Though Baker & Taylor traditionally holds its annual publisher summit in New York City, this year the event went virtual, broadcast on September 17 as a live Zoom webinar. During the program, executives from B&T and parent company Follett described how business has changed in the libraries they serve since early spring, when the closing of schools and libraries in the wake of the Covid-19 crisis led to a plunge in sales.
According to Aman Kochar, executive v-p of B&T, the challenges for his company and its public library customers were manifold after the coronavirus crisis hit.
“We had to decide whether to keep our service centers open or closed, and if we keep them open how we would do that in a way where the safety of our employees was the primary concern,” he said. A second consideration was how to support library customers who may be closed to the public but are still receiving materials. And thirdly, Kochar said it was important to help libraries find new products that would help them continue to serve their community when their physical doors were closed.
“Instead of calling us to ask, ‘When are my books getting here?’ they pivoted to ‘What can you do for me around remote programming?’ We had to educate our staff to field those changing queries. It was very challenging; 96%–98% of libraries were closed, and 80% of public libraries were not accepting shipments. We had to scale down our service center operations but keep it active, and invest in health and safety measures to keep it going.”
Six months later, Kochar said, the situation has substantially improved with "almost 96% of libraries by volume" now accepting shipments again. Nonetheless, Kochar said he believes that the journey back to normal is “going to be a long one,” and cited three main trends that have emerged as the pandemic has rolled on: accelerated digital spending (“no surprise there,” he noted); tremendous demand for remote programming that combines digital content with programming activities that librarians could deliver through Zoom and other apps; and, the impact of reduced budgets.
Kochar said digital sales were up almost 40% year-over-year at B&T heading into September, and that digital circulation on B&T platforms was up 50% over prior year. But, he said, planning for next year remains complicated because while many libraries expect their budgets to be cut, the depth of those cuts is not yet known in many cases.
“We recognize sales when we ship stuff out the door and our libraries are open to receive it. So, our sales numbers don’t necessarily reflect the library budgets per se," Kochar explained, adding that for the 96% of libraries that are now actively receiving shipments, B&T is "about 18% below prior year right now.”
A K–12 snapshot
On the school side of things, Britten Follett, executive v-p for Follett School Solutions, recalled that in the first few weeks of the pandemic challenges included concern for “the health and safety of our people as the health guidelines were still evolving” and worries about how the company would make money if schools shut down.
“Our team quickly shifted,” Follett said. “And thanks to partnerships with publishers, our focus then became, ‘How can we help teachers deliver instruction remotely?’ ”
Follett described what those early, uncertain days looked like. “We kept shipping orders as they were in the queue, then realized we couldn’t deliver them,” she said. “Our warehouse became a storage facility. At one point we had $12 million of books that were sitting in boxes waiting for the world to reopen. That in itself was an immense operational challenge. We had to build systems around ‘How do we choose and prioritize which boxes to ship when the world did reopen?’ ”
Now, as school begins again around the country, Follett offered a look at the top revenue trends she is observing.
“When the pandemic started, we were seeing revenue declines as much as 70% in print,” she said. “Part of that is due to the fact we couldn’t ship those orders to customers and send invoices. But that has quickly recovered. We’re still down, there’s no question, but we’re doing pretty well given all the uncertainties associated with back to school.” She said Follett’s print business is down about 20%.
Digital growth is also on Follett’s radar. “We’re seeing double-digit e-book usage and double-digit usage of Destiny Discover, which is the platform by which students search for print materials as well as e-books,” she said, adding that the environment that teachers and students find themselves in for the academic year obviously affects the demand for digital resources. And Follett said data collected from the company’s annual back-to-school survey of its K–12 customers indicates that the need for digital products will remain strong. According to the survey’s 16,000 respondents, 60% are going back to school on a hybrid model, 26% are fully remote, and only 15% are fully in-school.
As in most businesses these days, uncertainty is affecting funding. “We are seeing a delay in budgets,” Follett said. “Our customers don’t know how they want to spend their dollars or if they’re going to have the same amount of dollars." Some 47% percent of respondents are unsure about what their budget will look like, Follett pointed out, while 24% say it will remain the same, 22% say it will decrease, and only 1% say it will increase.
Still, Follett says that most survey respondents remain "committed" to print. “Many of them are librarians, and they don’t want to abandon print for the entire year," Follett observed. "If they abandon print for the year and only buy e-books, they’re going to have gaps in their collection that they might not be able to fill next year—that’s the thought process we’re hearing from customers. We’re definitely seeing a greater blend into digital.”
Overall, she noted, the good news for publishers is that, whether it’s print, digital, or databases, “kids need materials, whether they’re learning at home on their couch, or in a classroom."
Looking ahead, Follett said that “book fairs, eFairs, and My Destiny are the three strategic growth areas and initiatives for the school business.” But she acknowledged that she receives cancellations every day from schools that do not want to run a physical book fair right now. Some schools have shifted to eFairs, and some others have moved forward with more compact physical events.
Follett told publishers that the pandemic has made the company put a much greater focus on digital. “If you would have asked me six, eight months ago if we should be prioritizing work on our digital platforms, I would have said no, because we weren’t seeing the usage,” she said. “We were seeing sales decline, actually, in some areas of digital. That changed overnight. And so we had to change overnight.”
Nevertheless, Follett said print remains important. “I believe that e-books and digital solutions are an ‘and’ to the print book. And there are a number of schools, districts, and even states that do not have the level of internet connectivity that they need to be able to deliver e-learning and instruction using just digital resources,” she said. “So we need to work together to ensure that teachers, librarians, and principals know that we can be a solution for them, and that it’s print and digital—not print or digital.”
Kochar agreed. “It’s always a combination of physical and digital product,” he said. “Almost 90% of public libraries responded [to the B&T survey] that their physical content was still greatly in demand now. Whether they’re delivering it through curbside pickups or pushing a cart through neighborhoods, physical content is absolutely necessary.”