The Shatzkin Files


Where will bookstores be five years from now?


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Upton Sinclair famously said that “it is difficult to get a man to understand something when his salary depends upon his not understanding it.”

I keep putting facts about publishing’s commercial realities that I think most of the smart people running things accept together with forecasts for the future that I think most of the smart people running things accept and coming up with a view of where we’ll be sometime pretty soon that I find very few people will accept.

We have definitely passed what Michael Cader has dubbed “peak bookstores” in the US. Shelf space for books is probably dropping faster than the number of stores as book retailers look for other items to keep their customers more satisfied and give those items space previously devoted to books. And shelf space available for publishers who don’t own bookstores is dropping faster than that because Barnes & Noble, the leading provider of bookshelf display space, is aggressively sourcing their own product both to improve their margins and to develop proprietary product not available to their competitors.

The fate of bookstores is an existential question for today’s book publishers (not to mention today’s booksellers!) Although it isn’t often stated this starkly, the core value proposition for the biggest trade book publishers is that they can put books on shelves. All of the rest of what they do (and often do quite well) — selection, editing, development, packaging, and marketing — is fungible. And usually not scaleable.

A big publisher and an agent would add to this list the “banking” function: putting up the money in advance for the author to write the book. But I’d argue that is also fungible (there’s lots of money out there looking for investment opportunities) so the publisher’s opportunity to be that banker is also dependent on the publisher’s ability to put books on retail shelves.

So, whether they know it or not (and, at the highest levels of the biggest publishing houses, they certainly do know it) the competitive advantage of the trade publisher is inextricably dependent on the survival of brick-and-mortar shelf space for books, which is distinct from total sales of books or even total sales of print books. You don’t need an organization of the scale and capabilities of a major publisher to reach customers through online channels. And, in fact, because the biggest trade publishers are horizontal in their subject matter, their size is more of a handicap than an advantage in competing for markets online.

We consume a lot of industry bandwidth considering whether the Nook and Kindle will survive the iPad and other tablets. I’d argue that it doesn’t really matter much to us. What’s important is that more and more people are reading on screens, that those who do reduce their purchases of books on paper (a fact recently documented in the BISG-Bowker study of ebook consumption), and that the digital book business is transacted online with very little potential role for a brick-and-mortar player (notwithstanding a wonderful 4-year old French fantasy video and a burst of naive optimism from an ABA executive at a BEA roundtable.)

(Digression graf: a much more realistic view of what ebooks and online shopping mean for independent bookstores today is a pessimistic one from the blog of one of the country’s leading independents, Northshire Bookstore in Manchester Center, Vermont. We know Google harbors the hope that they can provide meaningful inclusion for independents in the ebook marketplace. But even if Google’s efforts are successful, they don’t support the independent store, they support the store owner. There is a difference.)

So the race between single-function e-ink and more full-function tablets accelerates the movement from print to digital book consumption; and the move from print to digital book consumption accelerates the shift from store-based purchasing to online purchasing; and the shift to online book purchasing, whether print or digital, accelerates the reduction of brick-and-mortar shelf space.

And the reduction of brick-and-mortar shelf space increasingly challenges the core proposition of all of today’s largest book publishers.

A panel of publishing CEOs in June suggested a consensus view that 40 to 50 percent of book sales five years from now will be ebooks. Last week, another leading publishing executive, Gina Centrello of Random House, made the same prediction. I think, if anything, these predictions are conservative, but if we accept them as made, the implications are profound.

Half of sales being digital means that half is transacted online. That begs the next question, which is how much of the other half is online and how much is brick-and-mortar? The answer to that depends on two variables: the purchasing preferences of consumers and the ability of retailers to keep stores open in the face of declining sales. The two variables are connected: the further away from you is the closest decent store, the more likely you are to increase your purchasing online. And the more you purchase online, the more likely the store nearest to you is to close.

It is a conservative guess that 20% of print book sales today are made online and that ebooks are about 5-to-8% of total sales. That means that consensus estimates are that the ebook share will grow from 5-to-10 times over the next five years. That’s not unreasonable since ebook sales have more than doubled annually in recent years and 10 times would be somewhere between 2-1/2 and just over 3 doublings in five years. (Centrello said they went from 3% to 10% in the past year and, without knowing precisely what dates are meant by “the past year”, we can certainly expect more of an iPad effect in whatever is the “next” year.”)

That kind of ebook sales growth suggests an increasingly digitally-ept and digitally-comfortable reading public. That makes them more likely to buy print online too. So what’s a conservative estimate of the online share of print in five years. It can’t go up 5-to-10 times and leave any sales at brick-and-mortar at all. So let’s say (I’d say very conservatively), that print sales in 2015 are half online and that enough shelf space has survived to deliver half of print sales through brick-and-mortar. (I have to say as I write this that I have trouble believing it, but most people would have even more trouble believing me if I went with my gut on this!)

That math leaves print sales through stores at 25% of the total book sales. Today, if the stores’ share is 80% of print and we assume print is 90% of total book sales (using Centrello’s 10% number as a baseline in an attempt to be more conservative for this particular calculation), then we’re talking about a brick-and-mortar decline from 72% of the market today to 25% in 5 years! That’s a loss of about two-thirds from today’s sales levels! And that’s across all stores: chain bookstores, independent bookstores, and mass merchants.

I am not hearing anything in the statements of publishing or bookstore executives to suggest that anybody’s preparing for change that drastic. And I don’t see anything in the trend lines that suggest that we can avoid it.

Tell the truth. If I had headlined this piece, “Industry executives predictions mean sales of books through brick-and-mortar will decline by 65% over the next five years”, wouldn’t you have started out reading it assuming I was nuts?

I did a post three months ago called Why Are You For Killing Bookstores? which was on a similar topic, focusing on the see-saw relationship between ebook growth and bookstore survival. (When one goes up, the other goes down.) It was one of the most commented-upon posts in 17 months I’ve been writing the blog. I think that was a result of what could be a corrollary to Sinclair’s maxim which would go something like this: “it is very hard to get somebody to understand something when understanding it would highlight the conflict between two propositions that appeal to them.”

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  • ecolibris

    Mike,

    Thanks for a very interesting article! Although I agree with the trend you're describing, I'm not so sure about the timeline.

    For example, Gina Centrello's estimated figure of 50% market share in 5 years is based on the fact that “last year eBooks represented 3% of the market and this year it will be about 10%.” I'm not sure I see how this year's growth can be used statistically to predict a 50% market share in 5 years – It's one thing go from 2%-3% to 5%-10% and another thing to keep growing significantly on a constant basis when you reach bigger numbers. I wonder if she has examples from other industries to base this assumption on.

    In all, I think that we need to take these timeline forecasts carefully, as I'm not sure we have accumulated enough data to allow such a statistical analysis.

    • You're right that a statistical analysis alone can't predict future ebook
      growth. You have to have some intuition to add the mix.

      But Gina Centrello is not alone in making this prediction. In June, another
      couple of CEOs (Carolyn Reidy was one; I can't remember exactly who else
      joined in) said 40-50% in five years. I have talked to at least one other
      who buys into that prediction.

      And I think we might hit 50% faster than that. The pace of adoption is
      speeding up right now, not slowing down. You're right that at some point you
      hit a plateau, but you're also right that nobody knows — and statistical
      analysis won't tell you — where that is.

      So we're left with expert conjecture, which is, presumably, what we provide
      here on the blog.

      Mike

      • ecolibris

        Many figures are thrown around. For example, Carolyn Reidy, President and CEO, Simon & Schuster said that in 5 years 40% digital, David Steinberger, President & CEO, Perseus Books Group said it would be 25%, and some other CEOs indeed say it would be 50% within 5 years.

        Still, I got a feeling that these estimations are based too much on the enthusiasm and buzz of the early adopters, who are different from the mainstream market.

        Raz

      • There are two separate questions at issue here.

        The point to my post was that people in powerful places are predicting 50%
        ebooks in five years without (as far as I can see) really appreciating what
        that would mean to their ecosystem.

        A separate question is what ebook sales will be in 5 years. I take your
        point that we don't know and that you believe growth continuing at about
        half the current rate for five years is an overambitious estimate. On that
        point, I just don't agree with you. But nobody really “knows.”

        Mike

      • ecolibris

        Well, we definitely agree on the first point 🙂

        Speaking of that, I was wondering what you think of B&N CEO William Lynch estimate that Barnes & Noble expects to have about 25% of the digital book market by 2013, providing the bookseller with the opportunity to boost revenue by $3 billion to $5 billion. Do you find it realistic (especially the $3-$5 billion part)?

        I'm also curious when we'll see Borders and B&N coming out with a clear strategy for their brick and mortar stores that will address the online growing dominance of the business.

      • My own hunch is that there will be big growth in ebook sales through a
        million web sites. Today's major players will be competing to be the
        enablers of that commerce (I don't know if they see that yet.) I think it is
        impossible for BN.com or a Nook site to get that kind of market share;
        Lynch's estimates were explictly based on the notion that books will follow
        music in consolidating sales across a small number of super-aggregation
        sites (which is the popular idea at the moment and one to which I do not
        subscribe.)

        So if BN beats out Ingram and Kobo and any other player that sets up a way
        for all sites to have white-labeled bookstores, maybe they can get there.

        And I think B&N and Borders think they *are* addressing the future online
        dominance through their brick-and-mortar stores. If you asked them, they'd
        say they're really working on the synergies. But if you mean when will they
        publicly acknowledge that business could crash more than 10% or more a year
        on a same store basis (which is what these forecasts add up to), I'd say: 1)
        they honestly don't believe it is possible (and there, I think, you agree
        with them, right?) and 2) if they did think it were possible, they have
        little incentive to depress today's stock prices by being the ones to say
        so first.

        Mike

      • Mike, could you imagine under any circumstances a permutation of white-labeling in which Amazon partnered up with brick-and-mortar stores around bundles of Kindle as well as POD and other print content?

      • I don't really have any sense of what Amazon would do. I wouldn't even want
        to guess.

        But I will say that I don't think the brick-and-mortar competition to Amazon
        is where the action is or will be. There are countless subject-oriented web
        sites with communities that need book-like content curated for them. That's
        a big mutual opportunity for those sites and for the aggregators of
        book-like content.

