The first time I noticed that Borders was in trouble was last year when I visited the UK and saw a closing down sale at the Speke branch of Borders. My first question was what would my Dad do in his spare time? He had single handedly allowed Borders to stay open for so long with his constant visits buying books that could have easily have been found cheaper online. The immediacy isn’t there in the online purchase though so as the ex librarian he is, he wanted to touch the books and look at them in real life rather than virtually.

Borders Files For Bankruptcy

Borders Files For Bankruptcy - Welcome to the New Paradigm

Now the news that Borders has filed for bankruptcy in the States after closing down all of the branches in the UK suggests that there are very few people like my Dad around now and the online spend is starting to eat into the traditional bricks and mortar businesses to an even greater degree. Any business now that doesn’t have a credible online strategy and within that strategy an equally important mobile strategy can start kissing goodbye to its nether regions now because sooner or later their market will disappear.

So have people stopped buying books and magazines, the staple diet of Borders?

Erm no!

In fact book sales are extremely healthy through Amazon and Barnes and Noble, the biggest online retailers of books and within that healthy market there is a burgeoning market which publishers need to get on now, the ebook. EBooks are actually outselling the physical book in many cases. Against that a friend of mine selling a book online recently reported 9 to 1 sales in favour of… the physical book. However in certain markets the ebook is king.

Now as an entrepreneur there is one thing that one of my mentors always drills into me, you go where the starving crowd is if you have a hot dog stand. It doesn’t matter about quality of product, feel and taste. If the crowd isn’t there you will not sell.

Where is the starving crowd in the book market? Well not in the Borders bookstores anymore evidently. The crowd is hanging around their kindles, tablets and iPads. If you are not producing a digital version and enhancing that digital version of your books for those who choose the online version then you are missing a huge trick. The ePub format for Apple and the Kindle formats available allied to today’s announcement from Apple about subscription based magazines being available now in the App Store means that there are so many different ways to market opening up for any publisher or indeed writer.

Now to bring this home. Here in Spain the paradigm will take time to arrive, quite a bit of time as we are years behind the more mature online markets, however it is on its way. The movements we can see in the States and the UK will come with time. How are you preparing your business and your writing and publishing for the new paradigm?

Borders is no more, long live the new King, whoever that is.

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  5 Responses to “Borders Files For Bankruptcy. Welcome to the New Paradigm”

  1. Your mark is Borders Gra, mine is (was – they could have gone bankrupt again..) Blockbuster. The truth is that both physical books and DVDs still sell very well, except people go online to get better deals. The shift to eBooks is taking place, just not quite as quickly as we would all think.

    There is also a shift in how people buy the “product”, for instance: 90% of single are sold as downloads, but 90% of albums are still in CD format. Yet, the number of non-single sales is increasing. Why? People are not buying whole albums, just tracks that their mates like!!!

    Some things will never go online: could McDonalds taste any worse? But all things will be affected by online: McD’s discount voucher anayone?

  2. Very good points. I would seriously hope that online would affect McDonalds but unfortunately only a serious change of attitude will ever do that (Or making it illegal)
    Interesting figures about single and album sales there.
    I have an iPad of course and the amount of reading that I do on it is increasing every week especially since downloading pdf-notes which allows me to annotate books too!

  3. iPad is a good product, and it should be the product to take eBooks out in front of paper, and start the decline of paper? Already it has “copy” competitor products.

    Was chatting to a mate in the music industry a few weeks back, and he was unhappy. He said all the music business are going down the pan: I told him no! We actually consume more music now, but how we consume changes. LiveNation makaes a load of money, because it sells music rights to about 8 core consumers: films, touring companies, advertising agencies, YouTube, etc. EMI are trying to sell to 7Bn people, some of whom have figured out how to copy tracks from their mates CD!!!

    All industries follow a pattern: technological lead, price lead, service lead. As each new technology moves through, the price of the old technology falls – once like a nice grass slope, now like a cliff! BetaMax or VHS anyone? But it doesn’t disapear. In fact eBay is seen as a market price prop for most old tech, where the geeks go to buy the stuff. If the tech comes back, it comes back as a high margin niche.

    Amazingly, EMI’s results reveal an old tech profitable niche: short run vinyl. Anyone remember the 12inch single? Well that mixed with a very, very nice cover. Makes lovely wallpaper, even if you still listen to the track on the download that comes with its sale.

    Online is: a low cost high function global communication and distribution channel. No more, and no less. Its products are all soft deliverable: product, price or service lead.

    Your original point Gra is right: How are you preparing your business for the new paradigm? It will affect us all, just now the classical history lessons to answer for each of us: who, when, what, where, why?

    Ed Dale’s pointer, based on Gary Halbert’s original premise to him of go where the starving market is, answers the question for new market entrant entrepreneurs: if you can also see where a product, price or service lead can be gained.

  4. This is exactly what I’ve been telling people for the last, like, five years. We’re moving online.

    Not only has Internet become a part of our lives – we’re literally moving parts of our lives into the Internet.

    Take facebook as an example. We store lots of stuff, such as our personal information and pictures there. And it’s all online. It’s insanely cheap as well.

    I don’t see anything bad with moving to the Internet, except for businesses like Borders having to file for bankruptcy :)

    /Kimmo.

  5. Maybe we will miss the social element of actually going to the shops, having a coffee, talking to people.

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