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Amazon to build three more bookstores

Investing in physical stores marks about-turn from Amazon’s relentless focus on online retail

Amazon is to expand its bricks-and-mortar footprint across the United States, undeterred by the fact many physical bookstores have been struggling for years.

The Seattle-based ecommerce company, whose online book business has upended the publishing and bookstore industries, opened its first physical bookstore in Seattle last fall. It now aims to build at least three more.

Amazon spokeswoman Deborah Bass said the company planned to open bookstores in Chicago, San Diego and Portland, with the Chicago location set to open next year. Investing in physical stores marks an about-turn from Amazon's relentless focus on online retail, and could pave the way for other types of physical stores.

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Its store in Seattle sells books and also showcases Amazon gadgets, such as Kindle ereaders, the Fire TV and the Echo, Amazon's voice-controlled home assistant.

A customer uses a Kindle table device at the Amazon Books store in Seattle, Washington.
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A customer uses a Kindle table device at the Amazon Books store in Seattle, Washington.

Books in store are priced fluidly and match those available online, so there are no price tags; instead customers themselves check at price stands.

While Amazon has not elaborated on its bookstore strategy, analysts believe the aim is to allow customers to test out Amazon devices.

Amazon's experiment with physical bookstores is not the only area in which it is building up know-how in territory traditionally held by retailers, while they in turn seek to catch-up to the ecommerce giant in online sales.

The company has also been increasing its presence in private-label goods, including coffee, baby food and apparel. Meanwhile, retailers from Walmart to Target, Staples and Macy's are fighting to create a successful strategy that integrates their physical and online operations. Walmart this month paid $3.3bn to buy online marketplace Jet.com.

Amazon's store in Chicago will be in the trendy neighbourhood of Southport Corridor, home to microbreweries and restaurants, and is near Wrigley Field, where the Chicago Cubs baseball team plays. The area does not appear to have any independent bookstores in the immediate vicinity — one children's bookstore closed a few years ago.

Chicago has a number of independent bookstores — the most famous being the Seminary Co-op, located far from Southport Corridor, near the University of Chicago, and best known for its regular visitors President Barack Obama and his wife Michelle. Even this bookstore, which is celebrating its 55th anniversary this year and has a solid member base, has posted a call to action for support so it can continue to prioritize "thoughtful curation" over best-sellers.

Barnes & Noble — the sole surviving national book retailer in the US after Amazon tore up the industry playbook — has reported falling sales for the past seven years. In its latest quarter the company said sales of its Nook ereader had dropped 20 per cent. It recently opted to replace its chief executive Ronald Boire because he was not a "good fit."