Biblio: Number Three Tries Much Harder
- By Michael Stillman
Biblio has grown to be the third most popular book listing site.
By Michael Stillman
If Number 2 needs to try harder, what must Number 3 do? This month we posed that question to Biblio, the online bookselling site that has moved into third position in this extremely competitive and narrowing field. Perhaps they are the ideal candidate to ask this question, as somehow, Biblio has been defying the odds and managing to grow in an environment that ought to be choking them.
At the turn of the millennium (a literary-sounding way of saying 2000), there were dozens of online bookselling sites competing for market share. Biblio wasn't one of them. They arrived in 2003, long after most bookselling sites were deep into retrenchment. To understand how remarkable their success has been, just take a look at the normal evolution of new technologies. New technologies spawn new businesses in a predictable manner. In the early stages, dozens compete to get a foothold. Soon, a very small number, perhaps just one or two, emerge as leaders. The others hang on, hoping for a miracle, or at least a combination or buy out which will enable them to make another run at the top. A few may evolve into something else, perhaps surviving by serving some highly specific small niche. But, for the most part, it is over for those who were not among the first few to emerge as leaders.
If you look back to the pre-2000 internet "bubble" days, you will find there were many search engines that people selected among. Today there is Google. Sure, some people use the searches on major destination sites like Yahoo and MSN, but for pure search, who else is of significance? "Google" has even become a verb. We may "google" something, but does anyone ever "altavista" something, or "lycos" it? Once upon a time there were several online auction sites. There still are, but can you name any that don't begin with the letters e-b-a-y?
So into this maturing online bookselling environment, with Abebooks and Alibris already established as the leaders, and the rest fighting for either a niche or mere survival, Biblio was born. Born too late. By all logic, the game was already over. This baby should have died in infancy. Yet here it is. Biblio is not only still around, it is growing. It has managed to leapfrog the entire field save the two megalisters at the top. And, its environment is even tougher than having two strong market leaders ahead of you implies. There may be only two pure competitors ahead, but there are also the likes of Amazon, Barnes and Noble, and eBay/Half up there. They aren't pure competitors in that they do much more than old books, but they compete for old book listings nonetheless, and each carries far more market recognition than any of the pure book listing sites.
From its beginnings in 2003, Biblio has grown from nothing to carry 25 million listings from 3,500 dealers today. The market leaders are Abebooks, with a stated 75 million listings from 13,000 dealers, followed by Alibris with 50 million listings. After Biblio, the next in line is believed to be ZVAB/Choosebooks. While Biblio still has a long way to go to catch the top two, their growth has been extraordinary. Besides which, they really aren't that focused on Abe's and Alibris' numbers anyway. Perhaps that explains their surprising success while most book listing sites have been slipping into oblivion. To discover how Biblio has done so well in a seemingly impossible environment, we went to Kevin Donaldson, Biblio's Director of Sales and Marketing.
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Biblio: Number Three Tries Much Harder
- By Michael Stillman
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We asked Mr. Donaldson to what he attributed Biblio's impressive growth. His response was one of focus on your own mission, rather than on what the competitors are doing. Biblio has a plan it believes will enable the company to succeed, and they focus on implementing that plan well. "Biblio.com really has tried to practice a policy of managed growth," explains Mr. Donaldson. "We take our time, create a viable online marketplace product, and make sure that our bookseller members are getting the support they need. Sales may not be at the level they are on other sites, but we are also not sacrificing the quality of our product offerings for a few extra dollars on the bottom line."
What Biblio has created is an easy-to-use site that, from all we have heard, operates smoothly for booksellers. This is particularly important as the site tries to expand its bookseller members, as some other sites have suffered numerous technical glitches of late. Abebooks and Amazon may be sales leaders in their field, but not necessarily in providing the smoothest operating technology for their dealers. Biblio evidently has gone to great lengths to provide good functioning software, as few things seem to rile booksellers more than error prone programs. Biblio seems to understand that point, and by keeping its site working properly, has taken advantage of an opening some of its competitors have given it. In a time when this is not true of all sites, the overwhelming majority of Biblio's dealers seem to like the site.
We next noted that Biblio has some major competition: Abebooks, Alibris, Amazon, Barnes and Noble, and eBay/Half. How can they compete against this field? Mr. Donaldson explained, "I am sure that you are aware that Barnes and Noble and Half.com still take a majority of their used listings en masse from sites like ours. EBay is just a different bird all together. So we really see our primary competitors as Abebooks and Alibris. Amazon is now the new player in our space. But they also have a different business model than us, Abe and Alibris. No one but Amazon has started carrying garden hoses quite yet, thank goodness."
He then goes on to quote educator Alfie Kohn: 'Trying to be number one and trying to do a task well are two different things.' Mr. Donaldson explains, "This is really an important ideal to us. Sure, we have a lot of listings and a plethora of professional independent booksellers, but we also have to have a fairly well oiled machine with our site, and in our business practices. It is much more in line with our mission and business focus to get better at what we do, and not to race!"
One of the things its members like about Biblio is its comparatively low fee structure. It's all based on sales, that is, it's a commission arrangement. If you make no sales, you don't pay a thing. There are no listing fees. Commissions start at 15%, but drop to 7.5% based on a monthly sales/number of listings formula. For example, if you list 1 to 500 books, you pay 15% of your first $133 of sales during the month. All sales above $133 are charged at 7.5%.
