Indigo Books and Music adds Apple shops to its larger outlets
TORONTO — Indigo Books and Music Inc. is rolling out Apple technology shops within its large bookstores and plans to open stores outside of Canada, chief executive Heather Reisman said Tuesday, as the chain weathers what she called a “very difficult transformation.”
The strategies are part of an ongoing drive at Canada’s biggest book chain — which initially had the prophetic words “and More” at the end of its name when it first opened in 1997 — to further extend the non-book categories it has always carried.
Along with the rest of the industry, Indigo has seen traditional book sales at its 236 stores erode in recent years amid competition from mass discounters, online book sales and digital books.
Reisman told shareholders at the company’s annual meeting in Toronto that Indigo’s new in-store format at its large stores will shift “from one main shop into a series of shops,” to house categories including home, style, paper, tech, design, baby and kids’ toys.
In addition to 40 on-site Apple shops selling iPads, iPods, Apple TVs and accessories, Indigo will become the exclusive supplier of Poppin office supplies in Canada and boost its assortment of health-related technology for personal use.
While it will take 18 to 24 months for the full effect of the strategies to be reflected in the company’s results, she said, she noted it is beginning to take hold, as the retailer saw margin improvement of 2.25 per cent in 2012.
The overall drive to boost non-book merchandise is evident in Indigo’s book sales, which now account for 78 per cent of overall revenue, down about 10 per cent from five years ago.
Digital book sales growth is also abating after a period of rapid early adoption, now accounting for 20 per cent of book sales, up only slightly from 18 per cent last year, Reisman said. Though it would seem Apple iPads would undercut sales with that of Indigo’s partner and former e-reader subsidiary Kobo, she said Tuesday the two are “not at all” in competition.
Fiscal year revenue slid 4.4 per cent to $893 million. The trend is mirrored in the broader industry, which saw sales fall 4.9 per cent in Canada last year to $973.8 million, according to the industry association BookNet Canada. It also said the ebook market appears to be plateauing in Canada; paperback books accounted for 58 per cent of purchases in 2012, hardcover 24 per cent and ebooks 15 per cent.