When Barnes & Noble shakes, we know something is happening. After all, it is one of the largest and most powerful bookstore chain in the United States with 720 retail stores and was the first to introduce giant, supermarket-style stores with deeply discounted book that smaller, independent stores could not match. The company recently announced that it was putting itself up for sale in the face of declining profits and the challenges of a fast-changing market in the book industry.
An aggregate of factors has changed the way people buy books and read them. People used to stroll through aisles of books, looking through books they didn’t know existed and buying them. Now people go into online stores and do the same thing, except that the experience is totally virtual. Amazon.com led the revolution when its online stores gave people the option to shop online with its vast selection of books. The physical books were then shipped to the buyer. Today the experience with the advent of electronic readers like Kindle and Apple’s iPad meant that when a buyer has found a book he wants, it can be downloaded and is ready to be read instantly. You can now bring as many books as you like in one device and read them wherever you like, without the physical constrains of paper books. The release of Apple’s very popular iPad in April 2010 has spurred an increased interest in e-books.
Small and Nimble
In a surprising twist of events, it is the small and privately owned independent bookstores in the United States that are holding a competitive advantage in the face of growing digital market. They maintain a close community of readers who would not trade the personal element found in such associations for the anonymity of virtual bookstores. There are more than 2,000 independent bookstores by American Booksellers Association’s estimate. The stand-out factor for them is their ability to know their unique base of customers and what their likes are. However, the challenges remain as more people begin to shift from books-in-hand to books in electronic forms which are less expensive.
Digital Book Publishing Futurists
So what does the future look like for books, physical and otherwise. Sales of E-books is on an upward trend. In the first five months of 2009, e-books made up of 2.9% of book trade sales. In the same period in 2010, it grew to 8.5 percent. (Association of American Publishers). Carolyn Reidy, the chief executive of Simon & Schuster predicted that within the next three to five years, the company’s book revenue from e-books could be as high as 40 percent while it is about 8 percent currently.
With the uncertainties of a growing digital market faced by brick and mortar bookstores and publishers, enter companies like The Idea Logical Company, which present themselves as digital book publishing futurists with a special interest in the challenges and opportunities presented by digital change. This is an area not only to be taken seriously by giant retail bookstores but also for small independent bookstores and publishers. It could be extinction or a second wind, depending on if they can find that sweet spot in the digital market for a new generation of readers who grow up surrounded by digital media and are geared for it, mentally and physically.
What would emerging business models look like for brick and mortar stores as well as for publishers in the future?