For indie stores, if you get to somewhere in that, 1520 of your inventory makes to be nonbook, youve got a profitable plan. A store that is selling 1520 nonbooks is still a bookstore. Its important for it to still be a bookstore because thats what your customers are expecting, but you need to get somewhere within that, that 1520 range. I know there are stores that are a little bit about that, that do well and clearly still continue to look and feel like a bookstore. I think the over all things go about the independent bookstores is that you are all different. The mix of product is different. What may work in joyces star is not necessarily going to work in the store on the west side of manhattan. So i think its really hard sometimes to generalize about what if it works in one place, wilderness is early work somewhere else . I think more often than not the opposite is true. Just because it does work in one place means it may less likely work somewhere else. Thats of course the charm of stores, that theyre all different. One of the things joyce said to me in my prepanel phone conversation, talk about nonbook, she said, and its im speaking for her, the closer to the book that it is compare the object is, the more likely it is to work in the bookstore. That was an interesting insight. So im going to now move to the other end of the room on the merchandising mix, which is the digital book. And here i was really curious about integrating ebooks. Can we make it work . Have made it work . What are great examples of people have tried things, are trying things, and it made integrating ebooks into the brick and Mortar Retail mix work. The other thing i asked was what are the exciting new things youve seen in the realm . Weve all seen interesting ideas like cars and all sorts of other things i thought we would ask that question. The merchandising mix, so much of the relationship between ebooks and physical books and ebooks in stores is about what space to ebooks and sort of leave unoccupied of which there is a they go deep in . When we look at kind of average data, i have mostly Canadian Market statistics to me because thats where im from, if you look at a typical store on average, 10 of physical store sales are romance, for example, wheres 25 of digital art. So were now talking to readers are starting to make deliberate decisions about what they leave in digital versus print. I cant actually stock every harlequin romance stock every harlequin romance series that is an been written and maybe i deliver late want to not do that. In fact, maybe i want to deliver to start putting up signage and train staff to say hey, if youre interested in this, we avoid to get all the romance books you could possibly want, and use that instead, which then frees up space for the unoccupied area, that digital has hihas been able to touch whe areas related to nonfiction and anything that touches you think of something as a physical object that moves one person to another. Those are places that digital does not touch it. We built all kinds of crazy gifting functionality for the most part. Because people want to give a beautiful thing to someone. So those areas of picture books, cookbooks and travel books and all of those things that about the beauties of physical objects still get touched. So we see people starting to double down on those and leaning back from areas like genre fiction and mystery where maintaining a big comprehensive collection is early hard. Instead be really territorial about which ones are new, which would or interest, how can i engage someone with a new voice they have had before instead of trying to keep everything thats been written. That is about the merchandise, right, which is interesting to what i wanted to hear about is common sort of the discovery and the balance between those two things. I think when we were talking on phone you its an interesting examples of people who have made that work. You know, and im wondering if you could share a couple of those. Yeah. We just came through a couple of pilots, specifically rated tickets. One of the things we tried to do is to see whether his uptick in childrens reading, for example, especially teenage series novels, stuff like that. A big campaign with indigo in the u. S. Sorry, indigo in canada, where just starting to introduce series and first novels to kids in digital format and giving trial an introductory offers, we are able to list the category about 44, 45 in one month. And series fiction was really, really interesting for them. The immediacy of being able to move through was effective. We have trials like that. We been going on that been quite interesting, and weve had i would say som similar limited success in areas where we are bringing things like digital bundling together. And where we did in the italian market of all places, where do these interesting structures like the biggest publisher also on the second largest retailer who also owns the largest magazine publisher. You can interesting stuff when you on all of it together. They took their top 100 books and bundle print and digital together to see how people would engage with that. And we found that when somebody bought a book in print and also start to read in digital, they would read fast because the reading at home and print and taking the book at your route and try to carry the whole thing around with them all the time and it also became shockingly valuable customer as we track their behavior spent which is i think one of the things that amazon has discovered, too, thats also a story. If you are fighting for more of peoples time, you can occupy more of the time with reading as opposed other stuff they did instead. Which is exactly what we want to do. John, i think its and comments about this as well. I have some thoughts, questions. The thought, michael hit on something that we believe is true, and its not dashing digital and print, its not either or. Its almost like either and. Inevitably, very strongly that all of us live on a continuum somewhere between doing everything in the physical world and everything in the digital world. We are all on this somewhere, and reading fits in there. So the idea of how to make bundling work is a critical one, and one, this is what my question and my thoughts come