The endangered bookstore

The sickliest part of the books business is the shops that sell them

Mar 31st 2010 | NEW YORK | From The Economist print edition

 

THESE are not easy times for booksellers. Borders, a big American one, ditched its boss in January and has closed stores, but is still at risk of collapse, some analysts say. The British chain of the same name, which it once owned, failed last year. Barnes & Noble, the world’s biggest bookseller, appointed a new boss last month to help it confront the triple threat of the recession, increased competition and e-books.

 

The struggles of booksellers can be explained in part by a surge in competition. More than half of book sales in America take place not in bookshops but at big retailers such as Wal-Mart and Target, which compete to peddle bestsellers at ever steeper discounts. Online retailers, too, are wreaking havoc. In 2009 Amazon sold 19% of printed books in North America, reckons Credit Suisse, compared with Barnes & Noble’s 17% and Borders’ 10%. By 2015, the bank estimates, Amazon will sell 28%.

 

Booksellers are labouring to raise their profile online and win back the customers they have lost. Barnes & Noble’s online sales rose by 32% to $210m in the quarter ending in January, compared with a year earlier. It has started selling its own e-reader, called the “Nook”, and digital books to go with it.

 

Will bookshops disappear completely, as music shops seem to be doing? Most are pinning their hopes on giving people more reasons to come inside. “Consumers will need some entity to help them make sense of the morass,” says William Lynch, the new boss of Barnes & Noble, which plans to put a renewed emphasis on service, including advice on e-books. Many shops have started to offer free internet access to keep customers there longer and to enable them to download e-books. Other survival strategies include hosting book clubs or other community groups and selling a wider variety of goods, such as wrapping paper, jewellery, cards and toys.

 

Independent bookshops face a particularly grave threat, because they are unable to match bigger rivals’ prices. Many are branching out by offering new services, such as creative-writing classes. BookPeople, a bookshop in Austin, Texas, runs a literary summer camp for around 450 children. Steve Bercu, the shop’s co-owner, says that independent booksellers can still thrive, provided they “reinvent themselves”.