if:book’s Kate Eltham is currently blogging for if:book from  the O’Reilly Tools of Change for Publishing Conference in New York City.

What Do eReading Customers Really, Really Want? An In-depth, Research, and Data-driven Exploration of Reading Behavior, Content Consumption, and Consumer Attitudes Toward eReaders and Multifunction Devices

Since the last O’Reilly’s Tools of Change conference, the publishing world has experienced remarkable growth, challenging those producing content, platforms and devices to understand and keep up with changing consumer trends.

Unfortunately, in the absence of good data, many publishers, developers, device manufacturers, retailers, and other industry players have been making business decisions based upon assumptions about consumer expectations. But, the era of guessing what ereading customers want may be nearing its end.

Find out more about this session.

Kate’s notes

Michael Tamblyn, Kobo

Kobo looks for reader segments to understand what ereading customers want. Factors like:

• Geography
• Reading Platform
• Free vs Paid
• Content (Genre)
• User Profiles

Typical eReader User Profiles

1. “eInk Reading Machine”: a most valued customer segment (Lifetime Value), first time spent $35, every time they come back spend $20-25 at least 7 times a month, reading continuously, reading on a Kobo eInk device, long-time user, early adopter, fiction reader, 100% paid.

Looking at how people come to be customers, general conclusion is that ebook consumption is accelerating over time. A customer who started in June 2010 buys 44% more in their first month as a custoemr than a customer who started in December 2009. A customer joining in Nov 2010 buys 70% more in their first month than a Dec 2009 customer. First months are getting bigger. Why? Better apps, better devices, better marketing, moret itles, better customers

2. Small-screen Reader (smartphone)

Largest segment in terms o fnumbers. Buy less frequently and are lower value customers than peopl eusing larger screens. First time spent about $15 and visit around 1 per month, spening $7 each time. iPohone is Kobo’s least productive sales channel. [Web, Kobo eReader, Kobo-powered apps, Android,iPad, iPhone] iPhone customers are price sensitive. This user is less likley to stick around, churn is high in this category of customers. Especially strong consumers of genre fiction, particularly romance. Will hunt for free titles and consumer both paid and free.

3. iPad Socialite

Not as good as eReading machine. Spendabout $22 first visit, stick around a while, buy semi-frequently. [Break out: iPad Reading Life with social features, just launched for iPhone too]

How does social change reading? A lot. You can connect your reading life to facebook. People who do this spend about 33% more time in app. Alo gathering data about reading behaviours based on time of day. Turns out, late night readers (in bed) read less. Readers who read during the day (commute, lunch) spend more time reading overall. Book industry is not, as it turns out, powered by the bedside table. More interrogation of the data reveals that even though evening readers reading for a shorter time, there are more people reading at this time. ie. there are more evening readers than daytime readers. 8pm-12pm is ebook shopping primetime, this is when most people are buying new ebooks.

Kobo looking at cosumption patterns after the book has been purchased.

4. The Freegan

Don’t spend money on books, they want free. Web is their primary source, followed by smartphones and iPad. Likely to have multiple devices, looking for free content to load on each. Interestingly, there’s a lot of free access happening in international markets.

Not everyone who reads free books are “freegans”. Some are “paygans”.

Customers with free books get a free book or two (pride & prejudice) and this is their ebook training wheels. True freegan have more than 9 free books in their bookshelf, they are actively shopping for free content. Freegans are shockingly resistant to marketing (big surprise).

Kobo is using this data so they can make the reading experience better. Easier, more enjoyable. And how to do it while keeping in mind that there are different categories of users with different reading behaviours. Fighting for tiny slices of people’s day, the more we can enhance the experience, the better it will be.