription is $9.99 for the US compared with $14.95 for Audible.
The Walmart deal with Rakuten Kobo also includes the launch of a new online grocery delivery service in Japan. Walmart president and CEO Doug McMillon says, ‘Rakuten is a strong e-commerce business and we’re excited to collaborate with the top online shopping destination in Japan. We look forward to expanding our grocery footprint in Japan and launching a new offering of ebooks and audiobooks for our customers in the US.
Supermarket ebook services in the UK have flopped repeatedly in recent years, usually ending with Kobo picking up the pieces and the members.
In 2016, British supermarket Sainsbury’s shut down its ebook service and Kobo took in the exodus of readers. The shutdown saw former members of Nook in the UK transferred for the second time within six month after Nook closed its UK operation and shunted off its members to Sainsbury’s rather than offering them to rival Kobo.
In 2015, Tesco supermarket closed its ebook operation in the UK and passed its customers on to Kobo. 2016 saw UK bookstore chain Waterstones pull out of its ebook operation and transfer customers over to Kobo.
The ebook retailer exodus has not been confined to the UK as, in late 2015, Flipkart quit the India ebook market, switching customers to Kobo.
The Asda supermarket chain in the UK is owned by Walmart but there is no indication of whether Kobo products will be sold in Asda’s 525 stores in the UK. Kobo already has a retail and ebook website deal with newsagent WH Smith in the UK.
Walmart in the US is, of course, a vastly different proposition in terms of size, with nearly 4,700 stores across the country.
That size alone should ensure that Kobo will see a significant uplift in sales of e-reading dervices and ebooks in a market where it has failed to make inroads.
It is also an important alliance for Walmart in its battle with Amazon moving further into the grocery business.
Walmart will become Rakuten Kobo’s exclusive mass retail partner for the Kobo brand in the US, offering Kobo’s nearly six million titles to Walmart.com customers. Walmart.com will offer ebooks and audiobooks for sale later this year. Walmart will also sell digital book cards in stores, enabling more than 4,000 stores to carry a broader selection of books for customers.
All ebook content will be accessible through a Walmart/Kobo co-branded app available on all iOS and Android devices, a desktop app and Kobo e-readers, which will also be sold at Walmart later this year.
Rakuten Kobo CEO Michael Tamblyn says: ‘Walmart is one of the top retailers in the world and one of the largest booksellers in the US.
‘Our strategy from day one has been to partner with the world’s best retailers, so that they can easily offer their customers the option of reading digitally. This informs the software and devices we create, the books and authors we promote, and also the partnerships we build.
‘For us, this is another great opportunity to serve book lovers at Walmart, those people who make reading an important part of their lives.’