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Publishers Weekly Bookselling

Staff -- 7/31/00

Lessons from the Web
Spanish Online | Aaron Heads Elliott Bay

Lessons from the Web
BookZone's Mary Westheimer offers indie booksellers
a recipe to make lemonade (with a twist)

Mention Internet bookselling to an independent bookshop owner and you are bound to get a reaction. "When I first heard about it, I was terrified," said Gayle Shanks, who has been selling books at the Changing Hands bookshop in Tempe, Ariz., for 26 years. "Someone in their pajamas was ordering books at 2 a.m., and it wouldn't be from me. Then customers started coming into the store, saying, 'I can get this book for 40% or 50% off online. Can you match it?' We knew we couldn't do that and stay in business."

Such concerns were not the first blow to independent booksellers, however. "The advent of the chains was the worst," said Shanks, who is also president of the Mountains & Plains Booksellers Association. "That was the first sledgehammer to the head. We all tried as best we could to compete, becoming extremely creative and resourceful." The national superstores that settled in local stores' neighborhoods carried more titles, discounted bestsellers, and had massive parking lots and flashy advertising campaigns.

As those "big box" chain stores became a fact of life for independent storeowners, the next wave of competition hit, and hit hard. Amazon.com, which began discounting books even more heavily and delivering them to purchasers' doorsteps, wasn't the first online retailer--books.com (originally known as Book Stacks), which quietly expired last year, preceded it. But Amazon.com fueled a boom in online bookselling that proved to be too much for many local bookshops. "When Amazon started, we still hadn't gotten our bearings," Shanks told PW. "It was a one-two punch."

A Rough Decade
Although it's difficult to attribute the attrition of independent stores to a specific cause, there's no denying that there are fewer independent bookstores today. According to Dun & Bradstreet, nearly 1,000 bookstores closed their doors between 1990 and 1997.

No one has expressed joy at the decline of independent bookstores, yet even many of their supporters admit that they've gone AWOL. "I love my local bookstore," said one industry professional. "It's just that it's such a hassle to go down to the store, and find and pay for a parking place. By the time I'm done, it's taken an hour just to grab the book I want. If I order online, I get the book in two days at my office--no muss, no fuss."

Ask a dozen people why they buy books online, and the answer you'll likely hear is that it's so convenient. "The selection online is a plus, but it's the convenience of having the books delivered to me that makes the difference," said one such shopper. "I just don't have the time I used to."

Michael Hoynes, marketing officer of the ABA, readily acknowledges the importance of giving customers what they want. "The consumer is making all the decisions, and we'd better have all the services or they're going to go elsewhere," he said. "Loyalty only g s so far. It's true in every business. You have to provide the services that make life easier."

That perspective is one Hoynes said has been lacking. "One of the things that has hurt independent bookstores over the past few years is that they have not had some of the competitive service practices, like gift certificates that you could buy in Ph nix and use in New York." Hoynes, who is also vice-president of marketing for Book Sense, Inc., said that Book Sense's online initiative is one way the ABA is helping its members provide what customers want. "Part of this is to take the excuses away. Independent booksellers said, 'I want people to come into my store,' but it became clear that they need to have this online option."

With the realization that they must do something and the advent of Book-Sense.com, independent bookshop owners are increasingly turning to Web sites. Hoynes said that 1,158 stores have already signed up for the BookSense.com program, which is currently in a testing phase. Shanks's Changing Hands is one of those stores. "We're ecstatic BookSense is here," she said.

Facing Down E-tailers
Booksellers realize, however, that they are now facing a competitive marketplace with "e-tailers" that have more titles, more content and significant head starts. Simply offering BookSense.com's eventual two million titles will not be enough. By learning from the existing e-tailers who have tapped into the value of delivery in today's busy world, and doing what independent booksellers do best, handsell, they may well benefit from the wait.

According to Hoynes, some independent booksellers are looking into delivery. "Bookstore owners must consider their customer service arsenal, and provide online ordering with options--pick up at the store, mailing or delivery," he said. Because most local bookshops' customers are located within 10 miles of their storefronts, a van or car doing rounds once a day could get books into purchasers' hands faster and more conveniently than the online bookstores.

Indeed, delivery (vs. mailing) is currently being tested by Barnes & Noble in Manhattan. "I don't see it working except in a large metropolitan area, where you have a large concentration of people," Hoynes said. "It's a costly proposition. Most bookstores already are having difficulty making a margin to make a living or stay in business. The question is how much more business they are going to get or save." Yet, he added, "If Barnes & Noble is successful with delivery in Manhattan, and Borders begins doing it, independent bookstores there will have to compete."

Handselling on Line
Another edge independent booksellers have over their large online competitors is their time-tested strengths in handselling and creating atmosphere through events and unusual offerings. These need to be brought to their Web sites. "My staff wants our site to have its own personal shopper, so someone can go online and say, 'I have a three-year-old who just loved an Eric Carle book. What else do you have like that?'" said Shanks, whose Changing Hands site is under development. Plans call for it to include staff recommendations, a monthly newsletter and an e-mail events calendar.