        Mike

      • ecolibris

        Even if the ebook market share will be just 25% or 30% in 5 years and the sales go down “only” 6%-7% annually, brick and mortar bookstores are still in trouble. It looks to me like they put all their efforts on the digital front, hoping that somehow it will compensate for the decrease in bookstores sales and will enable them to continue in 'business as usual' mode.

      • I think your diagnosis is close to correct, but I'm not sure what else they
        can do except manage the shrinkage (which they will also be doing.) They
        have a legacy business still (in B&N's case) throwing off cash and (in
        everybody's case) requiring the management of overheads not easy to dispose
        of. They see brick-and-mortar shrinking and digital growing, so they're
        trying to grow the digital. What else *can *they do?

        Mike

      • ecolibris

        Since we at Eco-Libris look at these issues from a “green” point of view, I wrote lately a post offering B&N and Borders to consider a greener approach that might help them to deal with this problem.

        You can read it at http://ecolibris.blogspot.com/2010/05/is-there-….

        Raz

      • Thanks, Raz. I'm very comfortable with your agenda, but I'm not sure it does
        much to save B&N or Borders.

        Mike

      • It would be interesting to know, if any recalls, what Barnes & Noble might have predicted as their share of the online bookselling market 3 years out at the point when they followed Amazon into that sector some years back. Generally, second-mover status seems not to have been kind to Barnes.

      • That was more than 10 years ago (1999…?) And Amazon pretty much abandoned
        the ebook market shortly after BN did then. So they're the second mover (or
        3d or 4th, but not first…) for the second time. However, there is a chance
        for somebody to be the *first* mover to provide the White Label solutions
        which I'm thinking are the wave of the medium-term future.

        Mike

  • Warren Cassell

    A downer but realistic post about the future of bookselling with no white knight on the horizon.
    I assume this dystopian view will also apply to libraries and will that be the end of civilization as we know it?

    Bricks and mortar R.I.P.

    Warren Cassell

    • Jean Arambula

      NO, the libraries won't disappear. As JC said, “We will always have the poor…” Libraries are the only internet access for a large population.
      The only other alternative is mobile. Pew reports more young black males have cell phones than computers. Mobile is the future of reading.

      • Mobile is sure a big part of the future of reading. But not all those young
        black males with mobile phones have data plans. Data plans aren't cheap. The
        phone company sells plenty of “talk and text only” packages, I'm sure.

        Mike

    • The future of libraries isn't tied to the hip of the future of bookstores
      because funding sources are different. But libraries will be sensitive to
      how much book lending is getting done, and I'm guess “less and less of it.”
      And in some cases there might be opportunities for libraries to
      *replace* booksellers
      (actually *sell* books.) I am expecting publishers to have some problems
      with the idea of libraries lending the ebooks they're trying to sell. There
      will be turmoil in that sector, but it will be a different kind of turmoil.

      Mike

  • Smitty

    I think this is conservative, given the folks I am talking with who are buying iPads. Over the past 10 years working with students being introduced to eBooks as a requirement of their main professional course of study at the graduate level, I have seen resistance to digital books plummet and the expectation for more than “pages on a screen” increase. As the eBook becomes the norm, so will multimedia and other digital improvements over the pulp of today. And as these improvements take hold and enhance the communication between author and audience, the end of print (and, by extension, brick-and-mortar stores) will arrive – most likely as suddenly as the death of the local newspaper evening edition, and the local bookstore. Those businesses (publishing and booksellers) that cannot enhance their products or re-invent themselves to take these changes into account will become the RIAA/MPAA of the next decade.

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  • I love brick & mortar bookstores, but I absolutely agree with you, Mike—their future is looking grim, and the future is coming faster than most of us would like to admit.

    I know a lot of people who say they'll never give up paper books, but they tend to be people who've never held an e-reader in their hands. As the price of the devices plummets, I think the resistance will as well. I'm not happy about it, but it feels inevitable at this point.

  • Thanks to Mike for his continued insights on his vision of the future based on his pedigree (his father's books are still interesting and worth reading) and experience in the business (and thanks for sharing). As an indie bookseller for over 20 years, I have seen a variety of challenges arise – and been successfully overcome – but, as far as simply selling books as we have – the next 5 or so years may spell the end of the brick and mortar as we know it. For now, we will continue to sell books (and sales have been up this year over last) and do what we have done (nimbly curate stock and respond dynamically to our customers) for the past few decades…..

  • Extremely intelligent, ballsy post, Mike. Thank you.

    • Thanks for the extremely intelligent and ballsy compliment.

      Mike

      • De nada. Off emmittc's comment I just ordered your Dad's book and monograph and I am looking forward to reading them. In the process of looking them up I came across a number of baseball titles under the surname. Hats off to you from a long time SABR and Bill James fan and APBA and Strato vet who cut his writing teeth covering Thurman and Carlton in the Cape Cod Baseball League for 15 cents a column inch and 3 cents a mile (against my hitch-hiking expenses). I especially noticed the Spring Training guides and wondered if there may have been a happy time when the notion loomed as a sweet annual series that might even become lucrative, or at least allow you to deduct your fan expenses….

      • Yes, we did Baseball Fan's Guide to Spring Training twice. And yes, at the
        time, one of the great features of doing that book was enabling me to deduct
        my baseball-related expenses. When you have a chance, check out
        http://www.baseballlibrary.com, which is the quintissential Internet 1.0
        site (no participation by site visitors at all…but LOTS of great content).
        That's mine too, and it has hardly been touched for 10 years.

        Dad had two books. The Magnum Opus is “In Cold Type”. The monograph is “The
        Mathematics of Bookselling.” Both are excellent. You will see pretty
        quickly, I think, that my old man was smarter than I am.

        Mike

  • You're probably correct in your predictions.
    However, bookstore owners have themselves to blame. I don't see any of them out there coming to us small presses and asking us if we would like to sell our books with them.
    So far as small press owners are concerned, bookstores are PART OF THE PROBLEM.

    • I'm afraid that the bookstores couldn't save themselves with the small
      presses. Their problems are endemic.

      And (the view from here is) the small presses can only save themselves by
      being community-centric so they don't depend so much on the bookstores.

      Mike

      • Jean Arambula

        So true. Snake Nation Press has found a niche publishing writers who will market their own books and using POD services from printers. It is almost impossible to get our books in book stores, so readings by poets and writers is the only solution for sales. Amazon priced us out of that market; we list books there only because writers think they have to be on Amazon, but it means giving books away because we try to keep our prices reasonable. We also have started selling t-shirts.

      • Thanks for chiming in, Jean. Focus is really the key for a small player. (It
        is for a big player too, but they can get away without it for a little while
        longer.)

        Mike

  • Hi Mike – Thanks for spelling out so clearly what will likely happen and has no appeal (and much to fear) for conventional book publishers. A factor that makes both publishing and retailing less efficient/profitable, and therefore exacerbates the situation, is the practice of publishers offering books on a “returnable” or sale-or-return basis. My calculations, verified by a few realistic publishers and retailers, show that the book industry has about 20% inefficiency because it refuses to switch back to “firm sales” (as was the practice before 1930).

    With the looming reductions in in-store print book sales caused by the growing migration to sales online and of ebooks, making a switch to firm sales is the best strategy to mitigate the economic impacts. Will the major book publishers and retailers do the logical thing and switch? Following Sinclair/Shatzkin, likely they choose not to “understand” the implications because it doesn't “appeal” to them.

    thanks, cheers, Bruce Batchelor

    • The returns question is very complicated and I've written about it quite a
      bit. I think the ebook first publishers will initiate a no-returns strategy
      because they really can live without the merchandising effect of stacks in
      bookstores.

      But take heed of a point made by Bob Miller (formerly Hyperion, founder and
      formerly of HarperStudio, and now at Workman) when he addressed an audience
      in Canada. HarperStudio did try the no-returns model, but they found it came
      back and bit them in the butt. They had books they believed fervently would
      do quite well and they couldn't get the bookstores to stock them in quantity
      without returns privileges. That meant they lost a lot of sales.

      I think most publishers would do well to start *managing* their returns,
      which means *managing *their inventory. Many of the big publishers are
      getting more sophisticated about doing that. Smaller ones have a harder
      time, because managing means getting the stores to be responsive more
      quickly to sell-downs. And that's hard to do when you don't have enough of
      their attention to begin with.

      Mike

      • Hi Mike – Thanks for mentioning Bob's brave attempt to change sales terms. What he lacked was support from other publishers — even support by his own publisher, since it was only HarperStudio that was trying this. Yet I don't think he “failed” – what he did was demonstrate that a switch needs to be a joint decision by all (or most) of the major publishers and the larger retailers.

        Of course, we can simply wait five years and see who is left standing. If being smart is a characteristic of survival, we may then have executives who will choose to understand that they could be reaping profits by avoiding the 20%-of-sales inefficiency caused by “firm sales”. That's many, many $ billions being wasted annually that could be going to shareholders.

        However quickly we see a sharp decline in print book sales, I'm hoping that will mean a parallel decline in the number of books wasted because of returnability — over 1 billion annually now. Surely such environmental negligence has to catch up to the industry and be stopped someday.

        thanks, cheers, Bruce

      • Sorry, Bruce, I don't buy what I think is the gross oversimplification that
        just saying “no returns” creates efficiencies. It doesn't. It may cut down
        on “waste” (books shipped and returned) but it won't help publishers,
        authors, or booksellers much if it cuts down on sales by a greater degree.
        Other publishers following HarperStudio's lead wouldn't have solved the
        problem Bob spelled out: that he *wanted* to take the returns risk in
        certain cases to get more books in the stores for customers to buy. Because
        the marketing efforts he was generating would themselves be wasted if he
        didn't.

        I don't believe returns are the cause of the industry's problems and I don't
        believe eliminating them by fiat will not solve them. I repeat: they
        are a *complicated
        *challenge. Any *simple *solution is not likely to be productive.

        Mike

      • Man, you type fast! I agree, of course, about the *complicated challenge*, but disagree about this not being solvable by a *simple solution*. Remember the “Sinclair/Shatzkin” maxim, my friend. 🙂

        Back in 1995 when I pioneered print-on-demand publishing, all the existing publishers, retailers, even the equipment manufacturers such as Xerox and IBM, declared it was not feasible. Book publishing and printing are very complicated, they told me, and my *simple* solution wasn't going to work. For one thing, it avoided returnability, large publishing houses and bricks-and-mortar stores. Now hundreds of thousands of authors are using this process every year — likely there is over a billion dollars of activity here — and the big publishers and bricks-and-mortar stores are getting little benefit.

