While attending the American Booksellers Association's 13th annual 2018 Winter Institute, aka #wi13, in Memphis, Tennessee at the end of January, I was left thinking about one of my favourite songs from the lauded musical episode of Buffy the Vampire Slayer, "Once More With Feeling." At the end of the episode, after Buffy and her friends defeat the bad guy, they gather for a final (very literal) bow, express their mutual feelings of consternation and isolation, and sing:
Where do we go from here? / Where do we go from here? / The battle's done and we kind of won / So we sound our victory cheer / Where do we go from here?
Winter Institute is a must-attend event for any serious bookseller (who's able to attend); you won't find a meeting of more interesting, motivated, and excited booksellers anywhere else in the industry. But after leaving Memphis, I felt nervous. While the conference felt like a celebration that things are as they should be for independent bookselling — sales are up, speakers from both within and outside bookselling professed the essential nature of indie bookstores to the well-being of their communities and culture at-large, and the booze was flowing — but there are things that need to be addressed as booksellers plan for the future. Like keynote Amy Webb, a quantitative futurist and author of The Signals are Talking: Why Today's Fringe is Tomorrow's Mainstream, I am a pragmatist, not an optimist. But I'll get there.
What we talk about when we talk about indie bookselling in 2018
Winter Institute covered a lot of ground in Memphis: actress Sarah Jessica Parker discussed her new imprint for Hogarth Books; Morten Hansen led an intensive workshop on identifying and refining a store's strengths; and there were sessions on social media strategies, sidelines, and hiring with diversity in mind, etc. There were also sessions on business strategy, legal issues, and inclusion. Indeed, almost every conceivable topic of relevance to independent booksellers was explored.
What we don't talk about when we talk about indie bookselling in 2018
But there was much left unsaid.
In their recap, Publishers Weekly observed that the mood "was largely upbeat. Many [booksellers] had had particularly good years in 2017." This was echoed in American Booksellers Association CEO Oren Teicher's address to booksellers: “For more than five years now, our channel has seen sustained growth—the result of your clear focus on ongoing professional development, tireless work, and continued entrepreneurial innovation." Recognizing that growth was not experienced by all stores, Teicher called out various factors, such as environmental disasters, rising minimum wages, consumer buying habits, and dollars moving online, as contributing to the difficulties experienced by independent retailers in the past year.
The elephant in the room these days, however, is Amazon. After all, we know Amazon is no simple bookstore — it's "the everything store." Invariably, when the word "online" is mentioned in a room full of booksellers who have been competing with the online marketplace for over two decades now, we are often referring to Amazon. Online book prices are lower, competition is essentially non-existent, and more and more customers are spending their time and dollars discovering and purchasing books online.
When we do talk about Amazon, we talk about pricing, heavy-handed negotiations with Big Six publishers, Prime membership trends, and revenues, but we need to be talking about much more.
Amazon is a bookseller but not every bookseller is Amazonian: Amazon Inc. & artificial intelligence
When Amazon.com launched in 1994, it was a bookstore in the sense that it was an online marketplace for strictly one product: books. However, in its S-1 filing with the US Securities and Exchange Commission (SEC), it eloquently stated its objective (emphasis added) "to be the leading online retailer of information-based products and services, with an initial focus on books." That books were simply the starting point was not noticed by many at the time, which is why the company attracted attention a few years later when it explained that its vision (again, emphasis added) "is to be earth's most customer-centric company; to build a place where people can come to find and discover anything they might want to buy online." This brings us to the present and Amazon's six primary strategic focuses, according to Webb:
- Artificial Intelligence (AI)
- Digital Voice Assistants
- Computer Vision
- Web Services
- Collaborative Robotics
- Automation in Retail
Just think about the past few years of Amazon innovations: Alexa (its voice-activated assistant); Amazon Go (a store without check-out counters); a partnership with Berkshire Hathaway and JPMorgan Chase on yet-to-be-determined healthcare insurance properties; Amazon Prime Air (drone delivery); Amazon Key (remote access for delivery personnel direct into customer homes); etc. etc. etc.
