Online Bookstores in Europe
Must Walk a Straighter Line
By KIMBERLEY A. STRASSEL
Staff Reporter of THE WALL STREET JOURNAL
FRANKFURT -- At this year's Frankfurt Book Fair, Germany's Internet bookstore buecher.de AG regaled crowds about the many advantages of buying online. Discounted prices weren't one of them.
The familiar tale in the U.S. -- such as discounts and gigantic selections -- is a different story in Europe. Rather, success in Europe's booming online book world boils down to clever customer service, unusual shipping deals and special loyalty programs.
"The European market demands some real creativity," says David Risher, senior vice president of marketing and product development at Amazon.com Inc., which on Thursday launched both U.K. and German operations. "We're letting customers take the lead, reacting to their requirements."
The online book industry has been one of the hottest sectors of Europe's Internet industry. At the Frankfurt Book Fair, Dr. Gerhard Kurtze, president of the German publishers and booksellers association, said more than 1,200 German bookshops were already online, and that "considerably higher turnover is made from book sales on the Internet per head of the population in Germany than in the U.S."
Bigger Players Enter
That kind of growth has caught the attention of bigger players, who have since rushed to join the market. On the heels of Amazon.com, which replaces the sites of leading local companies it had bought in April, Germany-based publisher Bertelsmann AG plans to unveil its online store, Books Online, in November and will later link up with the online ventures of U.S. bookseller Barnes & Noble Inc. Separately, U.K. publisher W.H. Smith Group PLC took over the U.K.'s leading online seller, Internet Bookshop Ltd.
The U.S. online success stories such as Amazon.com have won customers by passing savings on their low overhead costs to customers through discounted book prices and by offering vast selections of books. But in many countries in Europe -- Germany, Austria and France, for example -- book prices are fixed and discounts are illegal. The U.K., meanwhile, restricts companies from selling many books published outside the country.
In response, companies have to find clever new ways to compete on price. One of Germany's largest online shops, buecher.de, for example, offers to deliver books free in the European Union and Switzerland. Amazon's new German subsidiary, Amazon.de, also will cut shipping costs for customers in Germany.
"The point is to make sure people know they're saving money somehow," says Georg Heusgen, a buecher.de board member.
English-language books, which aren't subject to Germany's price-fixing laws, are turning into a battleground. Amazon.de has compiled a list of 300,000 U.S. titles that it will ship free in Germany, and it won't charge value-added tax. Meanwhile, buecher.de offers a 10% discount on each of its roughly 600,000 English-language titles.
Standard Features
Customer service, meanwhile, is a must. In addition to the customary services on U.S. online sites -- book reviews, information about authors and chat groups -- European companies are offering promises on next-day delivery, gift certificates and local-language help desks.
The U.K. scrapped price-fixing last year, and online firms already offer discounts of as much as 40% on books. Online bookstores, however, are still struggling to compile the far-reaching lists of titles that make online sites popular, because the U.K. restricts the number of foreign-published books that can be sold in the U.K.
Amazon.co.uk spent months compiling a list of U.S. titles that didn't conflict with U.K. rules. Now, in addition to the 1.2 million U.K. titles in its cache, it has a further 200,000 U.S. titles, and is working to increase that number.
"We're attempting to be whiter than white when it comes to the laws, but also make sure our audience has the widest of choices," says Simon Murdoch, managing director of Amazon.co.uk. |