        It doesn't matter if a solution is “simple” or not – it matters if it is a better solution than what exists. If returnability was such a great approach, surely it would be dominant in other retail sectors — but it hardly exists outside of book and music sales.

        Keep up the great work, Mike, reminding people in publishing of the need to keep an open mind to change!

      • Bruce, there are certainly exceptions, but, in general, print-on-demand
        isn't nearly as good for publishers as it is for consumers, retailers, and
        POD suppliers (like Lightning.) That doesn't mean it isn't a good idea or an
        idea that has lots of utility, but it is still (15 years later) not a
        substitute for press-run publishing for a publisher that wants to make
        money.

        And, yes, I do type fast. I have my Dad to thank for that (and he never
        learned to type at all.) Someday, when I'm feeling narcissistic, I'll tell
        that story, which is all about *me*!!!

        Mike

      • OOps, that statement should have been:

        If being smart is a characteristic of survival, we may then have executives who will choose to understand that they could be reaping profits by avoiding the 20%-of-sales inefficiency caused by “RETURNABILITY”.

        sorry….

      • Doesn't really change my reply. The question is: how much can a publisher
        afford to lose in sales to actually find it profitable to eliminate 20%
        returnability? It is actually possible they'd be losing money if sales
        declined by 10%! They'd almost certainly be losing money if sales declined
        by 20%!

        And since there is no question at all that returns boost sales by some
        factor (although we don't know much and it varies by the book), if you were
        an agent, wouldn't you be steering your authors to the publishers that had
        returns and would maximize your author's sales, and therefore her earning
        potential?

        As I said in a prior reply, this is *not* a simple question.

        Mike

  • Ines

    Mike, I am sure that if your predictions are correct, this will affect writers. What would recommend for the first time writer, who is not yet under the conflict of two propositions? How should I read the signs of the future? Publishing is getting to be next to impossible. Should I go straight to an e-book and leave the printing job to my reader's laser printer?

    • Ines, you should *still* go “straight to a publisher” if you can find one.
      And you'll still make more money if the publisher puts you in book form and
      prints plenty (we're still in a place where 90% of the books sold are
      printed, although we won't stay in the place very long.)

      What you have to do if you're a writer is to start building your own
      audience. You have to blog. You have to blog on the same topics consistently
      enough so you can build an audience. You have to answer your comments. You
      have to link to others and encourage others to link to you. You have to
      collect email names (one way is to enable people to subscribe to your blog.
      Nearly 1000 people now subscribe to The Shatzkin Files, and I know who all
      of them are — or I can, if I look at my Feedburner data.)

      I am trying to peer into a 5-year-ahead future and figure out where we'll
      be. We aren't there yet. There are still 700 or more B&Ns and 400 or more
      Borders stores, plus Books-A-Million and a couple of hundred (maybe) quality
      independents who want to sell your printed book. Don't deny them the
      opportunity to help you build your brand!

      Mike

      • The only problem I see with this is the fact that it COULD take 5 years to get your book on a shelf the traditional way. If you factor in starting from scratch, finding an agent, then finding a publisher, going through the contract signing process, and the up to 2 years it takes to get a book on the shelf. Time's almost out by that point for most new writers to benefit.

        If someone has an agent NOW, or gets lucky and finds one and a publisher very fast, they might be able to ride the last three years before it gets really bad. (But within 2 years it's already going to be worse for print publishing to a point where many will question the wisdom of big NY publishers in the first place.)

        But if they went with a publisher to get in on the last bit of NY publisher glory, then their rights are tied up on that sinking ship. Also their ebooks will be overpriced which is bad for them in the face of an emerging digital market.

        I just don't see the benefit of chasing the money tree that's about to die and stop producing.

      • Guest

        The point to me of going along a traditional path to publication for a book (whether print/digitally or both) is that I buy on-line more than from bookshops now, but I don't buy stuff which is 'self-published'. Mainly because quite frankly most of it is absolutely dire. Not necessarily just the story itself, but how it is written and structured. Of course some stuff which is released by publishers is also dross! But my view is that 80% of the self published stuff I've seen is ghastly, and 20% is great, whereas that roughly reverses for professionally published stuff. Not least because decent editors make massive positive impact on what ends up as the final book.

      • First of all, apologies to Zoe for not having responded to her comment when
        it was made. Sometimes I just don't quite keep up…

        The point about how long it could take from contract to publication is
        absolutely right. But the checks would still be cashable!

        Anne Rogers' point is interesting. Until now, it has been received wisdom
        that consumers don't pay much attention to publisher brands. But does what
        was true when bookstores were providing curation, weeding out the
        untrustworthy stuff, still apply when the consumer is wandering a garden
        where the weeds look very much like the vegetables?

        My sense of this is (and my advice to publishers has been) that big
        publishers should be stressing their genre-specific brands (and many of them
        are) to build consumer awareness of what they curate and filter.

        And I'd imagine that self-publishers will get better and better at creating
        brands that at least *sound like* they're legit!

        Mike

      • Awilliams918

        Sorry Guest, I don't get it. If, according to you, you “don't buy stuff which is 'self-published'” how on earth are you able to determine “80% of the self published stuff I've seen is ghastly, and 20% is great”? You must have incredible pysychic powers.

      • Good point!!!

        Mike

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  • I think you make some very good points here. It's like they understand on some level that this stuff is happening, but they just refuse to let their minds take it to the logical conclusion. It seems like they're in the denial stage of grief. Isn't bargaining next? Or have they already started that stage?

    To anyone on the outside, this is all painfully obvious. To people on the inside and at the top, this also seems painfully obvious. It seems like “middle management” are the only people who haven't been informed (But isn't that how it always is?)

    I would say that right now is the time if someone wants to go indie to just do it. In five years instead of chasing after a market which will hold little financial benefit for the author, an indie can have built a very strong platform.

    I realize for whatever reason most writers, even if they're good, can't seem to get good editing and cover art, and some have no idea how to socially network. But, for those who can do it, I say do it. The opportunity isn't getting any better, and as more and more people see this opportunity, it's just going to get harder and more competitive.

    But the more the industry changes like this, the less I understand those scraping and clawing to get NY publishers, unless it's about their own vanity and validation. Which is hilariously ironic.

    • Zoe, there are still deals to be had from major publishers. It takes a lot
      of self-published sales to compensate for even a $10k or $20k advance.

      And even among the smartest people, present realities are much more powerful
      than future conjecture.

      Mike

      • Great point, Mike, offering “better a bird in the hand” advice. However, I wish to clarify that — according to one of the US's top and most prolific literary agents in conversation with me privately — the average advance these days is $1,500. That is NOT a typo. Apart from a half-dozen publishing giants, the reality is that mid-size and small publishers are no longer willing to gamble up-front money on hefty advances. The authors are forced to share the risk… and are expected to shoulder much of the marketing work as well, if they hope to get any contract at all.

        My sense is that the $10k and larger advances you hear about are going only to established and celebrity authors.

        No one in the business wants to talk openly about this, of course, especially not literary agents! But it is a symptom of challenging times.

      • Thanks, Bruce. You're right about the indie publishers offering low
        advances. Actually, few agents will really do those deals. They literally
        lose money negotiating the contracts! This is part of the traditional world
        of publishing falling apart.

        Mike

  • In his delightful book “The Fabric of Reality,” physicist David Deutsch takes several major theories from disparate fields of knowledge and assesses what the basic reality of existence is really like if in fact all these major theories are in fact simultaneously true.

    So — quantum mechanics, information theory, evolution…what happens if these different fields' most basic theories are looked at as fully interfacing with one another?

    Deutsch decides it means that there are an infinite number of parallel universes branching off from one another at all times (this is Hugh Wheeler's “Many Worlds” hypothesis). This theory is unpopular, to say the least, among the scientists in the fields whose favorite theories Deutsch combines.

    Now, Mike, it seems to me that in your blogpost you are doing the same thing. You are asking what is the reality if several well-accepted ideas are simultaneously considered to be true, and then you derive some specific conclusions. You argue it's important to do this because these well-accepted ideas are not being properly considered simultaneously. You say these ideas are not generally considered simultaneously because the existing market participants can't bear to look at the inevitable conclusion if in fact all their well-accepted ideas are simultaneously true. Your proposed outcome involving the collapse of storefront bookselling is very unpopular among the industry players whose accepted ideas you combine.

    My problem with Deutsch's process, and with your process in your blogpost, is that in my opinion this process ignores the possibility that there is a pesky error in one or more of the “best ideas” or the “top theories” of the leading experts.

    More that that in your own case. Your proposal posits continuity in reality. And my experience of 30 years in bookselling is that Chaos theory holds. I believe in discontinuous change. In fact, since the very inspiration for your post is the assumption that things are changing very quickly, I find it surprising that you leave no room in your prediction for the completely unexpected! Why don't you consider that far from the *most* logical outcome being what will happen, that in fact what is more likely to happen is something completely novel that no-one can derive from current information??

    Why don't you consider the imperfection of knowledge?

    You may say, “What use is prediction, then? How can a person wishing to predict the future reasonably predict some left-field, totally unpredictable new effect?”

    By considering the basics.

    I live in the physical world, I have a physical body. As long as this is true, I can be lured to physical bookstores.

    The issue is not whether bookstores will survive, but rather how individuals who choose to be real-world storefront booksellers will take advantage of the nature of opportunities that are available to them.

    I have spent decades trying to bring about the collapse of Barnes & Noble. I am a very weak player, but I am confident that I am part of the collapse of Barnes & Noble, today. This battle has been terribly challenging, but those of us who are fighting it should not be ignored. We are finally winning. Give us some credit! People are more and more alert to the Buy Local movement. It's becoming fashionable. That means there are business opportunities coming up right now for people who want to serve their neighbors with fun real-world out-in-the-street activity with their real-world physical bodies. I'm talking about new indie bookstores.

    In other words, the weakening of superstore chains will come a resurgence of storefront indie bookselling. eBooks will not stop this. eBooks are DIFFERENT than this.