in, is its something we havent quite found the right way to scratch that itch. But we would love to test some things, and those of you out or interest in that, come and see us in the booth about it because, as i do believe what michael says is true, is that move through it faster and i also happen to think, i mean, publisher, its not goin going e one plus going to be one plus one, one digital book plus one physical book is going to equal the price of two books. Those economics are not going to work. But somewhere in there to our economics to work for everybody. I take for one player to be the only one to figure that out. Its very clear that we done some of those expended at this point. Theres interesting things about the space. Does anybody else want to talk with integrating ebooks . No . Are you we all done . You want to talk about it, gre great. You know, its hardly a secret that, you know, we are struggling to be able to get our customers to buy Digital Content from us. We have a partnership with my friend sitting to my left, and we worked hard with kobo in trying to convert in the reading experience in a physical bookshelf, but its been a struggle because its been hard to be able to convince our customers to think of us as a place where you can buy Digital Content. They think of us for all the extraordinary things that joyce was talking about, about the things we do in our community. They dont necessarily think of us as a place to be able to sell Digital Content. But i think, john, youre 100 right, is that we need to be smarter as an industry in figuring out whether bundling is an option, whether bundling will, in fact, work. And remember, you know, at the heart of what we do is generate content. The format should be less important. It should be the content that we ought to be able to demonstrate our expertise and our knowledge and our passion about. I think probably obvious observation is that as of now we havent quite figured out how to do that. I would certainly agree with that, but i think the places where we are starting to cross that boundary around print and digital, started to call me golden together is the place where theres a lot of opportunity. Cominco together. Theres a great phenomenon we have on the digital side where if i know you are interested in a book by a particular author i can drop a sample into your library of another author who is adjacent to i can certain that certainty that. The bundling software working on right now is simple. Let me give you a copy of what you already own. When you walk through, i already own it. How much more value is going to have . But could he give you a different related book or a sample of a different related book that introduces you to a new author or the opens up a new category to you, or that its an unexpected related read that you might not have found yourself . Are those things which are due instead to create some additional value for the bookseller who is already doing with have to do. And doing it in categories where we dont necessarily have all the bookshelves, all public space in the world inside a store so we kind of maximize our opportunity for the customer. Interesting thinking. Great. We are now moving directly into innovation, okay . And ive asked each of our panelists to talk about innovation but i want to talk about innovation in key ways. One is innovation in terms of new approaches to the Retail Business itself, whether it be supply chain, retail analytics ordinate Business Model. And then very simply im not sure there is a more passionate industry than the industry we also from which is the industry of books. So ive asked that they think about what turns you on, whats the stuff that you see a school, that is new, that is exciting, whether it be or grants or marketing to any of those things will work fine for me. So were going to start with new approaches to the business of retail, not fast john and mike to leave that. So when i think of innovation i dont have to go very far from home because i would say that without innovation over the last 10 or 15 years, Ingram Content Group wouldnt be where it is. I wouldnt be up here, so. Talk about digital things, i mean, this dog eats the doctor. I mean, i really make that point. When i think about, when i think about the independent bookstores and whats possible from and innovation, kind of a great untapped thing to me is, is each one of you could be a publisher. Each one of you use really strong in a local market or in some area of a local market. And my question is, why arent you publishing . Or maybe you are, and those that are, just nod your head and say yes, i got that. But it just seems to me that thats a great untapped opportunity. Each one of you lives in a place that has local newspapers. Local newspapers our treasure troves of content. You could helped curate because of your knowledge of what is happening in that local market. It just seems to me that that is a huge opportunity that sitting at the, either to publish yourself or even to be a venue for those who walk into your store and have content that they want to publish. I mean, we obviously have tools to help with that but there are others as well. As i look at a i go, running an independent bookstore, i would have a publishing arm to that for sure. And from our perspective, we dont really own any content. We are just this metal distributor distributing to all these doors. So we what we try to do early on many years ago was trying to be indispensable. We tried to be more efficient. We looked at online selling that was coming down the line. We looked at ebooks and we knew that one thing was that the publishers were not going to put up with the inefficiencies that my channels provides a we need to be smarter so that we could be partnering with them. So we put a lot of money into just a vision systems, inc. A replenishment come into gathering pointofsale and using that from a Business Analytics standpoint help us determine what should be in our stores. Were not as good as you guys. I cant have 10,000 plan oh grams out there but i can do century and try to bring some localist to it but not as good as you guys. But we invested a long time ago on the. We also invested in that evil called returns, reverse logistics side of the business