Book Stores in Manhattan and the Publishing world turned upside down.
Another great flash came across the consciousness of the people in the book trade recently with a front page article in the New York Times and a long piece in the New Yorker about Amazon.com. In some ways, the business of books is upside down. We take our newest most valuable items and sell them at an enormous discount through internet retailers and discount outlets. We developed a large network of independent professional booksellers and then encouraged chain stores whose goal was to eat their lunch with discounts.
Then we put those discount chains to the fire by aiding and abetting an internet service that out-discounts the discount chains and super stores. One of the chains is gone; the other reeling. The discounter of course would claim that this is good for consumers and more efficient, but it isn’t. This discussion has been going on seemingly forever about selling books and what seems to be wrong. One story blames the rent, another the aggressiveness of Amazon, others the demise of reading altogether or the migration of readers to ebooks. If we look back several decades and reread the stories the culprit was the chain stores. Some of our most sophisticated essays on the issue such as Andre Schiffrin’s have pointed out the pricing regulations in France and Germany that protected booksellers and suggested that we ought to follow that model. In those countries selling books at a discount was illegal and allowed a vast and diverse array of bookstores to survive even in big expensive cities like Paris.
The problem is the price but we don’t need legislation, we need leadership. If retailers, even Amazon or Walmart, don’t uphold the price point, you don’t sell to them. What is broken in the publishing world is the industry’s ability to sustain a diverse growing retail distribution network that maximizes the value it produces. The reason it broke is that the producers, that is the publishers, somehow gave in a long time ago to the notion that it was a good idea to give up control of pricing. Decades ago, as the chain book stores and superstores opened, a siren call of profitability sounded in the halls of publishers. It isn’t hard to see the value of dealing with a one large well capitalized efficient distributor of your product.
But it was wrong. It is still wrong. And by the way, yes my point here is that Publishers should regain pricing control, but it is also wrong for Amazon to continue to step on the throat of publishing companies to give in on terms when it has already achieved so much market share and so damaged an industry by taking its chosen path to growth. Our values as Americans, as lovers of justice and decency make this repellent to us. Jobs and cultural capital are being destroyed. In order to protect one’s brand, be it Knopf Hardcovers, or Polo Ralph Lauren, savvy , consistent pricing and good use of distribution channels are key. The very newest or most highly valued items, be they seats on a plane, or styles that we wear must be priced to uphold value and this has to be protected by the industry creating the product. But publishing is upside down. Only in books can you buy the newest, the most coveted, the most valuable, at a deep discount. It isn’t a monopoly it’s the hideous opposite, a monopsony. Amazon, the only buyer, is dictating terms and pricing and coop and sometimes even editorial control. Of course they aren’t the only buyer but the control they exert over the vendors is indicative of the effect. It’s as though the leaders of our industry have been in a destructive, abusive relationship for so long they can’t see the way out. Discounters, and mass distributors, have their place in the life span of goods and for certain types of merchandise, even some new books, to be sure. Having a tool set that includes Costco, Target, Amazon, Barnes and Noble and Urban Outfitters is essential to publishing and many readers. But giving these retailers control over pricing has been deadly to the sector of the retail distribution network that is attaining the highest prices and upholding the value of our product industry wide. Only independents stake a claim every day that a new hardcover book is worth the price that is printed on it. We charge that price and we live by it. To us and to our customers that is the value of a hardcover new release. We uphold the value of our product. I can’t think of another product or industry that is so destructive to its own value proposition or that of its retailers.
Moreover the lack of diversity in our retail network has sacrificed the diversity of voices that can be heard. Small retailers in every industry give wings to new trends, we break out ideas and incubate the new in niches and protected zones just by virtue of how we operate. In bookselling we are thousands of different owners doing things all a little differently; putting different books on display, reading differently, operating in different areas. And because we are so diverse, because our experiences and selves are all so different we need to encourage and make a place for all these voices, all our points of view. That place is at first in thousands of different book shops. Indies break out books – indies are the space for new and smaller voices- the industry knows this. Because even in an extremely small bookstore, take for example “3 lives” in the west village, or “The Grolier Poetry Book Shop” in Harvard Square, there is more on offer to a human being than in the screen that is Amazon. In Manhattan in particular it’s true that we have very high rents to contend with. But we also have the most literate book loving city to serve. And we have a walking vibrant city life that loves its local shops. Nationwide we have seen a bounce in the past two years for certain segments of book selling and more bookstores are opening. Even in Manhattan this can be true . And if we fixed the pricing problem there would be a steady stream of new shops opening in nooks and crannies and then even big bold spaces.