Bookstores Can Still Compete By Combining Traditional Strengths With Smart Innovations

from the that's-how-it's-done dept

When Authors Guild boss Scott Turow said that brick-and-mortar stores are the future of book sales, it was hard not to laugh. Tim Cushing & I joined forces to supply him with an ad for his quixotic campaign, and as expected, defenders of the joy of printed books and brick-and-mortar bookstores appeared in the comments to sing their praises in a non-satirical fashion.

But the thing is, if people love bookstores, then bookstores will survive. But the market will inevitably scale according to demand—and there can be no doubt that demand is declining. I count myself among those who get a warm feeling from shopping in a nice independent bookstore full of mismatched shelves and handwritten signs, and I think that's what most people are pining for when they talk about bookstores, not big box retailers with display tables of pop-psychology books and extraneous Twilight supplements. The latter originally thrived on convenience, selection and price—and in those areas they have been rendered completely obsolete by online retailers. But the former subsist on community, personality and charm—things that can be accomplished online, but in a much different way that will never wholly replace a physical space, and that are not really a part of Amazon's arsenal. That doesn't change the fact that independent bookstores are struggling, or that many have shut down and many still will, but the impassioned defenses of the neighbouhood bookstore that pop up in every discussion of this topic show that there is absolutely still a market to be served, even if the size of that market is still uncertain.

There's an additional fear that even if stores offer a superior experience that keeps customers coming in the door, many of those customers will simply browse and then order the books online at a lower price, thus reaping the benefits of the small store without paying for them. I'm not sure how justified that is. People still like to leave a store with something in their hands—and if you build an engrossing retail space with a sense of community, where people interact with the books and each other, they won't be thinking about their smartphones or Amazon's superior prices. A bookstore can also go a step further: Jim O points us to the story of the Harvard Bookstore, where the new owner set up an on-demand printer/binder to see if he could leverage the opposite trend. People don't just shop physically then buy digitally—they also shop digitally and buy physically:

Maybe access to the vast universe of digital content could also save the bookstore. Maybe the bookstore, while limited in inventory, could evolve in the digital world and become a destination where people had access to every digitized book ever published.

To truly compete, he would also have to solve consumer’s expectations for instant gratification and delivery. Jeff needed a complete production, distribution, and fulfillment model. He has likely shocked a lot of people by building one in his own backyard.

Essentially, Jeff installed a printing press to close the inventory gap with Amazon. The Espresso Book Machine sits in the middle of Harvard Bookstore like a hi-tech visitor to an earlier era. A compact digital press, it can print nearly five million titles including Google Books that are in the public domain, as well as out of print titles. We’re talking beautiful, perfect bound paperbacks indistinguishable from books produced by major publishing houses. The Espresso Book Machine can be also used for custom publishing, a growing source of revenue, and customers can order books in the store and on-line.

You can walk into the store, request an out-of-print, or hard-to-find title, and a bookseller can print that book for you in approximately four minutes. Ben Franklin would be impressed.

I've been excited about the prospects of the Espresso Book Machine for a while. Though print is obsolete in many ways, a lot of people still like printed books and express distaste for e-readers. Personally I don't see myself ever giving up printed books entirely (or selling my small collection of antiques), but I also don't mind reading electronically—and unlike many print defenders, I don't condemn those who do truly make the switch. Print still has value to the end consumer, and as such it is not entirely obsolete as a product—but the incredibly wasteful system of printing off huge runs of books and shipping them thousands of miles is. On-demand printers could solve that paradox.

So how is it working out for the Harvard Bookstore? There are no firm numbers, but the owner reports double-digit sales growth monthly over the past year. Can every town and city support a store like this? Certainly not—nothing changes the fact that demand for bookstores has gone down, and it's naive for those who still love them to expect the market not to shrink accordingly. But the reverse is also true: as long as some demand exists, smart entrepreneurs can find ways to stay relevant and succeed.



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    Shadeyone, May 11th, 2012 @ 7:08pm

    This is how you thrive and survive

    To me, this is what is missing so many times when people say that technology is killing something or is the death of a standard. Technology is not killing industry, industry is like the slow or injured member of the herd that gets picked off by the lions because it can't keep up with everyone else. Yes, I'm saying technology is the lions because it's culling the herd of fat, slow, set in their ways creatures who refuse to adapt to the world around them.

