Harry Potter Makes E-Commerce History

Amazon.com and Federal Express will take on one of the most significant e-commerce challenges to date on Saturday when they attempt to deliver a popular new children’s book to 250,000 U.S. homes in a period of just a few hours.

The book, “Harry Potter and the Goblet of Fire,” has set a record for a first printing in the United States, with 3.8 million copies. The book is expected to generate the highest first day sale of any book in history, with Amazon.com as its major online merchant. If Amazon succeeds in satisfying the quarter of a million customers to whom it will attempt to deliver on Saturday, it could go a long way toward bolstering the company’s reputation among mainstream American shoppers.

Secrecy Feeds Hype

The logistics of the mass delivery are complicated by the fact that the books must be delivered only after offline sales officially begin on Saturday, a requirement designed both to raise the hype generated by the publishing company, Scholastic, Inc., and to protect the secrecy under which the book’s plot has been cloaked.

Amazon is touting Saturday’s delivery as “the largest distribution event to date of any single item in e-commerce.”

After Amazon announced last month that it would work with FedEx to fulfill the one-day delivery promise, sales of the book skyrocketed from the 170,000 copies that had already been pre-ordered to 314,600 by Wednesday afternoon. However, only the first 250,000 customers who ordered the book will receive it Saturday.

Trade Group Protests

Meanwhile, offline booksellers are clearly not pleased with the publicity being generated by Amazon. In a statement on its Web site, the American Booksellers Association (ABA), the largest trade organization devoted to serving the needs of independent booksellers, said it has sent a letter to Scholastic, Inc. expressing its disapproval of the publisher’s plan to allow Amazon to ship the title for a July 8th arrival.

ABA chief executive Avin Mark Domnitz said, “What has occurred here is an unconscionable example of a level playing field being tilted by the weight of one huge customer and the publisher who caved to that pressure.” For its part, the publisher sent out a letter informing all of its accounts that they may ship books to their customers beginning July 7th, the date Amazon will ship.

A note on ABA’s Web site told independent booksellers, “Despite the news of early shipments, bricks-and-mortar stores still have one big advantage, a physical presence in which to host a midnight opening or early morning party,” and encouraged stores to do so.

Harry Potter to the Rescue

Amazon is instituting a host of measures to ensure a flawless Saturday delivery — installing temporary phone lines and placing technical advisers at all Amazon distribution centers throughout the United States. Remote support services from FedEx’s Memphis, Tennessee headquarters will bolster Amazon’s efforts.

Still, Lyn Blake, who is heading Amazon’s effort, said, “Logistical plans for something this large are very difficult to execute. We believe this is the largest shipment in e-commerce history. We knew that it was going to be big, but this is seven times larger than our last largest pre-order [John Grisham’s The Brethren], and they are still flooding in.”

FedEx claims it is ready to make e-commerce history with Amazon. “Precision is the key word here,” said Dottie Berry, executive vice-president for integrated technology at FedEx.

If successful, the massive one-day delivery will be a coup for Amazon, which is still reeling from published reports just weeks ago that the company could run out of operating capital by the year-end holiday season.

Although Amazon’s Jeff Bezos vehemently denied that report, the company is banking on positive buzz from the Harry Potter event to boost its image and renew investor confidence.