If Gutenberg was alive today, he would be a very busy angel investor.
With book sales booming during the COVID-19 lockdown last year, the polite written word suddenly grabbed headlines from VCs and founders. We’ve seen a whole slew of new products and funding, including algorithmic recommendation engine BingeBooks, book club startups like Literati and the aptly named BookClub, as well as streaming service Litnerd. There are also exits and possible exits for Glo, Litecharts, and Epic.
But one company that has captured the imagination of a lot of readers is Bookshop.org, which has become the go-to platform for independent local bookstores looking to build an online storefront and compete with the juggernaut of Amazon. The company, which started in January 2020 amid the COVID-19 pandemic, quickly grabbed headlines and was followed by its founder, Andy Hunter, a hardworking publisher with a deep love for the reading ecosystem.
A year and a half later, how is all this going? The good news for the company is that even though customers are returning to retail, including bookstores, bookshops haven’t seen a slowdown. Hunter said August sales this year were up 10% compared to July, and the company is on track to make as many sales in 2021 as in 2020. Referring to those figures, he said that in May there was a 130% increase in the sales of books. throughout the year. “That means our sales are additive,” he said.
Bookshop now hosts 1,100 stores on its platform, and has over 30,000 affiliates that curate book recommendations. Those lists have become central to the bookshop’s offering. “You get all these recommendation lists not only from bookstores, but also from literary magazines, literary organizations, book lovers and librarians,” Hunter said.
Bookshop, which is a public-profit corporation, like all e-commerce businesses, makes money by moving inventory. But what’s different is that it’s quite generous in giving money to affiliates and bookstores that join its platform seller program. Affiliates are paid 10% for sales, while bookstores themselves charge 30% of the cover value of sales generated through the platform. In addition, 10% of affiliate and direct sales at bookshops are placed in a profit-sharing pool that is then shared with member bookstores. According to its website, Bookshop has distributed $15.8 million to bookstores since its launch.
The company has grown tremendously in its first year and a half of business, but what happens next? For Hunter, the key is to build a product that continues to engage both customers and bookstores in as simple a way as possible. “Keep Occam’s razor,” he says of his product philosophy. As for every feature, “it’s going to add to the experience and won’t confuse the customer.”
This is easier said than done, of course. “For me, the challenge now is to create a platform that is extremely compelling to customers, what booksellers want us to do, and to create the best online book buying and book selling experience possible,” Hunter said. In practice this often means making the product feel “human” (like shopping in a bookstore), while helping booksellers maximize their profits online.
For example, Hunter said the company is working hard with bookstores to optimize their recommendation lists for search engine search. SEO isn’t exactly a skill you learn in the traditional retail industry, but it’s important online to stay competitive. “We now have the ranked number one store in Google for book recommendations from their book lists,” he said. “Whereas two years ago, all those links would have been Amazon links.” He added that the company is also involved in best practices for email marketing, customer communication and optimizing conversion rates on its platform.
For customers, too much emphasis on moving to bookshops is abandoning the algorithmic recommendation model popular among top Silicon Valley companies in exchange for a human-curated experience. “It feels like a buzzing hive with thousands of associates, … the institutions and retailers that create the diverse ecosystem around books,” Hunter said. [and we want to] Let those personalities show. “
There’s a lot to do, but that doesn’t mean the dark clouds on the horizon aren’t in danger.
Amazon is undoubtedly the biggest challenge for the company. Hunter notes that the company’s Kindle devices are extremely popular, and this gives the e-commerce giant an even stronger lock-in, which it can’t achieve with physical sales. “Because of DRM and publisher agreements, it’s really hard to sell an eBook and allow someone to read it on the Kindle,” he said, comparing Microsoft’s alliance to bundling Internet Explorer on Windows. “Has to be a court case.” It’s true that people love their Kindle, but even “if you love Amazon… you have to admit that it’s not healthy.”
I asked about whether he was concerned about the number of startups in the books space, and whether that funding could potentially run out of Bookshop. Hunter believes, “Book club startups – those books – and the conversations about books – are going to be successful by putting them in front of the largest audiences.” “So it’s going to make everyone successful.” However he is concerned with the focus on “disruption” and says that “I expect they will be successful in a way that partners with independent bookstores and community members.”
Ultimately, Hunter’s strategic concern is not directed at competitors or even the question of whether the book is dead (it is not), but rather a more specific challenge: that today’s publishing ecosystem ensures. that only the top handful of books succeed. Often dubbed the “middlelist”
The problem,” Hunter is concerned about the fast-paced blockbuster nature of books these days. “One book will suck up most of the oxygen and most of the conversation or top 20 books” [while] Great innovative works by young writers or diverse voices do not get the attention they deserve,” he said. Bookshop is hoping that human curation through its lists can help maintain a more vibrant book ecosystem than recommendation algorithms, which consistently push readers to the biggest winners.
As the bookshop approaches its third year of operation, Hunter wants to focus just on humans and bring the rich experience of browsing in a store to the online world. After all, it’s all about intentionality. “I really want people to understand that we are creating the future with all these little decisions about where we shop and how we shop and that we should be very conscious about how we think about them. ,” They said. “I want it to be fun to shop at the bookstore, not just to do your civic duty.”