In 2006 I was a member of a Competition Commission inquiry which cleared the takeover of the UK bookstore chain Ottakars by HMV, owners of the bigger chain Waterstones. It was a controversial decision in the publishing and bookselling world. Publishers, authors, and many readers argued that the merger of two of the three large chains of bricks and mortar book retailers would reduce choice for consumers and would reduce innovation and risk-taking by publishers, because between them Ottakars and Waterstones controlled the majority of the prime display spots on high streets in which new titles are displayed. The inquiry group ultimately disagreed. The number of titles published, and sales volumes, had grown strongly, although perhaps with some trend towards fewer blockbuster titles with enormous sales volumes (a 'superstar' effect). We identified many routes by which publishers could get their titles to market, including reviews, TV shows, direct advertising, online retailers, and supermarkets. We also concluded that the number of titles displayed in any store was a choice variable which could rise or fall for many reasons. The publishers made much of the fact that independent bookstores,one of the main rivals to the merging chains in the high street, were declining in number. We were puzzled as to why all publishers seemed to insist on the same profit margin from the independents as from the supermarkets. Of course it is cheaper to supply to one distribution centre for a large supermarket than to many independent stores, but if the independents are as vital as publishers claimed for new authors and titles and for surprise success stories, then surely it would make sense for publishers to accept a lower profit margin for supplying them?
I'm reminded of all this by the source of my second hand copy of Rawls Theory of Justice, which is sitting on my desk now. It came via Amazon's Marketplace from Eric T Moore Books of Hitchin, Hertfordshire. It's a secondhand store which will order new books, and clearly has found Amazon to be a useful outlet for its stock. I also order from O'Donoghue Books in Hay, and use Abe as well as Marketplace. So as a reader there seems to be as much variety as ever in choice of outlet, although as with other areas of retailing quite a lot of activity has moved online. This includes second hand books – which we treated nearly three years ago as a separate market. On the other hand, the newspapers are carrying fewer book reviews and some had shed their Literary Editors, and in the UK the Richard & Judy Book Club on TV is no more. There seem to be opposite views about the likely impact of the recession on book sales – that it will reduce sales because it's discretionary spending, or that it will increase sales because books are a cheap form of entertainment. On top of this we get online self-publishing, the various new bits of kit for e-book readers and the trend towards online publishing for reference works (described in previous posts), so still more technology-driven secular trends on top of the cyclical effects.
It leaves me wanting to know, as well as changes in sales volumes and new titles published, whether second hand sales account for a rising proportion of total sales (value and volumes), developments in the fortunes of independent booksellers, and what's happening to publishers' margins via the various outlets. I think the emergence of an online-enabled second hand economy more broadly is an absolutely fascinating phenomenon. Buyers of economics books are presumable heavier-than-average users of online outlets – rare is the bookstore which will carry a wide range of titles in our subject!