Day two of Winter Institute 14 in Albuquerque, N.M., opened with a rousing keynote speech by Reshma Saujani, author of Brave, Not Perfect: Fear Less, Fail More, and Live Bolder (Currency). Saujani called for more creativity and experimentation in our lives. This was no better exhibited than in the afternoon, when cultural critic Hanif Abdurraqib, author of Go Ahead In the Rain: Notes to A Tribe Called Quest (University of Texas Press) asked several hundred booksellers to gather around him on the floor of the Albuquerque Convention Center for an intimate reading and Q&A.
These events aside, the focus of the second day of the American Bookseller Associations annual meeting was focused squarely on commerce and best practices for booksellers.
A crowd of about 120 booksellers filled a convention center conference room to hear both good news and bad during Wednesday's panel session on industry trends and analytics. The talk was moderated by ABA CEO Oren Teicher and featured presentations by Michael Becher of Industry Insights, Brian O’Leary of the Book Industry Study Group, and Alison Risbridger of NPD Book (who called into the session via the phone from Chicago).
Becher presented his organization’s findings from this year’s annual ABACUS benchmarking survey of bookstore financials. Noting that 292 companies representing 331 bookstore locations participated in the survey of fiscal year 2017, up from 227 companies representing 260 locations the previous year, Becher explained that the respondents represented a wide range of businesses, both urban and rural, ranging from less than $250,000 in sales to more than $2 million.
Due to a number of factors, including bookstores selling a mix of new and used books as well as non-book items, the cost of goods sold has gone down, from 57.6% in 2012 to 53.2% in 2017. Payroll has remained steady, rising from 23.7% in 2012 to 23.9% in 2017. Total operating expenses went up, from 11.% in 2012 to 12.2% in 2017.
The BISG’s conclusions from its State of the Supply Chain survey, conducted in November-December 2018, is that “the industry as a whole understands the challenges facing retailers," O'Leary said. Priorities listed by respondents were “data-driven decision-making, [making use of] timely, high-quality metadata, and the ability to keep up with technology.” Across the industry, respondents expressed concerns with being able to “see only part of the picture” due to “inadequate” tools and “capacity constraints,” particularly supply-chain capacity constraints, and expressed the wish to “work together more closely.”
Risberger reported on trends in the overall book market as reflected in BookScan and PubTrack figures, as well as consumer research. “It was a banner year for bestsellers,” she said of 2018, with a 1.3% increase in sales volume due to “top heavy sales."
That said, the 2018 holiday season was flatter than 2017’s holiday season, with more shoppers buying books later in the season, though Black Friday week was strong. What growth there is in the book market is driven by adult non-fiction and children’s books. Adult fiction is declining, particularly romance and fantasy.
“In 2018, political book sales were unprecedented,” she said, and lifestyle books also spiked, with cooking book sales up 26% and books about the home up 50%. In children’s books, books about social situations, holidays/religion, games and activities, and educational titles were the growth drivers. And, after a significant decline in 2017, young adult science fiction/fantasy/magic novels rebounded.
Indies are well-positioned to thrive in this market, Risberger said, as consumers want convenience, but are also trending towards “localized, community” when shopping, and want “experiential retail," essentially events in which customers can participate, rather than merely attend. More impulse purchases are made in-person than online.
According to the ABA’s own data, Teicher said, sales were up 5% for its member stores in 2018. “For us, we had a nice year, nationally.”
One area where the ABA is working to help booksellers generate new sales is with pre-orders.
"The life of a book has changed. Sales for the book begin as soon as it is announced,” said the ABA's Joy Dallanegra-Sanger, as part of an afternoon panel on the topic of maximizing sales from pre-orders. "Pre-orders can account for 3-30% of the total sales of the total sales for a book, said Sanger, “so capturing those sales is increasingly critical for us.” Citing one example, Sanger said the indie channel was responsible for selling a 1,000 pre-order copies of Bob Woodward’s Fear.
The ABA has focused on ensuring that metadata for books are available as soon as it is announced and the organization is capturing news, such as the dates of cover-reveals, to help booksellers communicate with customers. Late last year, the ABA conducted a test with more than 20 booksellers and focused on six titles to ascertain best practices; titles tested included Hank Green’s An Absolutely Remarkable Thing (Dutton); Michael Lewis’s The Fifth Risk (Norton); Haruki Murakam’s Killing Commendatore (Knopf); Barbara Kingsolver’s Unsheltered (Harper); Louis Penny’s Kingdom of the Blind (Minotaur); and Diary of a Wimpy Kid: The Meltdown (Abrams).
Dallanegra-Sanger offered some tips for generating higher pre-order sales. “Creating a unique custom product page is the most successful, with a conversion rate of 10.5%; this compares favorably with just adding the pre-order information to an existing product page, which yielded a 8.5% conversion rate," she said. Bookstores that offered a bonus item—a tote bag, for example—also saw higher sales figures. “Exclusive offers do drive sales and define our channel’s value to customers,” she said.
Another strategy is to use larger cover images and present a single page that shows multiple titles for pre-order. Robert Sindelar of Third Place Books said: “We got a lot of incremental sales from doing that,” referring to presenting multiple titles.
Dave Lucey of Page 158 Books had perhaps the most straightforward advice: “Get it out there as soon as you can get it out there. Just beat the drum.”