    It's all about high-level innovation in indie bookselling practice. Brand new, discontinuous models. I just remind people: think restaurants. Make your new indie bookstore as amazing as an amazing restaurant. Make it hot, fashionable. Make it a hit. Make it kicky and splashy. In such places as these, the customers make purchases, because they feel excited. This weekend in my bookstore, I sold hundreds and hundreds of books to very excited buyers. They were taking home a piece of their experience in this physical place. We bookstore lovers can do this–we can keep making wonderful storefront bookstores and handselling fabulous physical books.

    In 1975, when there were about 60 breweries in this country, did anyone expect that there would be 1,500 craft breweries 35 years later?

    Indie bookstores are on the verge of a huge resurgence and we will save print publishing when we do it.

    Andy Laties, Author
    “Rebel Bookseller: How To Improvise Your Own Indie Store and Beat Back The Chains”

    • Hi Andy –
      Thanks for contributing an unexpected, and delightful vision.

      I'd like to build on it a bit, if I may. Your bookstore/cafe/neighborhood-place-to-be/entertainment/social-action enterprise would work better buying its book inventory at a higher discount off retail than today's 40%. More logical to buy at 50% like all other products. To accomplish this, you will buy books on a non-returnable basis, just like you buy all other inventory items.

      Because your enterprise is the place to be and is trusted as an arbitrator of taste in printed book content, so it will be trusted to “hand-sell” ebook content. You recommend a particular “book” and the customer buys it from you in printed or eBook format — whichever suits him or her. Google is building this in-store (and website) eBook sales capability for you right now.

      The customer is coming to your place for entertainment (while in the store/cafe), and for content to enjoy later. Likely you will be recommending (and therefore selling) all sorts of e-entertainment: eBooks, music, videos, games, whatever.

      As a customer, I want to come to your store/cafe/place, Andy, because of the total experience. As an aspiring writer, I would be coming to have you help realize my vision of being a content creator — because your indie store has the means of (or the close connections to) the editorial, design, production and distribution functions for indie publishing in print and eBook formats.

      Likely we will have a multitude of *solutions* emerging. Yours seems a real contender.

    • Andy, I *am* calling some things which aren't happening yet, or at least
      aren't obvious yet. Verticalization. Ebooks separately curated and sold
      across thousands of web sites. And pretty much the end of a business that is
      still pretty profitable for a lot of very big companies. Believe me, I am
      still considered pretty far “out there” by the establishment.

      And as a fellow citizen of the physical world and even a fellow enjoyer of
      bookstore, I can't make the leap that being such guarantees the existence of
      physical stores. I loved going to recorded music stores too. I can't find
      one anymore (except House of Oldies down on Bleecker Street.) What we want
      and what we like isn't a guarantee of what we'll get.

      And while I agree that those few bookstores that survive ten years from now
      will have done something incredibly creative to do so, I don't think doing
      something incredibly creative is a guarantee of survival. Lots of very
      creative bookstores have already gone down, and more will over the next
      decade.

      And you and I have worked at cross-purposes. You've been trying to bring
      about the collapse of Barnes & Noble. I have, from time to time, been trying
      to work with them on their thriving and surviving. (As my wife says,”Barnes
      & Noble is what stands between us and choosing from the books selected for
      us by Walmart.”) I think B&N will be the last ones standing with any kind of
      bookstore chain, unless the new digitally-conscious management throws away
      the last two decades of brilliantly efficient supply chain work they've
      done. I suspect they'll get boosts as others that will remain nameless for
      the moment bite the dust.

      But, as you pointed out, there are no guarantees, particularly based on past
      performance.

      And thanks for the lesson about philosophy and physics.

      Mike

      • Andy Laties

        Thanks for this civil and engaging response. It's quite helpful for me to understand your positioning in the industry. Have you noted that you, who have such a specific position, might yourself be blinded to things you do not want to know?

        Barnes & Noble is a particular kind of player. My favorite historical comparison is to Mudie's lending libraries in England, in the 19th century. When these kinds of players are weakened, all manner of creativity bursts forth. You may be unaware of the extreme chilling influence that the existence of B&N has on thousands of would-be indie booksellers. Your wife's comment about the choice between a world with B&N and a world without B&N ignores the reality that absent B&N, many prospective booksellers would enter the marketplace.

        That said, I feel it's important to learn from one's competitors, and I always teach indie bookselling by reference to the behavior of Len Riggio and B&N. The company's success was, for a time, unparalleled. I don't know if you've read my book, but here below is a favorite footnote therefrom, which sets up the simple truth that you can predict a steady state in the future, but you cannot know what new things will happen afterward. You may be right that five years from now shelf space for books will collapse catastrophically in this country — but it may be that ten years from now there will be more than ever. Remember that the membership in the American Booksellers Association went from 2,000 to 5,000 between 1983 and 1991. No-one in 1981 predicted this would happen.

        The footnote about how to live as a business person:

        “I’ve learned a lot from Barnes & Noble. Here’s Fernand Braudel absolving Len Riggio and me: 'I might be tempted to suggest that a major element in capitalist development was risk-taking and a taste for speculation. In the course of this book, the reader will have noticed that reference is often made to the underlying notion of gambling, risk-taking, cheating; the rule of the game was to invent a counter-game, to oppose the regular mechanisms and instruments of the market, in order to make it work differently—if not in the opposite direction. It might be fun to try and write the history of capitalism within the pa-rameters of a special version of games theory. But the apparent simplicity of the word game (gaming, gambling) would quickly turn out to cover a multitude of different and contradictory realities—forward gambling, playing by the rules, legitimate gambling, reverse gambling, playing with loaded dice. It would be far from easy to make these fit a single theory.'—Fernand Braudel, The Wheels of Commerce: Civilization & Capitalism 15th-18th Century, Volume 2 (New York: Harper & Row, 1982): 578.”

      • Civil discourse is what we do here on this blog and at The Idea Logical
        Company. And disagreement is common. The most important service I deliver to
        my clients is speaking truth to power. I told people at Barnes & Noble in
        2002 that I thought they should be figuring out how to use their incredible
        infrastructure to make smaller stores work, because the huge aggregation was
        losing its attraction. I still think I was right; they probably still think
        I was wrong. That doesn't change my respect for how they execute.

        As for the “one theory that fits all”: you'll never find me advocating that.
        My father was a socialist; I'm a liberal Democrat. I measure just about
        everything against two values: commercial sense and public interest. I find
        a lot of ideas that come from all over the spectra of business and politics
        that succeed or fail against those criteria. In fact, I named my company The
        Idea Logical Company as a way of tweaking my father (whom I loved and
        admired, but who was a staunchly ideological person and I am staunchly not.)

        There *were* a lot of good and creative booksellers that thrived in the
        period you identified (post 1980) and were done in, not by Barnes & Noble,
        but by Amazon.com. And the only reason that B&N is the bugaboo that you can
        blame for the dearth of independent stores (rather than Borders or
        Books-A-Million or Hastings or, for that matter, Krochs & Brentano's) is
        that B&N does what they do very well, or at least better than all the
        others. They pay attention to detail: to their leases and locations. And to
        their inventory and store set-ups. Fifteen years ago, Borders had A, B, and
        C stores and B&N had A, B, and C store *sections* so they could uniquely
        configure stores to their local marketplaces. That's just an example; there
        are a million more.

        I like the people I know at Barnes & Noble (and I haven't consulted with the
        stores in several years) but I definitely fear for them. I like many of the
        people I know at the big publishing houses, but I also fear for them.

        My beliefs (which are clearly not *hopes*; if one wants to be serious about
        trying to predict the future, you have to make an ongoing and conscious
        effort to separate what you *want *to happen from what you *think *will
        happen) about the future for B&N and the big publishers is rooted in my
        view of how information will be accessed and delivered. And I don't really
        think paper and static forms have very much to do with that. I think a
        “bookstore” will be like an antique store or a curiosity shop 20 years from
        now. Yes, we'll have them, but most of the functions they have served for
        years, and still serve today, will be much better delivered in other ways. I
        also believe in verticality and I think everything presenting information in
        a horizontal offering (which, alas, includes The New York Times as well as
        Random House, Barnes & Noble, and the Tattered Cover) will find it harder
        and harder as time goes on.

        So, as for being blind to (rather than blinded by) things I don't want to
        know, I'm as human as the next guy but I have given conscious thought to
        avoiding that trap for many, many years. I have built a business with more
        than a few clients who have explicitly hired me to challenge their thinking.
        That doesn't give me a pass, but I was fully aware of the point before you
        raised it.

        Mike

      • Andy Laties

        I would say that more people agree with you than with me. I think my ideas are disdained by a sizable majority of our colleagues in publishing and bookselling.

        I share your respect for my colleagues through the industry. I think that your projection of an implosion has a lot of truth in it — but my expectation is that some percentage of the tens of thousands of brilliant and highly trained book lovers who get displaced by the transformation of the industry will find themselves working together to open their own indie bookstores. I mean — will all these displaced booklovers honestly abandon the industry? What will they do next, if they don't stay in the field of books? What is their future?

      • Whoa! What the hell does *that* have to do with it?

        Jobs don't exist because people want to do them. Stores don't exist because
        people want to run them. Was I earlier being accused of wishful thinking?
        What's this if not that?

        There will be lots of online opportunities for people who love books to
        curate, comment, and promote. How highly paid those opportunities will be is
        an open question. But there are lots of avenues for creative self-expression
        that are not remunerative. Ask any quilter.

        Mike

      • Andy Laties

        Consumer society certainly allows for the idea of the manufacturing of demand. I ran a storyhour series at a store I helped found in Brooklyn, called Vox Pop. When I started the series in 2007 I had very few people showing up. But over the course of 18 months I built up a regular following. We won a Best of New York 2008 Award for one of the city's “Best Under-The-Radar Kids' Hang” destinations. If I hadn't wanted to run those storyhours, the program wouldn't have happened, and the market wouldn't have materialized around me. Now Vox Pop has many children's programs, throughout the week, and I am completely uninvolved.

        I believe exactly the opposite of what you wrote. I believe that jobs do exist because people want to do them, and that passion translates into income and profits. Customers materialize when they encounter that passion. Stores do exist because people want to run them. The market responds to this creative action of those store-operators.

      • Richard Howorth

        Mike –

        Thank you for such a good blog, and for the lively and civil thread from you and your commenters.

        I, too, believe that, as Andy has said, and as the independent bookseller Charles Haslam once wrote to me not long after I opened my store 30 years ago, “bookstores grow where their owners want them to.” That proposition holds true in many industries, and I think remains applicable to the independent bookstore even, and perhaps especially, in the environment that you fairly logically predict.

