Online book-rental business evolves from college experiment to full-time venture

There’s money in the business concept, which isn’t new. Barnes & Noble has a textbook-rental division. Chegg.com and Bookrenter.com also are major rental companies. Chegg.com reported revenue last year of about $130 million, and Bookrenter.com reported about $50 million.

The expansion of this industry niche has come so quickly that the National Association of College Stores described 2010 as “the year of the rental.”

“It’s booming, there’s no doubt about that,” said Julie Traylor, the group’s chief of planning and research. “And I’m not sure the market is totally saturated. The reason it has gone in that direction is that it’s all about offering choice. That’s what they’re trying to do, give students a choice.”

The growth has been so dizzying, in fact, that various comparison shopping sites have launched online in the past two years.

Rental sites such as Frewg could eventually pose a problem for publishers, said Malcolm Litchfield, director of Ohio State University Press.

“More power to everyone, but I’m glad I don’t make my living doing textbooks,” he said. “From the publisher’s point of view, it sounds good, but it could be a potential vicious circle.

If sales of textbooks go down, that just forces the price to go higher. Textbooks aren’t expensive because publishers are trying to gouge people, but because they cost a lot of money to produce. If you can’t recoup that cost on sales, it goes in a vicious cycle.”

With plenty of competition, Frewg has developed a strategy for success based on loyalty.

Hill noted Comisford’s cultivation of freshmen and sophomores as clients and his “great relationships with people on the campuses.”

“He has not only a pretty solid Web approach but an early approach to users/renters and a continuing touch with people.”

Frewg is also “looking to make partnerships with Greek organizations on campuses, too,” Comisford said. “We’ll probably pilot that in the spring. Once you establish yourself on campuses, it sets your mark there. It’s not foolproof, but I believe it will work.”