Publishers opening their own physical bookstores seems to be all the rage these days. For this month's episode, we sat down with two Canadian publishers — House of Anansi and Penguin Random House Canada — to talk about their new shops and why they've decided to take the plunge into brick-and-mortar.
(Scroll down for a transcript of the conversation.)
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Transcript
Zalina Alvi: It wasn't that long ago that brick-and-mortar bookstores were closing down and everyone thought online was the only way people were going to buy books, whether they were in print or digital. But then, Indigo started opening more stores, and Amazon opened a physical store, even a few indies have opened in the last year. In our latest report on how Canadians buy books, we found that almost half of all book buyers in Canada last year made their purchases in a physical store, with online at about 46%. So it seems a bit early to be announcing the demise of the physical bookstore.
This may explain a new trend we've been seeing lately of publishers opening their own storefronts in Canada and abroad. Of course, this isn't a totally new idea. Montreal-based Drawn & Quarterly have been doing this since 2008, stocking a mix of their own titles as well as others. And over in Windsor, Biblioasis is a bookstore turned publisher that's been doing both for the last decade or so as well. And once upon a time, this was the standard model for lots of U.S. publishers, and continues to be common in Europe. But just recently, House of Anansi and Penguin Random House Canada have both opened storefronts near or attached to their offices in Toronto.
So for this month's episode, we sat down with both publishers to talk about their new bookstores and why they've decided to take the plunge into brick-and-mortar. First up, we have BookNet's Krista Mitchell talking with Sarah MacLachlan, president and publisher of House of Anansi Press in Toronto.
Krista Mitchell: Why did you decide to open a physical store instead of just sticking to an online retail store?
Sarah MacLachlan: Well, it goes back to actually last year when we were...when it became clear that we had to move our regional offices at 110 Spadina. We'd been there for I think over 13 years. And we'd moved into that building to the 8th floor, when it was still very, very much a rag trade building, there were sewers, and that whole area of Spadina was still, you know, it was the last gasp of it, but still quite devoted to the schmatta trade. And we had a reasonable rent, and we all loved it. It was centrally placed. But there wasn't a lot going on down there at that moment. And then, over the period of time that we were there, it developed very quickly, and all of the rag trade people left the building, and there were the IT and TV production companies. And the landlord said, you know, "You guys are..." He was a very good landlord for a very long time. And then he said, you know, "You guys are paying woefully under the going rate for rent here." And so, when we tried to negotiate or talked about negotiating, it became clear that we wouldn't be able to manage the rent that he wanted.
And at the same time, it also became clear to me that, you know, publishing is undergoing, and has been undergoing constant change, and we have always had an active online presence as a publisher, both Anansi and Groundwood, and we do sell books directly to the consumer. And so, when Matt Williams and I went out to look for new space, one of the things I really wanted was to have a street-level space. I really wanted to have a kind of presence in a neighborhood in some way or another, and allow for people to come in and actually see our books and hold our books, and possibly purchase them. But also, to also have a space where we could have events. Because it became more and more clear to me that that's part of what a publisher does in a very active way. We don't just print books and send them out, we try to engage with the readers of those books.
And so, we looked at about 12 spaces. And the final space we looked at on the day we went looking with a realtor was this one at 128 Sterling. And when we walked in, it was basically a dugout, sort of below street-level space, but with great windows, and also, this amazing entrance which had been basically a garage. And that was what really triggered it for me, that we would have 1,000 square feet of bookselling and event space for both...for the whole company. And so, we then...from there, I got an architect friend of mine to come in and look at the ceiling heights and whether we can manage it, and spoke with the landlord. And we got a really great design firm called MSDS to design both our office space and the event/retail space that is the entrance to our building.
Krista: That sounds great. I've actually seen the Periscope of you guys walking around your new office, and it's really beautiful.
Sarah: Well, we've done the new...and we've done the actual built-up, we haven't done a Periscope of the built-up space, which we still have to do. We thought we might do it as a...I think the Facebook video is almost better than Periscope now, so we might do that.
Krista: Yeah, having to go Facebook live might be fun.
Sarah: Yeah, I think it would be. That's next on the list of things to do. Next on the things to do.
Krista: How do you feel that having that physical location and that sort of retail relationship with your customers will change how you communicate with your readers?
