Book superstores face new rivals
The bitter fight in the bookselling industry used to be one between the two superstore chains, Borders and Barnes & Noble, and the many independent bookstores that see the superstores stealing their business. But now there's a new force that threatens both the big chains and independents alike: big discount merchandisers, like Wal-Mart and Costco.
We've already discussed the cultural impact that these stores are having on music and DVDs as well as books. What's becoming more clear is their enormous economic impact. The phenomenon was discussed by a recent New York Times article by David Kirkpatrick.
Kirkpatrick cites the cases of the late spring/early summer's big books, the new Harry potter and the Hilary Clinton biography.
The impressive sales totals partly reflect the growing power of big discounters like Wal-Mart and price clubs like Costco. In a sea change for the publishing business, those outlets accounted for as much as half of the early sales of the three books and can claim as large a share as traditional bookstores and online outlets, according to the publishers and an analysis of sales of figures.
The power of the price clubs and discounters to move huge numbers of certain books is giddily unnerving for book publishers. The good news is that millions of consumers bought books last month. The bad news is that a lot of them skipped a trip to the bookstore, where they may have bought even more books.
The bookstores are complaining that the discounters are getting a far better price deal on the books,. But worse than that, they had large supplies of the books available from the start, while independent and superstores alike were hard pressed to get enough stock after the first few days. Soem even bought copies from the discounters retail, so as not to disappoint customers. The real bookstores claim they are being abused; the publishers deny it.
Noble, echoed the thought. “When you have books like these, where there is instant demand, you see bookstores around the country waiting for supply while it is piling up in mass merchandisers like toothpaste,” he said.
Whatever the truth about playing favorites, there's no doubt that Wal-Mart and Costco now have enormous power with the book publishers, and that the best-seller-crazy mentality of the book publishers can only be whipped into a frenzy by such examples. Wal-Mart and Costco are not remotely interested in the vast majority of other titles from the publishers; by comparison, even Borders and Barnes & Noble come off as literary salons. The result is that the book industry will becoming like the movie industry than it already is; they are going to place even more emphasis on getting to be one of the handful of books that everyone wants to read, and spend less time than they do now appealing to people who like to buy and read more than a few books a year.
For Borders and Barnes & Noble, their oligopoly position is being threatened by a shift in the competition matrix. Just like supermarkets, thy are being outflanked by Wal-Mart and its competitors.. [Oligopoly Watch]