Comics & Games Retailer
Buy the BooksBy Oliver Chin
Recently a report from the National Endowment for the Arts lamented the decline of reading in America. Conducted every decade since 1982 and based upon data from the US Census Bureau, the "Reading at Risk" survey found that less people read literary books (defined as novels, short stories, plays, or poetry) than ever before. For the first time, less than 50% of adults read literature in the past year, and habitual reading decreased across the board for all demographic groups (by all ages and ethnicities, as well as education and income levels).
This "news" disturbed book publishers, resellers, and creators. However, for many the research simply confirmed their observations. Overall annual book sales have been flat for the past few years, especially when compared to the rising popularity of competitive activities such video games and the internet.
However one book sector has shown dramatic improvement: online sales. In less than a decade, it has grown to be almost 15% of all book sales, as companies built massive business around selling books and collectibles (Amazon.com has 20 million visitors a month, Ebay $2 billion in annual revenue), and big retailers have gotten even bigger (Barnes & Noble's market capitalization is $2.4 billion).
Having worked in a range of publishers, from New York corporations and international anime/manga translators to non-profits and small presses, I have seen first hand how the web has transformed the process of buying and selling books. Recently I joined Alibris (www.alibris.com) as Manager of Sales and Direct Marketing. Now I have gained even more insight into online bookselling, and can tell specialty retailers that there are still opportunities to increase their sales online.
New, Used, and Rare.
Though there are no definitive statistics, one can assume that almost all the books that have ever been published are now out-of-print (OP). Some estimate that 50% of all books published go OP in 5 years, and +90% in 15 years. But over history and across cultures, a small but steady coterie of collectors has traded and trafficked in old and valuable books (a specialty that comics retailers can readily identify with). Today, these dealers participate in organizations like the Antiquarian Booksellers Association of America (ABAA) and the International League of Antiquarian Booksellers (ILAB) and travel to conventions in New York, Boston, Paris, and London. From this traditional network of reselling and referrals, Alibris emerged.
Back in 1993, Richard Weatherford, a veteran rare bookseller, had developed an online bulletin board called Interloc. By dialing into this database, dealers could retrieve reports on the "wish lists" of customers, and then contact them to fulfill their requests. Then Weatherford founded Alibris with CEO Marty Manley in 1998 to continue matching sellers of used and hard-to-find books with buyers over the web (earning a 20% commission on items priced less than $500, and 10% on those more than $500).
Based in Emeryville, California, Manley has refined Alibris' business model continually to survive the Internet shakeout. Originally Alibris consolidated all orders in its warehouse to forward on. Then Alibris changed to a more efficient "virtual consignment", where sellers shipped directly to buyers. Next it expanded its offerings by encouraging sellers to list new and used books, and then music and movies.
Driving the promotion of selling used copies alongside new titles to earn its own commissions, Amazon became the industry's lightening rod for angry authors and publishers who complained that used book sales have cannibalized their royalties and revenue. Ipsos BookTrends reported that the share of used books among all book purchases tripled to 15% in 2003. Meanwhile the research company Forrester predicted that online sales of used books will double by 2007.
But far smaller than the rapidly expanding online giants, Alibris engaged in "coopetition" with them. Alibris expanded the distribution of its sellers' inventory, by displaying them on Amazon, BN.com, eBay, Half.com, Borders, Books a Million, Canada's Chapters/Indigo, and Japan's Kinokuniya bookstores. Therefore Alibris has effectively enabled specialty retailers to exploit chains' larger customer bases to grow their own online sales.
On its own site, Alibris attracts more than 1 million visitors a month who browse through +40 million items for sale. By also catering to thousands of librarians who make purchases online, Alibris completes more than 10,000 transactions a day. However, even as it withdrew a recent IPO, Alibris still plans to become profitable in the coming year.
Naturally there is competition to attract retailers to sell books online and join networks of buyers and sellers. Each offers varying fee structures, and such sites include:
Otherwise known as the "advanced book exchange", it is based in Victoria, BC Canada, and launched its website in 1996. Booksellers pay a Monthly subscription fee to list their books, starting for $25 for 500 or fewer titles, to $300 for more than 15,000. When a book sells, ABE charges an 8% sales commission (the minimum fee is $0.50), plus a processing fee of 5.5% if it handles the credit card transaction.
"Pro Merchants" can subscribe for a monthly fee of $39.99, and waive the normal $0.99 listing fee per item. When a book sells, Amazon.com charges a 15% commission off the sales price, reimburses shipping costs, and then credits the revenue to your Amazon.com account.
Another market for buying and selling used, rare, and out-of-print books, this network charges booksellers (who preferably have a minimum of 200 items to list) charges 15% commission up to a maximum monthly amount, depending on their inventory size. For example, if you had no sales in a month, there would be no commission charge. If you have a monthly average of 500 book listings or less, the maximum commission total would be $20. If you had between 10,000 and 25,000 listings, it would be $45.
Founded in 1999, it also caters to resellers of new, rare and antiquarian books. Recently in in May 2004, it began accepting new registrations from booksellers who had 350 or more books for sale and could provide their database in a computer file.
This site has a tiered commission structure that is also tiered and based on the number of books listed. It is initially 10% of sales until the target fee is reached, and then 5% afterwards for the rest of that month. For example, if a bookseller lists 5,000 items, its maximum monthly commission fee is $25 (which equals a 10% commission on $250 of sales). If the bookstore sells $300 in a month, the site gets a 10% commission on the first $250.00 of sales ($25), and then 5% on the remaining $50 of sales ($2.50) for a total of $27.50. However, if the bookstore sold $150 that month, the site's commission would be $15 (10% of $150). ChooseBooks can also process credit cards for an additional fee of $0.50 + 5% of the total order amount (including shipping).
Web Swinging Sales
What does this mean to comic and games retailers? First, take advantage of additional online venues to list graphic novels, and collectible, strategy, and art books. If you already sell by mail-order, continue to try to increase your sales volume cost-effectively.
As a digital middleman, an online bookseller makes it easier for retailers to sell through multiple channels: it automatically deactivates items sold from the network, provides sellers a pricing tool to check how much competitors are charging for the same book, and handles credit card processing, customer service and returns at no additional cost.
The increase in graphic novel supply and demand has made online sales even more important for comic retailers. Publishers have ratcheted up output and sales, especially through the book trade where graphic novels have become established categories/sections in all major US chains. This has propelled interest across readers of all ages who are active online.
However, unlike bookstores, comic stores sell collectible items and buy non-returnably. This gives them more incentive and better inventory to sell online. More sales, even at a discount, are crucial to recoup initial investments and sustain cash flow. On the flip side, web buyers still place a premium on "harder to find" items.
Meanwhile the internet landscape continues to change. Ebay's pending dissolution of Half.com and changes in its own listing structure for books have disenchanted hundreds of sellers, who now seek alternate venues that are less costly, more user friendly, and still consistently draw book buyers. Fortunately, sites like Alibris offer these same benefits along with a singular focus on driving book sales through a worldwide web of sites.
So, ironically, there are more readers shopping online than ever before, and by partnering with these online booksellers, comic retailers can successfully find them.