        The biggest threat to indies and all other booksellers, and perhaps this is more germaine to your post today, is related to the survival of publishers. In the 1980s, when, incidentally, indies were popping up all over the place, most publishers were very profitable — easily double-digit profits, year after year after year. This phenomenon made publishers attractive for acquisition by large multi-nationals, so there were lots of deals and mergers at the time. Soon bean-counters ran everything; assets were sold, people were laid off, etc. (Today some of the healthier publishers are those few that remained privately held.)

        This trend was quickly followed by the early 1990s roll-out of the big-box chains, which publishers believed would, as the chains claimed, expand the market (which did not happen), and publishers invested heavily in the roll-out with new store incentives, placement allowances, and the like.

        The two largest chains together quickly became larger than the ten largest publishers combined, then amazon rapidly developed into a customer formidable enough to be listened to when they spoke to publishers of their needs. Soon publishers' profit margins were in the traditional independent bookstore range — 1 or maybe 2 percent.

        From this position, today, publishers are making huge investments in a digital platform that will cannibalize sales (no, this will not expand the market, either) from their existing platform — spending more dollars as sales volume declines. I am not saying this isn't a direction in which they need to go; I just wonder how well they will withstand the trip.

        I think our store will remain vital in our community, and we continue, however slowly, to use digital technology in our plan to serve our community and thrive. But I have a hard time picturing that if publishers fall off the cliff.

      • Richard, thank you very much for an “alternate” narrative about the last
        three decades in the book business. Obviously, we're all aware that
        publishers' lives have gotten much more difficult over the past 10 or 15
        years. I tended to blame (in no particular order) competition from used
        books, competition from the long tail, and competition from more and more
        cheap and free content as the principal culprits. I hadn't thought about
        what the impact was of the consolidation to three major retail accounts that
        could squeeze their margins, but I have no doubt you're right that it is
        important. Now we have deleveraging effect of shrinking shelf space to add
        to the pressure.

        Mike

      • Doesn't it seem like some major players in the publishing industry are really warming up to indie bookselling in the past year or two?

        I am standing at the cash register of Eric Carle Museum Shop and all around me people are piling up stacks of books to buy. Pop-up books, large-format picture books with coated paper pages and full color, boxed sets of miniature books, books to be used as gifts (physical, wrapped in paper gifts), books embossed gold award stickers on them, shrink-wrapped books… And, I just placed a large order for specialty educator books, imported from an obscure publisher in Italy, that are available almost nowhere in the country but at my storefront and also via a highly specialized website, in preparation for an educators conference here in three weeks.

        This isn't business that will be displaced by eBooks. When the big chains are vanishing, all publishers can look to the indies like me who will be expanding into the huge gaps in the market vacated by the chains. I'm psyched!

      • Richard Howorth

        Andy, I don't know about psyched, but you're right to be optimistic. Regardless the ferocity of the digital movement, the slow movement and buy local campaigns — which ten years ago people only talked about — have become quite real. If you put your Google alert on “independent bookstore,” over time you will find a lot of comments from people who wish they had one in their community or people who would support one if they did. These trends are evident in the Verso Survey done by Jack McKeown (http://www.versoadvertising.com/inverso/?tag=ve…).

      • Thanks Richard. I do wish that your marvelous 1998 study about Independent Bookselling and Real Market Growth were still available. It might help reassure the big publishers that any muscle they put behind the growth of indie bookselling right now would be worth their effort. I know that Jack McKeown has proposed the founding of an investment bank specially to back indie bookstores. He thinks the biggest corporations that would benefit from a major bounceback of the indies should be the capitalists there.

  • Thanks, Bruce. Yes, I have been buying non-returnable for the past 14 years (using gift-store accounts generally) and I simply mark unsold stock down. Mike Shatzkin is absolutely right that big superstore chain companies cannot do this because it's the exact opposite of their business models. (They are accepting huge shelf-placement payments for the excessive stock they are buying–that kind of payment is a critical part of their income stream!) But small indie bookstores CAN do it, and I HAVE done it with good profitability for many years. This is a form of competitive advantage that I have versus the chainstore companies.

    Last year I spent a lot of time learning about the microbrewery resurgence over the past few decades. At the same time indie bookstore numbers were crashing, microbreweries were booming. Indie bookstore operators were failing to learn the lessons the microbrewing innovators were offering up. Indie bookstore owners can be such stick-in-the-muds! This is why it's critical to reach out to the younger generation of bookseller, to encourage entry into the indie bookstore field. These younger booksellers aren't scared of digital anything — they take it as a given. That's what's needed for developing hot new models. All the most interesting new bookstores I know of have been developed by people under the age of 35. I have found myself floored by some of the innovations today. There is a bookstore in Massachusetts whose payroll in funded in large part by the Commonwealth of Massachusetts–this bookstore is staffed by troubled teens. Wow. A business model where your payroll line is a source of income!!

    • Hats off to imagination and flexibility. But, Andy, your stores and the ones
      you describe are outliers. They're curiosities. They're not a retailing
      infrastructure that will support much publishing.

      Mike

      • Andy Laties

        Hmm. Funny that you use the work “outlier” for those of us testing out new forms of bookselling. That's quite a compliment according to Malcom Gladwell. It points to the idea that the unexpected can suddenly become the norm.

      • No, that's not what Gladwell said at all. It points to the exceptional: like
        Wayne Gretzky. But it is not at all disparaging (except of your notion that
        many people can do it, or that many people will succeed trying.)

        Sometimes the things we do best are easy for us and damn near impossible for
        anybody else.

        Mike

      • Andy Laties

        Take total wages earned by all hockey players in one year. Take Gretzky's one year wages. What percentage of the total hockey-player payroll is Gretzky? Presumably, this one many earns as much as dozens or even hundreds of other hockey players. That's what Gladwell means. The outlier gains the power. Take Barnes & Noble — wasn't it an outlier at one time? Wasn't Amazon an outlier back in 1996 when it was a weird company that bought tiny ads at the bottom of the front page of the New York Times? Before the venture capital came in?

        In other words, I believe that you are encouraging me to open a chain of children's bookstores. If I do, and I get rich, I'll give you a cut.

      • That's another matter. What Gladwell was trying to demonstrate was that
        Gretzky became Gretzky (and Bill Gates became Bill Gates, etc.) because of a
        confluence of talent and luck that singled them out at a relatively early
        age to lap the field. It's about the single talented individual that is the
        exception, not the rule.

        Yes, maybe you *should *open a chain of children's bookstores (although I
        still wouldn't bet on it if you did…) But the point I meant to make by
        calling you an “outlier” is not to infer that anybody else can have the
        success you have had because you have had it. Maybe you're not an outlier;
        maybe you're just a typical schmo and anybody who wants to do what you can
        do can do it.

        But I doubt it.

        Mike

      • Andy Laties

        Like many people in the industry, I have been having variations on this “end of books/end of bookstores” conversation every day.

        This morning I was talking with a leading children's book illustrator about this set of issues, and I said something I sometimes do find myself saying: “If you're going to spend your life working with children, you'd better be an optimist.”

        Luckily for me, after 33 years working with children, I am still an optimist. That means I am prepared to say that in certain ways, every individual human being is an outlier — an outlier at being him- or herself. In my book I make this point using a Ralph Waldo Emerson quote: “Nature arms each man with some faculty which enables him to do easily some feat impossible to any other, and thus makes him necessary to society.” This is the kind of things kind first grade teachers say to children, but by the time we are all grown up most people have gotten used to not hearing it very often. I think it would be nice if everyone heard it, all the time. I really do not think there is any such thing as “a typical schmo”. I used to teach in the ABA booksellers schools and I met hundreds of booksellers from towns across the country, and none of them were typical schmos. Some of our stores lasted for three years, some for ten years, some for 25 years — and every bookstore does close at some point, yes. But then someone else comes along and tries their own hand at serving their neighbors as booksellers. It's such a venerable profession.

        I think you are right about your verticality opportunity. I simply think the new world you are predicting will co-exist with the world I think will be resurgent. But gosh, I am afraid I'm repeating myself, and I certainly acknowledge that 20 years from now in a world nearly devoid of bookstores I may owe you a drink for tolerating this bit of excessively optimistic cant I'm plastering on your non-existent wall.

      • You're welcome to the room on the wall. For one thing, you write very well.
        Thanks.

        Mike

      • Andy Laties

        It is difficult to maintain a posture of disagreement with someone as nice as you.

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  • Andy Laties

    Thanks for this civil and engaging response. It's quite helpful for me to understand your positioning in the industry. Have you noted that you, who have such a specific position, might yourself be blinded to things you do not want to know?

    Barnes & Noble is a particular kind of player. My favorite historical comparison is to Mudie's lending libraries in England, in the 19th century. When these kinds of players are weakened, all manner of creativity bursts forth. You may be unaware of the extreme chilling influence that the existence of B&N has on thousands of would-be indie booksellers. Your wife's comment about the choice between a world with B&N and a world without B&N ignores the reality that absent B&N, many prospective booksellers would enter the marketplace.

    That said, I feel it's important to learn from one's competitors, and I always teach indie bookselling by reference to the behavior of Len Riggio and B&N. The company's success was, for a time, unparalleled. I don't know if you've read my book, but here below is a favorite footnote therefrom, which sets up the simple truth that you can predict a steady state in the future, but you cannot know what new things will happen afterward. You may be right that five years from now shelf space for books will collapse catastrophically in this country — but it may be that ten years from now there will be more than ever. Remember that the membership in the American Booksellers Association went from 2,000 to 5,000 between 1983 and 1991. No-one in 1981 predicted this would happen.

    The footnote about how to live as a business person:

    “I’ve learned a lot from Barnes & Noble. Here’s Fernand Braudel absolving Len Riggio and me: 'I might be tempted to suggest that a major element in capitalist development was risk-taking and a taste for speculation. In the course of this book, the reader will have noticed that reference is often made to the underlying notion of gambling, risk-taking, cheating; the rule of the game was to invent a counter-game, to oppose the regular mechanisms and instruments of the market, in order to make it work differently—if not in the opposite direction. It might be fun to try and write the history of capitalism within the pa-rameters of a special version of games theory. But the apparent simplicity of the word game (gaming, gambling) would quickly turn out to cover a multitude of different and contradictory realities—forward gambling, playing by the rules, legitimate gambling, reverse gambling, playing with loaded dice. It would be far from easy to make these fit a single theory.'—Fernand Braudel, The Wheels of Commerce: Civilization & Capitalism 15th-18th Century, Volume 2 (New York: Harper & Row, 1982): 578.”

