Trusting the Retail of Academic Books in the Wrong Hands

Academic books are part and parcel of academic studies and research. This general class may include textbooks (+tutorial materials), readers (compilations of articles), and a variety of many more books that present the products of academic work (e.g., theory development, empirical research). Academic book stores usually work side-by-side with departments at academic institutes to provide to students copies of books used each term in courses. These stores are often located on-campuses or nearby. Wide selections of academic books in different fields can also normally be found in large book stores, some occupying several floors, at city centers. Definitely these are hubs of knowledge and learning.

Students may come with bibliographic lists from their lecturers to look for books required for their courses which are worth purchasing and keeping. Occasionally, students are looking for additional books in their fields of study to assist them in their academic work. Research students and academic staff members may look for books in very specific areas that are essential for developing their knowledgebase in their fields of research. The visitors can browse books available on the shelves, consult with librarians, or order books that they specifically seek but are not regularly in stock. Even people who have long graduated yet value continued learning may easily spend an hour or two browsing and choosing books that will help them enrich their knowledge and be better informed about most recent developments in their areas of profession and beyond.

A peculiar process that has been rolling-on in the past few years at Dyonon, a small chain of academic bookstores associated with Tel-Aviv University (TAU), raises concerning questions about its identity and direction in the future: books are gradually disappearing from its main and original store adjacent to the campus of Tel-Aviv University. Should we see in this a sign of lack of economic sustainability for the academic book store? Are there other factors contributing to this process? And how should the university deal with the situation?

A brief backgroud: Dyonon is owned in partenship by the University of Tel-Aviv and the Student Union at the university. For more than 40 years the original store was managed and operated by the student union. In later years it opened branches at private and public colleges and academic centers. However, in the early 2000s TAU has run into financial difficulties, the Dyonon has yielded less net income, and the student union could not maintain the retail operation alone. Eventually the owners reached an agreement to license Office Depot (Israel), a retailer of office supplies and equipment, to manage the stores of Dyonon on their behalf.  The local chain of Office Depot has been run at times as an independent franchiser or a direct subsidiary of the international Office Depot company. In September 2006 Office Depot launched the rennovated store at TAU with an investment of two million shekels (~ $0.5 million). The chain of Dyonon now has 5 stores including the original store at TAU (at least until 2006 they have had 8 stores).

At an early stage of Dyonon under management of Office Depot the books were migrated to a back wing of the ground floor and in the basement floor in order to make space for office supplies and equipment. Soon after, the migration of the books to the lower floor was completed. Positively, the books were awarded a whole floor as they deserve. On the negative side, a customer who enters the store can no longer tell this is an academic book store.  Now it resembles more a computer-related technology store. Nonetheless, gradually the books in the lower floor have been losing more shelf space in favour of other products typical of Office Depot. In recent months several sections of the lower floor dedicated to psychology, political science, history and other fields of the humanities and social sciences were given up for other products. The academic books left remain in a back wing of the floor and they now occupy about 20%-25% of the whole store area.

The business of academic book stores worldwide is facing some significant challenges that have only aggrevated in the last decade and could be of risk to the economic sustainability of the stores. Here are three salient factors worth conisdering in this regard:

    • Textbooks have been relatively expensive for students to purchase for decades. They may cost anywhere between £30 to £120 (when available, students can save considerably by buying paperback volumes that cost 50% of the price of hardcover volumes). Hence students would rather try to borrow their required textbooks from the library or acquire used books. Yet some books may be more essential and fundamental to the student’s field of study so that a new book is worth buying to have in hand during the period of studies. (The problem in Israel is more complex because of language issues).
    •  Academic books are widely available to order online. One may sit in the comfort of his/her home in front of the computer’s screen, search for required books in e-tailing websites, even read sample pages, and then order some chosen books. This course of action is especially efficient and attractive for acquiring books that are more difficult to find in stores at any given time. The best known e-tailer of books is Amazon but is not the only option. To counter this threat, many of the chain booksellers also operate an e-tailing channel in their Internet website. This business extension may canniabalise sales in stores to some extent, but it can be designed to improve service to their customers. That is, customers may search for books more conveniently at home, and they may even order some books online, and then come to the store to buy or pick them up, and then possibly look for some other books while on premises.
    • A growing variety of academic books is becoming available in a format of eBooks, including graphics-rich textbooks. The e-books can be viewed with electronic reader software applications and devices. One may read e-books on an electronic reader device, a tablet or a laptop. The e-book version may be priced 10% to 20% lower than the print version (one still has to pay for content). This is still a young field in book distribution and as a mode of reading but it can be expected to become a more serious challenge for stores to confront in the near future.