Consider this snippet from Bloomberg (emphasis added): "Amazon also announced Wednesday a partnership that lets people buy car tires on its website and have them delivered and installed at some Sears Holdings Corp. auto centers. It's another example of how Amazon is trying to stretch into product areas that have been almost entirely immune to e-commerce."
But these are all distractions. Webb suggested that independent booksellers and the wider publishing industry need to drastically shift to new ways of thinking to achieve sustainability. Yes, Amazon is constantly dazzling everyone with new product innovations, but is it possible that the current fixation on Amazon Go is merely a distraction? Webb notes in her talk, "The Future of Bookselling", that the public face of "the retail platform, the payment gateway, the customer data, the inventory systems [are] all being propelled by AI" that Amazon doesn't want us to notice. There are signals that consumers, and booksellers, should be noting that "tell us about the future of bookselling, even indie bookstores... [and] something about the future of how all of us will shop.”
Amazon is a company that purports to be obsessed with customers, and their business strategy is to pursue that obsession through relentless innovation. But it may be that Amazon is writing the future, featuring itself as the protagonist, while its customer base becomes a passive background character.
"Like every technology, when it becomes so convenient and easy, we’ll keep using it… even when we know it’s bad for us" - Amy Webb
Consider Amazon's Prime and "Subscribe and Save" services.
A primer on Prime: Prime is a membership program with an annual fee that allows the consumer to enjoy free two-day shipping for items fulfilled by Amazon (Amazon has a marketplace model where other sellers may list items and elect to either enlist Amazon to stock and fulfill customer orders or fulfill the orders themselves), as well as free returns, access to the Prime library of digital books, movies, television, and audio content (including exclusives and Amazon-produced content). In Canada, Prime sets you back $79/year and there are over 100 million subscribers across the planet, with over 90% of members renewing on an annual basis (according to Amazon in its recent report to shareholders).
A primer on "Subscribe and Save": This service is available to any Amazon customer with an account and saved credit card information. By partnering with a number of product manufacturers and distributors, they can offer a select list of household staples (largely supplies and edible pantry items) through a subscription. The customer can set up parameters including quantity, frequency of deliveries, delivery address, etc. and Amazon will automatically send a package every month with the items requested with no reordering work required. Oh, and if five or more items come in a single delivery, you'll get an additional 15% off. It's easy to do, and it works.
Both services are examples of Amazon's efficiency at recruiting and retaining customers: set high expectations, meet or exceed them, and continue innovating. Prime members see regular enhancements to the program. Just last week it was announced that Prime members will soon get an additional 10% off sale items at Whole Foods (which Amazon acquired in 2017 as a data and product playground).
Meanwhile, the exchange for both of these services between Amazon and its customer is as passive as it gets: A one-time handover of credit card information and all the consumer data Amazon can collect, followed by consistent and reliable product and service delivery. The financial endorsement such an exchange provides is also passive: Through continued patronage and purchasing from Amazon, customers speak with their wallets. Where you spend your money, particularly in today's politically charged environment, gets noticed. While Amazon and other tech companies may save customers time and money, larger issues of fair wages, treatment of warehouse employees, use of personal customer data, and the lack of anonymity, among other factors, are among the true costs of passive consumer engagement with modern tech titans.
Tomorrow is just a day away: The future of bookselling
Webb's work as a futurist means that she looks for "weak signals at the fringe." By using data from weak signals, futurists try to identify and analyze patterns in order to recognize trends as they emerge. They also "use trends to build models for possible, plausible, and probable future scenarios." The hope is that, with these scenarios in mind, observers can calculate risk and make immediate decisions to plan for the future.
Methodology: The Future Today Institute's forecasting model relies on quantitative and qualitative data. Our model alternates between flared and focused thinking. This includes: identifying very early stage fringe research, focusing on patterns, interrogating trend candidates, calculating a trend's trajectory, writing scenarios, and finally pressure-testing strategies and recommendations.
In her talk, Webb identified three signals she encourages booksellers to consider when framing their future:
- People want community, but they want to dictate the terms.
