It’s been a tough decade for college bookstores.
While much of their revenue comes from T-shirts, hoodies, and shot glasses, bookstores have still felt the pinch as students turn to flourishing online competitors to buy cheaper print books or digital texts.
Now campus bookstores are faced with yet another challenge: More and more students want to rent textbooks, not buy them. A small but growing number of students are renting textbooks for iPads and Kindles through online e-book sellers. But many more students are looking to rent print textbooks.
The bookstores themselves are trying to capitalize on that market by starting rental programs of their own or tapping into the resources of large textbook companies. The National Association of College Stores estimates that 200 to 300 of its 3,000 member stores offered rentals last fall. By this fall, the group estimates, 1,500 stores will rent textbooks.
The idea of renting textbooks is nothing new. Some colleges have offered the service since the mid-19th century. Until recently, though, says Charles Schmidt, a spokesman for the association, many stores avoided rentals because of the high start-up costs, not least the need to buy a number of books and find a place to house them. And faculty members have resisted rental programs because they often require professors to adopt the same editions of course materials for at least four to six semesters.
Online competition and rising student demand for cheaper textbooks are pushing colleges to overcome those hurdles, Mr. Schmidt says. “For a lot of kids, it’s the first time they’re swiping a credit card or writing a check for something three digits. ... This is another way for us to say we care and this is a way for you not to sell your soul for textbooks.”
Renting to Compete
Bowling Green State University’s bookstore began a rental program on a modest scale in January 2008, with just three of its 2,500 or so textbook titles. Two of the books were used in large survey courses, but Jeff Nelson, the bookstore’s director, says operating on so small a scale has presented challenges.
He and his staff members had to put in a lot of hours figuring out policies, procedures, systems, and accounting, as well as storing the 700 or so books involved in the program. The university wants to keep a selective title program as opposed to a comprehensive one, with a large number of texts. There still isn’t much faculty interest, although rentals are presented to all professors as an option each semester.
The bookstore earns less profit on rentals than on sales because it takes several years to pay off the purchase cost of each book.
Mr. Nelson also says book rentals typically don’t yield as much in savings to students as one might expect. If a new book costs $100, the same title might cost $40 per semester to rent and $75 for a used copy, with the possibility of selling it back to the store for $50.
The experiment has paid off anyway, the director says, either because students don’t want to risk being unable to sell a book back or because they like the upfront savings of renting over buying. He has been surprised at how many students have opted for renting.
In 2009 textbook rentals at the store represented more than $38,000 in sales and saved students nearly $58,000 over the cost of new textbooks. In the same period, the store sold $10,000 worth of e-books, with 244 titles represented, saving students a total of $5,000 compared with the price of new textbooks. Mr. Nelson expects the store, which offers nine titles for rental now, to offer 10 to 20 times that number in the fall as it joins with three major used-textbook sellers.
Bowling Green sees a strong rental program as a way to compete with students’ other rental options, such as BookRenter.com and Chegg.com, which have gained momentum in the past few years. Chegg, which uses the mail to send and receive print materials, says it offers more than 4.2 million titles and reaches more than 6,400 institutions.
“When they first had a ‘textbook.com’ boom in the industry, there were a lot of doomsayers who said the brick-and-mortar college bookstores are a thing of the past,” Mr. Nelson says. “It really didn’t turn out that way, but the competition has still grown, so we as bookstores really have to find a way to compete.”
‘It Makes a Difference’
While the percentage of students renting their books is still relatively small, many more are intrigued by the option but don’t have a place to rent, according to a recent survey by the National Association of College Stores. Of the 500 students who responded to the survey, in May, 12 percent had rented textbooks. About half of those who hadn’t done so said they would consider it if the option were available to them, while 36 percent were unsure and 20 percent weren’t interested.
Jenna Roney, a rising senior at the University of North Carolina at Wilmington, has done research on student opinions on textbooks as part of a state student-government organization. The biggest concern for students buying textbooks, she found, is cost.
