By Roger Tagholm

LONDON: Amid all the talk about digital and about Waterstone’s new future, one company is quietly getting on with business, operating away from the headlines and in a sector not deemed sexy.  This company often sells bigger numbers of what might be termed “Waterstone’s-type” books, and is conducting an overseas expansion almost without anyone noticing, since the media focus is all on reading devices and clouds and Amazon, Apple and Google.

Thriving Amid Recession

Its name, of course, is WHSmith Travel, long the jewel in the famous company’s portfolio, and still managing to glint despite a very tough economic climate in the UK.

The travel division of the 229-year-old company has more than 530 outlets, including all the major airports and railway stations, as well as overseas outlets as far afield as Sydney and Kuwait. The downturn in the UK economy, and the cuts and attendant job losses instigated by the coalition Government as it attempts to reduce the country’s deficit, have had a knock on effect on passenger numbers, yet it has managed to maintain sales. Revenue for the six months to 28 February 2011 was unchanged on the same period last year, at £213m ($348m). It remains a a very important customer to publishers who often find more joy with its buyers than they do at Waterstone’s.

Will Atkinson, Sales and Marketing Director of Faber which heads up the UK’s Alliance group of smaller, independent publishers, said: “They know how to make books in a way no one else can. Unlike the supermarkets, they won’t chuck something out after its three-week promotional slot has gone. It’s good, old-fashioned bookselling. They stick with titles. They have buyers who have been around a while and who have tremendous confidence. WHSmith Travel doesn’t talk down to its customers -– it’s a retailer in control of its environment in a way that Waterstone’s isn’t.”

That situation with Waterstone’s may now change, under James Daunt’s leadership, but over the last year or so many publishers have said that they have been receiving higher subscriptions from WHSmith Travel than from Waterstone’s. “For example, with Seamus Heaney’s Human Chain, the figures were two to one in favor of Smiths,” Atkinson said. “They’re on a roll at the moment.”

It seems that despite the cost of promotions and shelf space, publishers love WHSmith Travel. Philip Gwyn Jones, Publisher at Portobello, says. “They’re capable of making books that their rivals aren’t touching. We had a difficult, debut novel in February -– Max Schaefer’s Children of the Sun, which deals with skinhead culture -– and they took it, backed it and believed in it. They put in their chart and we had a bigger subscription from them than from Waterstone’s, although you might think this was more of a Waterstone’s book.

“I don’t think WHSmith Travel is celebrated enough. Yes, they take a narrow range, but within that you will see some surprises, in a way you wouldn’t in the supermarkets.”

Buying Expertise

UK publishers point to the expertise and experience of the buyers –- Matt Bates for fiction and Mike Roberts for non-fiction. Both report to Books Trading Controller Julie Wright, who has relatively recently returned to the company after four and a half years at Simon & Schuster. Before joining S&S she was with WHSmith for twelve years, half at High Street as it is called, and half at Travel. In the small, insular world of the UK book trade, the Wright/Bates partnership was legendary, with everyone knowing them, and vice versa, and the pair’s combined knowledge of books and authors was very, very impressive, as it is to this day.

“The types of books Travel sell can differ from High Street titles,” Wright says. “In fiction, as well as selling the key commercial authors we are generally able to sell literary titles too, and sell them for longer. In non-fiction, the narrative non-fiction categories and business category work particularly well for us. In addition, some ranges are selected locally by the store manager to ensure the local dynamics are reflected in our range.  We’ve done well with Christos Tsiolkas’ The Slap, as well as with Frederick Forsyth and John le Carre, and in non-fiction we had impressive sales of The Rules of Life [Richard Templar] and Persuasion [James Borg].”

Overseas Expansion

COO Simon Smith accepts a 2009 BAA Travel Award

On overseas expansion, Chief Operating Officer Simon Smith says: “We are now one of Europe’s leading retailers of English language books, newspapers and magazines with over 240 million global travelers exposed to the WHSmith brand every year. So far we have focused on airport locations -– with units in locations including Copenhagen, Stockholm, Delhi, Muscat, Melbourne and Sydney. We are now identifying opportunities in other international channels, for example, railway stations and hospitals.  We have 26 units open internationally and a further 2 will open shortly. In addition, we have recently won a further 12 units, including non-airport locations, in India and Kuwait, bringing the total number of units internationally to 40.”

Rail transport is vital to the UK and the roots of WHSmith Travel’s success partly lie way back in the nineteenth century, during the years of “railway mania” — between 1840 and 1850 -– when the basis of the nation’s current rail network was laid down. Smiths saw the opportunity and secured deals with the railway companies to allow them to open a nationwide network of station bookstalls, many of which still exist today. By the time Henry James moved to London in 1876, Smiths shops were already a familiar sight. In his Essay on London, published in 1888, James wrote of “the fine flare of Mr W H Smith’s bookstalls…it gives the idea that literature is a thing of splendor, of a dazzling essence, of infinite gas-lit red and gold. A glamour hangs over the glittering booth, and a tantalizing air of clever new things.”

In the major cities, Smiths’ station shops appeal to a professional, higher earning demographic for whom their presence is as familiar as the Amazon screen. Perhaps, for some busy executives, shopping at the station bookstall is more convenient than fiddling with the mouse and going online. Paradoxically, is going to a bricks and mortar store on the way home less of a hassle than going online? It’s a thought.

DISCUSS: How Can Physical Bookstores Better Integrate E-books?