The tale is in the tape: Book lovers spent some $650 million online 1998, up from $152 million in 1997, according to New York City-based Jupiter Communications' Ken Cassar. And they'll spend a lot more in the future: Cassar estimates that online shoppers will spend some $1.14 billion on books in 1999 and $3.6 billion by 2002. Investors are lining up at the cash register as well, reveling in Amazon.com's IPO news and responding equally favorably to the announcement of Borders' new Web site.
Still, true to Internet investor mania, Amazon.com has yet to turn a profit from its online bookselling efforts, and Web shoppers are not shelling out as much as they do in "real" retail outlets. Spending on books through more conventional outlets (i.e., stores) was estimated at $12.37 billion in 1998, according to the New York-based Book Industry Study Group, Inc. In 1997, that figure was $11.95 billion, and it is expected to increase to $14.5 billion by 2002. But it is a significant year-over-year increase, and proves that books are big business, both for virtual sellers and bricks-and-mortar outlets. The retailers who sell books through both channels stand to make even more once the costs of setting up their online enterprise are reconciled.
Are the same shoppers who cruise the aisles at the book superstore around the corner the same ones surfing the supersites on the Web? A snapshot of the in-store book buyer provided by the American Booksellers Association, based on 1997 figures, shows that buyers tend to be college-educated, married people between the ages of 35 and 54, with a higher-than-average annual household income. The typical book-store book buyer has an average age of 42 years and a median annual income of $39,900. More than half are married, and 60 percent do not have children in their households. Women (53 percent) are slightly more likely than men (47 percent) to buy books.
The online shopper, on the other hand, is slightly more likely to be male than female (51 percent male, versus 49 percent female), says Jupiter's Cassar, according to data on the typical online shopper who made purchases in November and December 1998. Cassar stresses that these numbers are for holiday shoppers making purchases in all categories and not just books, but he maintains that the profile they represent is suggestive of the online shopper in general. More than two in five online shoppers (44 percent) are between the ages of 35 and 49, while 30 percent are under the age of 35, and 26 percent are aged 50 and older. While 44 percent of online shoppers have annual household incomes between $35,000 and $75,000, 36 percent have household incomes of $75,000 and higher, and just 20 percent have annual household incomes lower than $35,000.
"There is not a lot of difference between our online and in-store customers," says Erica Moffett, a spokesperson for New York-based Barnes & Noble. "And there is even more overlap now than there was two years ago when we first started our Web site. The average customer who walks into our store also goes online."
"Our customers need to have three things: a computer, access to the Internet, and a credit card," says Bill Curry, spokesman for Seattle-based Amazon.com. "A lot of demographic segments fall out when you have those requirements," he adds. Amazon.com, which only sells its books through its Web site, may not appeal to the broader population, but its three requirements are probably not daunting for the typical in-store book buyer, and it is probably not wrong to assume that many of Amazon.com's customers also frequent actual book stores.
But does the trend toward buying more books suggest that America is becoming a more well-read sort of place? "We can't really say if Americans are actually reading more," says John Baker, editorial director of Publishers' Weekly in New York City. "We can say that they are buying more, though. When a book is suggested by Oprah Winfrey, for example, sales are pretty much guaranteed to increase by hundreds of thousands. But do those books get read? We have no way of telling."
There are some clues, however. Data analyzed by noted time researcher John Robinson indicates that at least one demographic group seems to have less time for reading. "Young adults (ages 18-to-24) show a decreased participation in many arts activities, especially in reading literature," Robinson notes in his latest book, Time for Life.
Baker suggests that there is one demographic that is reading more. "Book clubs-which are usually made up of fiction-reading women in their late 20s to mid 40s-are flourishing. So much so that publishers are putting out reading guides to accompany their most popular book-club-selected titles." It would be nice to assume that purchasers are also readers, but for the most part, sellers have to be content with the fact that book purchases are up in all channels, which is good news for everyone.