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Biblio: Number Three Tries Much Harder
- By Michael Stillman
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At the other end of the spectrum, if you list over 100,000 books, the commission rate does not drop to 7.5% until you reach $900 in sales. However, the maximum commission Biblio will take on any single book is $40 (same as Abe) so that commission rates on expensive books are very small. Biblio offers one other, unusual discount: a discount for high fulfillment. Biblio does not want its customers to be disappointed. So, they will discount the commissions you owe as much as 18% if you have a 100% fulfillment rate. It slides down to a low of 6% for a fulfillment rate of 85%.
We asked whether Biblio would increase its fees if it succeeds in increasing its market share. Some sites have done this as they became stronger, and it antagonizes sellers no end. Mr. Donaldson's response was, "I won't say that we will never change fees. If it costs us more to do business, then we will inevitably see changes in our fees. Will we increase fees because we are doing better in the market and we think our services are somehow more valuable? No!"
Next we turned to an issue that has been particularly important to the rare and antiquarian bookseller, or those with other higher priced items. These sellers rely on their expertise to sell books, but this necessitates direct contact between seller and buyer. Unfortunately, direct contact allows transactions to take place outside of the site, thereby depriving Biblio of its just commission. How can Biblio continue to foster this contact without hurting its own financial interests?
Mr. Donaldson's response was somewhat surprising. They rely on trust. Mr. Donaldson responded, "This is a fantastic question - one that we ask ourselves at every turn in creating policy and procedure for the independent dealers on our site. We are often contacted by sellers that have in some way worked with a customer and the process has taken them off of our site, and the transaction is simply easier to conduct between buyer and seller directly. They then email us and ask us how to pay us our commission for the lead. That is the kind of bookseller we like to work with. Personally, it makes me feel comforted to know that there are business people out there that have phenomenal ethical standards, and a genuine interest in seeing sites like ours succeed. If we do better, they will do better. We are committed to this."
As we noted, Biblio has achieved impressive growth despite a difficult, competitive environment. They have kept their site free from major technical problems, a source of enormous seller irritation, while some others have been plagued with problems. They have also avoided coming across to their dealers as imperial and uncaring, a trap a few of the larger sites have fallen into. They appear, for the most part, to be genuinely liked by their sellers, which cannot be said for all of their competitors. No one knows the future, but their strategy for now is to win more dealers over by maintaining these dealer friendly attributes. In other words, it is to remember what brought them their initial success, even if they become big enough that some might think this is no longer necessary. Many businesses become aloof and even arrogant when they become large. Biblio's plan is not to let this happen.
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Biblio: Number Three Tries Much Harder
- By Michael Stillman
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Nevertheless, popularity, technical expertise, and respectful treatment of booksellers are all trumped by the most important factor of all: sales. Dealers may love a site, but ultimately, it must make sales to survive. Otherwise, it is irrelevant. This is the challenge that Biblio must meet in the years ahead. Few dealers who sell across multiple sites list Biblio as their top seller. Abe and Amazon may have antagonized a fair number of their dealers of late, but they sell more books. So does Alibris. Biblio has raised itself from the lower tier of sites that can go months on end without making a sale for a member. They make sales, but for the typical Biblio seller, it appears to be gravy, not the meat of their businesses. They depend on the larger sites.
We posed this question to Biblio, and it is clear from Mr. Donaldson's answer that they both recognize that this is their major challenge and realize there is no easy answer. Here is his response to the question of what Biblio is doing to increase sales from its site:
"This topic tends to be the most important question on most bookseller's minds, and I don't blame them. Sales are important to us since it quite obviously affects our bottom line as well. I joined Biblio.com in the summer of 2004 to begin the focus toward a more customer-centric site. We have made a number of improvements to our site and experience, and though it is not prevalent to each and every seller, our growth is outpacing the used book industry as a whole by a substantial margin, so we must be heading in the right direction.
"One thing that might be hard for a lot of dealers to understand is that we operate a business where we do not control the product itself. Thus we can't discount it, offer it to be shipped free, or offer quantity. Some of these have become the tenets of selling online in the last few years. When one of our competitors offers a customer incentive that we can't replicate then those sites get more sales. That is just the way it is. But we won't do it. Not at the risk of losing a good seller. The quality of the books and the sellers is the most important aspect of selling used books online.
"The customer doesn't see any of this. Most of them don't understand the business process. They just want their book, and at a reasonable price in a reasonable time. We are in a challenging role of educating the seller on best practices for successful online selling, and making sure the customer is ultimately satisfied with minimal confusion. This is not always an easy task.
"In the near term, we will be continuing to build upon our growing network of affiliate sites, and partner search sites. We have an ongoing public relations campaign to get the word out to customers about Biblio.com. And most importantly, we are working on multiple strategic partnerships to provide other selling venues and new tools for booksellers to, again, have a more vested interest in Biblio.com. Better quality books, quality booksellers, better pricing. This is a team effort, truly between the independent dealer and Biblio.com. That said, it is a two-way street, and both players are going to have to strive to make this work.
"Does Biblio.com want to be the biggest? No. Just the best. There really is a difference."
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