Borders: The Fox in the Henhouse?

Jun 7 01:13 UTC 2002

Excerpted from the Monday edition of "At the Back Fence"
(url: http://www.likesbooks.com/139.html)
Remember when it was revealed a couple of years ago that Amazon received
payments from publishers to "recommend" certain books? That's going to seem
like nothing when you hear what Borders has planned, which is the
implementation of more grocery style-selling beginning later this year. If
you ask me, it's more than letting the fox into the hen house, it's letting
the fox run the hen house. 

As recently reported in Publishers Weekly and The Wall Street Journal, Borders
chairman and CEO Greg Josefowicz plans to implement a "category management
program" this year. Josefowicz, who came to Borders from the grocery/pharmacy
retail industry, developed the category management program when he was
president of Jewel/Osco, and what was good for the bottom line where soap and
beans and Epsom salts is concerned, will apparently be good for books and
Borders' bottom line. 

Borders will divide its book inventory into categories and invite publishers
to "captain" said categories. HarperCollins, for instance, will pay some
$110,000 annually plus $5,000 per employee to helm the romance category. As
you may know, HarperCollins, which is owned by Rupert Murdoch's The News
Company, publishes romances/women's fiction under its Avon, Harper Torch, and
William Morrow lines. The money Borders receives from these publishers will
fund market research that will eventually determine where - or if - books are
placed in its stores. 

Publishers who pay to captain a category will, as has been reported, co-manage
the category, and will influence Borders' buying decisions - including which
titles, and how many - will be bought. The questions raised in the Publishers
Weekly article are obvious; how will books by other publishers fare in such
a system? Will a sort of quid pro quo develop - ie, Publisher A will
"influence" the purchase of books by Publisher B if Publisher B will
"influence" the purchase of books by Publisher A? What will happen to small
publishers who do not have the money to buy a category's captaincy? 

I've long feared the concept that a book can be treated like a grocery store
item. Indeed, in a column I wrote in August 1996, I talked about the
then-burgeoning mid-list crisis and the fact that some would "market the genre
as though it were detergent." I felt a bit like Cassandra at the time, but
what Borders proposes to do scares me - it scares me a lot. Not to get all
political on you, but the idea of publishers stocking the bookshelves reminds
me of lobbyists who write the laws governing the industries they represent.
To me, this plan of Borders' makes Amazon's sale of used books on the same
page as new books seem like much ado about nothing. I wonder how authors not
published by HarperCollins feel about their ability to sell books via this,
the second largest book retailer in the U.S. and Fortune 500 company, with
$3.4 billion in revenues, according to their financials. 

According to an article on the Dow Jones Newswires on May 21st, the argument
does boil down to: "Is selling books like selling frozen food?" The market
research that will be paid for by certain publishers will eventually determine
which books you find on sale at your local Borders. 

__________________________________________________________________________

Twila again: I'm going on a boycott of Borders, and will be writing the
company about my disapproval of this "payola". Nicola's will be getting my
business. What about you?

response 2 of 52:

Jun 7 03:14 UTC 2002

But apparently the CEO seems to think they are. 

response 4 of 52:

Jun 7 09:17 UTC 2002

This is bad.  You see, we just got a Borders in the Yakima area (not 
Yakima proper-- Union Gap) and people are excited somewhat, as the 
company's arrival is part of a large influx of businesses into Union 
Gap's Valley Mall.  It opened very recently, second after its neighbor 
Old Navy.

On one hand, this is a rural city, and it is very probable most people 
here won't care very much.  However, this may hurt those of us who 
like books that aren't consumed by the public at large.  To be 
specific, I think gaming books are going to be hurt-- a friend 
informed me their section is quite small.  Maybe it's not a big change 
from the Waldenbooks we had earlier, but we cannot count on Ron's; 
which is the local gaming/collectible dealership in town.  It is 
especially difficult for those of us who play White Wolf games.  B. 
Dalton is our only other choice, and it is rather necessary to order 
most of the books.

I was impressed with Borders when I visited A2.  This is truly sad.

response 6 of 52:

Jun 7 12:09 UTC 2002

The various Borderses hereabouts (Farmington Hills, Novi, two in 
Birmingham, etc.) have been dreck warehouses for as long as I can 
remember -- the one at 13 Mile and Southfield goes back at least 15 
years.  Bestsellers, calendars, cutesy bookmarks, fash mags, tee 
shirts, tote bags.  But I will keep shopping there as long as they 
continue to carry such things as the Loeb Classical Library.  Until 
then, you can think of the store as a kind of book mall: mostly crap, 
but some very nice little specialty shops.

response 8 of 52:

Jun 7 12:24 UTC 2002

Boy, Michael, I sure do enjoy your Somerset though.  Yesterday I spent
the day there with a friend I hadn't seen in 20 years.  We had lunch at
Alexanders, I got to fondle the sphere fountain, and got away with only
two inexpensive purchases.

Even the air smells expensive.  Fun stuff.

I bought a paperback at Waldenbooks.  Waldenbooks knows how to be
a mall bookstore.

response 10 of 52:

Jun 7 13:07 UTC 2002

This is going to make it difficult to decide whether or not to
continue buying from Borders.  The little shoppers discount card
(privacy-invasion tool) used by Barnes & Noble mostly keeps me
away from there, but if Borders gets into payola for books I will
hold my nose and go elsewhere.

response 12 of 52:

Jun 7 16:03 UTC 2002

I now buy almost all books on-line. It's the biggest "bookstore" in the
world, and the prices are the lowest when you look around, even having
to pay shipping. It isn't easy to browse, of course - you need to know
what you are looking for. 

response 14 of 52:

Jun 7 23:33 UTC 2002

I called it PEE-b'DEES when I first moved here, but the locals soon 
corrected my accent.

response 16 of 52:

Jun 8 10:19 UTC 2002

resp:8  Mary, are you aware Border's *owns* Waldenbooks?  I forgot to 
clarify-- when I learned that fact (I was looking for a job, see), I 
wondered if Border's would close our existing Waldenbooks.  They did.

response 18 of 52:

Jun 8 13:18 UTC 2002

The library buys 95% of the books that we ask it to.  We are in no hurry as
there are plenty of other interesting things to read while waiting.

response 20 of 52:

Jun 8 18:33 UTC 2002

If Borders *really* wants to run the bookstore as if it were a grocery:
        Publishing houses would pay a bribe to get favorable (customer-
        friendly shelves).

        Book order would be altered so that one would have to shop the
        entire aisle to find what one wanted.  (This is why Meijer cereal
        aisle are so screwed up.)

        Publishers would have to pay a shelving fee to get a book into a
        store and nothing would ever be promoted without a per case
        allowance.

        Pressure would be put on the publishing houses to supply replenishment
        staff so that Borders can have minimal staff on hand.  Soon, every
        customer will have to first ask if an apparent employee actually
        works for Borders if assistance is needed.

response 22 of 52:

Jun 8 22:41 UTC 2002

I meant Shaman Drum, not Dawn Treader above. :(

response 24 of 52:

Jun 9 15:12 UTC 2002

Mary, why do you buy both the paperback and hardback versions of a book?