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Bookstores profit off online price wars

Jeremy Hobson Oct 30, 2009
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Bookstores profit off online price wars

Jeremy Hobson Oct 30, 2009
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KAI RYSSDAL: The war over book prices between the big online retailers has taken a new turn. Amazon, Walmart.com, and Target.com are trying to outprice each other on the latest hits. A book that might cost you $25 in an actual bookstore will cost you right around $9 on those sites. Independent booksellers were none too happy about that. But Marketplace’s Jeremy Hobson reports they’ve managed to put the megastores on the defensive.


Jeremy Hobson: If you can’t beat ’em, join ’em. That’s the MO for some independent booksellers. They’ve discovered they can get a better price at Amazon or Walmart than they can from their regular distributors. So they buy online and then just turn around and sell the books in their stores.

Gillette Kempf: I go to Amazon when they’re offering over 40 percent discount on an item.

Gillette Kempf runs Borealis Bookstore in Wadena, Minn. To combat what she and other booksellers are doing, Amazon, Target and Wal-Mart are putting limits on how many copies of a book can be bought.

But publishing analyst Michael Norris at Simba Information says it’s the big chains that are causing the problem in the first place.

Michael Norris: Non-bookstore retailers can sell books at a loss, and they can sell books for less than the price they paid, because they usually like to treat them as loss leaders.

Meaning they sell them at a loss hoping customers will be drawn in to buy other things.

Norris: The problem is that they’re carrying these books and they have no stake in the future of printed books.

Still, Gillette Kempf at the bookstore in Wadena isn’t worried she’ll be run out of business. She says no online algorithm can provide the kind of customer service that she does.

In New York, I’m Jeremy Hobson for Marketplace.

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