Wednesday, January 26, 2011

Everything Must Go

Warning! Unless you're particularly interested in the book trade, this is a long, dull post. If you are particularly interested in the book trade, then you probably already know this...

I remember visiting the first UK branch of Borders, back in the late 90s and thinking that I had seen the future.

Compared to the average Waterstone's, it was bright and airy, with an exciting range of products (I was particularly impressed by the listening posts for CDs). The buzzword in those days was "lifestyle" and the whole ethos of Borders was to create a place where people could "hang out", meeting friends for a coffee, going to a poetry reading or listening to the latest World Music CDs.

A bit like being in an episode of "Friends".

Like most people, I had no idea that I was watching a firework in its final stage, releasing one last spectacular volley of flares. The new Borders store turned out to be one of the last examples of a type of retailing - large stores with huge stockholdings - that would shortly become an anachronism. Once broadband was introduced, internet shopping quickly reached the tipping point and those lovely CD listening posts suddenly seemed ridiculously antiquated.

I was completely wrong about Borders, but I was right about the internet. In 1997, during a drink with a senior figure in Ottakar's (not James Heneage, I hasten to add), I said that it was imperative that we launched an internet site as quickly as possible. He snorted and took great delight in telling me that only 1.5% of the population shopped online and that the figure would only change slowly over time, as most people still weren't comfortable with computers. I wish we'd bet money on it.

Over a decade later, the book chains all appear to be on the brink of collapse. In the USA, Borders are about to go bankrupt and whilst some commentators have blamed years of mismanagement, the truth is that they have merely accelerated the chain's inevitable demise.

Barnes and Noble had a strong management team and embraced the digital age, but it still wasn't enough. Recently Leonard Riggio, the founder of Barnes and Noble, joked "Sometimes I want to shoot myself in the morning."

On this side of the Atlantic, British Bookshops have just gone bust and the management team of Waterstone's have been congratulating themselves for only losing 0.4% in last year's like for like sales.

Given the overall decline in high street sales, -0.4% looks quite promising - certainly much better than its ailing parent company, HMV. But considering that Borders UK ceased trading at the beginning of 2010, it's a pretty dismal result. Waterstone's should have grabbed enough of the Borders market share to come up with some positive figures.

Now that Waterstone's is the last man standing out of the high street bookselling chains, it can only survive by closing its loss-making stores (of which there are a growing number). 20 have already been ear-marked, but I suspect this is only the tip of the iceberg (particularly if HMV are forced to sell the chain).

Nice poster, shame about the dumbed-down text. And where are the books?

It's not all bad news for Waterstone's. They still have a significant share of the UK market and there is a core of thriving, profitable stores that have many years left in them if they can free themselves from the shackles of HMV and return to their roots. But overall, I can't help feeling that the age of the chain booksellers was just a brief interlude in the long history of bookselling.

In an article I read recently, someone neatly summed-up the problems facing the bookseller:

The Seven Deadly Paradoxes of Bookselling:

1. The better the bookseller and the more representative their stock, the less chance they have of selling it.

2. The harder a book is to sell, the smaller is their reward for selling it.

3. (The converse, which is more deadly than it first appears.) The easier the book to sell, the greater the reward.

4. The sooner they sell their stock, the longer they must wait before they can replace it on the same terms.

5. In buying the season's new books for stock they must recognize at sight and sometimes at the sight of the jacket only - the merits of their contents.

6. Readers are increasing; purchases are dwindling.

7. The window is their most valuable, and almost their only, advertisement; to be effective it must be in the main part of the town. Few can afford that position.

You may be surprised to learn that these words were written 75 years ago, by Basil Blackwell in a title called "The Book World - a New Survey". Conditions may have changed since 1935 (in Blackwell's day, the enemy was the public library), but the basic principles are the same: sales can rise or fall; rents only go up.

Until recently, it looked as if it was a straightforward battle, with the high street chains losing a war of attrition against the supermarkets and internet booksellers. But just as we were adjusting to the new bookselling landscape, the Kindle suddenly appeared on the scene, shortly followed by the Sony e-Reader.

