One of the Amazon Book Stores, which opened in Seattle, Washington in 2015, displays excerpts of online Amazon customer reviews and star ratings for books. Amazon shut down his brick-and-mortar bookstore business in 2022.
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Within its first month as an online bookstore in 1995, Amazon.com shipped books to all 50 states. By 1997, it had shipped its one millionth order (hand delivered by Jeff Bezos himself). In other words, the company that once called itself “Earth's Largest Bookstore” has continued to evolve its bookstore business for 30 years, experimenting with Whole Foods and physical stores and growing into an Everything Store and retail giant. There is something symbolic about the method. world, a global logistics provider, the nation's largest cloud computing services vendor, and recently a leading generative AI investor.
Despite all the time spent on books and the impact their success has had on the bookstore business, Amazon still has some problems to solve with its readers. In mid-December, Amazon launched a new service called Your Books that aims to address some of the challenges it still faces in helping users build more frequently used libraries.
It starts with customer reviews, one of Amazon's oldest features and an integral part of its capabilities as a bookseller. Helping customers find their next book through reviews and recommendations at least approximates the brick-and-mortar bookstore experience, where customers can physically browse shelves and chat with staff who know their tastes. It will be the center for
Reviews apply to all Amazon products, but they're even more important when it comes to books. Buying razor blades and sponges online doesn't involve as much of a loss experience as transacting in a brick-and-mortar store, but when you go to a bookstore, you get to see the shelves and the community of readers built into the book-buying experience. It involves serendipitous discoveries, such as perusing.
To overcome this, Amazon has added all kinds of reviews, ratings, and recommendations over the years. Some are human, some are algorithmic, and some are generated by AI. In a most obvious demonstration of the importance of community to readers and book buyers, Amazon acquired Goodreads, his 2013 online forum for book lovers to discuss books. Although this human approach has clear benefits, it also poses its own set of problems. All too human, such as the recent scandal surrounding Goodreads, where authors “review bomb” their competitors' books.
All of this may have influenced the launch of Amazon's Your Books. The company calls it a service that aggregates information related to a customer's entire book purchase history on Amazon, “including Kindle and Audible businesses,” to receive recommendations based on insights about their reading preferences and personal reading habits. It describes it as a “personalized space.”
“With Your Books, customers can access a highly personalized experience across all their past purchases, use filters to explore their library, and activate 'Discovery Mode' to get recommendations tailored to their interests. ,” said an Amazon spokesperson. A spokesperson said there are links to past expansions of the Amazon book brand by integrating customer history and community-building features such as Goodreads, and overlaying Goodreads' discovery, community and review experiences.
Your book is a reordering of existing functionality rather than something completely new. “Amazon customers have always been able to get book recommendations, access book purchases and wishlist items,” the spokesperson said.
Physical book sales still far exceed e-books and audiobooks
While digital bookshelves mimic physical bookshelves at the simplest level, this highlights another factor that Amazon still needs to consider: the durability of books as physical objects. People like to see and display what they read. It shows who they are in a way that few other objects can. And people still prefer buying physical books over e-books or audio formats.
According to the American Publishers Association, print books continue to significantly outperform e-books and audiobooks. The company's latest annual data through October 2023 shows sales of $10.6 billion in the first 10 months of this year, of which the consumer books business accounted for $7.4 billion. Of that, hardcovers accounted for $2.7 billion and paperbacks $2.6 billion, accounting for more than 70% of total sales. E-books were $836.1 million, and digital audio was $699.2 million.
Technology-enabled book competitors are facing their own growing pains, as are some of Amazon's broader book efforts. Audible just announced layoffs, one of Amazon's many divisions. In the second half of 2022, Amazon will cut staff in its hardware division, which sells Kindles, and in the beginning of the same year, it closed an experimental brick-and-mortar store whose sales growth was lagging behind other retail divisions.
For Your Books to really make a profit, it will likely need to lead readers to their next online purchase, or, in the words of a spokesperson, “to their next great read.”
Independent bookstores aren't going away
While this may pose additional risks for independent bookstores in the age of the Amazon threat, recent data shows that the local-level bookstore business is resilient. A multi-year study of independent bookstores in the United States by Harvard Business School professor Ryan Refaeli published in 2020 found that Amazon's business model has inherent value as it continues to grow. His research cites data from the American Booksellers Association that shows the number of independent bookstores increased by 49% over the 10-year period from 2009 (1,651 stores) to 2018 (2,470 stores).
The period since Amazon's launch in 1995 caused significant damage to the bookstore business, with the number of bookstores declining by 43% five years after Amazon's first year of operation, according to a report by the ABA, and recovery only began in 2009. This was 10 years ago, or two years after its introduction. However, Raffaelli believes this is because elements of the bookstore model are difficult to replicate in a virtual-only world.
Beyond curating the bookstore's collection itself, the power of recommendations in the form of direct conversations with buyers has proven essential for independent bookstores that not only survived but thrived in the wake of Amazon . “Independent bookstores have been able to compete with Amazon by building deep relationships with readers and authors,” Raffaelli said. Recommendations and curation are at the heart of this. “Relationships like these demonstrate the passion of 'indie' bookstore employees for reading and their long-standing commitment to sharing the next great book with others. It's a sacred act of community-building and… “It's considered,” he says.
NEW YORK, NY – FEBRUARY 27: Customers purchase books at Argosy Book Store, New York City's oldest independent bookstore, founded in 1925, on February 27, 2023 in New York City. (Photo by Liao Pan/China News Agency/VCG via Getty Images)
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Goliath will continue to win on price and inventory, but David shouldn't be trying to be the biggest bookseller on the planet anyway.
“Instead of competing with Amazon on price and inventory…booksellers are now seeking unexpected hidden gems from their shelves, whether they are up-and-coming authors or unexplored genres that online algorithms have not yet replicated.” “We have a unique ability to find out,” concluded Mr. Raffaelli.
It could be argued that algorithms and knowledgeable booksellers have similar goals, and both seek to help readers find books they value. And the algorithms that curate artistic content for consumers are much better at replicating personal touches, like Spotify's playlist selections, but they're still in development.
But, understandably, independent bookstores are reluctant to accept this comparison.
“Their algorithms do what they want them to do and make more money,” said Robert Martin, executive director of the Independent Booksellers Association, which was founded in 1993.
Everyone who sells books wants to make more sales, but Martin says the risks of algorithms are sacrificing autonomy for convenience. Generating new recommendations that adhere tightly to previous likes tends to create reading bubbles. “This is a very real danger, and one that independent publishers and independent bookstores must always actively fight by ensuring that diverse voices, genres and styles get the platform they deserve. ,” Martin said.
For Martin, actual recommendations from other readers and informed booksellers in bookstores are important, no matter how inefficient or uncontrollable such recommendation mechanisms may be. “I would rather try to convey my experiences and understand the feelings of other humans than be guided by a robot, which may not get it completely right,” he said. The best way to find your next great book, he says, is to “talk to a friendly, knowledgeable bookseller at your local independent bookstore.”
