Borders Wants To Run Its Own Store, Amazon Wants To Enable You To

from the but-it's-not-really-about-the-bookstore dept

Borders announced that it would be ending its alliance with Amazon.com and would run its own online bookstore starting early next year. Prior to 2001, Borders ran its own online presence, but since it could not turn a profit, they sought a partnership with Amazon. Now, the landscape has changed. Traditional brick-and-mortar retailers no longer see their online divisions as separate renegade entities. Online stores now play an important part of a larger, multi-channel strategy, and customers benefit from such services as in-store pickup at the physical store counterparts. Borders is doubling down on its new online focus, as it also announced that it would be closing of almost half of its Waldenbooks stores over the next two years. Though the loss of Borders could cost Amazon some revenue, Amazon isn't really losing sleep over it. Amazon hasn't really done much to address the changing needs of its multi-channel retail partners. Perhaps the ugly divorce that they went through with Toys 'R Us left them with a bitter taste when dealing with big brick-and-mortar retailers. Instead, Amazon is betting on "me"-centric web 2.0 user-generated e-commerce by building out Amazon Web Services, which means that anyone can add Amazon's capabilities to whatever they're doing. When Borders launches next year, they will probably have their sights on Amazon, and they may actually build themselves a fine online bookstore. However, the game has changed. Selling the most books, is not about being the best bookstore anymore. It's more about enabling consumers with the tools to do anything they want, which would then, in turn, sell the most books.


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  1.  
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    Anonymous Coward, Mar 23rd, 2007 @ 6:58am

    What?

    What does this mean?

    "However, the game has changed. Selling the most books, is not about being the best bookstore anymore. It's more about enabling consumers with the tools to do anything they want, which would then, in turn, sell the most books."

    Sounds like BS to me.

     

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  2.  
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    Dave, Mar 23rd, 2007 @ 7:15am

    Re: What?

    I don't think it's BS, I think it's pretty sound. The book selection between all online book retailers is more or less the same so they need to figure out other ways to win customers over. I go to Amazon over barnesandnoble.com or any other bookstore's website because Amazon makes searches easier and provides more tools like suggestions and better wishlists amongst other perks. Plus I can get more than just books at Amazon, so why create a second account for books elsewhere?

     

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  3.  
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    EdB, Mar 23rd, 2007 @ 7:39am

    Re: Re: What?

    So let's see if I understand this: It's not about selling the most books: it's about something that results in selling the most books. Sounds to me like it's still about selling the most books, but maybe I'm missing the great importance of the path to the goal.

     

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  4.  
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    Yay, Mar 23rd, 2007 @ 7:43am

    Yay!

    This benefits everybody.

    1. Borders has realized that it is in the business of selling books, and even if the pie shrinks a bit without Amazon's help, their piece is larger. Plus, Borders gets better firsthand intelligence on what customer demand is really like. (Which helps keep inventories lean, prevents under ordering key titles, e.g. 300)

    2. Amazon has realized that it is really paypal, but better, because it's customers are loyal. Seriously - they provide frameworks for sellers, they provide an interested customer base, and they take a cut of each transaction, without ever having to play the "we're fighting money laundering so we froze your account" game. The books are incidental - they sell the service of online retailing, not books.

    3. This is great for book buyers like me, if they do it right. I can already check inventory and select books online to pick them up locally instead of paying for shipping, and often instead of waiting a week. If they streamline the UI so I can keep wishlists, or hold things in my shopping cart, so much the better.

    Eliminating Waldenbooks outlets makes sense - they are so physically tiny that keeping books stored for anticipated customer demand doesn't make sense. If they have placed their superstores correctly, they should be very close to their wholesaler's warehousing/distribution centers, leading to very short turn arounds for orders.

     

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  5.  
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    Doug Karr, Mar 23rd, 2007 @ 8:46am

    Store vs. Platform

    Amazon is executing on a great strategy, building a platform rather than a store. They have a proven model, why not?

     

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  6.  
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    BlogReader, Mar 23rd, 2007 @ 9:25am

    Border's is in the business of selling books?

