Writers Tricks of the Trade ISSUE 3, VOLUME 7 - Page 16

By Mike Shatzkin on Jan 03, INDUSTRY NEWS 2017 A MAZON AND THE FUTURE OF PHYSICAL RETAIL M IKE S HATZKIN M IKE S HATZKIN F OUNDER & CEO OF T HE I DEA L OGICAL C OMPANY F ALL 2017 September 20, 2017 There are two parallel conversations about the future of retail that are quite active. One is within the book business and it centers around what the future will be —and will there be one for Barnes & Noble. The other one is about the future of retail competitors to Amazon in the broader sense, particularly the big retailers that anchor the malls and shopping centers and are depended upon to draw the traffic to all the other stores that share the same parking lots. Whenever B&N announces financial results, the whole book business pays attention. When a chain with the ubiquity and brand of Toys R Us goes under, as it did last week, everybody pays attention. Barnes & Noble has been feverishly changing executive management and delivering pretty vague and unconvincing strategic pronouncements in a context of declining revenues and a sliding stock price. Since B&N is both the single stop capable of putting a new title in front of the most bookstore customers and the single biggest retail customer for publishers’ backlists, it occupies a position of singular importance to almost every publisher. Amazon may already be a bigger account for most publishers but that doesn’t change B&N’s unique importance. So it is not surprising that publishers obsess about the chain’s financial and operational health. And although I am still skeptical that their demise—or even a rapid shrinkage—is imminent, the consequences whenever it were to come to pass would be industry-changing. That made it a useful topic for the discussion which Nathan Bransford and I had about it which he recently captured for his blog. Of broader interest is the impact Amazon is having on all retailers. So many of them—Sears, JC Penney, Macy’s—are very obviously struggling. This year alone, we’ve seen stories about the death of department stores and other retailers from the Atlantic, Business Insider (citing Warren Buffet as their expert), and Time, among many others. Borders is gone. Radio Shack is gone. And then last week came the word that Toys R Us is filing for bankruptcy. So Barnes & Noble’s struggles are within a context that goes way beyond them and way beyond the book business. The operational change Best Buy made was to use their distributed store inventory to ship online orders received centrally. The Times piece highlights the reduction in delivery time to customers that can be achieved by shipping from one of the 1000stores that is closer P AGE 8 W RITERS ’ T RICKS OF THE TRADE