Harry Potter and Viral Marketing

The release of J.K Rowling’s Harry Potter and the Deathly Hallows and fifth Harry Potter’s film has gained $700 million in its first month and more than 11.5 million books was sold only on August 3 in the United States. Rowling is the one who get bigger profits from this and reportedly richer than the Queen of England.

In spite of innovations in communication and technology that enabled mass distribution of in the days leading up to its official release July 21, Potter mania may have exposed a weakness in the already struggling publishing industry. For example, take the sale price for a hard cover first-edition of the Deathly Hallows, the most anticipated book in the seven-book series. Although the book lists for $34.99, the major chains discounted the book heavily, down to about $17, forcing independents with higher cost structures to follow suit or not carry the one book millions were desperate to buy. How can a book be a huge success and yet not make the bookstores any money?

The success of the Harry Potter franchise is a vivid example of how innovations spread, a phenomenon that was first studied by Everett Rogers in the 1940s in Sheth’s sociology classic, The Diffusion of Innovations, the book that gave marketers such essential terminology as “early adopters.”

Rogers noted that innovations spread not just through word of mouth, but because the tool or product turns out to be better than what had been available before, something he believes to be the case for Harry Potter. “The idea, product or service must have several differential advantages relative to existing offerings including value, compatibility and communicability. Harry Potter met all of them,” he says.

Indeed several factors were at play to create the marketing and distribution magic. The Internet had an impact on the spread of Potter mania. Scholastic, Rowling’s U.S. publisher, has spent only $3.6 million promoting all seven of the books, according to Nielsen BookScan statistics. The rest of the momentum is a result of word of mouth – and instant messaging. Viral communication has played an important role in building and sustaining the buzz around Harry Potter.

Online sites such as The Leaky Cauldron (The-leaky-cauldron.org) have played a role in linking Potter fans together, spreading news about upcoming events, such as new books and movie releases. Some marketing gurus have also pointed to Rowling’s decision to allow fans to post their own Harry Potter stories on line as a key way in which she helped maintain interest in her characters between publications or movies.Despite the cozy, old-English quality of the magical boarding school saga, the book’s strong sales have been driven by some of the latest trends in publishing – the growth of the large, market-dominating booksellers, such as Barnes & Noble and Amazon.com in the U.S., or Amazon.co.uk and Waterstone’s in the United Kingdom—and the rise of e-commerce, has made it relatively easy for them to deliver many books at once.

More fundamental to the success of Harry Potter books is that it launched a new niche, a young adult novel written for and about Millennials, persons born since 1982, says Andrea Hershatter, associate dean and director of the BBA program and a senior lecturer in organization and management at Goizueta. “J.K. Rowling created a nuanced, complex story about a magical Millennial, written for Millennials, at a time when there was not much fresh literature that was particular interesting for ‘tweens,” explains Hershatter.

Harry is a Millennial both by age and characteristics, Hershatter says. “Although he was not raised by helicopter parents, Dumbledore, Hagrid, Mrs. Weasley and Sirius fill the hovering role nicely for him. Harry actively seeks the guidance and approval of his elders, greatly values family and friends, thrives in a team setting (Quidditch, Dumbledore's Army) and cares deeply about Hogwart's institutional traditions. Within the realm of his precarious world he has been protected to the extent it was possible, and certainly, he has been raised to believe the future of the wizarding world is on his shoulders—which, in fact, it is,” she says.

With seven books and more than 335 million copies sold, the reader may be the ultimate winner. For all the business reasons behind the series’ success, Hershatter argues that the most important is the stories themselves. “At the end of the day, the ‘power of the brand’ is that Rowling is truly a uniquely gifted writer and storyteller,” says Hershatter. “She weaves magic, nuance, danger and humor in a way that probably comes along only once a generation.”