Harry Potter, IBM, And The Wizardry Of Online Book RetailingHarry Potter, IBM, And The Wizardry Of Online Book Retailing

When the new Harry Potter book arrives simultaneously in the hands of millions of children across the world Saturday, it might look to be a seamless operation from the printing press direct to readers.

It won't be, says IBM's Katie Kean, whose IBM WebSphere Commerce operation has some behind-the-scenes involvement in delivering millions of "Harry Potter and the Half-Blood Prince." Many disparate IT technologies and services interconnected with IBM's WebSphere technology are contributing to what is considered the largest event in the history of publishing.

WebSphere is a key supplier to Scholastic Inc., the U.S. publisher of the Harry Potter series.

Kean, who is vice president of services and support for IBM WebSphere, says the event is a sterling example of the changes online retailing is undergoing as different multi-channel pieces of book publishing, selling, and delivery are increasingly integrated. "People think the multi-channel (phenomenon) has happened," she said in an interview. "It hasn't; although it may look seamless."

The IBM executive said book selling is pacing overall online retailing and she reels off statistics to support her view: Of the top 400 online retailers, 25 percent are selling books, representing the top category by far. At the same time, online retailing is expanding rapidly with 6 percent of all retail sales last year driven by Internet channels.

"Web selling has taken off quickly," she observed. "Twenty-seven percent of all retail sales are influenced by the Web now. And 75 percent of U.S. Web users shop online and 67 percent purchase books online."

Kean said that retailers are increasingly flocking to the Web, and the resurgence in e-commerce is driven more and more by efforts to use multiple channels to improve sales. The phenomenon of "buy online, pick up in store" is being enhanced by Web sites designed to keep customers coming back.

She cited contests, auctions, and rebate promotions as examples. Scholastic, for instance, titillated and involved visitors to its Harry Potter Web site by sponsoring a "Harry Potter Essay Contest." Excerpts from the winning essays are featured on the Web site.

The pressing challenge to tie together different databases, software programs, and hardware into a unified, operational system remains the hardest test of online retailing, Kean observed. "We're trying to provide a seamless experience across all these channels," she said. "And the biggest challenge is on the back end (databases, for instance.) But when you get to integration, that's IBM's sweet spot."

Kean said WebSphere has followed a strategy of being able to integrate heterogeneous software, database and hardware systems, which has made it easier, for instance, to tie older databases with new software systems. She added that a "slight shift" in retailers' emphasis from IT cost-cutting to increasing sales may be a bellwether of the future, as CEOs are stepping up their efforts to drive sales. For retailers, she noted, IT cost containment remains a paramount issue nonetheless.

With Amazon.com alone announcing that nearly 900,000 copies of the "Half-Blood Prince" have been pre-ordered, online sales of the book are certain to number in the millions in the U.S. The wizards at IBM have their work cut out for them.