Sarah: I don't think it will. I think it'll just augment what we've already got going on all our social networks and on there. And, you know, sort of, the way in which we communicate with them now through our website, Facebook, Twitter, Instagram, the whole nine yards. And it's really nice to have people come into the space, and they do every day. And it's often just because they're walking down the street, come in and browse the shelves and ask questions. And some people are triggered by having seen something on our social networks or on our website, or through our blog, and others are just strolling, because, of course, we've got Henderson, the brewery, behind us. That's very active and community-spirited, and across the parking lot, we've got the Museum for Contemporary Art going up. So, it's becoming I think, once again, sort of Anansi is a little bit ahead of the curve on what's gonna happen in this neighborhood. We have a nice long lease, so we're looking forward to that.
Krista: Yeah. I was worried when you guys moved. But moving out of the downtown core might kind of hinder what you're trying to do with the bookstore. But it seems like your community is really active and really engaged.
Sarah: Well, it's also the landlord is really great. And I don't know if you've seen exterior shots of the building, or you've been down here. But it was an old manufacturing warehouse. And then they did things like pickles and sauces, and all of this stuff. And they've...that signage is painted onto the brick, and they repainted it. So, it has a kind of nostalgic feel to it. So they have allowed us to paint House of Anansi Press on the front brick, over the front door. And then, on the side, we have a big sign that says "Fiction, Nonfiction, Children's Books, and Poetry." So, we've sort of integrated ourselves into the spirit of the building.
Krista: That’s great. Okay. Who staffs the store? Is it just...?
Sarah: Whoever's at the, well, you know, we've got somebody at the front desk. And when people come in, you can see the front desk from when you come in. And so they simply have a look around. And then if they want to buy something, we put it through our square space, which we use whenever we go to festivals and word on the street, and that kind of thing.
Krista: Right. You guys also use that for your online?
Sarah: And we use it for online, yeah. I mean, we use Shopify. So, that's who we run the sale through basically.
Krista: Perfect. And have you felt that it's sort of impacted your business plan in any way to have to integrate this retail portion, or has it been pretty seamless since you already took it on?
Sarah: It's not become that big that it's something I'm particularly concerned. But I'm also very aware that, you know, they're great, independent bookstores all over the place. So we're not trying to do that, you know, we're just trying to have a face that people can make the association between a publisher's name and what they create, and what they make. So, for Groundwood and Anansi, that's what we're attempting to do. And we honestly...I mean, the area is still, you know, growing and quite underpopulated. So, we don't get that much traffic. I suppose when it becomes more of a hub, then we will. And I think as we have in our business plan all along evolved as the times evolve, you know?
Krista: Like you said before, Anansi is sort of ahead of the curve on this particular piece. Do you feel that opening physical locations is sort of the natural next step for publishers at this stage in publishing?
Sarah: Well, I mean, Penguin has done it. Haven't they? So, I mean, when the biggest company in publishing does it then I suppose there's something to it. And in the States, you know, powerHouse had that great space for quite some time, and Melville House. And it's in the history of publishing, you know, there is that wonderful old Scribner's building in New York that, you know, had been a bookstore for them.
So, I think old ideas become new again. And if you even think about Amazon, who their business is online, and yet, they're looking at physical space, because we know that people like to move out in the world and walk in the world, they're not all just staying in their houses buying things online, and books are still a very tactile thing. I mean, 80% of all our sales are still in physical books. So, especially with the children's books, you know, looking at a picture book is nothing...well, I used to sell books, I was a rep for a long time. And we used to be able to describe the adult book, and somebody would buy it based on our description. But in anytime you tried to sell a picture book, you had a blad or an effigy to show the buyer, and they would sit and dutifully look through it and read it.
So, you know, I think it serves the children's book market very well for us to be able to have this space. And we've hosted some parties for booksellers in the space. It's a great party space. So, that's the other thing. We're hoping to have most of our book launches in the space. And then, you know, we may have some kinds of educational aspect to the space as well. So, look for that coming down the road, you know, children's illustrator doing classes for young kids on illustration, or perhaps, you know, we'll have a course on how to write a novel. There's all kinds of possibilities, and the space allows for us to explore those possibilities.
Krista: Well, that sounds so wonderful. That sounds great. I won't go there right now.
Sarah: Come on down.
Krista: I will, right afterwards. I'll be there.
Sarah: Okay.
Krista: I had one more question. But I think you already answered it in a previous answer. I guess, sort of, like, five years ago people were saying "Print was dead, books were dead, you'd be crazy to open a bookstore." Did you encounter any of that when you were like, "We're gonna do it, we're gonna open?"
