What Is happening At Abebooks?
- By Michael Stillman
Abebooks offers more old books for sale than any other website.
By Michael Stillman
Consternation, confusion, controversy and downright anger are swirling around the largest old and used bookselling site in the world today, Abebooks.com. All of the major bookselling sites have strained relations with their sellers at one time or another, but Abe has been pilloried by the trade of late in ways not seen before. The explanation is that the venerable bookselling site has undergone some major changes recently. Changes almost inevitably lead to disgruntled users. Some don't like any change; others have legitimate beefs. On top of this, the implementation of these changes has evidently not gone smoothly, and this has led to further upset in the bookseller community. Sales have apparently been lost, and work multiplied. This is not a prescription for happy customers.
The sense of chaos and insufficient concern for the interests of their sellers has made Abe a target for much bookseller wrath. What Abe may see as "enhancements" can come across as mere attempts to grab more money to harried booksellers. However, I think this may be the side issue for Abe. Changes do not always go smoothly, and while implementation may have been a bit rough at Abe, technical glitches are usually worked out. A few acutely upset sellers may carry out their threats to walk, but as long as Abe is able to correct the technical problems in a reasonable amount of time, the great majority will stick around. Just like Abe, booksellers are out to maximize their profits, and whatever consternation and anger they feel, ultimately they will stay with Abe so long as the relationship, though it may be strained, is profitable.
However, beyond the upset of these surface tensions there are some underlying fundamental changes taking place, and I believe this is the really important issue between Abe and the booksellers, particularly those who specialize in antiquarian and rare books. While I don't believe this is intentional, these changes are having the effect of turning the knowledgeable, experienced bookseller into just another listing amateur. However, it is precisely this knowledge that enables the professional bookseller to successfully conduct his business. Turn a master chef into just another hamburger flipper, and he becomes nothing but another minimum wage employee. Turn an experienced, knowledgeable bookseller into just another lister, and he becomes just that, another amateur book lister. He's of no more consequence than a high school kid selling some books he found at a yard sale. But first, a little background to understand why these fundamental changes, which I believe are really unintended consequences of the new way Abe seeks to conduct its business, are occurring.
In the beginning, and for many years thereafter, Abe charged its booksellers only a listing fee. The listing fees were quite reasonable, enabling dealers to participate even if their sales weren't that high. It was a very successful formula for gaining listings, and it enabled Abe to zoom to the top of the list of bookselling sites.
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What Is happening At Abebooks?
- By Michael Stillman
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Meanwhile, other sites, especially the major ones, relied on commissions for income. Abe's major competitor, Alibris, employed a sizable commission at the time, 20%, but no listing fees. As the major new book sites like Amazon and Barnes and Noble joined the old book fray, they too used commissions. Then there was eBay, which also sells books, and did so on a commission basis. While Abe's fixed fees were very reasonable, commissions still had the advantage of providing dealers with totally free listings. They did not have to pay a penny unless the site made sales for them. The commission structure is more favorable to booksellers if sales are low, while the fixed fee is more advantageous if the bookseller is making a lot of sales.
As internet bookselling became the norm, rather than a new invention, people began making many if not most of their book purchases this way. Abe must have felt a tinge of regret with its formula. Fixed fees were great when sales were low, but as sales grew, the company must have become a bit envious of those who used a commission structure. Sites using commissions would be experiencing rapid growth of income as sales grew, while Abe's income stream would have remained relatively flat since its fees were fixed. They would have enjoyed some growth in sales based on increased listings, but Abe was not participating in the larger growth resulting from increased sales.
Finally, a couple of years ago, Abe decided it was time to share in the income generated by its sales. For the first time, they instituted a commission structure, a tiny 3% at first, to be charged in addition to the fixed fees. Since then, Abe has had several increases in the commission pricing. I do not know what percent of Abe's income today comes from commissions versus fixed fees, but I suspect most now comes from commissions, and if not, doing the math of sales and average prices and commissions tells me that Abe's intentions are that this will soon be its major source of revenue.
However, even as Abe was moving to a style of business more like that of Alibris than their original formula, their method of selling remained more suitable to the original formula (interestingly, Alibris has now added Abe-style fixed fees to its pricing structure while reducing commissions). Here is the difference. Alibris provides a complete selling package. The bookseller, in effect, turns over all selling responsibility to Alibris, for which it receives a commission. What Alibris really is here is a retail store, and the booksellers are the behind-the-scenes suppliers. Alibris' "commissions" are effectively the difference between the retail and wholesale prices. Alibris is more like Wal-Mart than like Abe. They buy books from wholesalers (aka booksellers) at one price, and sell them to their customers for 15% more, the retail price. The bookseller remains hidden in the background and does not participate in the sale, only shipping the book to the retail customer once Alibris has completed the sales transaction.
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What Is happening At Abebooks?
- By Michael Stillman
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On Abe, however, the bookseller has always been intimately involved in the sale. Their name is upfront on every listing. While Abe also offered the opportunity to complete the sale through its site, it was not of significance to them whether the customer bought the book on their site or directly from the seller. Either way, they were paid the same amount, the listing fee. Abe was not like Wal-Mart, making the sale. Abe was more like a magazine or other advertising media. The bookseller, in effect, placed an advertisement on Abebooks site, and paid his fee. As with any ad, they paid the same fee whether the advertisement generated no sales, or so many sales that its cost was a steal for the price. Abe, in effect, became what A.B. Bookman's Weekly had been in another, low-tech era, a place to run for sale advertisements in front of an audience of people interested in books.
