November 18, 2020
We talked to Andy Hunter, founder and CEO of Bookshop.org. A writer, editor, and publisher, he co-founded Electric Literature in 2009, Catapult press in 2014, and Literary Hub in 2015. He currently serves as publisher of Literary Hub as well as Catapult, Counterpoint, and Soft Skull Press. His work is dedicated to preserving and promoting literary culture and the importance of books in the digital age.
In the past decade, I’ve watched as Amazon grew to over 50% of consumer book sales in the U.S., while bookstore sales have dropped from $18 billion a year to under $10 billion. I wanted to create a universal platform for independent bookstores that would allow them to compete with Amazon for online sales, without any of the barriers (inventory, shipping time, overhead) that hold them back. As more and more people shop online, we need to find creative solutions that allow independent, small, local, brick-and-mortar businesses to compete with the huge internet retailers. We know that bookstores are of outsized importance to reading and the vitality of books in our culture. Every store is a cultural outpost, an advocate, a community hub uniting people around books. They must be preserved, or the role books play in our society will be forever diminished.
When the pandemic struck, it merely accelerated trends that were already taking place—suddenly, online sales became immediately important. We were fortunate enough to be ready to fill the need many bookstores had to get up and running with online sales quickly.
In our model, the customer orders from their favorite store, and the wholesaler (Ingram) delivers the book to the customer’s home. The stores do not have to touch a book. That takes the strain out of online book sales and makes it easy, especially in a pandemic when they don’t want to put the health of their staff at risk. There’s no overhead for the stores—it is totally free for them, and they don’t have to spend time or money on inventory, picking and packing, hauling orders to the post office, or answering customer service emails. Many stores do not have the resources to build nice websites and run ecommerce operations on top of their traditional business, but they can get set up on Bookshop in less than an hour, there’s no risk, and they can start selling online immediately.
Of course, there is nothing more valuable than entering a bookstore in person, browsing the shelves, experiencing the tactile and sensory nature of the physical books, and speaking to a bookseller and getting recommendations and insight. We could never replace that. But there is no reason for that same bookseller to spend their day stuffing envelopes and running down to the post office. We can do that part, and let them do what they do best. When a bookstore sells a book on Bookshop.org, they earn 30% of the list price; about 50% goes to the publisher, we discount up to 10%, and the remaining 10% is payment processing and fulfillment. Stores get to keep the entire profit margin off the book; we do not take a cut of their sales.
Most of our sales are through stores. It’s a collective platform, designed to be as frictionless as possible for both customers and bookstores, a single site that can rank high on Google and is easy for consumers to remember. We also have an affiliate program where authors, websites, literary organizations, and individuals can earn 10% of any sale they direct to Bookshop.org, and a matching 10% goes into a profit-sharing pool that is distributed to bookstores. Bookshop takes 10% of these sales, which is how we pay for the platform.
2020 has been crazy, for us as well as everyone else. We expected to sell $10 million worth of books this year; instead we’ll sell $50 million. The pandemic had a huge effect, as customers looked for ways to rally around their stores, and stores looked to us for a simple solution to their now-urgent need to sell online. In February, we sold $50,000 worth of books. In March, we sold $50,000 a day. In April, we sold $150,000 a day. We now have over 900 stores on our platform. But it’s not enough. Stores are still struggling, and we need to grow more and do more if we are really going to change the game and help make bookselling sustainable.
We were not prepared for the thousands of orders per day we got once COVID hit. It was only me and four employees, and we had captured 1% of Amazon’s market share in less than two months. I was going to bed at 11 p.m., getting up at 5 a.m., working from home with two daughters, nine and seven years old, doing remote learning in our 450-square-foot Brooklyn apartment. It was insanely stressful, but the work was very necessary, as so many stores were relying on us. For a couple months this summer, we fell behind on customer service, but we hired a large team (mostly laid-off booksellers) and implemented professional systems. Now our average response time is less than three hours. It’s all stable now. And while I still get up at 5 a.m., I occasionally can read a novel at night.
Bookshop is an everyone-shares-all model.
Authors can effectively double their royalties by becoming Bookshop affiliates, earning 10% by sending customers to us instead of Amazon, while supporting indie bookstores at the same time. In July, we distributed a million dollars from our affiliate profit pool to bookstores all over the U.S., and in January 2021, we will distribute twice that amount. We have authors who have earned over $15,000 in affiliate commissions, which of course means their sales generated $15,000 for bookstores, as well as for the publisher. Our sales are reported to Bookscan and best-seller lists.
