When it comes to the quickly growing online textbook-rental market, Chegg is the young giant to beat. But its smaller competitor, Bookrenter, is making some impressive gains. If you look at traffic to each respective website, you can see spikes at the beginning of each semester (see chart above).
Last January, Bookrenter’s traffic was only 12.6 percent of Chegg’s, whereas by the August peak, it was 32.5 percent. From peak to peak, Bookrenter’s traffic grew 167 percent to 446,000 unique monthly U.S. visitors, according to comScore. Chegg’s August traffic, however, was about the same as during the January peak: 1.3 million. The chart below, supplied by Bookrenter, shows how Bookrenter’s traffic has been growing as a percentage of Chegg’s. In October it was 58 percent, but that number is not as meaningful as the percentage during the peak rental months earlier in the semester.
We do know there is a direct correlation between traffic and sales, however, it is not clear from these numbers how many books on average each student rented. Bookrenter CEO Mehdi Maghsoodnia says he shipped about 500,000 books in the Fall semester. If you figure each book rents for an average of roughly $50, that means Bookrenter did $25 million in sales last semester. That was the semester Bookrenter went into hypergrowth. Add another 125,000 books shipped in the Spring semester, and it looks like Bookrenter will do a little more than $30 million in revenues this year based on my back-of-the-envelope math. Chegg is expected to hit about $130 million in revenues this year. Bookrenter still has a long way to go to catch up, but it also didn’t raise over $200 million in venture capital, it only raised $20 million.
Much of Bookrenter’s growth is being fueled by its partnerships with college book stores. Since partnering with campus bookstores last March, Bookrenter is now the official book rental platform for 515 college bookstores in the U.S. serving 6 million students, or 31 percent of the college population. There are between 6,000 and 7,000 college bookstores nationwide. Oh, and Bookrenter is now invading Canada as well.