Reuters notes the steep discounts being promised by book retailers when the new Harry Potter book from Scholastic hits the shelves of stores in July - no surprise, given that Amazon is already offering pre-ordering of the book at a 49 percent discount. With the younger book fans of the Potter series already very Web literate only the most avid fans are going to bother to line up on the release day to snatch up a copy at a bookstore rather than pre-order online. And if that's the case, isn't that what they call a matter of...supply and demand? The book industry is one of the last bastions of supply-oriented publishing that stands a shot at making its margins off of the "tall tail" of high-volume publishing, but implicit in their need to compete with online outlets is the greater need to build margins from "long tail" content - and yes, from Godiva chocolates and espresso - once customers are in the door. But if the most successful book franchise in modern history has become nothing more than a loss leader for long tail books eating up rent, climate control and staffing then the "big box" book stores may be headed to the remainder shelves in their efforts to compete with online content sellers and distributors.

For the time being the movie industry seems to have staunched some of its woes by leveraging available screens to make the most of the unique context - precisely orchestrated opening weekends - that they can offer for their wares. The movie distributors and theatre operators have the advantage of not having to compete with online outlets for same-day distribution with lower overhead and the added advantage that going to the movies is a social activity by and large. But even here the demand to distribute movie content online will push movie theatre operators to many of the same decisions that bookstore operators are facing today.

How to do better? To some degree the book industry addresses this with kiosks in other big-box stores that highlight popular content selections. But both booksellers and movie producers need to get better at making these kiosks centers for consuming long tail content as well as the hits. I can punch in an order at my local supermarket deli counter's touchpad screen to pick up cold cuts after a few minutes of shopping: why can't I do the same and pick up a print-on-demand book or a freshly burnt video? Or better yet, do it online at Amazon or some other outlet and direct the order to my local store for pickup? Zero inventory and shelf space for the retailer, easy profits and the ability to focus customized offers on the person picking up the merchandise. It's coming, don't worry.

Labels: books, Hary Potter, retail, Scholastic, Trends