  • MosesSiregarIII

    I think you're making a very strong argument, Mike. Immediately after I read this, I wrote a long blog post as a response (in agreement).

    If it's kosher, here's the link:

    http://sciencefictionfantasybooks.net/michael-s

  • Shelley

    I feel guilty here because my work is only on the Internet (not my fault!) and I'll include the title, “Rain: A Dust Bowl Story” because the Disqus page puts the “submit” button off the bottom of my screen–anyway, my suggestion is, what would Seth Godin say?

    • You'll have to ask him. Say hello from me when you do. He's a nice guy.

      Mike

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  • Hi Mike,
    Another interesting post. There is a truth in everything you said; but, what about the intangibles? And I believe there are some present where bookstores are concerned.

    The bookstore phenomenon (and I will call it that) will, I believe, be just like the movies and grand old moviehouses (although the grand old architectually-blessed moviehouses are gone) the movies and movie multiplex houses are still here and doing a bang-up business (you've seen the grosses these new movies are doing) even after the onslaught of TV's…then VHS players…then DVD players…then Blockbuster rentals…then computers…then movie-watching mobiles…etc, etc.

    So, what are these intangibles? Not sure I understand them all, but, one thing is for sure, there is something about the ambiance of going out to a movie theatre and watching a movie (especially with the younger crowd still and some of all ages)…Well, there is something about the ambiance of a bookstore: the smell of it, the comfortable lounge areas, the coffee and simple foods section and other areas you can use for computing, reading, studying and chatting with a special companion!

    A bookstore also has something you won't ever be able to get online…new printed books…with atmosphere (ambiance).

    So, one thing a bookstore can do is re-create itself as an “in-place” to be. An invitation only place? Why, you almost should have to RSVP to get in, for goodness sakes!

    Yes, I think the intangibles and immeasurables will keep the bookstores alive…They'll just have to go through that transition stage publishing is going through now…

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  • You are so right about the sense of unreality with which commentators invested in the dead tree distribution model peer into the future. A symptom of this is the debate (hovering about the agency model) concerning the extent to which low-priced eBooks “cannibalize” the market for print books. The automobile cannibalized the market for horse-pulled buggies. The light-bulb cannibalized the market for gas-lamps. And the prices on those inventions were for a long time HIGHER than the prices for the devices they replaced. Price isn't driving anything here. Technology is doing the driving.

    • In the largest sense, Ed, I agree with you. I switched to ebooks more than a
      decade ago and I am not any more price-sensitive about ebooks than I was
      about print. If I want to read it, I buy it.

      But in a narrower way, I see the point to the publishers' concerns. There
      certainly are people who make their buying decisions based on price. The
      wider is the differential between ebooks and print (and I mean, in general,
      not on a title-by-title basis), the more people are inclined to switch. As I
      tried to say in this post, the faster the uptake of ebooks, the quicker the
      demise of bookstores. And the quicker the demise of bookstores, the quicker
      the demise of general trade publishers.

      So it isn't stupidity — it is self-interest — for the big publishers to
      want to slow this down as much as they can. They can't slow it down much,
      but maintaining higher ebook prices does slow it down some.

      Mike

      • Oh yes, I'm with you. I didn't mean to suggest that the price unrest comes from ignorance. And of course, any desperate grasp at self-preservation always makes sense, especially to the man at the helm of the sinking ship. But the main theme here is, we agree, futility. Ultimately, we are talking about trying to use bail buckets on the Titanic. All the best, – Ed

      • Ed, your rhetoric is so familiar. I have been arguing with your friends and allies for decades. You were wrong in the 60s, and wrong in the 70s, wrong in the 80s, wrong in the 90s and now in the 10s you are still wrong. Titanic? Are you unaware of the success of the Cruise Line model of transportation? Bookstores are not going away. Printed books are not going away. We are being forced by competition to get better and better. We are smart and we are fighting back with energy, capital, motivation and education. We have a mission. We have oodles of young recruits who reject your idea of electronic dominance. Are you unaware of the burst of handmade zines and beautiful small print-run high-concept books that are a huge part of youth art culture? Coast to coast, this is big. It's simply that you aren't paying attention because you're paying attention to something else. Do not count us out simply because you don't care about our existence. We exist. We are working hard.

        In fact, the reality that you are ignoring all of us in the real-world, physical bookselling and publishing resurgence has no impact on us. We know you think we are a dying breed, and we don't care about your opinion. What surprises me is to be having a conversation with you on the blog of Mike Shatzkin! I honestly hadn't realized Mike had moved so far in your direction — saying that bookstores are going away, and that print publishing is really in trouble as a model of activity.

        In 1985 when I opened my first bookstore, I had a computerized inventory system. A competitor was quoted in the newspaper saying that my bookstore was not as good as his, because my bookstore's books were selected by a soul-less computer, while his bookstore's titles were selected by booksellers.

        This was absurd. And your position is wrong in the inverse way. I utilize technology creatively to advance my bookselling practice. Every new technological innovation–far from damaging my viability and sustainability as a bookseller–HELPS my viability, INCREASES my sustainability as a realworld, storefront bookseller. These things you say will kill me — eBooks, POD–these will all help me to make my realworld booksellers stronger.

      • Dear Andy: You'll be surprised – Although my logic leads me the other direction, I hope you are right. I think brick & mortar book-selling, especially indie book-selling, to be one of the most civilized and civilizing of pursuits. I also personally love the texture of printed and bound books. My strong belief is that the traditional model is done-for, but I won't cry if I am proved wrong. Absolutely the opposite. All the best, – Ed

      • Thanks for this sweet response to my bluster, Ed.

        Publishing and bookselling are very funny industries, of course. The intersection of culture and commerce. In the past decade commerce has been visibly winning — but culture has been bubbling beneath. Back in 2002 the National Endowment for the Arts reported that literary reading in American had declined a lot in the prior decade, and many people commented on this and argued about the validity of the numbers. Unremarked was the statistic in the same report that said creative writing among Americans had INCREASED by 30%.

        I would say that this rate of increase has accelerated. More Americans than ever are engaging in creative writing. It's technology that has enabled this.

        I don't think that creativity is a narrow thing — when you engage in creative work, it spills over. I think entrepreneurial energy and creative arts are interrelated. This is why I think bookstores have a future — because they are an arena for creative action, and all areas of creative action are fair game for engagement by creative Americans. Why declare any form of creative activity off-limits? Bookselling is a way that I live as a creative person in the world. I like it. It makes me feel useful. What's more, I can actually make a living off of it! When the market changes, I have to change, for sure. I just tell people: Come on in, the water's fine.

      • I've been busy this morning and not replying, but Ed has done a very good
        job of saying what I think needs to be said. We aren't *happy* about seeing
        bookstores go away, but all current trends and logic say they will, despite
        the best efforts of creative and well-intentioned booksellers trying to
        forestall their demise.

        Mike

      • Andy Laties

        I've been thinking about this response all day, Mike and Ed. You say you aren't happy about seeing bookstores go away, but you accept the inevitable and are simply trying to understand the way forward honestly.

        But I am an activist. I think that if you want the world to be a certain way, you should try to make it that way. (At least if you are informed by good will towards others…) So, the real question is that is in play here is whether I and my friends will inevitably lose our good fight. Mike, you cited Chris Morrow's blogpost on the Northshire Bookstore website. You seem prepared for their battle to be a losing one. I simply don't understand that kind of thinking. It's fatalistic. Why should the world be seen as an arena of inevitability? Doesn't a person's effort and action count for anything in the world? You are a baseball fan. You surely don't think that players and teams have no impact on game outcomes. Suppose certainly players and certain teams fight against insuperable odds and win the World Series. All the commentators said they couldn't do it, and then, surprise, sometimes the underdogs actually win the big game. In fact, this is what everyone wants to happen, right? So, why not root for underdogs? And why shouldn't we underdogs try as hard as we can to win? What is the reason that I should listen to your opinion about my activity failing inevitably? Rather, I should ignore you, and battle the forces that seem to be causing me trouble. I will do this. I will be the winner in this battle. The independent bookstore movement will be the winner — we will make a major contribution to American culture during the decade you think we will vanish from the scene. I will do everything in my power to make this happen.

      • Just as you should do, Andy. Mike and I and others have our informed opinions, but we are not Gods. You, with years of experience in the business, have your own informed opinion, and obviously a great deal of smarts and commitment. If I were you, I'd ignore us too. Ultimately, none of us can (or should) steer by any lights other than our own. And I do, sincerely, wish you success. – E

      • To Ed's remarks, I say “hear, hear.”

        Each of us has to pursue our own vision. And nobody (at least not I) is
        saying that there will be *no* bookstores five, ten, or even twenty years
        from now. I am just saying that the book retailing landscape will undergo
        transformational change. Maybe you have the foresight and skills to
        transform right along with it.

        Or maybe I'm just wrong…(but I doubt it.)

        Mike

      • Thanks for enduring my comments. I appreciate the conversation so much. I'm heading into the preparation of a second edition of Rebel Bookseller, and this is the first time in a few years that I've had a head-to-head exchange with leading industry people who are staking out what amounts to the opposite stance from the one I am taking. It's extremely interesting that this opposite stance from the one I take has changed. Once it was “Indie bookstores are going away because of chain superstores.” Then it was “Indie bookstores are going away because of Amazon.” Now it's “All bookstores are going away because of eBooks, however maybe quirky outlying indie bookstores will be found here and there.” I had no clue that this opinion existed. It is so encouraging to find a leading voice like yours saying, in your video lecture on your website, to the Hachette staffers, that the book superstores are being squeezed from both ends and they are going away. You don't want the superstores to go away, but you say they are going away. And yet you hold out hope for quirky, strange, outlier indie operators like me — it's just that you think we won't be a significant part of the book industry, enough to distribute adequate books to save the big publishers. For my own purposes, that's terrific. I don't care about saving the big publishers. Disaggregation is fine with me. Thanks so much for your hard thinking about this subject.

