the bookstore business, and how to fail at it and the ebook store business at the same time

 It’s a strange business plan that says let’s sell ebooks online in our entertainment section of our website, and do them in epub form only -- while in our stores we’ll sell an ereader that takes mobi files. But that’s the course the British supermarket giant Sainsburys have been following the last few years. Not so surprising, then, that Sainsburys are closing their ebook shop down.

They’re not alone in making seemingly suicidal business decisions. For quite a while Waterstones had been selling the Kindle ereader in-store while selling non-Kindle epub format ebooks online.

If the Sainsbury’s decision to sell epubs and Kindles seemed like a company shooting itself in the foot, then Waterstones was shooting itself in the head.

After all, Sainsburys are a supermarket. They sell clothes, CDs, DVDs, stereos, homeware, fresh produce and food and detergents and all the other stuff that you’d expect. Books, too (though sadly the space for books seems to be shrinking in some stores). If they don’t do well in the ebook market and their traditional published books sales fall flat, well it’s a pity, but it’s not the end of their world.

Waterstones sells books, end of. Well, just about. They may sell a few Game of Thrones amulets and cups with some literary link or other, the odd t-shirt. But I’m sure you’ll agree that the mainstay of their business is books.

And yet someone thought it would be a good idea to put the biggest threat to the business’s livelihood in-store and encourage people to buy a product that, by definition, would reduce the sale of physical books. Not only that, but they invited in a company that sells books online, often at a steeply discounted price. Amazon’s range of books in stock is massive, often featuring import titles not readily available in the high street, and if you’re prepared to pay the postage, you can usually have the book delivered to your home in a day or two (or five to seven days for free if your order is over a tenner). By contrast, if Waterstones hasn’t got a book you want in-store, then you can order it from them, and in, say, a week’s time you may get a phone call telling you to come on in and pick it up from the store. Oh, and it’s there at the full retail price.

Given that, was it a smart move to bring in the biggest threat to your continued existence into the store? Not only that, Waterstones rigged up free wifi so you could bring your Kindle into the store and download ebooks from Amazon while you sat in one of their few comfy seats (often after you just looked on the shelves to see the book you were after was £8.99 for the paperback and the Kindle ebook was £3.99). Huh? It just felt like Waterstones didn’t know how to react to the threat of new competition and held their hands up in surrender.

Amazon is already the largest market shareholder in the ebook business in the UK. Its nearest rival (with the damp squib non-arrival of the Nook*) is Kobo. For my money the Kobo ereaders are superior devices to the Kindle ereaders. Formatting is simpler, the display options are considerably more advanced, and they don’t load your screen with adverts.

But all that’s by the by for the sake of my argument here.

The important part of Kobo’s business that needs to be emphasised here is that they sell ebooks alone. They’re not Amazon; they’re not selling physical books at steeply discounted prices. They’re not moving into the food business to threaten Sainsburys, and they’re not setting up bookstores in the high street to rival Waterstones.

In such circumstances, then, if you were going to partner up with a firm selling ereaders and ebooks, surely the natural partner would be Kobo.

The book and magazine retailer WH Smiths followed this plan, and seemed to have got it right. But they needed support. They needed publishers to get behind them, to offer up incentives for buying the Kobo from WHS. Tie-in vouchers or discount coupons with actual physical book purchases, that would encourage both physical and epub ebook sales. Tie them in with another high street retailer like Waterstones and there’d be a bigger presence and more brand recognition for the Kobo ereaders.

But none of that has happened. And now, coming up to the busy pre-Christmas retail season, what’s happened? WHS has stopped stocking the Kobo in stores. It’s possible a few of the bigger stores have them in stock, but I haven’t seen them.

There are some who argue that none of this really matters, and argue honestly and sincerely, because Amazon are doing such great things for writers. This is mostly true. Amazon has broken the shackles traditional publishing has placed on writers. It’s forcing traditional publishers to move on, to get with the future. But right now, Amazon are heading for complete market domination, maybe even a monopoly in ebook and ereader sales. At the moment they are fighting for every penny for their writers because there is some competition left. But will that change when they are the only business in town? Ask their employees in their “fulfilment centres”, on zero-hour contracts, no workers’ rights beyond the most basic. Is that the future for the writers who are so reliant on them too? I hope not. Just as I hope that the Amazon warehouse workers get a better deal soon.     

If you’re buying a new ereader for someone this year, the best ereader out there is the Kobo.

But the best format video device back in the day was the Betamax.

And if you were born before 1980, you all know how that ended. (If you don't, then you can learn all about Betamax here.)

If you want to buy a book, WH Smiths and Waterstones have a presence in most high streets across the country. And Sainsbury’s sell the latest bestsellers, often with a good discount. For now.

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* Barnes and Noble - a US book-chain even larger than Waterstones is in the UK - pioneered the Nook as a rival to Kindle. They’ve stopped supporting it now, which in itself is hardly going to endear their customers to them. No wonder that Barnes and Noble are, I think, on their third CEO in nearly as many years.