In the olden days we publishing people used to say we shouldn’t get into retail sales because we owed it to the bookshops to direct all business their way. Now that the bricks-and-mortar bookselling business is in crisis we apparently feel it’s fine to pile it on and kick them while they’re down.
This is provoked by The Digital Reader‘s piece laying into HarperCollins after their announcement that they are transferring their retail, direct-to-consumer site to Bookshout.
I want to take issue with the assumptions behind both of these paragraphs.
It’s true that once upon a time we did stay clear of retail because we knew that the proper division of labor was “we create the books; they sell them”. That business model had evolved over a couple of centuries and had the advantage that we all knew where we stood. There were always occasional exceptions: a bookshop which arranged to have a local interest book printed, or a publisher who’d retail this or that product. One of my responsibilities in my first job in publishing was, among many other things, our retail sales. We would sell direct to the public items which were too boring for bookshops to bother with. These were mainly University publications: Statutes and Ordinances, Members List, Exam papers, and most sexily the University Diary. Several things have happened to make this division of labor redundant: a reduction in the number of bookshops (caused no doubt, at least in part, by the following), the invention of the Internet and Amazon’s development of a killer retail system, the development of digital printing, the growth of e-books, an explosion of out-sourcing, the escalation of rents and other costs. Publishers are not trying to get into retail sales nowadays as a means of oppressing the independent bookshop. They are doing it in response to Amazon, whose size gives it power which threatens the very existence of the publishing industry. Publishers have moved on from their paternalistic attitude towards bookstores, and are now flailing out against the common “enemy”. The fact that the flailing may knock out the occasional bookseller is seen as unfortunate — but, of course, collateral damage happens. We didn’t mean to bomb you, Médecins sans frontières. The fact that we did so is an unfortunate side effect of our noble struggle. Now of course this doesn’t make it OK; but in desperate times we all do desperate things.
HarperCollins may well have had a lousy website, as The Digital Reader suggests, but that doesn’t mean they were wrong to try to sell their books direct to the reader, or that the failure of their site means that all our industry’s efforts are over. In fact if their site was that bad, I’d see that as grounds for optimism. If a lousy site failed, might not a good one succeed? In fact there are many publishers who are able to direct-sell their books very well. Some can count on retail standing orders which take care of up to a quarter of their first printing quantity. There are lots of things that have to be done in making a retail sale which are almost invisible when you are dealing with bulk sales to a wholesaler or retailer. But to make up for that extra effort (cost) there’s the 50% or so discount which you’d have had to give to Amazon. Small scale may help here: giant publishers have giant investments in the infrastructure devoted to scaling out books in the way we’ve always done it, and switching from carton-based logistics to one-off distribution can be wrenching. The fact that as an industry we have “failed to address the remainder issue” seems utterly irrelevant in this context. Does The Digital Reader perhaps mean returns, rather than remainders? With the ability to print shorter and shorter runs gifted to us by the digital printing fairy, remainders are hardly the problem they used to be. They’ll never go away — we manufacture lots of book intentionally for the remainder table. As long as there are bricks-and-mortar bookstores, there’ll be reminder tables. People love the idea of a bargain. In effect it’s just another sales channel. Returns are an intractable problem: everyone would like to stop them but nobody can afford to be the first mover.
Amazon’s site is of course wonderfully efficient and nobody can realistically expect to compete with them and win. But total victory isn’t essential. Selling some of your books direct to customers at a small discount doesn’t have to be your only revenue stream. It’s just the jam. I wonder if Amazon really want to keep on controlling book retailing — I bet they have other better businesses they prefer, like cloud services, and general retailing. Of course Amazon could fight publishers on direct-to-consumer sales, refusing to sell the books of publishers who compete with them, but this doesn’t seem in any way certain to happen, and is contrary to their “the customer is always right” rhetoric. (Though they have of course taken down sell buttons before this.)