These challenges pose different levels of risk and difficulty. The problem is that a retailer like Office Depot is neither prepared nor motivated to take the challenge. It is not in its core business and mission, and thus it is not likely to be committed enough to face those challenges. The easier solution for a retailer who does not genuinely see his place in this area is to remove the books and replace them with products its management is more familiar with and expects to be more profitable, as Office Depot does. A professional staff qualified to advise customers and sell books cannot be sufficient if the management is not ready and qualified to tackle the strategic difficulties and challenges of the academic book market.

Moreover, Office Depot in Israel has run into operational and finanical difficulties in the last 18 months for reasons that are beyond the scope of this post, making the situation more complicated. Unsurprisingly, at the time of critical test Office Depot is seemingly acting not in the true interests of Dyonon. In retrospect, it seems that early on Office Depot has “kidnapped” Dyonon for its own line of business and now we see just the culmination of this process in an apparent crisis for Dyonon.

But Office Depot is not the only party that bears responsibility. The University and the Student Union reportedly agreed in licensing Office Depot that it would display its usual products on the ground floor and books on the lower floor. This is not without logic and benefit to both students and faculty and to the retail business. If Office Depot in any way “kidnapped” Dyonon as suggested above, it was rather in later stages of its operation when it let its usual trade become more dominant at the expense of books, and the store’s owners did not interfere to curb this activity in time. The more intriguing question remains: Why did the owners choose an operator without desired skills and experience in the book market?

Recognizing the economic burden on students to purchase new books and their preference to find used copies, academic book retailers entered this scene and are engaged in mediating between buyers and sellers. More momentum is now given to the transition to eBooks and the means to view and read them. For example, the American book retailer Barnes & Noble  is more focused in the past few years on advancing its Nook programme of eBooks and electronic reading applications and device. It offers special library and service (Nook Study) for students and professors online, and is particularly specialising in offerring lower cost eTextbooks. Some described features of the application seem particularly useful for studying (e.g., search, mark-up, notes).

Exectuvies at Tel-Aviv University and the Student Union should be planning for the days after Office Depot to restore Dyonon as an academic book store. A possible path to follow is return to a model more similar to the past. The store may be governed by the university and student union but managed and operated by a professional team directly hired by the owners. The team may be organised as a business unit. This type of arrangement can be found at the University of Washington in Seatle — over the years they have built a model where an incorporated body of professionals is running the academic book store (and other stores) under supervision and control of a Board of Trustees of the university’s academic and admininstrative staff and the student union representatives. Other examples for stores controlled by student unions and universities include the Union of Toronto in Canada and the Co-Op Bookshop in Sydney, Australia (fully named “The University Co-operative Bookshop Limited”, a not-for-profit bookseller). It is further noted that another chain of book stores in Israel, Academon, is affiliated with Hebrew University in Jerusalem (12 bookshops, four of them in Jersualem).

If this model, however, seems no longer feasible or practical for the university, and they need to lower their level of involvement, they should be renting or leasing the store space to an established book retailer. A convenient solution may be adopted for instance from the United Kingdom where the bookseller Blackwell operates its own academic book stores in 45 locations on-campus of academic institutes or nearby (see also the Student section on its website).

  • The book retail scene in Israel is controlled by two chains of book stores (“Steimatzky” and “Tzomet Sfarim”), possibly distancing the university from dealing with them. In fact, negotiations were held with “Tzomet Sfarim” but terminated by the owners in 2005 in favour of Office Depot. The former lost its case in court against this action. From a position of strength, it is likely the book retailer has made high demands for control of the business the owners would not accept. The alternative solution the owners chose with Office Depot, however, was not any more viable.

An academic book store is one of the most valuable services a university is ought to provide its students and faculty in one form or another. However, in order to protect and enhance the economic sustainability of the book stores, they should be supported with an “envelope” of complementing value-added services, employing also advanced technologies, thus making the stores more attractive, interesting and useful.

Ron Ventura, Ph.D. (Marketing)

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