For readers, we offer a more human experience, and they can feel good about themselves when they purchase books in a socially conscious way. Bookshop is all human recommendations. I don’t believe anyone has ever bought a book because an algorithm told them to. We buy books that people, or media, that we respect tell us about. Our community of bookstores and affiliates create recommendation lists, from anti-racist books to favorite cookbooks, and our editorial team selects lists to feature on our homepage and elsewhere on our site. Bookshop is a hub of bookstores, literary organizations, authors, and other participants of literary culture advocating for the books that they love, and everything the customer encounters is a reflection of this—it’s all curated by people who have dedicated themselves to books in some way.
Amazon is a winner-takes-all model, and they’re the winner. They discount so deeply that they lose money on many of their book sales, but they gain market share, because no independent bookstore can match those prices. It’s anticompetitive and destructive, and it devalues books. Bookshop has to discount to compete with Amazon, but we limit our discounts to 10% of the cover price. We find that customers shopping online expect some level of discount, and we don’t want them to leave us and go to Amazon.
Amazon’s affiliate program, which pays a 4.5% referral fee, drove many websites to link to them. Now, with our affiliate program offering more than twice that, no one has a reason to link to Amazon, and independent bookshops earn money off every sale made on Bookshop.org.Even if you like Amazon, even if you are an author or publisher who earns money from Amazon, you know it is not a healthy market if one player controls it. When they have all the leverage, they will use that leverage to squeeze profit out of all their partners. Amazon certainly does this to publishers, and they are squeezing physical bookstores out of existence entirely. That will be very bad for authors and publishers in the long run. We need to innovate for the survival of the culture that we love; the sustainability of writing as a career, bookselling, and publishing are all inter-linked.
Bookstores have earned $7.5 million since February. That’s due to the power of people who are socially conscious and love bookstores as much as we do, who are making a choice to support local businesses in a time when they need it most. Authors and other affiliates have earned about $2 million.
We encourage all authors to become affiliates and link to Bookshop on their websites, in emails, and on social media—unless you have a relationship with a specific independent bookshop who prefers you link directly to their website. Our most successful affiliates only link to Bookshop, with no Amazon links on their sites—customers already know how to find books on Amazon, and Amazon doesn’t need the help; their sales are up dramatically since the pandemic hit, while bookstore sales are down substantially.
We have a guide for authors here.
Shipping is pretty fast right now, but it was delayed over the summer. Our distributor, Ingram, put safety protocols in place that can delay shipping for up to 72 hours to keep their employees safe. Over 20,000 Amazon warehouse workers have contracted COVID, so next-day shipping has a hidden cost that we prefer not to pay. This summer, from June to August, the postmaster general banned overtime for USPS workers. That caused delays everywhere—people weren’t getting mail-order medications, goods, everything that people rely on the Postal Service for was affected, including our books. Fortunately, a court ordered that USPS resume full service, mostly due to the issues the delays would cause for mail-in ballots. Since September, we’ve seen USPS delivery times and reliability go back to normal.
If we have new books in stock at Ingram, no used options appear on Bookshop.org. We understand that authors only earn royalties for new books, and it’s part of our mission to support authors and publishers. In the rare case that a book is out of stock and not available on print-on-demand, we display options to buy new and used books through Biblio.com’s network of independent booksellers. The reason for that is that we don’t want our customers to ever feel the need to return to Amazon. That means we need to offer the same availability Amazon does; we can’t have someone look for a book, see it’s unavailable, and go to Amazon to buy a new or used copy. However, 97% of our sales are new books, because we don’t show used options when new books are in stock, unlike Amazon, which does a huge business selling used books and is completely indifferent to the effect on authors and publishers.
In the past 15 years, we’ve seen very little successful innovation in the book world, outside of Amazon’s rapid growth and dominance. We’re now at a tipping point, and there’s a very real danger that hundreds of beloved, essential bookstores are not going to survive the next year. Everyone who cares about books needs to rally around them. We need to give books for the holidays, and buy them from independents—in person, off their websites, or via Bookshop.org. Bookshop is the most successful and promising initiative that has happened in book retail in a decade, but we won’t succeed without broad industry support—and authors are absolutely key to that. I’m so grateful to the Authors Guild for helping spread the word, and everything else you do for writers and our industry.
Photo credit: Idris Solomon