- Advancements in AI will change how people read (and write) books.
- The leaders in AI continually mine, refine, and productize our data.
Quite simply, it's impossible to reconcile these signals and their potential future impact without considering the influence and strengths of large tech companies like Amazon that independent booksellers just don't have. With these signals in mind, Webb developed three potential frameworks for the future, for both independent bookstores and publishers:
Indie bookstores in 20 years
Optimistic framing: 25% probability
Independent bookstores are thriving because they banded together in 2018 and invested in digital infrastructure. They now have a digital commerce and fulfillment system that’s just as good as Amazon. Fulfillment is immediate, not several days. Staff are available via video chat to talk about books. Authors attend virtual book tours, hosted by local shops. Community members feel like stakeholders in their local booksellers, who they see as both curators and thinking companions.
Pragmatic framing: 50% probability
Independent bookstores were unsure what to do next. They decided not to take risks. Consumer behaviour changed; they expected no interaction, no lines, no waiting. Speed became paramount. Independent bookstore business slowly eroded.
Catastrophic framing: 25% probability
Amazon became the de-facto backend for retail operations. Because smaller stores couldn’t compete individually, they eventually sold. Local bookshops disappeared. My mother-in-law is now forced to buy wildly inappropriate books for my daughter, who is a confused teenager.
Publishers in 20 years
Optimistic framing: 25% probability
Publishers recognized that their business relationship with Amazon wasn’t sustainable — and that their publishing schedules and workflows weren’t realistic. They reduced friction in the supply chain and enabled books to be published much faster. Publishers got together to launch an exceptional digital reading experience, which now includes generative algorithms that automatically adapt text for reading levels. Readers purchase books or subscriptions through local booksellers.
Pragmatic framing: 50% probability
Amazon began a new kind of program, where books were “piloted” before they were sold. Amazon stopped holding inventory, and instead started printing copies on-demand at its Amazon Go stores and in local warehouses. Publishers are now paid per book license rather than on books sold. The finance model for publishing imploded. Publishers shrank, laid off staff, consolidated.
Catastrophic framing: 25% probability
Book topics, text, and visuals evolved and are now dictated by our data. Books are mostly distributed digitally, though some are printed on-demand. We have a filter bubble that extends to fiction, memoir, biography… Eventually, Amazon launches an automated system to write books without humans.
If you're actively involved with the present-day publishing industry, each of these frameworks represents a drastically different reality from the one you're accustomed to. The optimistic frameworks will require strategic planning, large financial and human resources, and active collaboration at a scale not currently seen in the industry. So how do you plan for a future that may very well not include you?
Futurist thinking is another tool in your toolbox
Facing such troubling future scenarios, Webb suggests radical work for booksellers: take incremental actions for your future. And just as Amazon et. al. use tech and thoughts of the future to their advantage, so can booksellers. She has shared a toolkit on Dropbox with the hope that booksellers can realize the optimistic framework. It outlines a process by which stores can design scenarios that address three key signals that will impact bookselling in the future:
- Build a stronger relationship with your local community by getting them great books fast.
- Build a stronger relationship with your local community by becoming more visible.
- Think about the farther-future, so that you can confront disruption today.
The process then continues by evaluating your completed scenarios against the future frameworks Webb defined (optimistic / pragmatic / catastrophic, as above) and then completing the plan by building in accountability: assigning clear next steps with deadlines attached and identifying who and where to turn when the planning work has stalled.
Naturally, much of this work aligns with the routine strategic and business planning a company does on a regular basis, though the timeline is drastically expanded. Where most strategic and business plans don't exceed five years, futurist planning can extend to 10, 20, or even more years into the future. Take your time, consult, and collaborate. Use the other tools in your toolbox — industry research, tech trends and news reporting, business intelligence software, budgeting, etc. — and pay attention to the weak signals.
Finally, stay in touch with BookNet. We're here to help! Our biweekly TinyLetter for booksellers, Let's Sell Some Books, is a great option for the busy bookseller.
