The Anti-Amazon Model

Fewer than 20 years ago, the question, “Where do you go to buy books?” would have seemed like a pretty silly one, with the answer obviously being, “A bookstore” (possibly followed by, “Stop wasting my time,” or “Who is this, and how did you get my phone number?”).

Today, of course, a vast majority of consumers don’t physically go anywhere to purchase books — or any of a number of retail items. They simply log on to Amazon.com from wherever they may be and conduct their shopping through clicks of a mouse or on a touchscreen.

It is without dispute that Amazon, and its central role in the boom of online commerce, changed retail as we know it. The increasingly urgent concern for retail companies — in particular smaller ones — during the last 20 years of Amazon’s rise is how to compete with that powerhouse while lacking its ever-growing resources, infrastructure and scope.

There are success stories in this regard, many of whom — perhaps fittingly, given that Amazon began as a bookseller in 1995 — are retailers of books.

While once-flourishing chain stores like Barnes & Noble struggle in the face of the online retailer’s dominance (a battle that others, like the now defunct Borders, lost completely), independent bookstores, such as McNally Jackson, Book Culture and Green Apple, as well as combination sellers and publishers like City Lights and OR Books, have found a way to thrive.

OR Books Co-Founder Colin Robinson (whose company Dazed specifically called out as being “a radical, exciting response to Amazonian hegemony”) told PYMNTS that the key to success in competing with Amazon is for retailers not to get on board with the eCommerce titan’s model and instead do for themselves what that company would otherwise do for them (at a cost).

Deal Directly With Customers

“Our model of selling direct works best where we can identify communities that will be interested in a particular book we’re publishing,” says Robinson.

“Increasingly,” he continues, “as we build our customer database, we are transitioning from trying to find an audience for our books — which conventional publishers regard as their primary responsibility — to trying to find books for our audience, which, in my opinion, will be the approach of publishers in the future … the modern, forward-looking ones.”

Finding it “odd that publishers generally say their first obligation is to their authors, rather than their readers,” Robinson instead follows a consumer-first approach.

Viewing authors in the publishing world as, in effect, part of the wholesale chain for any retail company, Robinson attests that while that element is “incredibly important” to a company’s overall health, the needs of the end customer must remain a retailer’s top priority.

It’s his experience that dealing directly with a general consumer audience allows retailers to create and nurture various targeted databases, which in turn creates channels for repeat sales.

“Build[ing] a community around your company,” says Robinson, is an essential retail tactic.

Get The Full Price

It is Robinson’s belief that by cutting prices, Amazon has “forced publishers to reduce advances and royalty payments to authors, especially those in the mid-list (referring to books that aren’t bestsellers but are strong enough to economically justify their publication).”

“Cutting what is paid to writers can only affect the quality of what is written in a negative way,” Robinson observes. “Publishers have also been forced to cut editorial and promotion budgets for mid-list books. The result is that blockbusters are being read by ever more people, and vast numbers of perfectly good books are being read by hardly anyone at all.”

The advantage of the consumer reach that Amazon can provide to a smaller retailer is, as Robinson puts forth, not worth the drop in product quality often borne out by the necessities of mass production — and is especially not a fair tradeoff when a retailer does not receive the entire purchase price for items it is selling.

Spend Money On Marketing (Not Amazon)

Avoiding using Amazon as a go-between, according to Robinson, also frees up a retailer’s funds for application toward “imaginative online marketing.”

He asserts that “Amazon, by happily selling anything, without judging whether it is of value or not, [has] created a situation where the consumer is often bewildered by vast, meaningless choice.”

Given the mass of products that Amazon has the ability to recommend to shoppers, it’s Robinson’s belief that entering into that fray is an uphill battle for smaller retailers and that they would be better served by removing themselves from that competition entirely. As no one can speak to a retailer’s unique qualities better than the very retailer in question, that company would be better served to spend its capital on marketing itself rather than for representation by a third party.

As for bookstores themselves, Robinson acknowledges that the writing is on the wall, and the continued dominance of online retail (along with “price-cutting and increased competition from other formats of entertainment and education”) will — as it did with respect to the music industry — perpetuate the decline of the brick-and-mortar model.

The bright side that he finds, however — as proven by innovative, independent booksellers — is that there remains a future for “carefully curated spaces that combine hand-selling by knowledgeable [retailers] with imaginative event programming.”

Somewhat paradoxically, “the more time people spend in front of their computers,” concludes Robinson, the greater the attraction for consumers to get out into the world — virtually or otherwise — and engage with retailers who know their shoppers and design their marketing to appeal to and engage with them.

In effect, Amazon might live and breathe in the online space, but there is plenty of room in there for retailers of all sizes to stand their own ground.