If you spent any time watching the slew of college bowl games today it was hard to miss the promotional effort Blockbuster is putting behind their Total Access program. Total Access is Blockbuster's response to Netflix, but with an important additional component: rather than being forced to swap movies through the mail, you also have the option of swapping them at your local Blockbuster store. This helps address the instant gratification issue of waiting for your next Netflix DVD to show up in the mail.
What's the lesson for brick-and-mortar bookstores? (I'm not suggesting a book loaner program, btw!) The lesson is in seeing how Blockbuster is using their physical store presence as a strategic asset against Netflix and their virtual presence. The big brick-and-mortar bookstores have used the opposite approach, choosing to keep the online and physical stores as separate as possible. Part of this has to do with "maintaining the margins" of the physical stores, "not getting into discount wars" and just old-fashioned thinking, IMHO. Meanwhile, Amazon (and others) continue to chip away at their core business.
Why not take a page out of Blockbuster's playbook and treat your stores as an extension of your online presence? How about letting me find the book I want on your website, confirm that it's available at my local store and then giving me the online discount when I come in and buy it at your store? This hasn't happened up to now because of the margin/discount concerns noted above. These chains would rather hold their margins and lose the sale.
OK, I'm oversimplifying a bit here since some folks still prefer the instant gratification (and full price) associated with a brick-and-mortar store; these are the same customers the chains don't want to offer discounts to because they know they're leaving money on the table. But wouldn't the incremental sales that could be stolen from the online stores more than offset this? I think so.
Don't stop there though. Why not leverage the "buy-x-get-y" program made famous by Amazon for this type of transaction, thereby upselling a second or third product? So once I start the online transaction for the book I'm going to pick up at the store, the system tells me I can also get a great discount on a related title. Every store prefers a 2-item $40 transaction over a 1-item $20 transaction.
Then there's the benefit of additional foot traffic in the stores. How often do you go to a store and only buy exactly what you set out for, ignoring all the other potential impulse items? If you're like most people it's rare that you leave without an extra item or two.
I see this as a huge opportunity for the brick-and-mortar accounts to turn the tables on the online stores. Despite the fact that B&N recently increased their in-store discount policy for their member program, I think what I'm proposing has about a zero percent chance of happening anytime soon. It's a shame because it could really change the competitive landscape of bookselling.