Sarah: No, I mean, our justification on it really came out of the fact that our sales online were increasing. And so, we devoted a certain amount of space in the office for active stock, because we ship directly from our office. We don't use a third party or a warehouse to ship our online orders. So the fact is that we had a certain amount of square footage in terms of bookshelf space that was devoted to pure sales. And so, we took that as a justification to actually put that space...use that space that we required, and open it up to the public. If you see what I'm...I think I'm explaining myself properly, that there was a certain amount of space in our office devoted already to active stock that we were selling online. So, put that space in a public space, and give it an extra oomph and let people come in.
Yeah, I said...I think what I said about physical books is that they're still 80% of our business, maybe even more. And people seem to still wanna buy them and read them. There's always a conversation going on around peoples' free time and what they spend it doing. And, you know, the truth is that mobile devices have really taken up a lot of people's free time. But I think there's also maybe a little bit of a backlash on that. I mean, I talk to young kids now who think it's hip not to have a smartphone, but to actually just have a flip phone. And if they want to do stuff, they'll do it on their computer or their tablet. But the smartphone is expensive, and it sucks up a lot of time, and you waste a lot of time on it. So, we'll see how that all falls down.
Krista: That's true. Everything goes through sort of a retro-revival maybe.
Sarah: Yeah, I mean, I was listening to the CBC yesterday, and they said that Canada's going to become one of the leaders in record production, i.e. vinyl, because there's a place that's reopened and all the major labels are coming to them to produce the vinyl, you know, and I think nobody thought that would happen.
Zalina: With more indie publishers selling their own books online, and the ease and availability of POS tools like Shopify for managing transactions, it is easier than ever to set up your own bookstore. And using the space for events and book launches also makes a lot of sense, especially if it's already part of your office space, and if building a community with readers is part of your overall strategy, which is the case for lots of publishers. But opening a store is not without its own challenges. And operating a retail space is very much a unique and separate business from running a publishing house, which is why Penguin Random House Canada is taking a small step into the retail space and just testing the waters for now.
Meghan: My name is Meghan MacDonald, and I'm the director of Digital Product Strategy and Consumer Marketing Development, at Penguin Random House in Canada. As part of that, I oversee all of our consumer sales and marketing initiatives. And one of those is Penguin Shop. So, I've been involved throughout the project to build Penguin Shop. And now that we've launched, I'm overseeing all of our operations, its strategy, thinking about store themes and assortment philosophy. So, basically, I've my hands in all aspects of the shop.
Krista: Can you tell me a little bit about the history of the genesis of the store? When did you guys start thinking about opening it? Where did the idea come from, and why?
Meghan: Absolutely. So, in some ways, we've been thinking about a shop for many, many years. It's kind of fun. This type of thing we throw around in conversations when we're talking about different, say, marketing initiatives or just the business generally. Saying like, "Oh, wouldn't it be fun if we opened a store?" But it didn't become a reality until recently. And as you may know, Penguin Random House merged a few years ago. And as part of that, in Canada, we merged our offices as well. So we went from three different locations to one central office in Downtown Toronto. And then, when we moved into that office, it came with the opportunity to have a retail space in the lobby of our building. And so, that really was when it kicked off, it's like, "This could be a reality. So let's start talking about it a bit more seriously, and think about what this space could be."
And it's also I think worth noting that Penguin historically has a long history of selling direct to consumers. This is not really a new initiative for us. It is in some ways but also is not in many others. For example, Penguin in the UK recently had a popup shop in London. We've had a Penguin truck for many years in the U.S., which is a bright orange Penguin-branded truck that drives around and sells at events, most recently at BookCon in New York. And we've had a lot of other small popups around the world as well. And then also, we've sold online at various points throughout our recent history as well.
And so, with the space in Toronto, this is our first bricks-and-mortar location in Canada. And we have a few goals for it. I think it might be a bit of a surprise to some people that sales is actually not our first goal. We're really thinking of this as a brand extension exercise. Obviously, Penguin is a loved and trusted brand for many, many readers. We all know the classic tri-band, the orange and white banded series of books. And so, being able to extend the trust in that brand to other products, and to see if we can bring people in the store and let them interact with us is really exciting.
We also want to be able to have a space that...we're kind of thinking of that as a product lab in many ways, where we can test out some things in a way that's a bit safer than rolling it out to, you know, all of our partners across Canada to see if it works, and then use that information to make some more informed decisions about what we end up bringing to all of our other bookseller partners. So, that could be things like, you know, maybe it's different types of merchandise, or it could be a limited-edition cover of a book, or something like that where we do smaller runs of specialty products. And then our third goal, and very much our last goal is sales. For us, it's way more about line extension and product experimentation. And then, when we happen to sell things, it's a nice bonus.
Krista: Yeah, sounds good. So, can you tell me a little bit about the basic setup of the store, like these basic, kind of, nitty-gritty details, like what are you stocking, how are you bringing in customers, who's actually working there?