so we are again, we are efficient for our publishers we give them both back that they can use in some other manner. We try to get rid of any duplication in the process that they are doing from our retailers. I guess the one thats really taken us the farthest is just this whole use of data. You know, we do like to think theres a lot of art in our business and there is a lot of art in our business. When you need a good buyer in my retail environment or in the chain retail environment, you recognize that buyer immediately that they have a passion for the business. They are just not there to put the time in and move on to batteries and toilet paper. They like books. And so we use these Business Analytics to help them fight the battle within the own organization of why we carry the stuff we carry, why we want to look it would want them located and to do the things within that again self serving, help us keep our space within reach and can keep our sales high, but it can also act as a good steward of the product that publishers provide us to our retailers. Okay. We will move on to the second part of innovation question of what are some of innovative programs and ideas that are being tried specifically, whats cool, whats new, whats exciting . Oren, go for it. You know, dominique, i think it was three years ago, maybe in this room or one of the rooms down your and the javits center, aba challenge our colleagues in the Publishing Industry to figure out how do we Work Together . How do we reinvent this Business Model that for all intents and purposes hadnt changed in 50 years. We were doing business in 2009 and 2010 in the same way we did business in 1960. It doesnt hardly pass the giggle test that theres anything in business that youre doing the same today that we did 50 years ago. What we said to our friends in the publishing community, look, how do we reinvent this business . How do we make both of us were profitable . What other kinds of innovation and creativity you could do that would figure out and remove some of the inefficiencies in the supply chain, and in the way we Work Together . We are not there yet. We have probably scratched the surface, but theres lots of you in this room who know there have been dozens and dozens of innovative things that publishers have done to help figure out how to reinvent the business. Issues about replenishment, eliminating some of the complicated ridiculous burdensome requirements surrounding coops. Looking at dating, look at all the kinds of things, not as, not as charity to bookstores but how do we make this business how do we oil the wheel, the machinery, right. The good news is there is some innovation out there. I think weve got a long way to go, but i think weve made some progress. And i know that joyce wants to say something, so go for it. Whats exciting . I would underscore what oren said. Its definitely a partnership, we seem incitement programs come along and how thats working with our stores. One of the big challenges for the independent bookseller today is occupancy costs and margins. And as we look at how we curate now, our selection for the customer, all that plays a role in terms of what is on display, what is in in our stores and what were getting from the publisher. I would like to see them explore, for instance, guaranteed margins. I think that consignment programs that have been tried along the way and the last couple of years have been very beneficial as far as what weve seen in our stores. But it takes more space to do some of that, but if you more books you can sell more books. So i think what oren said, us continuing the dialogue and then doing something about it, weve got a long way to go. But theres much more to find out to keep us all in business and healthy. And i suppose, joyce, i cant resist saying that what we want to do is make books of all publishers equally available all the time. [applause] michael, would you like to add something . All books are available. [laughter] okay. Believe it or not thats actually the time we had. I want to thank you all for joining us, and have a great show. Thank you very much. [applause] thats a fitting end, isnt it . Trendline. Cspan to, every weekend booktv now for 15 years the only Television Network devoted to nonfiction books and authors. Cspan2 created by the cable tv industry and brought to as a Public Service by local cable or satellite provider. Watch us in hd, like us on facebook, and follow us on twitter. From a booktvs recent trip to des moines, alice meyers talks about the challenges of owning a local bookstore, beaverdale books, and the current state of the book industry. We are in the heart of beaverdale books, a wonderful neighborhood in the northwest area of des moines. It is known for its distinctive brick houses. A few years ago Forbes Magazine named it one of the produce neighborhoods in the country. Its just a great area. We have it all here. We have a huge fall festival every fall that brings thousands of people who. We have a Farmers Market during the summers. And we have a lot of shopping and restaurant opportunities for people. One of the things that happens especially of a person is first coming into the store, they will come in and say, this is just like that store in that movie. Whats it called . Youve got mail. Yet, and they are so appreciative. Its small enough that we can know our customers and serve them well. Obviously, we cant carry everything in our inventory that we would like to, but people once they realize we can order a book and you shall have it here for them in a couple of days, really happy with the service we can give them. Beaverdale books, we just want it to be a neighborhood bookstore. We sell new books. Ripple a bit of everything from childrens sections to bestsellers to fiction, lots of nonfiction sections. One of the things were most proud of is our local author section but with a great iowa writer session of the a lot of the authors approacheapproache s and remember the first day that we opened the store with so many others comment asking us if we would carry their books. The section started with about, a couple of book shelves and now takes up the entire wall, one wall of the store. We represent about 400 authors, and if it all goes back to the great liter