Why Amazon.com opened a bookstore

The online retailer hopes 20 years of consumer data collection will yield the ultimate bookstore.

On Tuesday, Amazon.com opened a bookstore called Amazon Books.

And it’s a real one, Fortune reports, that you can go to in person – with books and chairs for sitting and reading – in Seattle, where the online mega-retailer was founded in 1995 when it started off primarily selling books. 

It may seem ironic that Amazon – which currently holds a market share of around 30 percent of US book sales and since 1995 has put many bookstores out of business, including the national chain Borders – would open a brick-and-mortar store. Yet it actually makes perfect sense.

In a letter to customers on Amazon.com, vice president of Amazon Books Jennifer Cast called the new bookstore a physical extension of the website. “We’ve applied 20 years of online bookselling experience,” she said, “to build a store that integrates the benefits of offline and online book shopping.”

The combination Ms. Cast described has resulted in a number of differences between Amazon Books and traditional bookstores.

To begin with, Amazon products such as Kindles and Echoes will be available for testing at the store.

And at Amazon Books, the books face outwards on the shelves, so shoppers can see the covers, as they do on Amazon's website (perusing aisles meets scrolling down a page). Beneath each book, there is a “review card” detailing a customer rating and review.

Finally, Amazon Books uniquely stands as the manifestation of two decades worth of consumer data collection, which is why they’re able to provide customer review cards with each product on opening day.

Cast said stocked books, “are selected based on Amazon.com customer ratings, pre-orders, sales, popularity on Goodreads, and our curators’ assessments.... Most have been rated 4-stars or above, and many are award winners.” That means the majority of books for sale in the store ended up there by means of the same kind of computer algorithm that determines which advertisements Facebook users will see in their mini-feeds. In other words, Amazon Books sells what Amazon.com predicts customers will buy.

The Seattle Times points out this practice begs the question as to whether shopping at Amazon Books can provide customers with the same experience as traditional book shops, which offer a sense of community connection. Cast told the Times that Amazon Books is “data with a heart.”

“We’re taking the data we have and we’re creating physical places with it,” she said.