James Daunt: ‘Amazon are a ruthless, money-making devil, the consumer’s enemy’ – Independent 5 Dec
This article, published in Dec 2011: http://www.independent.co.uk/news/people/profiles/james-daunt-amazon-are-a-ruthless-moneymaking-devil-the-consumers-enemy-6272351.html?origin=internalSearch was part of James Daunt’s continuing campaign to put across his vision for Waterstones. Overall he is certainly heading in the right direction but I still think he is missing a trick or two so in response I sent the following to The Independent. Since then Waterstones have teamed up with Amazon to sell Kindle’s in their stores – can leopards change their spots??
Marbella, 6 December 2011
I read with interest your article on James Daunt and over the last few months he has been making his case for re-modelling Waterstones by taking it back to its “local” roots. As the founder of the recently launched online specialist bookshop, Books4Spain (www.books4spain.com) I happen to agree with the overall thrust of his strategy and his assertion that physical bookshops will NOT survive if they are not good enough – which is actually stating the obvious. The question is: what is “good enough” and are Waterstones, and other bookshops, on the right track to be able to compete effectively with Amazon?
It is an irrefutable fact that increasing numbers of consumers are buying books online – whether physical books or ebooks, as the recent KPMG survey confirms and that the market share of online sales will continue to rise. There is also little doubt that a good bricks & mortar bookshop should continue to attract customers. However, the 3 key success factors for bricks & mortar bookshops are:
- Location, location and location;
- Quality of products, i.e. book selection; and
- Knowledge and experience of staff.
The threatened closure of The Harbour Bookshop, the Travel Bookshop, Derwent and Pritchards earlier this year demonstrate that, in the case of the first and third, location is a major factor and in the case of the Travel Bookshop the lack of interest of the next generation to continue means that knowledgeable and experienced staff will not be available to maintain the quality of selection and service. For Pritchards it also looks as if location/footfall and selection of products have been key factors in the closure of its Liverpool shop (aside from competition from the Internet and supermarkets, of course).
For me a very good example of an “independent” UK bricks and mortar retailer of an in-demand product which was very successful in the 1980s and 1990s because of their locations, the quality of product selection and the knowledge of staff was the wine merchant Oddbins. Essentially, the double whammy of the Internet and supermarkets (and Majestic) has killed off Oddbins – they have lurched from one crisis to another over the last 10 years.
I’m afraid, I see much the same happening to many “independent” bookshops – they too are being hit by the Internet, by supermarkets, rising rents and rates and the refusal of banks to lend – and will find it increasingly difficult to attract physical customers and sell sufficient volumes of books to cover their overheads, let alone make money. I wish them luck because they are, and should continue to be, an integral part of our cultural heritage but I fear the days of many hundreds of independent bookshops are numbered – in fact according to the Bookseller in September there were 22 independent bookshops for sale in the UK.
However, the Internet enables an independent bookshop to address the three key success factors, and more, with much lower overheads than operating one or more physical stores.
I therefore established Books4Spain not only in response to the explosive growth in online mass market ‘soulless’ book retailers, such as Amazon (and Waterstones for that matter) but also to the continuing decline of the traditional independent bookshop with knowledgeable staff and an interesting collection of books. It meets a number of key criteria which I believe are vital for success in competing against Amazon:
- A user friendly site which has been designed to re-create the experience, attractions and benefits of a traditional bricks & mortar independent bookshop;
- Specialisation – in this case “local” = Spain;
- Books which have been classified and categorised correctly (or is the word “curated”!) to enable customers to find relevant books easily and quickly whilst also drawing them into a browsing experience;
- An interesting selection of books, e.g. modern best selling Spanish writers in translation; and
- Added value information such as Book Reviews by people knowledgeable in the subject area, e.g. Wine, Flamenco, Food etc.
All with the added convenience afforded by the Internet. So from our perspective we have very low overheads which enables us to focus on customer service and identifying and curating relevant books whilst giving us global reach.
For example, a key feature of Books4Spain are Spanish Themes which are designed to enable users to easily explore and discover in greater detail books covering important aspects of Spanish culture and history. We have launched with three themes: Flamenco, Spanish Civil War and Camino de Santiago with more on the way, e.g. Travel & Leisure and Food and Drink. In addition to Spanish Themes, the site has a growing number of books in a number of categories ranging from Crime Fiction to History, Novels, Music & Entertainment and Politics & Religion. All books on the site are curated manually and so the number of books will grow as more and more books are identified and added to the website.
We are getting very good feedback from users, publishers and authors – the last two being as keen as James Daunt to try and break Amazon’s dominance and aggressive discounting of mass market books hence, for example, the introduction of agency pricing for ebooks.
In summary, while I think bricks & mortar bookshops do have a future, only a small number will survive the onslaught of the Internet giants such as Amazon and I believe to do so effectively they need to embrace the Internet and use it to their advantage. Barnes & Noble in the USA is a good example of a leading bricks & mortar bookshop which appears to have developed a successful strategy to cope with Amazon, not only for physical books but also ebooks, which is ultimately where the future lies. Whether Waterstones can do the same remains to be seen, their internet “presence” is poor. To complain vehemently about a highly successful company that is successful precisely because they provide customers with an excellent service, albeit a “soulless” experience, and to call Amazon a ruthless, money making devil and the consumer’s enemy (they did lose hundreds of millions of dollars for many years) is to me a sign of jealousy and fear, an insult to consumers and an implicit acknowledgement of past failures to develop successful strategies to cope with the growth of online shopping and Amazon in particular.