Amazon vs. Walmart in Cage Match Extravaganza
Hey all you booksellers: are you ready to rumbleeeeee?!! Ready or not, Amazon and Walmart are gunning for you in what seems to be a power play for online shopping dominance this holiday season. Basically, Amazon and Walmart, and now Target, are in a shoving match, each trying to undercut each other on prices for new hardcover book releases. New releases normally priced upwards of $25.00 by bricks and mortar booksellers are now going for $10.00 or less online. Predictably, many independent bookstores are lamenting yet another butt kicking in this economy as they don’t sell enough in volume to compete on this level. Some are opting out of the battle by not bothering to stock the books in question in their stores and just hoping to survive the aftermath. Damn you, Fates! How could you be so cruel?
To add an interesting twist of the knife, Sears is doing all it can to stick it to the competition by becoming the newest third party online retailer. Under the guise of its new program, “Keep America Reading,” Sears is profiting at its online competitors’ expense. It’s ingenious, really. Amazon, Walmart and Target are losing money with their deep discounts, which Sears encourages with its incentive program: anyone buying a qualifying discounted book from one of those three online retailers just needs to email Sears the receipt (readamerica@customerservice.sears.com) and they’ll get a $9.00 credit towards anything they buy from Sears online. The Big 3 retailers will hemorrhage cash for the next few months while Sears sneaks in the back door handing out coupons for its own merchandise. Sears isn’t competing for a book buying audience and marginal revenues; it’s going after the core consumers who buy everything from clothing to electronics. This is the stuff evil geniuses are made of.
Call me sadistic, but I’m enjoying the price war: it’s great for consumers and forces retailers to think about serious innovations in order to remain relevant. Everybody wins, even the independents if they take some initiative. What’s to stop them from taking a page out of Sears’ book and using it to their advantage? If the Big 3 retailers are selling premium product for less than what publishers or distributors charge (including their ~40% discount), why not buy retail? This way they get inexpensive books for their stores and the moral victory of sticking it to the big guys.
Sorry publishers, maybe everybody can’t win.