Ms. Roney, who majors in biology and chemistry, spent $111 renting textbooks from Chegg in the spring semester and calculates that she saved $240. For her and the students she has surveyed, she says, every saved dollar counts. “A hundred dollars might not seem much in the thousands that we’re paying, but it makes a difference,” she says.
Wilmington has an on-campus rental program, run by Barnes & Noble, and is one of 25 institutions that participated in the company’s pilot textbook-rental program last spring. Sharon H. Boyd, associate vice chancellor for business services, says the program is a way to reach not only students who want to save money, but also those who were not planning on purchasing their textbooks in the first place, because of the expense.
“We believe it improves overall success because it gives students more options,” she says. The availability of rentals “means students will turn to us for their textbook needs, and it’s also a great option for them to reduce their textbook costs.”
The Follett Higher Education Group is another major bookseller getting into the rental market. Follett and Barnes & Noble, between them, manage nearly 1,500 campus bookstores nationwide.
Follett began testing rentals on a few campuses in the fall, expanding to 27 in the spring. Thomas A. Christopher, the company president, says the experiment was a success. Now about 400 institutions have signed up to use the company’s new Rent-a-Text program.
The college bookstore of the future will be a “bookstore of choices,” where students can readily rent textbooks or buy new or used copies in print or digital format, Mr. Christopher says. As textbook rental evolves, he adds, there will have to be more discussions about how to create a sustainable rental market.
Because the rental model relies on the reuse of materials, Mr. Christopher says, if colleges—faculty members in particular—are really interested in keeping the price of textbooks down, “they’ll be motivated to use their editions maybe a little longer.”
“I think that this is a breakthrough,” he says. “I think up until now, the process was different in terms of publishers competing with each other to try to convince faculty to adopt products, and whatever products faculty adopted was what students had to purchase. I think that will remain. But the ability to rent or not rent the book, I believe, will become a factor in the choice of product.”
Made to Last?
But rentals may be an imperfect, short-term solution to students’ high textbook costs, says Nicole Allen, textbooks-campaign director at the U.S. Public Interest Research Groups, a network of advocacy groups for college students. One better long-term option, she says, is the open-access textbook, which is essentially the free, self-published equivalent of a textbook. Several companies, like Flat World Knowledge Inc., offer open-access texts.
“When it comes to solving the problem of textbooks, there are things to do to reduce costs for students now, and things you do to reduce costs for students in the long run,” Ms. Allen says. “Textbook rentals fall into the first category.”
Albert N. Greco, a professor of marketing at Fordham University’s Graduate School of Business Administration who studies the textbook market, calls the rental model a transitional one that will fall out of use as interest in digital texts rises.
Another survey by the National Association of College Stores found that digital course materials accounted for only 2 to 3 percent of textbook sales at stores that offer them, although that figure is expected to rise to 10 to 15 percent within two years.
Mr. Greco anticipates that the textbook market will be 95 percent digital by 2015. That doesn’t mean the end of the college bookstore, though. “It won’t disappear,” he says, “because people continue to need insignia products and software. You’ve seen a college bookstore—they sell everything but submarines. But it’ll change a little.”
Changes in how students buy textbooks, including the booming rental market, have motivated stores to better advertise their other offerings, which can include dry cleaning and tanning beds, among other services.
The bookstore at the University of California at San Diego, for example, has a greengrocer, convenience store, computer repair shop, and a Starbucks-like space with room for live music performances. Sam Houston State University has installed several tanning beds in its bookstore.
The College of Wooster’s bookstore enlisted the aid of an undergraduate marketing class to help redesign its bookstore. The students recommended that it use signs to highlight nontextbook services such as dry cleaning, package shipping, faxing, and report binding.
“Students weren’t reading our glossy, expensive brochures,” says Jacqueline Middleton, director of administrative and auxiliary services at Wooster. “We now have easy-to-read signage, emphasizing our services, and have improved marketing through Facebook and Twitter.”