Txtr RIP?

Provisional administrator Christian Köhler-Ma has been appointed to German ebook service provider Txtr.

Txtr provided ebook solutions to retailers such as Foyles, device makers and mobile operators such as Deutsche Telecom. They developed a large international repository of ebooks which they serviced through a cloud based white label ebookstore and a comprehensive set of apps. Their service was based on Adobe ACS4 DRM and they sold ereaders based on eink technology.

At the time Foyles pinned its flag on Txtr in 2012, Sam Husain, CEO said, “Our new eBook store and apps, ‘Foyles powered by txtr’, make buying and reading eBooks as easy as possible, without the added expense of having to buy new hardware. It is the next step in our on-going journey to serve our customers with a choice of books, across the widest possible range, in every format.” The question now is whether their customers will still be serviced from a bankkrupt cloud?

Txtr developed ‘The Beagle’ which they launched in 2012. The 5" device was designed to be paired with a smartphone and to be a "companion reader" with smartphones and subsidized by new mobile contracts. However despite the fanfare, the low price, it was too late to market and came at a time when the smartphone and tablets were replacing the old eink technology.

The txtr team launched Blloon, a new ebook subscription service, which was set up as a separate entity and therefore should not be impacted by the current situation. At its launch last summer txtr founder Thomas Leliveld, said that, ‘Blloon aspires to offering a lower cost ebook service in a market already crowded by Scribd and Kindle Unlimited.’

Blloon's subscription model is different and is based on pages and a lower subscription price. Leliveld said at the time, ‘We aren't offering an expensive ‘unlimited’ service simply because that isn’t the demographic we are targeting. And people can only read so much. We’re welcoming young people, the majority of whom currently read up to 12 books a year. Providing a package that allows them to expand to two or three a month makes it an attractive and affordable offering - without any compromise on the quality of the titles. In time we hope it will encourage them to read even more.’

So as Blinkbox follows Sony and bites the dust it is now to be followed by Txtr. The question is not how many more will follow but what the impact these collapses have on consumer confidence not in ebooks but in ebook services who may leave them and their purchases in the cold. These events also strengthen the case for subscription services. However subscription services may be able to be switch off like a tap and impact the consumer less as he merely moves his subscription to another service

Do Bookshops Have A 2020 Vision?

We have all read about the decline of the independent bookstores in the UK and US. However, we have also seen the relaunch of Foyles in Charing Cross, the expansion of the Hatchards brand by Waterstones to St Pancras, the growth online of the bargain bookseller, The Works. So what is the future of the Bookstore and does it have a vision of itself in 2020, or is its vision somewhat out of focus and requiring both short and long sighted correction?

Stanley Unwin once said that, ‘To write books is easy, it requires only pen and ink and the ever-patient paper. To print books is a little more difficult, because genius so often rejoices in illegible handwriting. To read books is more difficult still, because of a tendency to go to sleep. But the most difficult task of all that a mortal man can embark on is to sell a book.’

Today more than ever before that quote reflects the significant changes and challenges facing booksellers. Some would say that the question of what is sold, is as important as that of how it is sold.

Today many continue to sell not just a narrow range dictated by their physical square footage, but a range focused purely on the new or only available through the publisher. It’s as if they haven’t read what it says above the door and have ignored the word ‘bookseller’ and replace it with ‘new books only seller’. Books are books and the consumer doesn’t grab a book and turn immediately to the copyright page and look as to when the book was published, so why do so many bookstore restrict themselves? In a market that over produces both in titles and quantity, there are many mint condition ‘bargains’ to be stocked from outside the traditional publisher channel. They may not have the ‘sale or return’ safety net, but they also can be often acquired at a fraction of the price. One of the salient lessons we should have learnt by now from the likes of Amazon, is that consumers want to buy new, old, rare, bargain and used books and to do so from one place where they can seen the full range.

A recent article in The Economist looked to the future design of the bookshop and asked four firms of architects and designers to create the bookshop of their dreams and in doing so reinvent it for tomorrow. The designers looked at many aspects and even covered the sale of used and digital books and using the space to sell lifestyle, create theatre and host events. It is worth a read.

However, they started from the premise that the hub was the bookshop and everything revolved around the book. Is that how we should look at it, or is the book merely part of a larger proposition based around a wider lifestyle offer? This obviously raises the question of range both in terms of width and depth. We have seen many acclaimed bookshops which have narrowed their offer to appeal to a segment of the market, but how many of these have actually complimented their book offer with a full range of products that appeal to that same segment? Does the cookery shop sell cookery product and books, or books and cookery product? Does the children’s bookshop sell toys, children’s clothes, prams etc. alongside books, or books alongside childrens’ product? Ex Borders UK head, Phil Downer has made his Calliope gift shop one that sells gifts which include books and in doing so he is able to cross sell and merchandise and adjust his offer to suit the market. Will books be a major or a minor element in years to come will depend on many factors, but ultimately it should reflect consumer demand.     