    Borders has realized that it is in the business of selling books, and even if the pie shrinks a bit without Amazon's help I don't think Borders is in that business. They are in the business of making a social atmosphere for high end income people to come into a store first, selling them books and magazines second. I state this as I rarely if ever go into B&N and I order all my books off of Amazon -- they offer exactly what I need, I can search for it easily, their recommendations are spot on. Borders will never ever top that with a homegrown system unless they want to spend hundreds of millions of dollars. The only reason I go into a B&N is if I need a book that day, I want to get some magazines, or if I want to drink a coffee and read a newspaper.

     

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  7.  
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    Extreme Centrist, Mar 23rd, 2007 @ 9:40am

    Amazon is the bomb!

    I love Amazon. I always comparison shop, but I often end at Amazon or going through them. They have competitive prices, their customer reviews are indispensable, and they have proven themselves trustworthy.
    Furthermore, I want to sell a very small number of my own works. No way I can publish in print, but I can leverage the e-book concept. Amazon will provide the business framework I need.
    They are way ahead of everyone else in the key aspect of doing business, which is meeting the customer's wants.

     

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  8.  
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    Yay, Mar 23rd, 2007 @ 9:54am

    Yes, dear BlogReader, Borders is indeed in the bus

    Please note that Borders and Barnes & Noble are two different businesses.

    Sure, both companies give away a pleasant environment filled with books and the scent of coffee. It makes it that much easier to sell books, partly because it is a more pleasant environment for their employees, almost all of whom are nuts for their product. But neither sell the atmosphere (unlike theaters) they sell books they buy on a returnable basis from wholesaler-distributors.

    There are some differences between the two; I don't believe that B&N allows you to check their inventory online. I don't recall B&N having search kiosks sprinkled throughout the store. Borders has done these things incrementally, and has been learning from them. It seems logical enough that they'd be able to meet all of your needs: recommendations, relevant inventory, easy searching. That stuff isn't rocket science costing "hundreds of millions of dollars". That is computer science. Which nowadays can be banged out in a weekend by a single programmer using Ruby on Rails.*

    Remember, inventory management, search, and recommendation aren't hard to do. They are hard to do excellently, but hey, it looks like they've been practicing, eh? They have to be able to do these things anyway, just to run their business. And they have years of actual customer searches to pull from their in store kiosks.

    *granted, a good result means spending 60-100k/year for five years in salaries and equipment costs, but really, that's peanuts for these guys.

     

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  9.  
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    yardape6, Mar 23rd, 2007 @ 10:11am

    Long Tail Economics

    What the article is driving at is the fact that "selling books" is not amazon's business model. Being an online retailer is about selling everything, and allowing customers to customize their experience. It is not enough to just be a presence online anymore. You have to attract customers through other services which allow the customer to design their own experience. Borders site will be a day late and a dollar short in that department. To compete with amazon you would have to create better services than amazon, not simply compete on price point, though that cannot be totally discounted.

     

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  10.  
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    Outta Names999, May 17th, 2007 @ 6:16am

    Re: Border's is in the business of selling books?

    Uh- they already spent hundreds of millions and they actually have retails locations to show for it, unlike Amazon which spent the money and has little or nothing to show for it. I like Amazon, but come on, Borders would go broke trying to copy Amazon. They have to play to their strength which is in the offline world - where Amazon can't compete.

     

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  11.  
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    Outta Names999, May 17th, 2007 @ 6:17am

    Re: What?

    You called it. It is BS. Web 2.0 BS to be exact. And there is a lot of it out there on the net these days.

     

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  12.  
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    Dating Manual, Dec 29th, 2009 @ 9:23pm

    Expected book sales?

    I'm working on getting a book listed on Amazon (it's not too hard), and I'm wondering about expected book sales.

    Getting my book (a dating manual) into stores like Borders, Chapters/Indigo, etc. would be a lot harder, but would it be worth it?

     

    reply to this | link to this | view in thread ]


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