Fast forward to the commission structure. Now, it is critically important to Abe how the customer purchases the book. Abe needs the customer to buy on their site, not directly from the dealer. If the buyer goes direct, Abe will never know a sale has been made, and they will not receive a commission. While the commissions were still small, this may have been a tolerable situation for Abe. Now that commissions are more substantial, and probably Abe's planned major source of revenue, getting customers to buy on their site becomes imperative.
This, naturally, leads Abe to take steps to make sure customers buy on their site. So we saw the introduction of "canned" descriptions and images, which tend to blur distinctions between dealers, making direct contact appear less important. Then we see a downplaying of how to contact the sellers directly. Abe still lists the seller's name next to the book, and provides a link to information about the seller. However, that seller information page does not contain the magic number for contacts, the bookseller's telephone number. That is not to say the buyer cannot figure out how to contact the Abe seller directly. A small link under "Payment Methods" on the "Details" page headed "View Bookseller's Homepage" leads to his phone number if he/she has provided one. There is also a small link to "Ask Bookseller a Question" which allows the buyer to email the seller directly, sufficient to set up an offline conversation. Abe has not eliminated direct contact between buyer and seller, at least not yet. However, they certainly don't encourage such contact. If customers continue to contact and buy directly from the dealer, my guess is that Abe will take further steps to reduce that interaction. As commissions become Abe's major source of income, I can only surmise that Abe will take greater steps to make sure that these sales take place on the site, where Abe can collect its commission.
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What Is happening At Abebooks?
- By Michael Stillman
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So, presuming Abe's commissions are reasonable, and deciding what is "reasonable" for their service is Abe's right anyway, what is the problem with these changes? What Abe is doing is no different from what Alibris and Amazon have been doing for years. If their pricing structure is too high, booksellers will move their listings to another site. If the pricing structure is fair, though perhaps not the bargain it once was, dealers really have no cause to complain. It still affords them their share of the profits. The problem here for many booksellers is not that Abe is charging too much (though they undoubtedly feel this way). The issue is the changes being made to increase Abe's share of income are forcing dealers to change the way in which they conduct their business. This has enormously upset many of those dealers, especially those in the antiquarian and rare (as opposed to "used") book trade.
Here is the difference between the antiquarian/rare book dealer and many of the newer online used book sellers. Many used book sellers simply buy old books wherever they can find them and post them for sale online at a mark up. They are not necessarily experts on their books. They may, in fact, know little about their merchandise, like a sales clerk at a large discount store. They probably do not have a store, and have minimal contact with their customers. They simply use their skill at finding old books to operate a business that posts them for sale on the online sites. The new Abe works just as well for them as the old Abe.
The traditional antiquarian and rare book dealer, however, is a very different animal. He or she has developed an expertise in his specialty that is of great value to his customer-collectors. This bookseller understands what is important in a particular field, what is acceptable condition for a given book, and can help the collector find the titles that are important to his collection. He survives on his relationships and knowledge as much as on his inventory, probably even more. This dealer may not sell books at the lowest of prices (although maybe he does), but that expertise can be of enormous benefit to the collector, and may help that collector avoid some disastrous mistakes. In short, service is an essential ingredient of what that bookseller has to offer. Without this service, the most knowledgeable, trained, experienced bookseller is little more than the totally ignorant newcomer who just bought a bunch of books he doesn't understand at a yard sale and decides to post them for sale online.
In the old Abe, the knowledgeable bookseller could readily provide his/her service. That bookseller could encourage buyers to contact him personally, where he could provide valuable advice to the collector. Now I certainly don't think Abe has anything against providing customers with such service, or has any desire to cut it off. It's just that in order for Abe to secure its commissions, it must cut off the direct contacts that make this service possible. It is undoubtedly an unintended consequence of moving to a commissions system, but an apparently necessary one nonetheless. To secure its commissions, Abe must reduce direct contact between seller and buyer, and in so doing, it negates the value of all the knowledge and experience the professional bookseller brings to the table. In effect, they need to prevent the professional bookseller from using his most critical tool, his knowledge, to make the sale. He is reduced to being a Wal-Mart supplier, selling books at wholesale prices to a retailer who is entrusted to make the sale for him. He is just another supplier, no better or worse than every other supplier, including those without a fraction of the knowledge he possesses.
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What Is happening At Abebooks?
- By Michael Stillman
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This, I believe, will be a major issue Abebooks will have to confront in the days ahead. It may not be important to the used book amateurs who sell on the site, but it is critical to the antiquarian experts. If Abe persists in taking steps that negate their selling skills, it is hard to imagine they will not earnestly seek selling alternatives. This may not be a major concern for the other large sites which have never facilitated direct contact, but Abe has always been the one that did, and this made it a favorite of the "serious" bookseller.
Perhaps those booksellers will find no alternatives and be forced to swallow the changes. There are other sites with a more antiquarian bend, such as the ABAA (Antiquarian Booksellers Association of America) site, but none of these have anywhere near the traffic of Abe. However, Abe needs to understand that their changes are hurting the traditional bookseller, the backbone on which their business was built. If Abe is unable to find a way to meet their own financial needs without jeopardizing the business model of many of their important sellers, they must recognize that those sellers are likely to seek new selling venues. If so, it remains to be seen whether they will be successful. They may not be able to find alternative selling vehicles superior to Abe. Then again, maybe they will.
Editor's Note: We have received many interesting and informative comments on this subject, and they can be seen in our Letters to the Editor
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