Amazon's foray into the physical bookstore world could eventually be the start to a major retail chain. At least, if the hint given during an earnings call from a mall operator comes true.
The news that Amazon might just have plans to open a few hundred more bookstores went viral after reports surfaced from a mall operator CEO from General Growth Properties, who dished on a little insider information. But take the report with a grain of salt, of course, since Sandeep Mathrani, the mall exec, may not be the most versed in what exactly Amazon has up his sleeves.
But that one comment sure got its day in the sun in the press. When asked about mall traffic, Mathrani responded: “You’ve got Amazon opening brick-and-mortar bookstores, and their goal is to open, as I understand, 300 to 400."
And that set off media outlets to reporting that Amazon was set on launching hundreds of physical stores. And while Amazon has certainly hinted at its brick-and-mortar ambitions, with its first physical store opening last year in Seattle, it's nowhere near confirmed just what Amazon will actually do.
In fact, it's probably too early to tell. And Amazon is far from confirming, likely because it would also need to see how its first physical stores actually end up performing. For now, it's not confirmed where or how this mall executive got his information.
For now, the rumor mill has suggested that Amazon is looking to use its one physical bookstore to see how quickly books can sell off shelves, which would include having nearby warehouses ready with a new supply of those books. But that's also according to an anonymous source that spoke with The Wall Street Journal.
Amazon's entrance into the (physical) bookstore world was reported back in November when Amazon announced it would open its first brick-and-mortar shop in Seattle's University Village. The style of Amazon Books is familiar to anyone who has ever perused the stacks of a mall bookstore — wood shelves laden with bestsellers and customer favorites.
Amazon, which for years has been the terror stalking the dreams of physical booksellers, had, before then, leveraged its ability to undercut its rivals on price by sidestepping the overhead costs associated with physical retail. Now, armed with a massive pile of consumer data on book preferences gathered nationwide for the last two decades, Amazon is turning to physical in the hopes of leveraging all that information into doing it better.
Particularly, Amazon might be able to avoid the typical trap that catches booksellers: the unsold title that languishes unsold, taking up valuable shelf space. With better insight into customer habits, Amazon could theoretically do a better job of picking titles that move and avoid sluggish inventory.
And, Amazon notes, it's about more than just the cold data when it comes to selling books.
“It’s data with heart,” Jennifer Cast, vice president of Amazon Books, said. "We’re taking the data we have, and we’re creating physical places with it.”
That first physical space is around 5,500 square feet, with 2,000 square feet of additional storage. It will also be laid out a bit differently than most typical bookstore shoppers are used to — avoiding the "spine-out" display model in favor of displaying books "face out," which means much less space for books.
As for Amazon's next brick-and-mortar chapter? We'll have to wait and see if it comes true.