A couple of years ago I was congratulating myself for swapping high street bookselling for the internet. Little did I know how soon the goalposts were going to move again.

Keen to reduce their warehousing costs and stay one step ahead of the competition, Amazon have been aggressively promoting the Kindle. When e-books started to appear on Amazon's bestseller charts, they were accused of manipulating the figures to stimulate demand. But according to Jeff Bezos, millions of people now own Kindles and the demand is growing by the day, with Amazon selling around three in every four e-books.

In the UK alone, it is estimated that several hundred thousand people received Kindles for Christmas, so the tipping point has definitely been reached, but where does that leave the rest of the book trade?

This post is all ready far too long, so I'll be brief. Here are, in my opinion, the main issues facing the book trade today:
  • The decline of the high street chains will be accelerated by the advent of the e-book. However not all book formats lend themselves to the Kindle, or even the i-Pad. Children's books will contiue to thrive on the printed page, particularly books for young children. Paperback sales will dip sharply, but there will still be a market for titles with high production values. Bricks and mortar booksellers who can adapt to these niche markets stand more chance of surviving.
  • If the high street chains collapse, then publishers will find it increasingly harder to develop and promote the next generation of authors. Fewer titles will be published and first-time novelists will struggle more than ever.
  • Amazon are taking a risk with the Kindle. If the encoding of e-books is cracked, they could be downloaded and shared as easily as MP3s. If that happens, then publishers, agents, booksellers and authors will see a substantial loss of income.
  • With the advent of the i-Pad and its inevitable imitators, why would anyone want to buy a device that only reads books?
Where will it all end? Basil Blackwell saw difficult times ahead in 1935, but the Penguin paperback made reading more popular than ever. I suppose that ultimately, what matters is not where we get our books, or what format they're in, but the fact that we read.

BREAKING NEWS... In the three days since I posted this, Borders are trying to negotiate a $500,000,000 refinacing package and Amazon have announced that Kindle sales are now only 20% lower than their paperback sales. Also Waterstone's have asked publishers to reduce scale-down the new title orders and their head of e-commerce has resigned.


foxesatdawn said...

I logged on to buy a book from Amazon and thought I'd have a quick look at your blog first... 'Nuff said.

Steerforth said...

As we were saying the other week, about browsing...


JRSM said...

Depressing and alarming stuff. As for the cracking of ebooks, it's already happening. I have trouble feeling bad for Borders, though. In Australia they struggle on, but they charge 10% MORE for every book than its recommended retail price, which seems a weird business model.

Martin H. said...

Oo-er, I'm afraid I'm one of those several hundred thousand people who received a Kindle for Christmas. It's great for downloading classic titles that are copyright-free, but I would still want a book on the shelf, if I'd paid money for it.

About seven years ago, I did some postgraduate research which included a comparative study of broadsheet newspapers in electronic and print copy. The print won, hands down.

Would you believe, the word verification for this comment is 'wierd'. It almost describes the feeling of reading, without turning a real page.

zmkc said...

Booksellers can only sell what is produced by the publishers. Publishers seem to be inclined nowadays to publish things that are as near as they can get to the last thing that succeeded. This results in disappointing books. Those of us who have been burned once too often by buying highly praised novels that turn out to be not very good then turn to secondhand bookshops and the more reliable pleasures to be found in books published at a time when the publishing world seemed to have a more enterprising approach to new works. This also contributes to the decline of the market for booksellers: I buy lots of books but I don't think I'll be buying many new ones until I'm convinced things have changed at the publishing end of things. In short, at least part of the problem is the product.

Steerforth said...

Martin - it could also be "wired".

I can see the attraction of Kindles. If I wasn't able to obtain books for next to nothing, I'd certainty consider some sort of e-reader.

James - it's happening already is it? I'd better not buy a Kindle then.

MikeP said...