      • Good points being brought up here. I'm following this conversation as an ex indie bookstore owner and present writer. I was one of those nerds who built up a bookstore from nothing and thought it would be a lifelong vocation. My store is still standing, but someone else owns it now. Long story. Point is, I agree that the small indie store in the right neighborhood environment will be likely to survive as a cultural necessity, if the bookstore owner is flexible and innovative. Indie bookstores hook into the “experience” aspect of books, while big box stores hook into the “object possession” aspect of books. That's a conversation on its own, but my comment is more from the writer's perspective. I've been navigating online writers communities and I've come to the conclusion that there are a lot of talented writers creating great work, that are sort of out to sea at the moment. Traditional publishing was never an easy process in the best of times. Yes, the selection process is meant to weed out inferior works, and yes, there's a lot of crap writing online. But I'm coming across authors who really have something to offer, and that's who I'm talking about. We post online, on our blogs and on other people's blogs, we get published in small online lit magazines, we Twitter, we Facebook. We build our following one comment at a time. Some of us self publish and sell ebooks. We still query agents and publishers. A lot of us have material we'd be happy to see printed on real paper and displayed on a bookstore shelf. But what I'm seeing is that there is a disconnect between the people who create the works and the people who make a living selling books. That disconnect is the publishers. Someone mentioned the 3-5 year schedule for getting a paper book on the shelf. In the current landscape that's absurd. We know from seeing print on demand options that the actual creation of paper books don't have to take that long and doesn't have to have a huge amount of material waste involved. So where does this timeframe come from? Mostly it's the publishers and their archaic gatekeeping system. The old system is dying in the middle, while book sellers and writers stand on opposite sides of the shore. If I was still a bookstore owner, I'd be trying to connect with the source of my product. As a writer, I'm still sifting through the options, but more and more, it's looking like going straight to the reader is going to end up being the only way new authors can get started.

      • Hi Pamila,
        Check out the Hub City Writers Project bookstore. Writers can be booksellers in storefronts if they work together!
        http://www.hubcity.org/bookshop/

      • That's very interesting. Beautiful bookstore that illustrates perfectly why people want to go on having stores. Barns & Noble, etc., can't provide that experience. It's always the people involved who make a business, any business, special. The Writer's Project is interesting, I'll have to read into it further. Thanks for the tip. I think it actually speaks to one of Mr. Shatkin's points, however, which is the scalability. It's clear from a cursory glance that there are passionate, creative people involved in Hubcity who have really devoted themselves to developing a literary arts center for their community. The reference to Outliers – as in a confluence of the right people and the right circumstances creating an unusual likelihood of success, seems to apply there. Are there enough of those kinds of small stores to provide viable outlets for writers? Could there ever be again? I'd like to hope so because I love bookstores! But right now, writers are in the position of having to develop our own ways to find and reach out to our (potential) readers, because we see the shifts in the industry, we want to be read, we want to eventually be paid for our work and we're frustrated with the traditional process. Discussion about booksellers and publishers (generally speaking) just leave out the writer, as if it really doesn't matter whether we can make a living or not. The vast majority of us don't make a living solely from our writing. The vast majority of us want to and will work toward that goal. Writers have always had to strive. We create something that has to be delivered to others in some form, whatever delivery option allows us to get our work out, and be paid decently for it, is going to take off.

      • Others may differ, but my own hunch is that writers have to build online
        networks to reach people directly, *or* rely on publishers to help them
        reach people online, *or *rely on publishers to deliver them to a network of
        stores (as long as it lasts.) None of these are mutually exclusive; the best
        strategy is to do them all.

        Mike

      • My fiancee is a graphic novelist who is posting her current book online as she creates it (paints it). She uses an existing network of webcomics sites — what links these thousands of websites together is a company called Project Wonderful. This is an advertising system whereby each webcomics site displays banner ads for other of the participating webcomics site. Each webcomics site participating purchases banner ads on other webcomics sites, and in turns is able to sell banner ad space on its own site. Higher traffic sites sell their banner ad space at higher prices. Lower traffic sites can get much less money for banner ad space on their sites. My fiancee currently has about 10,000 pageviews per day. Banner ads on her site do not go for very much, and she is spending $20 per day to generate the 10,000 pageviews. Her traffic is gradually growing and she hopes to reach a tipping point as the plot of her graphic novel becomes clearer and she gets more of a fanbase. Her son is also a webcomics artist, and has run his site for ten years (since he was in highschool). His webcomics site (on the same network as his mom's newer one) has hundreds of thousands of pageviews per day, and he currently has to spend very little on banner-ads, instead he can sell banner-ad space at a pretty high price….he is making money selling ads on his webcomic.

        So — here the big winner in terms of model is Project Wonderful, but the writers benefit because they can build their followings.

      • Hard for me to tell how representative of industry thinking is anything I
        say. My sense is “not very.” But I'm glad you get value from it.

        Mike

    • Yes, the automobile cannibalized the market for horse-pulled buggies, but the drivers remained, the destinations remained, the roads improved. Are you sure you are analogizing bookstores and books to the correct portion of this array of elements in the social contruct we call transportation. Maybe the “bookstore” is analogous to the “road” not to the “buggy”. Maybe the “bookseller” is analogous to the “driver”. Maybe the “p-book” is analogous to the “destination” (not to the “buggy”). You have to be careful with these analogical analyses! A p-book is not merely a means of information delivery! A bookstore is not merely a locus of transaction between p-book buyer and p-book customer. And you have completely left out the professional bookseller, in your analogy.

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  • Scott Nicholson

    Brilliant conversation. The way I look at it as an indie author (former trad), you can put your energy into a shrinking pond or you can wade into the expanding ocean.

    Scott Nicholson
    http://www.hauntedcomputer.com

    • Just check out what they'll pay you for entering the shrinking pond before
      you make that decision.

      Mike

  • Patrick Hogan

    I've thought about your provocative post from the bookseller's perspective and the publishers. My perspective has been that publisher's selection certainly, and to a lesser extent development, marketing are distinctive competitive advantages. I think they still are, but yet concede that value has diminished with the participative Web. Saying the core value of publishers is putting books on the shelf is indeed stark and also harsh. Can you call it a core value when it delivers no benefit to the publisher? Only subsequent industry turn benefits the Publisher or the Bookseller. Perhaps this is tangential to your main point. Publishers have a indirect benefit by stocking shelves because it preserves the distribution channel. Publishers, like companies in music, journalism that have faced the e-challenge earlier, the reality is smaller revenue stream from e-books.

    • Patrick, the publishers *are *pretty good at marketing, but if they didn't
      have the ability to distribute the books, they couldn't get paid for the
      marketing. And whatever they do with marketing is done for the most part
      with labor, not with contacts or a built-in customer base. That means it
      isn't scaleable.

      Mike

  • Interesting and insightful as usual, Mike. Tell me, are they including in their numbers the effect of accelerated brick-and-mortal store closures?

    How many bookstores can survive a 20% drop in sales over the next two years when they're having a hard time keeping the doors open with current sales? When they do close, and customers suddenly find that their nearest bookstore is not five miles away but fifteen or more, for that area it won't be just a 20% drop. It might be an instant 80% of the readers switching to online books and ebooks as they conclude that it doesn't make sense to drive so far out of the way when they can have a book in a couple days with free shipping – or instantly.

    Along with other factors (which you have eloquently written on in previous posts) it could turn into a catastrophic cascade of conversion to online buying long before that five years have passed.

    Ted

    • Ted — You seriously underestimate my colleagues and myself. We are professional booksellers. Many of us have been working in bookselling for many years. I saw sales at my first store, The Children's Bookstore in Chicago, drop by 50% in only three years, when six superstores opened on the North Side of Chicago in the mid-90s. I did not get out of the business. I opened a new store, in a new location and made more money than I ever had before. It turned out I should have changed my business model a few years before I was forced to! The tough new competition finally forced me to figure out how to make more money as a storefront bookseller. In the following years I have opened several more bookstores, all of which are still in operation, owned by various people (one of these is owned by 210 neighbors of the store!). Yes, existing bookstores will close. But existing booksellers will not die, and many will open new bookstores to fill the void. These new stores will be capitalized by local real estate owners, among others–local real estate owners benefit by the presence of physical bookstores since it kicks the value of their properties up to have a bookstore in the neighborhood.

      When bookstores close, other bookstore will open. There are probably 100,000 booksellers in storefronts right now in this country and we will continue to serve our neighbors irrespective of the fate of the current owners of the current bookstores.

      • Bruce Batchelor

        Hi Andy and Ted (and thanks, Mike, for inspiring all this dialogue) –
        I think you are both right, and are talking about different aspects of the same prediction.

        Ted's doomed bookstores are the chain-run stores. Andy's surviving and new bookstores are much smaller locally-owned and neighborhood-focused stores that provide an enjoyable place to be (cafe, music, hang-out, events). Andy's stores might sell as many used books as new – which will satisfy the customers while not providing as much revenue for publishers.

        thanks, cheers, Bruce

      • Yes. Many of the individuals working in the chainstores simply *must* work in bookstores. We aren't fit for any other line of work. We are nerds. (Not geeks — they are online.) If we couldn't work in bookstores we would shrivel up and die. That's why there will always be bookstores in this country, and when big Wall Street capital decides to abandon bookstores as a way to get return on investment, lots of people will keep engaging in hand-to-hand bookselling without making much return on our investment because we are unfit for any other activity. You cannot make me stop telling people I meet about some great book I just read because I am terrible at casual conversation and this is how I relate to other people, by trying to persuade them to read some great book.

      • Bruce, that's correct. I mean traditional book-only bookstores. Chain or independent. I don't know how it works on Main Street in a town with a strong community, but here in the sprawling suburbs of Southern California when they go they're gone. Nothing comes to replace them.

        Andy, I admire your enthusiasm. I wish you the very best luck over the coming years.

        Ted

      • Hi Ted, Thanks for your conciliatory tone — I do tend to get a bit overwrought myself, unfortunately, no this subject.