The coffee shop within the bookstore is often a very good earner per square foot and creates lifestyle and greater selling opportunities. It is claimed that our obsession with coffee houses is going to grow by a further 20% by 2020. So would you open a coffee shop that sells books or a bookshop that sells coffee?

A further example of how market trends have changed well established markets is in the off licence sector, where the supermarkets have come in and not only wiped out much of the previous retail space, but also have actually expanded and grown the market. When supermarkets first started selling petrol it looked obvious and was restricted to their out of town supermarket locations, but now some have taken their supermarket offer to the garage forecourt and taken over independent stations which are convenience stores that sell petrol and this has enabled them to grow their convenience business and opened new locations miles from their supermarkets.

Just focusing on books is obviously a very limited consumer offer. Just selling new books could be terminal.  

‘Pay to Peek’ Is Not The Answer For Bookstores

It is often hard to see the opportunities when we look at the threats to book retailers today. Many just see dome and gloom and create what some would say is an environment of self prophesying decline.

Geographic markets are different and within the UK there are clear government and civic challenges of higher rates, rents the unfair status afforded to charity shops manned volunteer staff. That’s without the corporation tax avoidance advantage achieved by many internet stores within the EU boundaries and the current EU digital VAT fiasco.

There are the challenges of competing not just the physical book market but with an increasing digital market. This is not just about people adopting the technology, or the convenience of ordering online, but also the lack of coherent pricing which today can result in the 20P bestseller and a general devaluation of all books.

There is also the limited range and keenly priced increasing supermarket offer. They may just want the bestsellers and safe bets, but in doing so they effectively cream off those titles with mass appeal at the expense of the bookstore.

This week we read about Foyles, who at the time that they are planning their big move and the store of the future, are having to make staff redundant in their existing business. Today, everyone is looking hard at their costs and trying to cut their cloth accordingly.

Also this week Victoria Barnsley discussed the idea on BBC radio 4’s ‘The Bottom Line’, that bookstores should consider charging customers to browse. If it’s ok for shoe store in the US to do it, why not bookstores in the UK. Well we could say that many jewellers lock their doors to control entry, but you would seriously advocate that for bookstores? You could point to the refund tickets for parking in many supermarkets and ask why not pay for customer parking on the High Street? The point is that book buying is different, much of it is impulsive and it requires a ‘hands on’, not ‘hands of’ hand selling approach. It would be easy to envisage empting bookstores and book ‘discovery’ moving further online and the customer contact becoming virtual. ‘Pay to peek’ is a barrier to buy and therefore not the answer.

If we look at the alternative shopping experiments and practices, one that may lend itself to some larger stores and chains, is the personal shopper, that assistant that doesn’t sit behind the counter, but actively hand sells off the floor. Many will say we do it today, but many customers may question that. It isn’t about steering customers to the obvious, but adding value and helping them discover that ‘hidden gem’. A friend recently related an experience about being introduced to a quirky book by our local store and what a difference that made. The choice was perfect, the relationship forged and the repeat business and respect flowed. Straight forward, but is it truly an experience we all share?  

Then we have the great giveaway with the inducement of yet more’ free’ books. Has the ‘give away’ policy really worked? Has it lead to a significant rise in reading and growth in the market and have the bookstores that have backed it really benefited in a sustainable way, or have we merely created a costly blip which is flattened out over the year? We even those who have supported the idea that to promote 15 million £1 books on the back of giving kids junk good is good PR. It may bring more kids into reading, but at what expense and who will have ‘ketchup’ on their hands if the PR turns like it has with horse meat? More importantly will it build the marketplace, or just further drive buyers away from bookstores?

The glass is not half empty and opportunities do exist, but often change is required to leverage these. It may be no longer good enough to only sell ‘safe’ front list on a sale or return basis. It says ‘bookseller’ over the door and by that it surely means a variety of new, backlist, classics, bargains, used and even rare. Obviously each store has to build around its community and market proposition but looking past the latest release would help. After all how many consumer pick up a book and look straight to the publication date to see if it’s new? Books don’t have a sell by date.

We were recently told about a publisher who celebrated a healthy pre Christmas order that turned to disappointment when after Christmas the entire stock came back and still all in its printer’s packs. Bookselling is a two way street.

Bookstores have discovered that coffee may work and can increases footfall and interest. The same could be said of other goods and services. Ask yourself whether the Works a bookshop, stationary store, gift shop, craft shop or just a bargain store? What the product and demographic mix difference today between say, WHS and the Works?  

We look at the many excellent examples of bookstores that continue, despite the odds , to deliver in their community. We read of the success and enthusiasm of new ventures such as Philip Downer’s Calliope. What we see are bookstores changing and adapting despite the challenges and using their skills to make themselves appealing and different. What we must do is find ways to support these further, improve hand selling and reward excellence. 

Would You Buy an eBook Reader From This Man? Part 2

Today we have the news that Dixons' stores are to join John Lewis in selling Amazon's Kindle e-book reader in the UK. Dixons will sell Kindles through PC World and Currys outlets and not online. The price will be the same whoever you buy a Kindle from with the Wi-Fi model being £111 and the 3G-equipped version £152. To us this sounds a very logical step by Amazon in selling through trusted and experienced outlets trained to sell technology and spreads the Amazon offer onto the High Street.

