At “The Power of Retail: Making Books, Authors and Building Community” education session at BookExpo 2019, leaders from the book industry discussed how physical bookstores, both chain and indie, and publishers can strengthen the market and drive reader discovery in the face of online retailers like Amazon.
This panel on Thursday, May 30, was moderated by Lynn Neary of NPR and featured American Booksellers Association CEO Oren Teicher; Barnes & Noble Chief Merchandising Officer and Executive Vice President Tim Mantel; Penguin Random House U.S. CEO Madeline McIntosh; Sourcebooks CEO and Publisher Dominique Raccah; and Dennis Abboud, president and CEO of Readerlink.
Teicher said that while sales across the independent bookstore channel have increased in the past few years and ABA membership numbers have grown, the current U.S. book market is still a tough environment for indie book retailers. But, he said, “the good news is that what so many of our members are able to do is to do more than just sell books — they can sell an experience; they can sell a connection to the community; they can sell a knowledge and passion about books that goes beyond the product itself.” Looking ahead, he noted, “We think there is a lot of opportunity for growth.”
Teicher said that a major factor of indie bookstores’ recent successes is the growth of the localism movement, but he also said that there is still great potential for indies to capitalize on the book buyer’s desire to support locally owned businesses.
“This decision by literally millions of American consumers to want to shop at a locally owned independent business because it is a locally owned independent business is absolutely driving some of our success,” he said. “People get it, that the dollars they spend in a local business recirculate in the community, and that having a unique array of indie businesses helps make a community different and not just a cookie cutter of everywhere else. So the localism movement is huge, and I would suggest that, even in 2019, we’ve barely scratched the surface of being able to take maximum advantage of that.”
“A local business does contribute to the community in a way that is unique and different,” he added, “and we think that resonates with lots of consumers. As an association, ABA has the opportunity to help empower stores to be able to deliver that message to their customers.”
Regarding reaching customers, Barnes & Noble’s Mantel said that in an industry where it is easy for consumers to purchase books from online retailers, B&N has been using data and industry insights to continuously adapt their strategy to consumer behavior.
“We have been doing an enormous amount of consumer insights work … to really understand the mindset of customers who come into B&N,” he said, “and to understand what is motivating them to shop, what is the trigger to get them to shop, and, in understanding who they are and why they’re shopping, how do we merchandise our stores in such a way that not only presents the books but presents them in a way that helps readers discover new authors, new content, and to drive sales.”
Mantel said that more than 60 percent of customers come into Barnes & Noble stores with a single book title in mind. Because those shoppers are purchasing additional titles, Mantel said that “we know that the environment we are creating is one in which people enjoy shopping and they are discovering new content when they are in our stores.” The key to furthering this, he said, is to give each individual B&N store enough flexibility to curate their merchandise to meet the tastes of that location’s community.
Abboud, the CEO of Readerlink, which supplies books to chain drugstores and grocery stores, as well as to large retail chains like Walmart and Target, said that since these aren’t necessarily stores where people go specifically to buy a book, the company has adjusted its strategy.
“Our research shows that about 77 percent of purchases made in the mass channel are made on impulse, so we really focus a lot on drawing awareness of the category generally,” said Abboud. “We focus a lot on the shopper themselves and what they are purchasing and what their shopping habits are. We know that in many of our retailers, the average market basket of a book buyer versus a non-book buyer is 50 percent higher, so we’ve been using that message to cultivate a means of getting more displays, more space, more promotions in these channels in order to drive the overall business.”
Abboud said Readerlink focuses heavily on curating assortments since these large chain stores tend to carry around 2,000 different titles per store, compared to 75,000 available titles at each B&N store and millions of titles available at Amazon. “We have systems that looks at performance of like titles to help forecast with some degree of accuracy what we are putting in stores and where and whether it appeals to the particular demographic we are trying to reach,” Abboud said.
With so many different titles hitting the market at any given time, Penguin Random House’s Macintosh explained that publisher and bookseller partnerships that help readers discover new books and authors can be essential. In addition to skilled and effective sales reps, another important ingredient to these partnerships is publishers’ willingness to recognize how their role in the post-publication process has evolved over time.
“It used to be that we saw our role as delivering the books to [retailers’] front doors and then the rest was really up to you. Now we really see ourselves as in partnership all the way through the sales process. So we are working with very different kinds of retailers on how can we take the investments that we have made in data-driven consumer insights and really craft a campaign — whether it’s at Target or B&N or an independent — that is going to help this consumer understand that this is the right book for them,” she said.
Publishers also still invest huge amounts of money and authors’ time in touring, she added, which is one reason for the success of books by authors like Amor Towles and Celeste Ng, who worked over years to build individual bookseller relationships and who have then helped booksellers create rich in-store experiences for their customers.
Sourcebooks’ Raccah spoke about the power of relevant data and appropriate technology to sell more books and to help publishers and booksellers build their businesses. “I think [the question is] how do we create that moment of impulse [to purchase a title] and use data to drive that moment, to deliver the right product at the right time, and also to create the right product,” she said. “Right now, we’re doing all that work using data in partnership with each of our retail partners in a way that really augments the experience for readers in-store.”
Raccah added that data show that about 40 percent of books purchased in physical stores are being bought as gifts, which, she noted, demonstrates that for gift buying consumers prefer an in-store experience over online. “The reason that we publishers are interested in bricks-and-mortar stores is because a) they create an experience, b) impulse [purchases], and c) gifting that is absolutely at a different level than our online partners have created.”
The panelists also talked about the importance of author and non-author events as a way to connect readers; the goal of creating a robust gathering place, as with the expanded café model (which B&N is introducing at several branches); and of using social media as a way to build community.
“Events in our environment absolutely drive the creation of community, and it is that community that ultimately allows indie stores to survive,” Teicher said. “That piece of our business is certainly indispensable, but, far beyond that, it gets to the very core of why consumers even want to come shop.”
On the publisher side, PRH has done a lot of work with retailers on how to create interesting experiences that don’t require the author to be in the store, added Macintosh, including book clubs, teen-focused weekend events, and moms’ nights out.
“This builds on the idea that readers and booklovers love each other and want to be brought out of their shell a little bit and brought together,” she said, “and a bookstore feels like a really good, safe place to do that.”
Teicher capped off the session by noting that right now is an auspicious time for new booksellers to get into the business. Compared to Western Europe, the U.S. is “underbookstored,” he said. Despite the competition from online shopping, he said that there are opportunities for new stores in communities across the U.S. In fact, ABA currently has the largest number of prospective members it has had in years.
“We’re absolutely confident that there is an opportunity for the physical book market and the physical bookstore to grow,” said Teicher, “and ABA is doing everything we can to facilitate that.”