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Old 02-04-2012, 08:40 AM   #1
fjtorres
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Amazon on the brain: Kindle B&M Retail Stores?

By now its clear that a lot of people in the publishing business have a twitchy, knee-jerk fight-or-flight reaction at the sound of the name: AMAZON.

It turns out they're not alone:
http://www.launch.is/blog/rumor-amaz...g-channel.html

http://www.launch.is/blog/amazon-has...ding-them.html

The articles are two months old but quite amusing in a 50's "The Reds are coming!" way. Or maybe, "The Blob!"

I'm wondering if the folks at Amazon get off on propagating these kinds of stories to build up their mystique and keep opponents off balance.

After all, with all the fuss over their not charging local taxes (because of lack of Nexus) the idea that forcing them to charge taxes invites and faclitates a *physical* invasion by Amazon has to be at least mildly disquieting to the Anti-Amazon crew. Can't be too comforting to the B&N and BAM execs doing their oh-so-principled stands againts Amazon-published books to think of Amazon responding by setting up their own chain of B&M shops across the street.

Paranoia is a survival trait, though.
Might there be a bit of fire under all the smoke of FUD?

Well, I'm of the opinion that the future of B&M pbook retailing lies in going back to the future, to the old 70's and 80's B. Dalton model of bookstores (3000-5000 square feet) built around periodicals, "bestsellers", and genre fiction. But with 21st century in-store ordering terminals for the rest of the catalog. Add in regional depots for next-day in-store pickup of terminal-based and online orders and you have a very lean but effective distribution channel better suited to the times than the regional superstores of recent decades.

Stick them in enclosed malls everywhere--strip malls in the more affluent neighborhoods--like GAMESTOP, RADIO SHACK, and PAYLESS. Maybe even *franchise* the things. (Richard Adin got me thinking in that direction, BTW. It has its merits: less corporate investment required and it defuses the whole "Amazon is coming to kill local businesses" hysteria.).

For B&N and even BAM, getting to that lean retailing model--much better suited to fighting off dept stores and supermarkets by leveraging the online sales and distribution supply chain--will entail much disruption and pain.

For Amazon, alas, not...so...much...

So, while I think all the angst over Amazon pulling a SEARS and going from (online) catalog sales to B&M ubiquity is unlikely, I do think there is a crying need for a new B&M retail model for the internet age.
*Somebody* is going to do this. There's money to be made! (If nothing else, from the folks who proudly support local businesses.) People to be hired, too. (Hmm, there might be a Solyndra-type government loan program to tap, too.)

And, admittedly, Amazon does have all the pre-requisites:
- logistics chain? Check.
- brand visibility? Check.
- product catalog? Check.

Do they have the need to go all the way to B&M to *grow* their business? Maybe not. There are no signs that online retailing is hitting the wall just yet.
But...

For quite awhile now Amazon has been focusing on adding customer convenience and service to their price and catalog-size retailing toolkit. Kindle. Prime. Same day delivery in select metro areas. Even the delivery lockers they've been "experimenting" with...
http://www.amazon.com/gp/help/custom...deId=200689010

Those lockers are... curious...
They're definitely a local presence. A Nexus in tax police lore.
It hits at things to come but what is unclear. Ubiquitous order terminals in Mall Kindle kiosks? A merger with UPS?

For now, they've been piggybacking on partner businesses. If they expand them further, they would be naturals to be included in a chain of B&M sites. They could sit unobtrusively in the back next to the order terminal kiosks.

All the angst over Amazon over their tiny Amazon Publishing venture is, frankly, overblown. What's their catalog? 50 titles? They could grow it ten-fold and it would still be noise in an industry doing hundreds of thousands of books a year, in the US alone. And they are going to kill six giant multinationals? Yeah, right.

The focus on Amazon taking over the upstream side of the business is ludicrous. Pure FUD-mongering from a crowd that has been complacently grazing for decades, living off their now-gone gatekeeping power, and now faces the oh-so-dreadful prospect of having to actually earn their keep.

But Amazon increasing their reach downstream?
Well, now, isn't that what Kindles are all about? Each Kindle is a Storefront, after all. (The FIRE most of all.) And you can't get much more local than inside the house.

Still, I have to say that for all the merit in the lean bookstore model--and I think *somebody* is going to do it and soon--I don't think Amazon is headed that way yet. Online is still expanding and rapidly and that business is way cheaper to expand through other moves. A TV Set-Top Box comes to mind as a likely posibility. Even a cellphone line. (A dedicated Amazon store button; one click to connect, one click to buy.)

I won't dismiss the idea of Amazon stores... or better yet: Kindle Stores.
Not down the road.
But for now there isn't much need just yet.

But I gotta say, the rumor does sound like Bezos has found a nice way to rattle the cages of his enemies. Keep'em off balance, looking over the shoulder...
Give *them* a taste of FUD.

Last edited by fjtorres; 02-04-2012 at 11:28 AM. Reason: ytpo
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Old 02-04-2012, 09:16 AM   #2
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I don't think it is likely that Amazon is going to add retail stores. However, when all US on-line retailers start paying sales tax (and taxes are inevitable) it becomes much more likely that some of them will open stores.
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Old 02-05-2012, 02:26 PM   #3
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Predicting the future is hard.