So we found ourselves in central London and thought we would check out what the three major book chains were doing in-store in their premier outlets with ebooks and ereaders.

Foyles, Charring Cross Road


There was no reference to ebooks, digital or ereaders on the store directory, but given the placement of their information desk, we went straight there to enquire if they sold ereaders. A very pleasant lady explained, ‘We don’t have any in store but sell them online through our web site.’ When we then asked why and said we thought they sold them in store, she disclosed, ‘We used to sell them but they just didn’t pay their way and where a security problem.’

We left wondering why they didn’t take our name for someone to call us, or offered us some flyer explaining why we should go to their web site and if they were serious about ebooks. The lady was helpful but the store was clearly saying ‘Not sold here!’

Blackwell’s, Charring Cross Road


We crossed the road in search of the elusive ereader. Blackwells again were without any signage or reference to ebooks or readers. So we went passed the stationary, the umbrellas and book cradles, to the information desk. Yes they sold ereaders in store, but not the Sony and did not have a display area. ‘Did we want to see one?’ The assistant went off to a staff area and returned with two boxes containing Elonex readers which were still wrapped in their covers. The lack of knowledge on what they did, or didn’t do, was embarrassing and misleading. He pointed out they played epub files ‘which can be bought from anywhere’ and when pressed this even included Amazon! We pointed out that these were LCD and not eInk screens and it was if we were talking a foreign language. They did have some POS material on a stand on the desk, which he read out loud as if we were a child.

Again he didn’t take or even ask for our details so an expert could help us and allowed a potential £100 sale to just walk away.

Waterstones, Picadilly


We entered the flagship store expecting so much, but soon understood that our previous experience was clearly not an exception, but probably the norm. Again no signage or reference on the extensive directory, but we knew where to go and headed straight to the bank of checkouts, past the information desk that was busy and sure enough we found the same bolted down display and POS we had seen on Bath. This had just four units and two dictionary type gadgets.

We hovered, we started to play with the devices, but two of which appeared to be frozen. We looked around for help, but not an assistant in sight and the two on the checkouts were busy serving customers. We decided to go back and ask for help at the information desk and the lady suggested we ask the checkout operators. We pointed out that they were busy, so she offered to come and help, but explained she knew little about the devices. Bless her, she did try to read out the limited POS and clearly was out of her depth. When we asked about the POS pricing over the shelf which offered a ‘get VAT back’ price and quoted the net price and the VAT back, she had to ask the checkout operator. They said that the offer was an old one that finished at Christmas and the VAT back was done by Sony. We hid our amazement that they openly had misleading and out of date pricing on display and clarified that we had to add the two elements together to get the price! The two Sony readers were stickered as ‘out of stock,’and when we asked about the apparent stock in boxes under the shelf, were told those were all empty and should have been removed. Their admission, not ours!

The checkout assistant took over our enquiry and the information assistant went back to her station. The second assistant knew a little more but it was a little. She recommended the top of the range Sony because 'it does more than just reading and can play MP3 files'. When we asked what the difference between the iRiver and the Sony was she quoted number of files and battery life as two major differentiators. We said why the number of files matters as we don’t expect to buy and read 1.000 let alone 2,000 ebooks! We asked about the battery life which she said was based on page turns and we had to point out that the limited POS next to the device said that the iRiver could in fact do 1,000 more page turns than the Sony. She pointed out the Sony reader had 12 dictionaries included, which nearly prompted us to ask if she always carried a dictionary around when she read a book?

She did try very hard to sell us a Sony top of range ereader. However when we asked why it was in landscape and could we see it displayed in portrait like the cheaper reader she was unable to change the setting and even navigate the basic features.

We asked when the Sony devices would be back in stock and she went off to check. She quickly returned to say that didn’t have any on order, but there appeared to be stock in another store if we were interested and she could ring them. We suggested we needed to think about it and despite spending time with us and obviously keen to sell us the top of range Sony she failed once again to even ask let alone capture even the basic customer details.

As we were leaving she offered a small flyer stating it would tell us more about the devices. The flyer was in our opinion a waste of paper except it did give a 0845 telephone number where we could get help. Now why didn’t she at least tell us that?

The eQuestion we ask

When Amazon is selling its devices through technology and trusted retailers, why are these booksellers not making the effort to train staff, provide informative and accessible literature, capture interest and at least appear serious about digital? Would we buy any ereader from these stores today - no. How are they going to build a digital business when they clearly are sending out at times misleading and disinteresting vibes in-store? Books are books be they digital physical, audio, print on demand, front list, back list used etc.

Ironically, we wrote this piece on the very day the BA (Booksellers Association) emailed a newsletter to all their members provide them with sound advice on a retail strategy to sell ebooks.

We also suggest that bookshops watch Mary Portas's 'Secret Shopper' that was broadcast tonight channel 4 and take on-board some of the sound advice she gave mobile phone sellers .