    Instead of giving up or just coasting, the Harvard Bookstore owner saw a way to integrate technology with his industry. He adapted and used it to improve the customer experience. He didn't completely alter it, he didn't change what people do, he just made it easier for them to do what they normally do.

    That's something I've seen constant cries for here on Techdirt, let me do what I need to do or give me what I want/need in a way that is not a hassle. This guy gets it and that is why I think he will succeed, he's not the slow fat gazelle in the herd. He's the one who's been looking around at his environment, alert for predators and ready to go. Nothing in this life is just given to you and if you own a business and want to succeed, you have to work for it, it's not going to fall in your lap.


    Thus ends my first ever post on Techdirt, didn't expect to go off on a rant. I look forward to any corrections, diverging opinions and general clamour that will hopefully follow.

    /Shadey

     

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      Anonymous Monkey (profile), May 11th, 2012 @ 7:46pm

      Re: This is how you thrive and survive

      Yes, THIS is innovation! The entertainment corporations would've just continued to cry FOUL and lobbied for more protections. The garbage **AAs are spewing about piracy this, and losses that, doesn't innovate anything, except maybe more laws. Maybe they should look at ways they can actually INNOVATE instead of sitting in their posh executive chairs like lumps of something vile.

       

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    Nicole, May 11th, 2012 @ 8:04pm

    Welcome back bookshops

    I think you are right, hard copy books are never going to disappear but your suggestion of local book stores finding innovative ideas to recapture their customers is great. It is all about providing a service that cannot be provided online. Great post, thanks!

     

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    Zos (profile), May 11th, 2012 @ 8:53pm

    lawsuit against the harvard bookstore incoming in 3...2...

     

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    Anonymous Coward, May 12th, 2012 @ 1:50am

    'many of those customers will simply browse and then order the books online at a lower price'

    they did their bit to keep the bookstores open by going through the shop door and browsing. the fact that they bought nothing there and as almost everyone does with almost everything, actually bought on-line at a lower cost, is irrelevant to them.

     

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    leichter (profile), May 12th, 2012 @ 4:36am

    For an interesting example of how to respond to the new environment, have a look at the Northshire Bookstore (http://www.northshire.com/). Northshire is located in Manchester, Vermont - a fairly small community surrounded by smaller communities, many poor. But Manchester is a tourist hub - there's a ton of skiing in the area, and many resorts that get summer traffic as well. The town is a tourist shopping hub. Many years ago, it was filled with locally owned store; for the last ten years or so, the major chains have taken over with outlets. The outlets are fading a bit; we'll see what replaces them.

    Northshire has been there through all the changes. The store expanded a couple of years ago, and is, in total footprint, comparable to a medium-sized B&N. But since it started life in what was probably once a hotel, and added rooms here and there, it doesn't *feel* huge - it feels like a bunch of rooms. And it specializes in providing an experience: Knowledgable, friendly staff; regular talks by authors; special displays by local writers; little notes on the shelves from bookstore employees describing their favorites; etc.

    Northshire has had a book printing machine (I don't know who makes it) for a couple of years. They also started selling on-line a while back.

    I have no connection with the store, other than as a long-time customer: We vacation nearby a couple of times a year, and as a family tradition always include a visit to Northshire on every trip. The store has been busy every time we've been in there. And we always leave with a large collection of new books. In fact, we used to have Borders near us at home. We realized that we almost never went there: Books we needed "quickly" came from Amazon; books that were the result of browsing came from Northshire. Borders just kind of faded from our lives (though we do miss knowing it's there).

    I hope Northshire's external appearance of success don't conceal inner dry rot. It's been a tough couple of years for many of the Manchester vendors, and they haven't had to deal with the technological changes in the book business.

     

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    Anonymous Coward, May 12th, 2012 @ 5:50am

    I have a Nook. I find books with photographs to be far superior to their electronic counterparts. I still regularly go to the bookstore to buy books on nature photography. This is one area where physical books can outperform the digital medium.

