How We Lost Bookshops Thanks to Amazon and Publishers

Why does Amazon rule supreme in book sales? Bookseller Tim Waterstone recounts the story of how his eponymous chain was ruined by a short-term business mindset and publishers giving in to the internet behemoth.

From a piece on the Daily Beast...

What the publishers seemed not to realise was that Amazon in their concentration on consumer pricing, were impervious to the overall welfare of the industries in which they were operating.  It’s all so very simple. Make and build your brand on a reputation for absolutely rock bottom pricing. Even say it upfront, insultingly and aggressively, in your advertising—go, Mr. Consumer, go to Harrods or wherever it is, inspect and admire the goods, then come home and buy them from us. Online. At a deep, deep discount. And f**k Harrods or whoever it is for their trouble. More fool them. And more fool Waterstones.

No one of course can now put the genie back in the bottle. It was the publishers who largely allowed Amazon to create its model. How? In business school speak, by dealing with Amazon on a wholesale model, and with the traditional bookshops—their lifeblood for centuries—on an agency model. In simple terms, Amazon was allowed at their inception to buy from publishers at far, far lower prices than their bookshop competitors. It was a savagely disloyal mistake. Every publisher knows that now, even finding themselves in all sorts of legal knots as they try, second time around, to control price setting in the ebook market.