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When we imagine people without books, we think of villagers in places like Afghanistan. But many families in the United States have no children’s books at home. In some of the poorest areas of the country, it’s hard to find books for sale. A study (pdf) of low-income neighborhoods in Philadelphia, for example, found a ratio of one book for sale for every 300 children. Tens of millions of poor Americans can’t afford to buy books at all.

Tapping a vast potential market of young readers too poor to buy books.

At Fixes, we like to highlight creative ways that markets can be harnessed to extend access to vital services like electricity, credit, or water. Today, I’m focusing on a nonprofit organization called First Book, which is spearheading a new market mechanism that is delivering millions of new, high quality books to low-income children through thousands of nonprofit organizations and Title I schools.



The First Book Marketplace is trying to do for publishing what micro-finance did for banking: crack open a vast potential market that is underserved at significant social cost. The organization’s goal is to democratize book access, but along the way, it may end up reinvigorating the book business.

Some 42 percent of American children — more than 31 million — grow up in families that lack the income to cover basic needs like rent, child care, food and transportation. “These are families that are not buying books at retail,” notes Kyle Zimmer, the co-founder of First Book. “Not only are we losing 42 percent of kids whose families can’t afford books; the industry isn’t reaching 42 percent of its potential market. The system isn’t serving them.”

In bookstores, most hardcover children’s books sell for $15 to $20, with paperbacks typically running from $5 to $10. Although lower cost titles are available, the pricing of books — especially the most popular and attractive children’s books, as well as baby board books — puts regular book buying out of reach for low-income families.

This situation might be acceptable if books were luxuries, like silk scarves. But educators contend that access to books should be seen as a necessity, alongside access to food, shelter and health care. Indeed, numerous studies have shown that making books more accessible to children — through libraries, reading programs and home libraries — can produce marked improvements in their reading behavior. A meta-analysis published last August found that access to books plays a “causal role” in children’s motivation to read.

It’s often assumed that families without books lack interest in reading. But that is not necessarily the case. “When poor people, even those at low literacy levels, have a little extra money, they will buy inexpensive books,” explains Susan B. Neuman, a professor at the University of Michigan, who specializes in early literacy development and co-authored the study in Philadelphia. “But some families have so little disposable income, they can’t afford any books.” This is bad news for their kids. Around the world, one thing that has been shown to be a consistently powerful predictor of academic achievement is a home library. [1]

First Book

What makes the problem even worse is that 80 percent of pre-school and after school programs serving low-income children do not have any children’s books, either, largely because they lack the money to buy them. “A poor child goes from a home without books to a pre-school situation without books,” says Neuman. “That creates serious problems for literacy later on.”

There are many factors that influence children’s reading and no one is claiming that books alone will solve the problem. However, some noted educators, such as Stephen Krashen, professor emeritus at the University of Southern California, have argued that “simply providing access is the first and most important step in encouraging literacy development.”

Libraries can make a huge difference — but inequalities persist there too. A study of book access in Los Angeles, co-authored by Krashen, found that school classrooms in Beverly Hills offered children eight times as many books as classrooms in Watts and Compton. Their school libraries also carried about three times as many titles and their public libraries carried roughly twice as many. Moreover, libraries in poor communities are open fewer hours.

First Book was founded by Kyle Zimmer and two colleagues. Zimmer had previously worked as a lawyer and community organizer. She got an intimate view of poverty while working as a volunteer tutor for poor children in Washington, D.C. Zimmer became close with some families and visited their homes — where she discovered an absence of children’s books. “I think it’s a surprise to almost anybody of modest means that there are families and children in this country without books,” she said.

She saw that children’s eyes lit up when they were given a book of their own, particularly a new book with an attractive cover. Kids would say, “Can I really take this home?” Some would add: “This is my first book.” They would go home and do their best to read it — and then they would come back and ask for another one.

First Book established volunteer chapters in hundreds of communities across the country. The organization would purchase books and donate them to groups helping low-income kids to read — everything from schools to reading groups in church basements, from Head Start programs to public shelters. “There is an army of volunteers and professionals out there who are working their hearts out in the least romanticized environments — in destitute communities, in high crime areas. We’re sending them no supplies at all — and we’re surprised when they fail,” says Zimmer.

Related More From Fixes Read previous contributions to this series.

In 1999, the organization piloted the first national book bank in the United States, an online system to distribute bulk book donations from publishers to thousands of reading programs. To date, First Book has distributed close to 85 million books.

