Entrepreneurs seeking to tap into the $7 billion college textbook industry by claiming to offer cheaper, easier Internet-based alternatives to the campus bookstore have clamored to join the online marketplace in recent months. Five textbook vendors have launched, upgraded from beta-mode or began offering expanded services since July.
The textbook industry, which has long criticized used and alternative book vendors for stripping its profits and inflating textbook prices, has also taken to the online marketplace, bypassing retail middlemen and selling electronic versions of many textbooks directly to students.
Though many traditional campus bookstores sell textbooks online as well, trade groups representing them said stores and managers remain wary of purely online operations.
They claim these electronic vendors could potentially hurt universities. Many campus bookstores pay schools a percentage of their sales or are staffed by students, so a chunk out of their bottom line could strike a blow to the educational institutions, they argue.
In some cases, however, bookstores with a physical presence on campus wind up having a leg up over their digital competition. Several online textbook ventures based on trading books and networking-based sales must quickly attract users to their sites for the sites to be useful.
BookThief.com is one such venture. The site, which went live Nov. 27, works at the local level to connect buyers and sellers of textbooks – who pay a 99 cents listing fee to post an item – on the same campus so they can meet and sell textbooks in an informal setting. The site allows for long-distance sales, too.
Co-founder Gary Chubb says he is energetically marketing BookThief, focusing on the top 220 schools by way of enrollment, which he thinks exposes the site to 50 percent of college students.
More than 5,000 students have registered for the site, he said, and 20,000 have viewed books. He hopes the proportion of users to browsers will increase within the next six months, bolstering the selection and number of books on the market.
Mark Hexamer, a co-founder of Swaptree.com, which matches users’ list of wanted textbooks, video games, CDs and DVDs with other users who have those items and want to trade them, agreed that his site – which is still in beta – must garner a “critical mass” of users for it to be effective.
The more people who want to trade items, the more items are available to trade and the greater the likelihood of a favorable trade, Hexamer said.
One company even takes a Netflix-like tactic to textbooks. BookRenter.com’s approach is through short-term leases to students. The company, re-launched in August, says it saves students up to 75-percent off retail prices.
Laura Sneddon, spokeswoman for BookRenter, said the deal is overwhelmingly better for students.
“Why not just pay less for a couple months?” she said. “It’s not only better than the Bookstore for the savings, but more convenient because it’s online.”
Approximately nine USF students currently use BookRenter, Sneddon said.
AbeBooks.com, which at 11-years-old is a relative veteran in a marketplace filled with startups, is working with a new partner, allowing the site to revamp its buyback program and offer more titles. To use it, students enter a textbook’s ISBN and a merchant will make an offer on it.
Some in the publishing industry remain skeptical of these new ventures. They encourage the sale of used books, which don’t generate any profits for publishers, making textbooks more expensive, said J. Bruce Hildebrand, executive director of education for the Association of American Publishers.
“The publisher invests all the money, and takes all the risk, and hires the authors, and does all the printing and every thing else,” he said. “They have to cover all the development costs that way – in sales.”
The industry has fired back though, and launched its own startup, seizing on the popularity of e-commerce.
CourseSmart.com, which is still in beta, sells 5,000 electronic books at about half the price of a conventional retailer, Hildebrand said, enabling “students to go directly and purchase the books that they want in the format they want without the middleman.”
Charles Schmitt, spokesman for the National Association of College Stores, a trade group that represents 3,100 college bookstores, said he thinks Internet startups are capitalizing on college textbooks simply because it’s an untapped business opportunity.
“The college textbook market is a $7 billion business,” he said. “So everybody is looking for other options and a chunk of that pie.”
He also said that electronic textbook sales are keeping with the push toward online classes as technology improves. Also, people seek alternative vendors because they’re upset about how much books cost, he said.
The end result for campus booksellers is that revenue from books is declining over time. Bookstores are fighting to keep customers and profits by branching out, selling jewelry, cosmetics and other merchandise. Other college bookstores have taken up purchasing goods and shipping for academic departments on some campuses, Hildebrand said, in addition to selling their textbooks online.
Though money from textbooks is decreasing, Hildebrand remains optimistic.
“It’s just a very interesting time in the textbook industry and the college detailing industry,” he said. “For anybody who is flexible and innovative thinking, it will be a successful time. ”
Grace McQueen, general manager of the USF Bookstore, which pays the University a commission, said its sales weren’t in keeping with national trends.
“All sales are growing in the bookstore,” she said, including books. McQueen attributes the swing to the fact that the store is right on campus, making it easier for students to get books without the wait of online vendors. Also, students are more confident with traditional campus bookstores, because they instantly know that they’re getting the right books, she said.
At Gray’s College Bookstore, the situation is similar.
Jim Laneer, a manager at Gray’s and former USF Bookstore manager, has worked in the industry about 20 years and said sales were increasing, but with a few caveats.
There was a decrease in sales when online retailers of used and new books like Amazon.com initially took off, but the attraction to online vendors has steadied because people were getting the wrong books and were dissatisfied with the service.
“Initially, price was the big issue,” he said.
“But with the number of people that are getting the wrong books or the wrong edition or broken books or something like that, people are increasingly looking to quality of service and price,” he said.
It’s not clear that online vendors are a smash with students, but some treat the idea warmly.
Junior anthropology major Brittany Anderson didn’t buy books online this semester, but said “I should probably do that,” alluding to the crowds at the Bookstore.
She said she bought books online once – through the USF Bookstore – and that it was easier because all her books were in one box and because she didn’t have to peruse the racks.
Joey McDonald, a senior majoring in accounting, had one such experience. He ordered a textbook online once, he said, but “it took too long to get to me.”
He said he’d consider buying a textbook online again, but probably wouldn’t go through with it because he doesn’t wind up using the books in about half of his classes.
McDonald also enjoys the convenience of the campus Bookstore.
“I can use my financial aid, which is nice.”