Part Four: Bookstores vs. Online

OK, it's time to start pushing the boundaries on this one.  This is the fourth in a series of posts about how I think brick-and-mortar stores could better compete with online retailers.  The earlier parts can be found here, here and here.

Next up, I'd like to suggest something radical: Bookstores should create a store-within-a-store and use it to focus on rentals.  Think of it as a mini-Blockbuster that focuses on books.  For a reasonable annual fee members can rent any one of the latest Top 100 titles in the industry.

The obvious objection to this is, "we already have that...it's called a 'library'."  How readily available are the latest releases and bestsellers in your local library?  They have waiting lists for them at mine, hence the suggestion for a solution that straddles both the library and bookstore models.

It's not just about creating a new revenue model; this is also about driving more traffic to the stores.  Someone coming in to return one book for another is also likely to browse the rest of the store and potentially buy something else.

Comments

[garret van der boom]

Sounds like Blockbuster for books. I am not sure how well blockbuster is competing against netflix financially, but I have a membership with blockbuster because I can return the video I got in the mail to the store and get a free rental right there without waiting a couple days. This would be great for a bookstore. They can auto charge you if you keep it longer than 1 month with another month grace to return and if you return it after that there is a restocking fee or something. I have a couple dvds from blockbuster because I kept them too long.

[Lori Cates Hand]

As someone who used to manage the waiting lists at a public library, I know first-hand that sometimes there would be 20 people waiting for a new book when it came out. Multiply that by a minimum of two weeks each and you could be waiting for that hot new book a looong time.

But just playing devil's advocate: Say the chain orders 20 copies of the newest bestsellers to keep in stock for rentals at each store. What happens when the book is no longer hot and they've got a bunch of beat-up books on their hands? Why, send them back to the publishers for full credit, of course!

[Joe Cottonwood]

If I were renting books, I'd end up wanting to keep the good ones. It might be a sneaky way to sell books - sort of a free trial offer.

[Walt Shiel]

I agree with Garrett about the returns issue. I can see publishers arguing with retailers over what constitutes a resalable return and what doesn't qualify. (The whole returns idiocy is why we at Slipdown Mountain Publications do not accept returns and put very little resources into selling into the bookstore market. There is, after all, like beyond the bookstore for publishers.)

That issue aside, there are already websites that will rent you a book for a nominal fee through the mail. http://www.booksfree.com/ for example.

I think most people who check out books at the library are doing so because it's free (a powerful word and real motivator in today's economy). I'm not sure you'd capture many of them by charging a rental fee, even if they could get a bestseller right away.

Not sure I see a real market advantage for bookstores with the rental model.

[Kim Greenblatt]

Exactly my problem with that idea. At what point is that book considered bought and not returned so the publisher/authors get to make money? What is to prevent the store from loaning out the books and then three months later, "Sorry, it didn't sell, here are the returns".

I don't accept returns because the whole system was adapted for a different century's business concepts and it isn't worth it financially. If people think that because I am a self publisher that they aren't getting quality, they can read my site and blog before buying my books.

The future may be in something outside of books, pdfs and something in line of videos and cell phone applications. Or whatever the "next next big thing is" :).

Kim Isaac Greenblatt

[Suzanne]

I think your book rental idea is interesting. Currently my source of books are amazon or the library, depending on just how soon I want/need to read the book. I'd be willing to pay a small fee to rent a book immediately rather than wait weeks to get it from the library or the expense of buying it online.

[Joe Wikert]

Wow, lots of great feedback on this one. Thanks to everyone. Let me try to follow-up on a few of the points...

First, Lori, you're right that this will result in a bunch of worn copies at the end of the run. I'd recommend the same solution Blockbuster uses in this situation: sell them as "gently used" products.

Joe, you're absolutely right that some books will be keepers for certain customers. What a great way to introduce a "rent to own" angle to this idea! All the chain would have to do is add an option for customers to buy the rental they like, probably for some agreed-to discount off the new price. It adds a level of complexity but it could all be done via percentages and computers, so it wouldn't be overly labor intensive, IMHO.

Finally, the returns issue. Actually, I think there's a simple solution to this too. The books in this program would be marked with stickers or stamps to show that they're not to be treated like regular inventory.

To be fair to all parties involved (including author and publisher), it might make sense for these books to be higher-priced than the editions that are sold the old-fashioned way on the shelf. So instead of a $20 book, the store might have to pay $30 or more for this rental edition. Why would they agree to a higher price? If the program works they'll more than make up the difference in subscription fees. This would also help get authors and publishers more comfortable with the concept since they could argue the loaner program generates fewer sales and therefore lower revenues. That's a whole separate discussion though. The key point is that this inventory must be marked so that it doesn't get returned at the end of the rental life.