In recent years, however, the limitations of the book bank have become apparent. Publishers, facing tough times, have trimmed costs and cut print runs, which means less excess inventory for donation. At the same time, recessionary pressures mean less money for schools and nonprofits from foundations and governments. But the children still need books. “We would put up 400,000 books for distribution on the book bank and 36 hours later they’d be gone and we’d be turning thousands of organizations away,” Zimmer explained.

In 2008, First Book launched its marketplace with the goal of making books systematically available at deeply reduced prices — typically 50 to 90 percent off — to any organization that was certified tax-exempt and serving children in need. First Book offered publishers an intriguing deal. Even though the profit margins would be much smaller than normal, because the organization could aggregate sales across its network, it could make bulk purchases and remove the publishers’ biggest risk: returns. All sales would be final. First Book promised to be hyper-vigilant that books sold through its marketplace would not bleed into normal retail channels.

It took a while for the idea to catch on. “A few publishers were tiptoeing when we started,” explained Zimmer. “But now they’re pretty jazzed, because we pay on time and they haven’t seen any wobble in their retail market that has to do with us.”

Most books on the marketplace sell for under $4 with the average paperback going for $2. All shipping costs are included in the prices. Currently, there are close to 2,000 titles. “Where the Wild Things Are” (retail $8.95) sells for $2.79. “Encyclopedia Brown and the Case of the Sleeping Dog” (retail $5.50) sells for $1.85. “To Kill a Mockingbird” (retail $7.99) goes for $3.50. First Book’s chief financial officer, Jane Robinson, recalled: “People came to us and said, ‘The children are all talking about “The Diary of a Wimpy Kid” and we don’t want our kids to be left out — but we can’t afford it.” Now it’s available for $3. A special bilingual edition of “The Very Hungry Caterpillar” sells for $3.25.

For publishers, the timing is fortuitous. Long term sales projections have been flat. This year, First Book expects to sell 3.5 million titles — close to 1 percent of unit sales in the U.S. children’s book market. At present, the marketplace is still relatively unknown — only 27,000 out of an estimated 1.2 million eligible programs have signed up. First Book’s goal is to be working with 250,000 programs in three years.

Publishers have historically had difficulty serving low-income buyers. “This market is incredibly fragmented,” explains Lisa Holton, who ran Scholastic Trade and Book Fairs and Disney Global Children’s Books. “Because First Book has been completely focused on this area for so long, they really know the customers.”

Publishers are also excited by the content possibilities. Many people go into publishing because they believe in the transformative power of books. Sometimes editors want to publish books that meet real needs, but if the market is risky it’s hard to go forward. First Book is in a position to survey thousands of organizations and ask what they want to teach. If enough groups request, say, Native American stories or Mandarin-English dictionaries or Spanish translations of midlist books, First Book can present publishers with a safer market.

Chandler Arnold, the executive director of the First Book Marketplace, explains: “Publishers have historically had to fight hard for their slice of the market segment. Here we’re making the entire market bigger. What we want to do is unabashedly change the way our country educates our hardest to reach children — and do it in a way that generates revenues for the publishing industry so that they take it up.”

I asked Zimmer if she was worried that publishers would eventually start competing with First Book rather than partnering with the organization. “The goal for us is fixing the access problem not commandeering every sale,” she said. “If we can play a role in waking the industry up to the viability of this market, then we’ll call it a win. We will be toasting each other with mint juleps on a cause well done. And I’ll go out and get a real job.”

On Friday, I’ll respond to comments and highlight two organizations that bring books to children in need.

FOOTNOTE:

[1] A study of close to 3,000 children in Germany found that the number of books in the home strongly predicted reading achievement — even after controlling for the parents’ education levels and income. And a massive, longitudinal study examining the educational attainment of 70,000 students from 27 countries found, surprisingly, that having lots of books in the home was as good a predictor of children’s educational attainment as parents’ education levels. In fact, access to books was more predictive than the father’s occupation or the family’s standard of living. The greatest impact of book access was seen among the least educated and poorest families.



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David Bornstein is the author of “How to Change the World,” which has been published in 20 languages, and “The Price of a Dream: The Story of the Grameen Bank,” and is co-author of “Social Entrepreneurship: What Everyone Needs to Know.” He is the founder of dowser.org, a media site that reports on social innovation.

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