I have seen a lot of cataclysms in my 40-odd years in publishing, but this one is dramatic enough to make me glad that I'm no longer involved day-to-day in trying to make sense of it all. It was bad enough when Waterstones, Ottakars, Borders etc were in their pomp, trying to get a first novel off the ground - but then I can remember a time when you could guarantee to sell at least 2000 copies of the most sensitive, angst-ridden first novel to libraries, and look what's happened to them!

And yet, and yet...just as there is for every industrial mega-brewery there are half a dozen artisan breweries turning out great stuff for an appreciative local audience (and the same goes for cheese, bread, sausages etc etc), I do believe that writers and publishers have the tools and the technology to take matters into their own hands to an unprecedented extent. Print on demand, blogging, email even - all these can be used to find an audience. You could produce a book - The Steerforth Papers, say - and I could download a pdf to my iPad and pay you for the privilege, or you could produce an actual book 50 copies at a time. Once upon a time, when I was a hotshot publisher, I would have listened politely (and possibly taken you to lunch) and then equally politely shown you the door if you'd suggested such a Quixotic enterprise.

With a few obvious exceptions, books have
never been a sure-fire road to riches, which is why it never made real sense when the red braces brigade came crashing into the business. Personally, I'm quite glad to see the back of them - it's going to be tough, but I have a lot of faith in human ingenuity. I don't feel threatened by Kindles and the like - it's just another tool, and nobody's going to take my books away from me. The world is full of books I haven't read yet.

The Poet Laura-eate said...

I agree with everything you say on this subject Steerforth but would offer the following rays of hope.

While Kindles may be useful for travelling or those who live in exceptionally small homes where accumulating too many physical books is impractical, there are plenty of people of my acquaintance who cannot stand them. A 20 year old colleague studying publishing for example who thinks they lack 'soul'. A 23 year old graduate who feels he spends enough time looking at screens all day and sees a real book as a break for when he's had enough social networking and work--a-day screen work.

Sure they will have their lovers. But I also feel certain they will have just as many detractors and people who prefer the tactility and versatility of a real book and being able to see at a glance how far they are through it thicknesswise.

What bookshops could be doing to stay competitive however is installing print-on-demand machines (now as little as £16k each) to print specialist and out-of-print books for their customers at a reasonable rate and even 'Kindle download posts' for those Kindle enthusiasts who are less internet savvy. And many of the wisest ones have already diversified into events and any accompanying product merchandise.

As you will recall, cinemas seemed very perilous for a while and as if we would see the last of them. Then people realised that watching videos at home lacked the magic and sense of occasion that a cinema gave. It think there is a lot of hope that the smartest booksellers will realise that even if things are tough now, a renaissance will come. The question is how much further damage and erosion can they and the publishing world take until it comes?

Yes, I too thought Borders was terribly exciting when I visited the first one. It is still much-missed in Oxford.

Steerforth said...

zmkc - I wouldn't just blame the publishers. I think that there are elements in both publishing and bookselling who are simply looking for a fast buck and never think further ahead than the end of the financial year.

As Mike say, it's the "red braces brigade" who have ruined the book trade (I miss the launch parties!). I suppose EPOS systems didn't help - once you have hard evidence that Author X has only produced so much revenue in five years compared to Author Y, people in the trade become risk-averse.

It took ten years for Ian Rankin to break through. Today, he would have probably been dropped after the second or third novel.

Luckily, there are still enough people out there in the trade who are doing it for love rather than money - Dedalus, for example - and they all help to make up for the plethora of celebrity biographies and the Dan Brown/Stephanie Meyer imitators.

Steerforth said...

Laura - I'm glad to read that it isn't just people over 30 who are resisting the Kindle (and as someone said, they'll be no use at all when the oil runs out).

It's a shame about Borders, although I didn't like the fact that their branches weren't able to buy their own stock.

I met someone who worked at Borders and he said that it was great when it started, as it was run only US model and had a thriving events calendar. But then a UK management team took over and they never really understood the "brand". I certainly felt that the shops lost their sparkle after the first three years.

I agree that a really innovative bookseller should be able to survive. I quite like the idea of an arty cinema in Waterstone's Piccadilly - the shop's never made any money and that seems a clever way of attracting footfall and sharing the rent.

