USERS GROUP – Wednesday, March 1st (Afternoon) | SUMMIT EDUCATION - Thursday, March 2nd (All Day)
For more information on the event, click here.
Sidewalk began renting books in-store in 2009. What seemed novel then eventually became mainstream, and we’re happy that the majority of stores today have brought some form of rental to students. We believe rental is a powerful tool to lower the cost of content, making content accessible to more students.
Rental has been an important part of Sidewalk. It has allowed us to get to know this industry and has ultimately led us to build even more products that we passionately believe address fundamental value opportunities for the college store. In-store rental has also had its downsides. Financing it has been painful. Timing and market volatility combined with too broad array of titles being returned to Sidewalk from stores, created sometimes unpredictable financial outcomes. What that has meant for our partners is unpredictability in the way we price rentals, how many titles we make available each semester, and how quickly we pay.
Although we fundamentally believe that every book available should be for rent, we’ve learned that we cannot guarantee every title ourselves because our ability to monetize many books after the rental cycle is negligible. As it turns out, Sidewalk alone is not large enough to consume the rental demand of our clients.
We pondered the problem at hand, desiring to create an outcome which aligned with our values and which would accomplish the following:
Keep rental alive in-store, in a fully managed and risk-free fashion
Provide a broader and more predictable title selection to our store partners
Provide better pricing to students
Increase the speed at which we could pay our store partners and increase our financial strength as a company
Decrease inventory risk so we can focus on software and the user experience
Bring the current textbook market dynamics to the store, not just our interpretation of it
The thinking around these desired outcomes led us to something we’re calling Cloud Rental. This is the new and sustainable way that Sidewalk is offering rentals to the market. Cloud Rental can be related to renting with rebates, but with some very important twists. For example: it remains a fully managed and risk-free program, and all rebate participants (vendors) are hidden from the store. It works like this:
Sidewalk aggregates rebate lists from industry participants. (Eventually this could even include other schools who understand their future demand.) When you upload your rental list, it prices against this cloud of rebate prices available in Cloud Rental, delivering the best rental price it can, based on rebate prices available at the time. When students return books to your store at the end of the semester, you simply keep the ones you want to keep and send the rest to Sidewalk. Sidewalk then divides the books and ships them to the individual vendors who won the titles through their rebate offer.
Your store wins because more books get priced more competitively. This happens predictably, term after term, attracting more students and growing market share. Your risk decreases since rental is a reflection of a broad set of market activity, as opposed to the needs of a single vendor (Sidewalk – or any other vendor offering a single vendor solution). Sidewalk wins because we transfer much of the cost burden onto other participants who have specific need for titles, and who have the capability to monetize titles most profitably.
Over the next few months we will be modifying our internal workings to deliver a stronger, expanded catalog for the January rental season via Cloud Rental. We’re excited about rental, as we always have been. We believe it is a core value proposition that both students and administrations have come to expect, and it is our hope that these changes increase stores’ success with rental.
To learn more about Cloud Rentals, click here.
We are often asked, “Why is Sidewalk so different from other vendors?” CEO Alan Martin didn’t start out with the intent of creating an unusual culture at an enterprise focused on higher ed course materials. He began with the problem, “Why?” — as in “Why are college textbooks so expensive and how could I help bring that cost down?” That was in 2007 and now, nine years later, Sidewalk is intentionally answering those questions with a corporate culture best served to accomplish the solution in innovative and effective ways. Here’s a little window into the Culture Statement that drives and inspires Sidewalk to approach things differently every day.
Complete transcript below:
CONTEXT, NOT CONTROL
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“If you want to build a ship, don’t drum up the people to gather wood, divide the work, and give orders. Instead, teach them to yearn for the vast and endless sea.”
This quote has been attributed to Antoine De Saint-Exupery, but we can’t verify it. We don’t care who said it. It captures the power of context over control almost perfectly.
The best managers figure out how to get great outcomes by setting the appropriate context, rather than by trying to control their people. Context, not control means providing the insight and understanding to enable sound decisions from talented and reasonable people. This means we embrace strategy, metrics, assumptions, objectives, clearly-defined roles, knowledge of the stakes, and transparency around decision-making. We avoid top-down decision-making, management approval, committees, and planning and processes (if they are valued more than results). Good context includes: clear ties to company and functional goals, relative priority (how important or time sensitive something is), level of precision and refinement (no errors at all, pretty good because errors can be corrected, totally experimental… failure is expected), who the key stakeholders are, and key metrics/definition of success.