Amazon Opening Brings Questions Of Space Use, Competition

Feb 25, 2015

Purdue President Mitch Daniels tries in vain to cut the ribbon at the first of two Amazon locations on campus.
Credit Stan Jastrzebski / WBAA News

There was a brief moment at the ribbon-cutting for the new Amazon pickup location that spoke to the debate surrounding it.

Purdue President Mitch Daniels, who’d been handed one of those oversized pairs of scissors used only for such an occasion, found that though the space behind him was cutting edge, his scissors were not – he tried repeatedly to slice the ribbon, was met with little success and almost gave up.

“Ok, it’s off…seemed like a good idea,” Daniels joked to the crowd.

Finally, though, the banner split in two. The man who handed the scissors to Daniels is Paul Ryder, a Purdue alum and Amazon’s president of North American media. He says the shop is something Purdue needed.

“Purdue, in fact, didn’t have its own official book store on campus,” Ryder says.

That’s technically true, but it’s splitting hairs. Across the street from the Purdue Union on one side and a Krannert School of Management building on another – in other words, off-campus by just a few feet -- is University Book Store. It’s a licensed retailer of Purdue items and has sold textbooks to Purdue students for 75 years. Store manager Tom Frey has worked here since the late 1960s. He says what Amazon is doing is illegal.

“We’ve given our lawyers for the National Association of College Stores a list of 57,000 titles that they’re selling below our cost. Which is against the law," Frey says.

The National Association of College stores represents University Book Store and many other such locations and actually works with Amazon, says Vice President of Government Relations Rich Hershman. He says the group’s lawyers have been presented with complaints against Amazon, but didn’t say whether they’re being pursued. In part, that’s because Hershman feels local stores can compete with online retailers.

“The lines have blurred both for traditional brick-and-mortar businesses – [which] have moved online – and at the same time, a lot of online businesses have realized there are benefits to having a physical presence," he says.

The way Hershman says local stores can win is by catering to customers. Amazon tried just that a couple weeks before the Krach Center ribbon-cutting.

Perky students decked out in Amazon garb gave away padded envelopes to students who happened in. In the envelopes were Amazon gift cards and apparel – designed to push the brand and give students a reason to spend time at the new location.

The company went a step further with Purdue student body president Bobby Haddix, who’s made two presentations to the school’s trustees this semester openly questioning why a building designated for use by student groups saw a large conference room given over to an outside corporate entity. It flew him out to the retailer’s Washington headquarters to learn more about the company and how it would make over the former student meeting space.

Still, Haddix isn’t sold on the move or how the decision was made…

“This was a brand-new building. It was supposed to be specifically dedicated for students," Haddix says. "And the decision was made over the summer while there weren’t a lot of students here to share their input to give this conference room away.”

What’s more, Haddix isn’t sure how much the space will be used outside the first two weeks and last two weeks of a semester, when students are buying and selling books.

“If in the future it’s being used year-round then I think that’s great, but at this point, it looks like it’s only going to be used primarily during those textbook seasons,” he says.

“Well, Bobby needs to catch up to the facts a little bit,” says Daniels. He says usage is growing by 500 transactions per week in the early going.

“You know, [Haddix] said he didn’t always see a lot of people in there. Well, you don’t want to see people standing in there. The average visit time takes two minutes or less. That’s the whole idea is it’s so convenient for the student. Walk in, hold your phone with a barcode under a scanner, locker opens, take your stuff and leave,” Daniels says.

The second Amazon location is set to open this summer in a much larger space on the Purdue Union’s main floor – an even more prominent spot than the first pick-up center. And it may not be until sometime in the fall of this year, after the next flurry of textbook buying, until the competition between the online store that’s putting down roots and the local business with 75 years of tradition has its first results.