Print-on-demand machines? No! They need to buy their books from me ;)

televisiontakenote said...

The mantra in the (non-Waterstones) bookshop I work in is "there's no money in books."
I know I should be looking around for something more secure and better paid, but I love what I do and I love "working in the valley of the shadow of books," as Gissing put it. I'm worried about the future of the bookselling business - of course I am - but, you know, I knuckle down and do my best. I'm in no way exceptional either - bookshops have some amazing, dedicated, overworked underpaid staff in them who are working bloody hard for sales. If it were purely down to them, shops would prosper. We don't even hold much sway with regional managers though, much less outside forces in retail and technology.
Wish us luck!

Gill said...

And I came to read your as usual excellent post and smiled when I read the last comment you made ...

They need to buy their books from me ;)

Interestingly, I have recently searched your blog to see how to do just that ... and used google ... no clues : )

We typically purchase most of our books online because we are unable to find them in our local bookstores! (Ontario, Canada)


Brett said...

Interesting post and comments. I spent five years in the mid-80's working for an early "big-box" chain in Texas and Florida, "Bookstop", which would be bought by B&N.

The bad news for Kindle owners is that libraries and digital media vendors who sell to libraries, (at least in the U.S.), want materials in an open, industry standard format, ePUB, not Amazon's proprietary fork of the Mobipocket format.

The ePUB format can allow for free sharing, as in the case of copyright expired Google books, but can also accept a layer of DRM. Adobe's ePUB+DRM format is what OverDrive, the top library digital media vendor in the U.S., is using.

The Sony Reader, the B&N Nook, and Borders's Kobo eReader have all gone with Adobe, and all support PDF and ePUB. Owners of these eReaders can use the public library. Kindle owners are out of luck. Amazon owns their container.

Jim Murdoch said...

My wife bought me a Kindle for Xmas. It's not my first e-book reader - I had a Rocket eReader about 10 years ago - and I don't find the Kindle that different in fact I actually miss the Rocket's back light and stylus.

The Kindle is a very basic machine there is no getting around that. It can't cope with so much, like tables or tabs and although it does do hanging indents it tends to much them up (at least I haven't figured a way of formatting them right yet). And reading PDFs on it is pointless; I've been converting mine to MOBIs which helps but it destroys any tables.

We'll just have to see what the future holds but the only good thing I can say about the Kindle is that it has at least piqued the public's interest.

David said...

I have a horror of ebooks. While I can produce rational justifications till the cows come home (a "reader" is another layer between you and the book, real books smell better, you can arrange them on your shelves) etc I think it's the sheer idea of books, beautiful, civilised, civilising books, just becoming "content" on somebody's server. And I hate the idea that this will drive bookshops out of business, publishers will go wholly e, and I won't be able to get new proper books anymore. I'm already noticing that some of the new books I'm waiting for will only appear in paperback, especially those published in America.

Well, if they stop publishing on paper, I'll stop buying and content myself, as you say, with collecting second hand. Steerforth, I think that you current line of work has an excellent future in that world - curating the whole sum of human knowledge, before the new Dark Ages fall.


Anonymous said...

Oh Steerforth, what a sad commentary on our times! I try to buy books in an actual physical form, partly as a backlash against the technology of ebooks. As one of your readers commented, after using a computer all day, a book in one's hand is a treat!

I'm afraid I do order books online -- often from -- Though I live in America, I have very English tastes and a lot of the stuff I want to read isn't available here. So I order from Not cheap of course, but hey, I deserve some vices!!

Personally, I like the look, the feel, the scent of books, and have occasionally bought a book from a local bookshop just because the book felt so good in my hand. Take that, Kindle!!

Good luck with your online sales, Steerforth -- and may the actual book with pages one can turn with a finger never die!

Canadian Chickadee

Annabel (gaskella) said...

I too got a Kindle for Christmas. I read Moby Dick on it, and it was fine. But I don't intend to buy any books for it that cost more than a few pence. It lives in my handbag and means I have a free classic on the go whenever I need a book to read, and it is fine for that. I get on well with the e-ink, but keep forgetting to put in bookmarks of bits I want to refer back to - I've started reading the mega-chunky Les Miserables, so finding bits again is a must.