Smokin': David Sedaris celebrated the end of his Me Talk Pretty One Day (Little, Brown) tour of the U.S. and Canada (29 bookstores in 28 days) with a reading and signing for more than 200 at New York City's A Different Light. "After less than a month in our stores here and in West Hollywood, this book is our bestseller of the year," said owner Norman Laurila "We've sold over 300 copies in both stores, and there's nothing that comes close to that in sales."

Like its original location in downtown Tempe (which closed earlier this year due to lack of parking, "mallification" of the area and rising rents), the current Changing Hands offers the atmosphere, staff recommendations and steady calendar of events that has helped the store build a fiercely loyal clientele. It also features plenty of parking and an accompanying bakery. Shanks and the store's other owners have added many nonbook items to the new, larger location, as well. "We're trying to make this store a one-stop shopping destination," Shanks explained. The store's Web site will be yet another way for it to compete effectively.

By doing what they do best--creating atmosphere, providing personalized service, and taking advantage of their proximity--independent bookstores can provide something book lovers can't get anywhere else, and thereby not just survive, but thrive. "As a bookseller, you cannot stop learning what's going on in the marketplace, and you can't assume that you can exist without electronic devices like fax machines, e-mail, Web sites," Shanks stressed. "We are in this world now, and we must play by these electronic rules."

Spanish Online

Submarino recently doubled its staff.
Submarino. com Surfaces In Latin America
No surprise: the leading "business to consumer" Web site in Latin America is also a major bookseller. Submarino.com, founded in Brazil and with $71 million in capitalization, now serves additional countries--Spain, Portugal, Argentina and Mexico--with books in Spanish and Portuguese, CDs, videos, toys, video games and, now, books in English.

The mix varies by country, Juan Saldivar, who heads up the Mexico operation, told PW. In the Mexico online catalogue (www.submarino.com.mx), there are 600,000 titles, and books are 40% of the biz so far. This figure is expected to grow since the recent addition of the new English book category.

In Brazil (www.submarino.com.br), where the language is Portuguese, not Spanish, and English is the second language, the book list is 700,000 strong, including 500,000 from Ingram in English.

The Portuguese operation, based in Lisbon, will launch next month, according to Saldívar, who left the Mexico office of the Spanish publishing house Plaza y Janes, a subsidiary of the media group Bertelsmann, to join Submarino.

"Prices and editions of books vary by country," he told PW. "But the main quiz is how to get people used to buying online. And that takes time."

Mexico has about two million Internet users, and the number is growing at an annual compounded rate above 40%, says Saldivar. He hopes for a takeoff phenomenon similar to Brazil, where Submarino started earlier.

"We began there in 1999, and the big boost in business began the first quarter of this year. I think it is happening now in Mexico. In the last eight weeks, we've gone from 22 employees to 58, in order to serve the growing number of customers."

As in most of Latin America, book retailing and distribution is still limited and unreliable. At Submarino Mexico, the "inbound process," as Saldivar calls it, involves the company's own staff, in cars and on motorcycles, going from publisher to publisher, picking up titles ordered.

The "outbound" service is contracted to private delivery companies like DHL. With credit card penetration still limited in Mexico, Submarino also offers cash on delivery and payment by bank deposit.

Several other book Web sites have opened in Mexico as well. Gandhi.com.mx, Sanborns.com.mx, and Porrua.com.mx, run by traditional book retailers, use their own stocks. J-libros.com, zonashop.com.mx, and casadelibro.com.mx are also all offering books online. But they are all limited to Mexico.

Just launched in April at the International Publishers Association meeting in Buenos Aires is another Mexico-based online books operation, www.espiral.com. Offering "todos los libros, un solo sitio" or "all the books from one site," Espiral has, as of this writing, five national Web sites in Spanish--Mexico, Argentina, Colombia, Venezuela and the U.S.--and a Web site in Portuguese for Brazil.

Espiral.com partners with BIS, an international Spanish- and English-language book supply service that up to now specialized in textbooks, with warehouses in each of these markets. Federico Krafft, formerly with the Book Chamber of Mexico, is spearheading the venture, which PW will report on further in our September 14 supplement on the Spanish-language book markets in Mexico, the U.S. and the Caribbean.
--Sally Taylor

Aaron Heads Elliott BayElliott Bay Book Co., the Seattle, Wash., independent that was bought last year by Ron Sher of Third Place Books, will be headed by Peter Aaron, who is forming a partnership with Third Place. Aaron was formerly an officer with Third Place. Sher will retain an interest in Elliott Bay.

Aaron said that declining sales and staff turnover have stabilized, with sales and inventory rising in the past six months, and some important employees, including manager Tracy Taylor and events coordinator Rick Simonson, are staying.
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