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Book & Music Outlet Sector: Must-Read Reports & Analysis

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Topics under Book and Music Store

Global Book & Music Stores Industry

The global book store industry (part of the global specialty store sector) is divided into three categories, namely college, specialty and general book stores. The latter sell mainly trade books (i.e. fiction and nonfiction, children’s and adult books) distributed through booksellers to the general public. Specialty book stores sell special interest books such as religious books, and college booksellers sell mainly textbooks to a student customer base. All three categories buy from manufacturers and wholesalers to sell to the public through stores, e-shopping and mail-order houses.

Book demand is influenced by demographics and fluctuating levels of consumer income. Larger outfits compete by offering consumers a wide range of books at lower prices, while smaller outfits remain retain market share by catering to a local market or providing specialized products. Newer sources of competition, such as online retailers and discount stores, are making the industry increasingly competitive. This is compounded by a digital trend that sees readers turn increasingly away from printed books to convenient formats, like e-tablet readers. Companies are therefore upping their merchandising and marketing efforts to retain customers.

IBIS World predicts that the bookstore market will lose market share to mass merchandisers and online retailers over the next five-year period but will enjoy a positive impact from rising demand for new technologies such as e-readers. Continuing decline in physical book sales will put industry players under increasing pressure.

The music and book store industry is facing increasing competition in the form of online sales, espacially music stores fighting against streaming music services and big-box stores, reports IBIS World. Record stores, which sell a range of pre-recorded music media like CDs, DVDs and vinyl, are struggling to rival the convenience and price of these players. Despite the continuing decline, the market should see rising levels of disposable income and consumer confidence provide some relief. Other industry players will diversify to set up online storefronts to boost revenue.

Records and CDs combine to contribute 40% of music store revenue, followed by Blu-ray discs and DVDs, which represent 35% of sales. Music stores also sell other products like toys, books and video games. Some record companies sell music through digital retail channels, including downloads through websites or kiosks in stores. Apart from franchises, chains and independent music retailers, the industry also includes superstores that act as entertainment centers.

Larger music stores benefit from advantages in marketing, distribution, purchasing and marketing, while smaller stores focus more on stocking specialty products and offering higher-quality customer service. Music stores compete for business with internet retailers, warehouse clubs, mass merchandisers, mail order clubs and consumer electronics retail outlets. Trends in entertainment and consumer spending dictate demand for both books and music media.

Regional Market Share

There are around 10,000 stores operating in the US book stores industry. Hoover’s estimates these 10,000 outfits to generate yearly revenue of around $16 billion combined. Leading booksellers in the US market include Books-A-Million and Barnes & Noble. The market is characterized by a high degree of concentration, with the 50 top booksellers accounting for around 85% of overall sales.

There are around 4,000 music stores in the US music industry with annual profits reaching around $3 billion, reports Hoover’s. CD Warehouse, Hastings Entertainment and Trans World Entertainment are among the leading players in the US music store industry. The market is highly concentrated with the leading 50 outfits accounting for over 70% of sales.

India’s book retail market represents a strong growth area, reports NetScribes. Offline represents the leading market segment, and the online market is also looking increasingly promising due to greater internet penetration. Online book retailing offers companies advantages such as doing away with the expense of renting or buying store properties, automation cutting down on staff costs, scalability, cheaper products and avoiding inter-state taxes.


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