        But, are you sure that nothing will come to replace the big box bookseller when it abandons your suburb? I have been involved in the Children's Museum movement for many years. These institutions are generally founded by groups of neighbors who feel that their area lacks adequate cultural amenities. Most of the 200+ children's museums are located in suburbs (the most famous children's museums are in big cities, but most such places as I say are actually in suburbs). The children's museum movement is a good example of how in suburban areas, neighbors can in fact band together to create a new cultural amenity. Suburban bookstore revivals may similarly emerge. As an example, think of the burgeoning presence of bookstores inside of large churches. These can be very large! They are run by volunteers, and many such stores sell books at 40% off (I am talking about new tradebooks). Also, are you aware that dozens of Friends of Libraries groups across the country have put full-time bookstores inside libraries. Some of these stores are beginning to branch into selling new tradebooks! They are staffed by volunteers.

        Last month I was on a book tour of stores on the East Coast, in big cities and small towns. I was the saxophone player in the band backing the lively spoken word performances of the book-author. The book was about radical economics. The host stores were left-wing radical bookstores. Many have expanded in the past few years. The one in Philadelphia has a larger, lovely space. On the tight, well-stocked shelves were books from a huge variety of publishers — major companies and small press. On the magazine racks were dozens and dozens of zines produced by people from across the country (there are specialty zine distributors). What an unusual store, and what a great crowd we had. The first run of the book we were touring to support — Understanding The Crash, by Seth Tobocman — is now sold out from its publisher (Soft Skull/Counterpoint) — so, the tour into those alternative bookstores was very successful.

        The suburbs, denuded of big box stores, may turn out to be fertile ground for all manner of community generated bookstores. Church stores, Friends Of Library stores, even radical stores (youth oriented) — it's amazing how creative the individuals in our country are! Some of them will say, “hey, let's open a bookstore” — even in the suburbs of Southern California!

      • Andy, I don't discount the possibility of niche bookstores. Though I think that survival is more likely for those that serve the ethnic communities, of which we have many. Spanish-reading is, of course, the biggest. But I know of a fairly large Japanese bookstore that seemed to be doing quite well when I visited a couple of years ago. Not much help for U.S. publishers, however, since they import nearly everything from Japan.

        Ted

      • I'd say “niche is necessary”, one way or another.

        Mike

      • Andy Laties

        I made the decision “niche is necessary” back in 1984, with the assistance of David Schwartz, when I opened a children's bookstore instead of a general bookstore. The children's bookstore I currently run has a lot of internet business, and I look forward to selling eBooks via our highly trafficked website, as soon as the price of your proposed white label eBook store becomes affordable to me (at the moment, Overture is way too expensive for an indie store). But my bookstore will still thrive because it's inside a museum, which provides foot traffic. This is my second store inside a museum. I think that there are a huge number of such traffic-driving locations available in this country. Being a storefront niche bookseller will remain viable into the future.

        Another point I still haven't addressed, regarding the idea of verticality, community, and niches: when I run a bookstore everyone thinks is a children's specialty store, I have found I can sell a lot of adult tradebooks there. I sneak more and more in — I broaden my definition of my specialty as much as I can. So, my profitability depends on pushing the boundaries of my niche activity.

      • Andy, you really need to start your own blog.

        Mike

    • Ted, it's amusing having these dueling observations taking place in the
      comments to this post.

      I believe that when the various publishers predicted 50% ebooks by 2015,
      they were *not *factoring in the impact of closing stores. That's why I
      actually think the prediction is conservative.

      Obviously, others who have read this post think bookstores can continue to
      thrive in the face of this change. Apparently, you agree with me not
      agreeing with them!

      Mike

      • Yes, Mike — I would say that Bruce and I are not recruiting any prospective booksellers from among your commentors!

  • Patrick, the publishers *are *pretty good at marketing, but if they didn't
    have the ability to distribute the books, they couldn't get paid for the
    marketing. And whatever they do with marketing is done for the most part
    with labor, not with contacts or a built-in customer base. That means it
    isn't scaleable.

    Mike

  • Chris

    I've been watching the replies on this post for the last few days and feel the need to contribute… nothing in particular.

    I only want to annoy Mike … because, you know, the guy shouldn't be given a moment's rest!! 😉

    • Hey, I'm glad to know somebody besides the people posting are *reading* these
      comments!!!

      Mike

      • Chris

        Hey, who said anything about 'reading', Mike?!

        I'm just 'watching' … nobody reads anything these days.

        Especially not online.

        Oh, wait…

  • Cynthea

    I agree. I am a publisher based in Melbourne, Australia. We sell to the nursing profession. Book sales have fallen over a cliff in regard to postgraduate works. We saw this coming years ago and have developed a much broader interpretation of the word 'publishing'. So glad we did, we are our now out of the valley and climbing up the mountain in terms of sale. One point – I find there is a huge inter-generational issue emerging here. The younger people have the zoom factor and the older people the cautious behaviour – so necessary online. You need a very clever business model to capture this.
    Ausmed Publications Melbourne

    • One key, I'll bet, is that you sell to a defined audience. That makes it
      possible for you to market directly to your customers and not be so
      dependent on intermediaries.

      Mike

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  • 26th November 2009, Borders UK enters administration.

    End of February 2010, 4 months later I found it sobering to hear from Neilsen Book Data that the book sales usually attributed to Borders hadn't moved to other bookshops.

    In short the share of the market who used to shop at Borders had simply stopped buying books altogether.

    Book buying in brick-and-mortar shops becomes a personal habit that people do in their leisure time. When a bookshop closes the sales don't automatically move to online. Sometimes they just disappear altogether.

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  • Richard Askenase

    Before I got a Kindle, I read most of my books by getting them from the library. And, yes, I would go to a book store and write down titles, etc and then order them from the library.

    Now, frankly, I do all my reading on the kindle. Why? I enjoy it, it’s easier, and I never have to deal with a physically large book (like Stephen King’s “Under the Dome”), and I LIKE long books.

    I think Mike Shatzkin is right that more thsan 50% of book sales will be by ebook within 5 years- And textbooks even more so (California is on its way towards mandating all school books be ebooks for older students).

    So book stores are in trouble. I love them for the magazines, browsing, recommendations, and even conversations with other customers. But as websites get more socially oriented (beyond Facebook), you can get this dialogue on line as well. Of course it does not replace real conversations, but I can find more people who love reading on line than in my real life. (Too many people do not read heavily- defined as at least a book a week). This is where the world is going.

    • Thanks for the validation, Richard. I think you are one of many. Very many.

      Mike

  • Here's my own blogpost describing my appalling party-crashing in the comments section of this blogpost of your, Mike. I will now shut up!
    http://rebelbookseller.livejournal.com/29804.html

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  • Fascinating after all these years and words, we must still pit one channel against another rather than embrace the importance of many. Of all industries, I would hope that ours would one to avoid polarized thinking and pursue diverse avenues. We seem to buy into the win/lose mentality rather than press for more win/win outcomes for a better, richer culture.
    With 25 years in the book business including publishing and indie bookselling and now working with indie start-ups, I see fascinating skills and ideas enter our industry each year. Today's retail concept is about the reading lifestyle and offers an entrepreneur more creativity and flexibility in atmosphere and selection. It's a fun playground for business. Most who come through training these days want out of business sectors that have no soul, integrity, or contribution to community. As long as we have these dynamics at play, I see indie bookselling evolving and the new owners offering energy and creativity. And, this has nothing to do with age.
    So, how about if we shift the conversation to our role in contributing to a richer, more wonderful world of ideas where we're not constantly proclaiming the demise of the indie channel, but recognizing its presence and value? This, to me, is our greater opportunity.
    Donna Paz Kaufman

    • I am committed to writing and saying what I *think will *happen, not what I
      *wish would* happen. Others are free to conduct their discussions about the
      future using any ground rules they like.

      Mike

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  • Louis Maalouf

    The significant growth and increase in the share of ebooks relative to print books has not so far translated in an equivalent drop in print books. The fact is the overall pie is getting bigger and beyond the most optimistic projections.

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  • Mikebooth61

    This is almost a religious argument, Mike, with everyone clinging desperately to their own dogma. Meanwhile, I think the underlying issue here is neither bookstores nor online sales. It's the acceptance/rejection of change. Everything changes, and some people cannot accept that fact. They perceive it as threatening. Other people (the lucky ones) perceive it as interesting. Eventually, however, almost everybody gets used to it. Does anybody mourn the slide rule? How many mourners will the bound book have after all is said and done?

    • Oh, you're quite right. It is all about resistance to change. But resistors

      are on a continuum. Some have a real stake in the current situation:

      bookstore owners, major publishers, paper manufacturers. For others it is

      some combination of sentimentality and lack of imagination. But it is a

      syndrome not in any way limited to defending printed books or bookstores!

      Mike

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  • Marketing

    Mike, book publishing has always amazed me as a business that creates tens of thousands of products a year and ignores the great majority of them. What other industry would make so many products and not market them?  So in the world of 50%+ sales of books being e-books, and shrinking margins etc. might it not make sense for the publishers to cut their editorial staffs in half and publish half as many books…choose wisely, and market the heck out of every one?

    • Lots of books make money for their publishers without much marketing. Lots
      of books make money for their publishers without becoming bestsellers. There
      are very few publishers who wouldn’t be out of business if all they did last
      year was the books that sold the most. They wouldn’t be able to cover their
      overheads and, besides that, the books that sell the most usually *cost* the
      most to sign up. You can sell 20,000 and make money and sell 200,000 and
      lose money, depending on what you paid for the book in the first place.

      Mike

  • Chris Mercer

    Excellent article and discussion online rams it home – all this is taking place online, not in some book store.  Another area which will be exploited is the interactive e-book where the book is supported by a website full of colour photos, and a load of videos on You Tube.  now that is something hard cover cannot adequately compete with.

    • When the publisher or retailer is giving the customer a file, rather than a
      physical thing, all sorts of new possibilities emerge.

      Mike

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  • Red Harvey

    Your predictions are scary, and that’s what makes them even more believable. Knowing that you wrote this a year ago makes me even more fearful for the future of my own books (or e-books). Good post, though.

    • It actually is not fun to be a doomsayer.

      But it is more fun to be right than to be wrong.

      Mike

  • Catherine Evleshin

    Good statistical analysis. One point: You didn’t address what kind of books will go electronic, and that skews everything. Books with pictures, cookbooks, books for young children, and those appealing to the oldest demographic will be slow to convert, while books with text only, while YA, sf and other nerdy types have already adapted, limited only by availability of e-print. Traditional books are now referred to as “dead trees” by the environmentally conscious.
     
    posted by an avid reader in the oldest demographic who doesn’t use her Kindle in the kitchen, but open to a new invention.