Your comments are sad, but as you say at the end - at least we're still reading which is hopeful.

Steerforth said...

Interesting to see that Amazon are now claiming that e-books sales are now only 20% lower than paperback sales. Is that in actual sales or volume, I wonder?

Televisiontakenote - I like the Gissing quote. It sounds familiar. Was it from New Grub Street?

I agree with your comment. The future of bookshops will lie, once again, with booksellers (not, I hasten to add, the grumpy, misanthropic ones who helped to make chain bookstores so popular!). The self-aggrandising, sales-driven regional managers of this world will hopefully disappear from bookselling (although in fairness I had a couple of wonderful regional managers when I was in Ottakar's).

Gill - Yes, I sell books, but I don't like to mix work and blogging, so that's why Google drew a blank. I'll write about books I find at work, but usually only if they're about to be consigned to oblivion.

Brett - fascinating stuff and yet another reason to hold back on buying a Kindle. I didn't know that libraries were so involved in this phenomenon.

Jim - Your wife's very generous. I just end up with gloves (although she'd argue that I'm a nightmare to buy presents for). I'm interested that you miss the backlight, when one of the Kindle's selling points is no backlight! I find the grey screen very depressing.

David - A curator for the post-apocalyptic age? All my life I've been beset by a lack of direction and now, at last, I have a vocation! It's a brilliant idea.

Chickadee - I can't see books completely dying, any more than film and photography has stopped people painting. It's just the mix that will change. What I don't like is our increasing vulnerability as we digitise everything. Where would we be if the power stopped?

Annabel - I love Les Miserables as much as I love Moby Dick (which is a lot). I suppose e-readers are great for out of copyright titles, although in the case of the Hugo, I'm quite fussy about what translation I'm reading.

The Poet Laura-eate said...

Amazon were on Radio 4 this morning saying that although sales of e-books had gone up dramatically in the last 12 months, sales of paperbacks had also gone up almost as impressively.

I like to hope there will remain space in the marketplace for both. If proper books disappear from our bookshops altogether I too shall retreat into the past and buy only secondhand books as one or two of your other commentators have threatened!

I will not be forced to spend my life looking at screens, much though I enjoy blogging. And aside from the soul and feel of books, there's the SMELL as Canadian Chicadee pointed out. Kindles must be so dull once the initial novelty has worn off - almost an item to make you start devaluing books. They never vary in texture, thickness and tactility or smell, do not as yet reproduce illustrations or graphs reliably and human beings are very tactile creatures. Why else has online supermarket shopping never really taken off? Because unless it's a box of cornflakes shoppers want to see and feel that avodocado!

At the risk of sounding paranoid I feel disturbed by how extra layers keep being put between humanity and reality, ostensibly to make life easier. I feel a blog posting coming on! ; - )

Jason Crabtree said...

Another factor that has made bookselling a perilous business for authors and publishers is the discounting phenomenon. Wholesalers have demanded ever increasing discounts from publishers which has the knock on effect of reducing rewards to authors, whilst also reducing profit margins for the publisher. Amazon are as guilty in this as the money they expect for taking books on makes it a loss-making exercise for small publishers with small print runs. So I don't buy books from Amazon. Or Waterstones, who are equally demanding in terms of discounts. (I lie - just bought a new COD but that was an exception.) My book buying code is "Support your local independent bookshop" - how they survive is thanks to the dedication of the people who work in them. As for e books, no thanks - it's the touchy feely printed book for me... And let's see the return of the Net Book Agreement!

Anonymous said...

Poet Laura-eate: So true about the need to actually see a book and to pinch the avocados! What a great analogy.

And Steerforth, so true to point out that where are we going to be when the power goes out and the kindle crashes? My old paper copy of Vanity Fair is still readable, even during a power outage if I have a candle. So to my way of thinking, the kindle can't hold a candle to a real book!

