business news in context, analysis with attitude

by Kevin Coupe

There has been a confluence of stories in the New York Times that, I think, illustrates something about how to compete against Amazon.

The first story focused on the subject of counterfeiting, which, as has been pointed out here in the past, has become something of a hairball for Amazon.

Here’s what the Times writes:

“The company sells substantially more than half of the books in the United States, including new and used physical volumes as well as digital and audio formats. Amazon is also a platform for third-party sellers, a publisher, a printer, a self-publisher, a review hub, a textbook supplier and a distributor that now runs its own chain of brick-and-mortar stores.

“But Amazon takes a hands-off approach to what goes on in its bookstore, never checking the authenticity, much less the quality, of what it sells. It does not oversee the sellers who have flocked to its site in any organized way.

“That has resulted in a kind of lawlessness. Publishers, writers and groups such as the Authors Guild said counterfeiting of books on Amazon had surged. The company has been reactive rather than proactive in dealing with the issue, they said, often taking action only when a buyer complains. Many times, they added, there is nowhere to appeal and their only recourse is to integrate even more closely with Amazon.

“The scope of counterfeiting across Amazon goes far beyond books. E-commerce has taken counterfeit goods from flea markets to the mainstream, and Amazon is by far the e-commerce heavyweight. But books offer a way to see the depths of the issue.”

Among the pirated titles and books are ripoffs of “To Kill a Mockingbird,” “War and Peace” and “For Whom the Bell Tolls.” But there also is “The Sanford Guide to Antimicrobial Therapy” … which tells you about how deep the problem may be.

(FYI … nobody, best I can tell, has pirated “The Big Picture: Essential Business Lessons from the Movies” or “Retail Rules” or “Business Rules”. Yet. But you’d better get them while they’re real.)

Amazon says it does its best and tries to do better all the time when dealing with counterfeits, whether they are books or sneakers or whatever. But I don’t think that there would be much of an argument with the observation that counterfeiting continues to be a major problem; there is no doubt in my mind that Amazon would be well-served to have a better trackability/traceability system that would weed out the fakes more effectively and provide customers with better, more accessible information about the products they buy. (It isn’t just Amazon. The entire retail business can and should do better.)

Part of the problem is that while Amazon’s reputation may take a hit from counterfeits, its bottom line doesn’t, at least not in the short term - a sale, after all, is a sale.

The Times then had a different story focusing on “the continuing resurgence of independent bookstores,” writing that “the success of independent bookstores has offered a lesson for other brick-and-mortar merchants: Become part of the local fabric.”

There’s one line from the story that grabbed my attention, because it stood in stark relief compared to the counterfeiting story:

“Independent bookstores have become anchors of authenticity.”


Through highly curated selections, author events, sales of non-book merchandise and a deep commitment to their local communities, that’s exactly what many independent bookstores have done. In doing so, they can create community centers that can attract other retailers, which attract other customers.

Sure, they’re not “everything stores.” But they sure as hell know what is on their shelves, they can make recommendations to their shoppers, ands they’re not selling pirated copies of “For Whom the Bell Tolls.”

That’s an important lesson for retailers trying to compete in what admittedly is a tough, challenging, often cutthroat environment.

“Anchors of authenticity.”

That’s an Eye-Opener. I love it.
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