     

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    Gerald Robinson (profile), May 12th, 2012 @ 9:34am

    B&N Bookstores

    One was downtown and not that easy to get to. They carried some stock that wasn't otherwise available but made ~30% of their profits from trail guides and maps. Between the rising use of GPS and digital maps (which they didn't support) and REI they went under. The other had a relatively small store near a large mall. In '99 they moved to a more remote location not as easy to get to and a much much larger nicer store. But when B&N and Borders moved into the mall their business declined and they went under.

    The nearest bookstore to me now is B&N and yesterday I went in (its a 1 hour drive) because I had a 20% off coupon and because they are near Whole Foods where I needed to get some things. I wound up spending $45 on two books by authors that I really like. But not nearly as convent as Nook or Kindle. Maybe a hybrid model using downloads would make them some more money. Certainly its a promising approach combining physical books with eBooks; but the publishers must stop with their price gouging on eBooks for it to work. The physical books I bought at B&N were cheaper than on Nook or Kindle otherwise it would have been no sale. And in spite of the lies told by the publishers they make way more on an eBook than on a physical. There are a lot of publishers on Amazon who make good money at $2.99 to $5.99.

     

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    Andrew D. Todd, May 12th, 2012 @ 1:53pm

    The Lost World

    In my experience, the kind of bookstores people romanticize about, the kind of bookstores which have resident cats, and scholars hanging out in the aisles, are usually used bookstores. The irregular shelving is well adapted to an irregular stock, consisting of whatever the customers bring in to trade. And of course, Scott Turow does not receive royalties from used bookstores. Therefore, one can assume that he hates them.

    A lot of used bookstores "square the circle," by having used books in the basement or the attic, and something more lucrative on the main floor. In my time in Boston, as a prep school student, circa 1973-76, I used to patronize a small used bookstore in Church Street, behind the Harvard Coop. One half of its used book department was in the basement, down a rickety stairway. The main floor was given over to postcards, small plush toys (teddy bears), and similar souvenirs. The other half of the used book department was in an attic over the repair garage across the way. I recently did some street-view-crawling, and discovered that the location of the main store is now occupied by a yogurt parlor, or something like that, and the garage has simply vanished. I don't mean the business, I mean the building itself. Used bookstores have never been able to compete for retail space with "carriage trade" businesses such as yogurt parlors. Come to that, I understand that another long-time Church Street institution, Sage's Grocery Store, has bit the dust, unable to compete with PeaPod deliveries, and with the growing sophistication of chain grocers in the suburbs. The space is now used to sell cellphones.

    I don't think you can put the clock back. The kind of young people who read omnivorously are very comfortable with the internet, very comfortable reading words on a screen, and they go straight to the Gutenberg Project, or straight to Hathi Trust. They aren't inclined to pay for what they can download for free. Graduate students all have their little electronic cameras, and can be expected to snap-snap their way through library books, like the characters in old spy movies. They are not going to pay twenty or forty dollars for a single book if there is any possible alternative. Not while they are living on ramen noodles and canned beans.

    On the other side of the fence, authors who don't reasonably expect to make meaningful sums of money on books are choosing to give them away on the internet. There are more or less substantial costs involved in dealing with publishers, and unless one can expect correspondingly substantial sales, the game isn't worth the candle. The basic new book market is someone who is about twelve years old, and reading, more or less under duress, in a middle school somewhere. Traveling salesmen who used to read books on airliners because there wasn't anything else to do can now carry a movie in an electronic device instead, something more suited to their mental horizons, or else they can clear off their paperwork on their notebook computers. If you want to write a book which is way beyond the understanding of twelve-year-olds, you cannot expect to make very much money. The publishing industry is steadily squeezing down to a much narrower range of books.

    Amazon's baseline price for used books, the price which just covers operating expenses, and applies to books which are not remotely scarce, is about four dollars. Amazon is presently absorbing Kiva Robots, and once they have enough robots, and recast their business practices around them, they will probably revise their price structure to conform to Edward R. Hamilton's baseline price structure during the great publishers inventory sell-off of the 1990's, of four or five dollars for the first book, and one dollar for each additional book. The cheaper Amazon can sell a used paper book-- which does not require copyright permission-- the more leverage Amazon has for negotiating with the publisher to put books on the Kindle-- which does require such permission. Amazon will do whatever it can to make the sale of physical used books run as near to internet speeds as possible. When you are buying books for a dollar each, you don't browse through the pages, you buy everything which looks as if it might be interesting.

