Penguin Decision to Sell Online Doesn't Sit Well With Booksellers

Recently, Penguin became the first major U.S. publisher to begin selling directly to consumers via its Web site, as first reported by Publishers Weekly. And while a spokesperson for Penguin Group USA told BTW that the move was meant to be "complementary rather than competitive," booksellers contacted nonetheless hoped the move was not a sign of things to come for the publishing industry. "It's one more thing that's going to make it harder for independent booksellers to grow their sales," said Stuart Lamson of Bank Square Books in Mystic, Connecticut.

As of January 13, 2004, Penguin began giving consumers the option of purchasing, at full price, all of its titles from Penguingroup.com or us.penguinclassics.com. The sites also offer users the ability to read excerpts. The house’s decision to sell its titles directly to the consumer via the Web was made because "it's getting more difficult for retailers to carry our entire backlist -- which is about 30,000 titles," said Dave Zimmer, a spokesperson for Penguin. The Penguin sites do offer links to bookselling sites, such as BookSense.com, Amazon.com, and Borders.com, to name a few.

Zimmer also was quick to point out that selling directly to consumers is not exactly a new thing. Like other publishers, "we had already included mail-in coupons [on the backs of books] that allow consumers to have books shipped to them [directly from Penguin]," he explained.

At present, Penguin does not discount titles sold through its Web site and does charge for shipping and handling, though Penguin CEO David Shanks acknowledged that Penguin could offer discounts in the future, as reported by PW. Moreover, Shanks called the move a way to test Penguin's ability to sell books and compared it to retailers starting publishing operations, the PW article noted.

Nonetheless, Chris Livingston of The Book Shelf in Winona, Minnesota, said that he believed this is "something you don't want to see publishers do en masse. Personally, I think this is a cause for concern if that's where the industry is going."

Bill Nasshan, senior vice president of trade books, of Borders Group Inc., said that Penguin's decision would not affect Borders relationship with the publisher. He told BTW: "Publishers may choose to sell their products to anyone, and we hope that they, like Borders Group, believe that retail stores are the most effective and efficient outlet through which to reach their consumers." He added that, because a direct-to-consumer offering from publishers is restricted to the publisher's own catalogue, it has "limited potential for success."

Zimmer stressed that Penguin's decision to sell online was not meant to alienate retailers. "We value all of our relationships with wholesalers and retailers," he said. "But because bricks and mortar [stores have] a plethora [of inventory] it's not possible for them to display our entire backlist. In no way do we want this to be construed as a competitive move…. This is a way to be more visible and offer better access to our entire line." --David Grogan