Meghan: Yeah, of course. So, I think it's worth noting that it is a tiny, tiny space. It's 158 square feet. So we really had to...it was a little like a shoe repair kiosk before we took it over. So, very, very small. But we worked with a great design firm called Figure3, to create a kind of dynamic design that worked within the small space, that let us have a bit of a flexible feel to the space. So, it is made up of one wall, looks like a bookshelf where there are seven book spines, and four of those pull out, and those are our bookshelves. So, we can reconfigure them in different ways. They kind of slide across the floor. So you might come in one day and see only one of those shelves out, or you might see all of them. But also the book spines that I've mentioned, the seven, they're made up of these magnetic strips. So, we can change out which books are featured at any given time. So, when we launched, we had the classic Penguin tri-bands up. And we've now switched this to some different books. So, I think Bobby Orr is up there, for example, right now. And that will happen at a regular cycle throughout the year, and we'll try different things at different times.
In terms of what we're carrying, we're also thinking of our assortment philosophy in that same way, where it's a very flexible, changeable assortment. So, because the space is so small, we can only carry a very, very limited quantity of books at any given time. So, it's not your traditional bookstore at all. It's more of a curated space. We'll come in and do something different. So, when we launched, we have a lot...right now we have a lot of classics in the space. So, some of the, you know, beautiful hardcover gift sets of books you know and love, we have some bestsellers featured, and obviously, now that we're going into award season, are showcasing some of our award nominees as well. But that will change over time. So for example, we might end up doing a Hockey East store takeover, or kids' week, or cooking, for example, and that will change all the time.
And then, in terms of staffing, we have one full-time employee dedicated towards managing the store and partially working in it. So that person is thinking about what we're ordering and when, how do we restock the space, what the timing is? And we also have one part-time bookseller. So, you know, working afternoons, potentially weekends in the future. So it's very small. For us, it's very...doing a lot of, like, figuring things out right now. We kind of don't...we're still...we're only one month in. So, there's a lot of processes that need to be worked out. And we're still in that, in that stage.
Krista: That's nice, though. It sounds like a very creative use of the space, very flexible, like you can really adapt it to different things quickly and easily.
Meghan: Yeah. And that's what we're hoping. And people who are coming into the space seem excited about that as well. Anyone who hasn't seen videos, when they come in, we, you know, see them kind of looking around. And then I'll say something like, "Oh, have you seen how we can move these around?" And literally, just push the bookshelves in a different configuration in front of their eyes. And then people get so excited about that. We also have this back wall in the space that is a stretched canvas over a light box, so we can change out what that design is at any time as well. Right now it's the Penguin logo. It's bright orange, glowing from across the lobby. But that could be different as well when you come in.
Krista: And you have a bit of Penguin merch, right?
Meghan: Yes, we do. So we're carrying right now a lot of mugs that are in classic Penguin design, tote bags, we're carrying like onesies for babies, as well bibs, some t-shirts that are based off of classic books, like "Moby Dick," for example. And then, also some of the tote bags and notebooks and things that are based off of different illustrations. And so that's stuff that has been out in the market for a long time, but it's difficult to find all in one spot. So we see a lot of people coming in and getting really excited that, you know, they could buy a gift for their family member who is a big reader, and, you know, would love to have a mug with "Little Women" on it, or something like that. We have also commissioned some pins that are based off of the Penguins. So we have the penguins in different poses. And we also have the classic Penguin logo in the orange oval background. So we plan to do more of that in the future, of trying different little products and seeing how they work.
Krista: Do you know if a lot of the customers have been people kind of seeking out the Penguin Shop that they'd heard about elsewhere directly for this, or people kind of be like, "Oh, what's this," and wandering in?
Meghan: So far, we managed to get a lot of really great coverage in places like "Toronto Life." And anecdotally hearing from customers that that's how they heard about it. And so, that's really exciting that people are reading about it and wanting to seek out the Penguin Shop. We knew...we guess that we had this, kind of, you know, big reader fan who would want to kind of watch this, it's like many of us who work in the industry. But you never know for sure. And so, it's nice to see that that is actually true. And people who are coming in saying, "Oh, I've been looking for this version of this book for a long time, and it's so hard to find, I'm so happy that you have it." Or wanting to carry a tote bag featuring "On the Road" or something like that. But then also we have, obviously, our...so our building is right in Downtown Toronto near Union Station, so there's a lot of foot traffic. There are many office buildings around us. So we're seeing some other people who, you know, probably work in the area, maybe aren't as big of a reader, but are kind of wandering in. And that's nice as well. There's, obviously, a lot of people in our building who are now stopping by and are already becoming regulars actually, which is great.
