Brick and mortar bookstores continue to lose ground to e-commerce

The latest book sales numbers are in and e-commerce is the winner. Photo: (Sylvia Loveridge)

DOTHAN, Ala., August 14, 2013 — Brick and mortar bookstores continue to be negatively impacted by the growth of online book selling. According to the latest industry report from the research company Bowker, e-commerce now accounts for up to 44 percent of all traditional book sales.

Another 15 percent of book sales are through bookstore chains, and independents lag in distant third place with just 6 percent of the market. The rest is split among mass merchandisers, book clubs and miscellaneous outlets like grocery stores, The Borders closing and questionable management strategy at Barnes and Noble both contributed significantly to the continuing decline in physical stores.  

On the surface that may seem to be bad news, but there is good news for book lovers. Independent bookstores are more or less holding on, and indie owners seem to be like pioneers of the American west who refused to give up. To stay afloat, many independents are turning to non-book inventory, new services and even crowd-funding.

As reported recently by the New York Times, donation and funding websites like Indigogo.com and Kickstarter are an increasingly popular way for independents to raise short-term capital. The amounts range between $5,000 and $50,000, but that is just a temporary fix for cash flow problems. Independents are still being swamped by the big discount chains as well as online retailers. 

Amazon was recently berated by Oren Teicher, CEO of the American Booksellers Association (ABA), in an open letter to all booksellers. Teicher described Amazon’s business practices as “questionable” and cited a list of news articles to support his case. He also ranted about President Obama’s recent speech at an Amazon warehouse opening in Tennessee, noting that Amazon received $10 million in tax breaks for that site alone.

Teicher claims Amazon has cost America more than 42,000 jobs as smaller retailers have gone out of business. One can appreciate that the head of a booksellers’ association is supposed to be protective, but Mr. Teicher might consider that ranting is rarely a productive business tactic. 


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You never hear consumers say things like, “Gee, I really hate little bookstores, I prefer browsing on my computer.” How to introduce new book titles to readers without a store display is a huge gap in the online retail business model. Most consumers will admit that while they like the cheaper prices of online sales, they also like to browse in person at actual stores. 

If Teicher and others truly want to help brick and mortar stores survive, they might investigate some creative partnerships. The B. Dalton Bookseller chain, bought and ultimately liquidated by Barnes and Noble, found a way to overcome limited floor and shelf space in their high-rent mall stores. Their system was to bundle customer requests for titles not in stock, then partner with jobbers and publishers to drop ship inventory.

Modern day independents might benefit from something similar if they had a forward-thinking industry trade group to help them. Earning one’s own tax credits might prove a better strategy than just complaining about competitors and presidents. 

Despite the industry being in flux, book publishers are putting out more print titles than ever. The number of new books for 2012 was nearly 302,000, a rise of 3 percent from 2011. The numbers suggest record readership regardless of where consumers do their shopping .

Who is doing all this reading? Women are. They currently account for 60 percent of all print book buyers and 65 percent of e-book purchases. 58 percent of all dollars spent on books are from women, though men are more likely to buy more expensive books. None of the industry groups that report statistics care to offer any explanations for the consumer behavior behind sales trends.  

Adult fiction continues to hold on to first place as the most popular genre. 42 percent of all book sales are in this category, followed in distant second by juvenile books with 18 percent of the units sold and adult non-fiction with 12 percent. 27 percent of books sold are hardcover, 45 percent are paperback and 22 percent are e-books.

The majority of e-book buyers, as might be expected, tend to be younger and better educated than their older counterparts. 60 percent of e-book buyers are under age 45 and 64 percent have college degrees. Among traditional print book buyers, 55 percent are under 45 and 61 percent have college degrees. 

Industry statistics all by themselves are pretty boring. The real story with numbers is what lies beneath the figures. On one hand there seems to be a languishing market for selling books through physical stores, yet more print books than ever are being printed and sold.

Some of that is due to Barnes and Noble making a disasterous decision to more or less abandon its core business and take on Amazon.  Some of it is due to the fact that around 22 percent of the traditional book market has evaporated into e-book sales. 

People are reading more, but publishers are nervous because their 20th century business paradigm is mostly gone. The overall industry has not seen this much change since the introduction of mass market paperbacks. Books are, more and more, just a commodity to be sold and distributed in bulk. 

Technology companies have entered the picture like hungry sharks and are making big money riding on the back of publishing to sell gimmicky electronic gadgets. If you believe the advertising, ruining your eyes on a cell phone screen is cool, reading a paper book is not.

Who is paying attention to the needs of book-loving customers amid the chaos? Who still treats books as something of value rather than mere commodities? Who does not need an expensive market study to know what readers really want?

If you guessed the answer to all those questions is your friendly, local bookstore, you have been paying attention.

Now for the million-dollar question: who is best in the best position to help bookstores stay open? 

 



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Rick Townley

Rick Townley was a bookseller before switching to electronic publishing with The New York Times, Reuters, Grolier and others. He is the author of a humor book, For Boomers Only – Exploring Life in the New Millennium, a supernatural novel, Stepping Out of Time, and numerous short stories. In addition to contributing to the Washington Times Communities, Rick is working on a fiction series called Stigma and resides in southern Alabama with his 7-year-old granddaughter, Chloe.

 

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