Canadian Chickadee

Steerforth said...

Yes Laura, I can see a future with quirky, independent high street shops and internet chains.

I don't think many high street chains have a future - the retail property rents mean that they can never compete with the internet. Only clothes stores like Primark and food retailers will endure. Probably.

Jason - I was a HUGE fan of the NBA. It created a level playing field in which booksellers could only outdo their competitors by stocking a superior range or offering better service. Books were also priced more realistically. But the moment the internet appeared, its days were numbered.

If the NBA hadn't been scrapped, several chains might have survived for longer, but today, vast numbers of people would be buying their books from some offshore internet seller. Once you have a global market, it's hard to legislate nationally, isn't it?

Chickadee - "A kindle can't hold a candle..." - it's catchy. I like it!

televisiontakenote said...

Steerforth - yes, it is from New Grub Street, which of course paints a rosy picture of toil in the literary world.
Lawks, books are brilliant though aren't they?

Steerforth said...

Yes they are brilliant, and I love New Grub Street, even if (or because) it isn't the most cheerful read.

It's central message about personal integrity versus world success is still relevant.

Junie said...

"I remember visiting the first UK branch of Borders, back in the late 90s and thinking that I had seen the future."

I had the same experience in a Borders here in the American heartland.

After the first pleasant impression had receded, I wasn't too thrilled. I like browsing through books while standing in claustrophobically small aisles full of step-stools, stacks of old volumes, the smell of leather and the flicker of tired fluorescent lighting.

These days I do most of my book buying online, the rest at thrift shops. There are no used book stores of the kind I love within 100hundred miles of where I live now.

Steerforth said...

Borders was very seductive at first appearance, but it was still a corporate retail chain and from my point of view, as a UK bookshop manager, I was horrified by the lack of autonomy their branches had.

When I managed bookshops for Ottakar's, I was responsible for buying most of the stock and had complete control over the pricing and displays. They trusted me to know my local market and the result was that every branch had its own distinct identity.

Borders tried to have the best of both worlds. They used their events calendar to creat a "local" feeling, but in reality the senior management were just retailers who didn't trust their shop floor booksellers enough.

How awful that you'd have to travel over 100 miles to find a good secondhand bookshop. Although more used books are being sold online, nothing beats the serendipitous discoveries that come through browsing. If you ever come to England, I can recommend several places.

Anonymous said...

A fascinating post. It's interesting to read so many comments about the experience of reading and owning a 'proper' (whatever that is) book and so little about the appreciation of the content - which is really the reason we buy a published text, yes? It's still the same on an e-reader - it will still transport you to another world or immerse you in another way of thinking. Steerforth is right to say that ultimately what really matters is that we keep reading.

E said...

I know nothing about the book trade but as a reader I worry about the dominance of Amazon. Once they control virtually the whole retail market they could raise prices and even more worryingly dictate publishing too.

I wholeheartedly support my two local, independent booksellers. Diversity is a good thing.

Junie said...

"How awful that you'd have to travel over 100 miles to find a good secondhand bookshop. Although more used books are being sold online, nothing beats the serendipitous discoveries that come through browsing."

Yes, as someone very susceptible to the tactile appeal of books, I agree. But as someone insatiably curious about the past, I love the websites that offer full views of copyright-free books. (That's how I read The Diary of a Nobody, complete with the hilarious illustrations.)

"If you ever come to England, I can recommend several places."

Thank you! I can't think of anything better in the bookish way than getting bookstore recommendations from you. As it happens, my friend and I made plans just a few days ago to visit England once she retires in 2015, which gives you several years to brace yourself or alternately, to disappear into the vastnesses of cyberspace.

Steerforth said...

I'll put the kettle on and warm the pot.

Anonymous said...

what's your opinion of world book night?

Steerforth said...

I'm not the right person to ask, as I'm furious whenever anyone gives me a book.

I'm reserving judgement. Like many people, I was initially snotty about the Richard and Judy Book Club, then I saw lots of unlikely people buying Cloud Atlas and, even better, loving it. Since then, I've kept an open mind about these things.