Yeah, and then there's a few...one thing that's also really exciting that we're seeing is people who have been following, you know, maybe us on social media for a long time and heard about the shop that way, and got really excited early on, even before we got press coverage, and kind of have been, like, waiting for us to open, hoping that it would happen any day now, and they're coming in as well. And obviously, sharing and posting photos, and telling their friends about it. One thing that our design firm did a great job of is creating a space that...what we've seen so far is people want to take photos of. So we're seeing a lot of people posting on Instagram, and, you know, wanting to...asking us to close up the bookshelf so they can stand in front of the wall of books lined, or in front of the back wall with the backlit penguin. And then, like, telling their friends about it for us, which is so nice. That word-of-mouth is really important.
Krista: Nice, very Instagram-able space.
Meghan: Yes, exactly.
Krista: Great. So, that all sounds amazing. But I'm sure there's been a few challenges along the way. Can you tell me a little bit about things you've encountered so far, maybe further challenges you're expecting?
Meghan: Yeah. Of course, there's always challenges with any project. One thing that, you know, happened early on is just construction delays. We haven't...I mean, obviously, as a book publisher, we don't undergo too many construction projects. So, that was one thing that, you know, once you get the bookshelves in, finding out that they don't quite fit as well as you expected. And so, having our launch day delayed for those reasons. So that was an early challenge. But now that we're actually up and running, we're facing a whole new set.
So, because the space is so tiny, we also don't even have, like, a backroom connected to it. So our storage location for anything we're receiving from our warehouse is kind of a different point within our building. So there's piles of...there's boxes of books around my desk. And so that process of ordering things and receiving them, but then also getting them into the store is just a work-in-progress in terms of like, what is the right timing, when can we, you know, shut down the space for long enough to re-merge, and things like that? So we're working through some of those kinks right now. And in some ways, those are things we didn't exactly expect.
And then, in terms of things for the future, we would like to sell some of the products online. We're not going...we need to, you know, kind of get the store right first, people keep asking us when we're going to be selling across Canada. And we really need to figure out the physical space before we jump into that. But we do want to start experimenting with that. And so, thinking about shipping times across this vast country and what we should sell, and how many orders should we expect and all of that is stuff that we know we will have to figure out in the future, and expect it to be a bit of a challenge.
Krista: Yeah, the retail space is its whole unique challenge with its own considerations for sure.
Meghan: Oh, exactly. And I'm sure other publishers who are getting into direct-to-consumer sales are facing some of the same things where, you know, we've already...we've worked with our bookseller partners for a long time. But it doesn't necessarily mean we completely understand how this works and things that, you know, we didn't even think to take into consideration.
Krista: So, along those lines, I mean, this is kind of an overall trend with lots of publishers choosing to sell their own books either online or in physical stores like you guys are. I'm just curious, do you see the industry as a whole moving more towards direct-to-consumer?
Meghan: You know, that's an interesting question. I think in some ways, though I think as an industry, we have a habit of jumping to, you know... I remember when I started in the industry years ago, it was all about eBooks. And I was like, "Oh, is everyone gonna be reading online? Is the print book dead?" And it's was like, "No, we're just gonna kind of have both." And I think that sort of trend might end up being what we see within direct-to-consumer as well, where, like, it obviously makes sense for publishers to try to have closer connections to our readers. We have always been slightly distanced, and one of the downsides of that is that we don't have that feedback loop with our readers to know, do they like what we're publishing? Is there something else they're interested in that we might not have considered? Or have it...what are they actually...how do they react to a book cover? Or things like that. So that kind of information I think we need more and more of, and we're trying to gather in different ways. Like speaking for Penguin Random House, we're obviously doing things like digital marketing efforts, and many publishers are as well, so having that direct connection through social media. And I think direct-to-consumer sales is another way to have that connection. But I don't think it's ever going to replace booksellers. That would take...I don't even think it's possible actually. I think the...like, the trust that is in place with your local bookseller is so important, and that service that is provided to various different communities, I don't think a publisher could replace, to be honest.
Zalina: If you're visiting a publisher-run bookstore in the near future and would like to share your experience and thoughts with us, we'd love to hear about it. Please visit booknetcanada.ca to find out how to get in touch. Thanks to Krista, Sarah, and Meghan for taking the time to be on this month's episode. We gratefully acknowledge the financial support of the Government of Canada through the Canada Book Fund for this project. And of course, thanks to you for listening.