    There really aren't very strong economies of scale in computer printers. At this stage, you can get a black-and-white laser printer for a couple of hundred dollars, with competitively priced toner, which is fast enough to print a book in ten or twenty minutes, faster than you could go much of anywhere, or receive a delivery. Presumably you can use software to put four or eight pages on both sides of a single 8-1/2X11 sheet of paper, and strip out the color parts, and route them to an inkjet printer, and afterwards intercolate the color pages with the black-and-white pages. People who consumed a lot of books, and didn't want to read them on the screen would have their own printers and bookbinding tools. I do a certain amount of "repair bookbinding," for old books which have lost their covers, or have had their binding glue disintegrate, and I don't think it's all that difficult. In other words, I doubt that printing has enough inherent centralization for a bricks-and-mortar bookstore to hang onto it. In the long scheme of things, people chose to own their own computers, rather than go to a central computer lab. The same principle probably applies to custom printing.

    For what it is worth, there was a weird stage in the early sixteenth century, just when printing presses were coming in. Rich people would buy a printed book, and then turn around and hire a scribe to hand-copy it out for them with his pen. That didn't last for very long, of course.

     

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    Anonymous Coward, May 12th, 2012 @ 2:45pm

    I live in London and this article got me thinking about the number of book shops in my area - none, they've all closed down. When I think about it I'm not at all surprised. I haven't bought a physical book since I bought my first Kindle, about a year ago. Before that the last time I bought a physical book in a shop was 1999.

    Book shops, chains or independent, simply do not offer anything even remotely worth visiting, let alone purchasing from, for the vast majority of people. I can easily peruse virtually any book online before purchasing it electronically and having it instantly available on my PC, ereader or to print out at home. If I'm willing to wait an entire 24 hours I can even have the physical book shipped to me for cheaper than going out and buying it in a book shop, assuming of course I could actually find a book shop.

    I for one, and I'm sure I'm not alone, do not miss book shops in the slightest; they're simply become obsolete to many people.

     

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    Dionaea (profile), May 12th, 2012 @ 4:02pm

    I do think this could work, especially with the out of print books being sold. I've heard of people who spent ages looking for a specific book and then bought it for a huge amount second hand. This would definitely be great if you're looking for an out of print book.

     

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    Hyman Rosen, May 13th, 2012 @ 12:01am

    Bookstores

    I've lived around the corner from a B&N for over fifteen years and I love going there to browse. But they themselves convinced me to buy a Nook, so I hardly ever buy paper books from them any more. I actually asked a clerk whether there was any way to get my electronic purchases credited to the store, since that's where I was deciding what to buy, and I was then buying from BN.com. Of course the answer was no. And then the agency model killed off all the discounts, and now I just get my books from the public library.

     

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    ABINEA Dolomiti Romantic, May 13th, 2012 @ 1:11am

    Espresso Book M.

    What i think about the Book Machine! you are right, book M is a innovative idea to recapture their customers itīs great. It is all about providing a service that can be provided also online. Great post, thanks!

     

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    Arwyn, May 13th, 2012 @ 7:48am

    If I buy a physical music CD then I can convert that inot a digital copy fro my IPod...

    Book publishers need to embrace the same idea - the cost of a physical book should include a digital version ...

    then I have the pleasure of buying the book and reading it at home ... or on my Kindle while I travel.

    Of course, some cost adjustment would need to happen ...

     

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    Anonymous Coward, May 14th, 2012 @ 6:21am

    There is only one bookstore in America: Barnes & Noble. And frankly, fuck that place.

     

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    John Marry, Nov 22nd, 2013 @ 1:55am

    Espresso Book machine

    Yes it is very hard to think that brick and mortar stores are the future of book sales as many customers simply browse and then order the books online at a lower price. But I am very happy that the Espresso Book machine can also be used for custom publishing which is now a growing source of revenue for them.

    Regards,
    http://www.colad.com/

     

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    Amy Anderson, Nov 27th, 2013 @ 5:36am

    Book Stores

    Book stores are important for everyone thinking from a student to a house wife. So, it is hard to think that Brick and mortar stores are their future. In my opinion, Custom publishing will be a great work for them.
    The Paper Worker

     

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