I suppose if Amazon develops their hardware line, they might go for a physical retail presence. They would also be able to sell content at the same time, which might work for them? But Amazon is just a big computer so it's difficult to see them crossing over into the physical realm.
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Old 02-05-2012, 04:40 PM   #4
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I don't think that Amazon will get into B&M stores nationwide. I could at most see them opening a few stores in large markets like NYC, SF, etc.
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Old 02-05-2012, 05:05 PM   #5
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I second the current wisdom of this thread, amazon has name for itself by selling via the information superhighway and I don't think that they are going into local stores any time soon. Those throwbacks that want local stores are better served by B&N where they don't always have exactly what you want. I think the choice of amazon vs B&N depends on what you want. Amazon has everything but B&N has local stores so you can get tech support standing there with you. Amazon's tech support is over the phone or internet only. Of course I have an old saying "If you need tech support for anything you have bought the wrong product for your needs.
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Old 02-05-2012, 05:48 PM   #6
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It's so simple, really, isn't it......

[QUOTE=jbcohen;......Of course I have an old saying "If you need tech support for anything you have bought the wrong product for your needs.[/QUOTE]

Such a clever saying, and so helpful for anyone who may have trouble with hardware they bought, often following clever advertising, point of purchase persuasion, and often after accepting advice from "expert" retailers/assistant, whose job description would seem to be to match you with the perfect product for your needs.
These people often appreciate helpful advice on how to overcome the trouble they have - perhaps because they are not as fortunate as others in being familiar with the "new" technologies - and MR is one of the places people approach, with some success - a lot of success in my case.
How lucky I was that I haven't been simply told " You got the wrong product."
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Old 02-05-2012, 09:18 PM   #7
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I could see Amazon opening mall kiosks to demonstrate and sell the Kindles. But only in states they already collect sales taxes and states with no sales taxes. Could even do it temporarily.
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Old 02-05-2012, 09:32 PM   #8
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I could see Amazon/Kindle kiosk type stores doing well at airports and malls.
Especially airports where Apple stores already have a big presence.

Many of my book impulse buys have been at airports where I wanted something to read on plane and something to read at destination.

Would almost be silly for them to not give it a try. One can justify all kinds of purchases when one is flying off into the wild blue yonder.

Helen
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Old 02-05-2012, 10:26 PM   #9
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It's hard to imagine Amazon getting into B&M retail but then the Amazon/Kindle brand is powerful as the B Dalton mini-mart model might make sense. It's hard to see the margins there given how poorly the industry is doing already.

The only caveat is Apple. It seemed crazy talk a few years ago when they announced their intention to open a few stores. That seems to have worked out alright. Made it could for Amazon, too.
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Old 02-05-2012, 10:47 PM   #10
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Maybe in some bigger airports across the globe, but I wouldn't see Amazon having an actual B&M presence the way other retailers do.
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Old 02-05-2012, 11:00 PM   #11
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Was a bit confused as to what B&M meant, but figured it out.

In Canada one can buy ereaders of most brands in Staples, FutureShop, Walmart, Sony Stores etc.

But they are not that easy to find, and sales staff are not helpful generally.

A store that said get your kindle here would probably do well.

Not that I personally would buy a kindle, but I think it is a close second to IPad in name recognition.
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Old 02-06-2012, 03:27 AM   #12
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Quote:
Originally Posted by speakingtohe View Post
I could see Amazon/Kindle kiosk type stores doing well at airports and malls.
Especially airports where Apple stores already have a big presence.

Many of my book impulse buys have been at airports where I wanted something to read on plane and something to read at destination.

Would almost be silly for them to not give it a try. One can justify all kinds of purchases when one is flying off into the wild blue yonder.

Helen
That is an excellent idea. If it is inside the international terminal it is in a Tax Free Zone without any geo-restrictions. Set up a decent WiFi structure and Kindle holders can do downloads, and you can see how easy it would be to entice new customers based on the crowd gathering outside the store. Perhaps terminals for regular Amazon buying with a customer representative waiting for you at your destination with the goods you ordered.

A nice little gem Helen. You could sell it to Amazon.
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Old 02-06-2012, 06:54 AM   #13
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I live in New Hampshire which has no sales tax. Our borders are littered with retail outlets that thrive on sales to those in neighboring states that have sales taxes. Barnes and Noble has stores in these retail areas. In other words, B&N is among the retailers avoiding collecting taxes on sales made to persons in states with sales taxes.

Amazon ought to establish distribution centers and retail outlets in states with no or low sales taxes. It would expose a bit of hypocrisy and quiet the demand for internet sales taxes. Bienvenue au New Hampshire, Amazon!
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Old 02-06-2012, 07:49 AM   #14
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Let bookstores put book ordering/pickup kiosks in local QFCs like banks do. Order the book online, pick it up when you do your next week's grocery shopping. Get rid of the superstores.
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Old 02-06-2012, 02:46 PM   #15
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