Last fall on the outskirts of Birmingham in a strip mall between Morrison's cafeteria and Kinko's copy center, the state of the art in spiritual retailing opened its doors: Disciples, the first "Christian superstore."

Not surprisingly, Disciples boasts perhaps the nation's biggest single retail concentration of Bibles, Christian books, and music. But its 100,000 titles cover only 60 percent of the 25,000 square feet of floor space. The rest is devoted to Christian-theme greeting cards, collectibles, T-shirts, and other products, ranging from angel figurines to $300 paintings of eagles.

And while nearly everything Disciples sells has religious themes, it is merchandised with as much style as any high-gloss Madison Avenue media campaign.

Couches and high-backed leather chairs invite book browsers to relax, while seven "listening stations" at the ends of aisles allow music customers to hear specifically promoted releases. A 52-inch television screen plays children's videos; three other TV sets and a personal computer offer parents and children the opportunity to "test drive" Christian games and other software.

There is even a 1,000-square-foot coffee bar and periodic performances by local Christian musicians.

"People have tended to think of Christian bookstores as just Bibles and commentaries," says Mike Murray, Disciples' director of store operations. "That's just a small portion of what we do."

A LARGE, VOLATILE MARKET: Disciples exemplifies the new reality of the commercialization of Christian culture: Unprecedented product variety, sophisticated marketing, and a retailing philosophy that focuses on competitive pricing and high customer service.

In fact, more mainstream retailers are themselves establishing separate sections of religious books and other merchandise. Taken together, the phenomena add up to boom times for sales of everything Christian.

Yet, even amid such success, there are some discomfiting rumbles within Christian retailing as store owners look toward the future. Several market and demographic forces are at work that may weaken the standing of religious retailers in coming years, including significantly greater competition, buyouts of independent stores, the aging of its core female-customer base, and pressures on book and music publishers for blockbuster titles and recordings.

The commercial success of Christian products is occurring in part because publishers, manufacturers, and retailers are catering to the tastes of baby-boomer families, whose demographic dominance has translated into a vast national market.

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America's much-discussed modern search for the sacred adds to the interest. So does the simple fact that Christians are a relatively accessible market because they are so easily identified.

"Our industry is the ideal niche market," says Doug Ross, president of the Evangelical Christian Publishers Association (ECPA) in Tempe, Arizona. "You can rent a mailing list of Christians. You can go to the [Christian Booksellers Association] convention. You can advertise in a variety of Christian magazines. You can reach our marketplace, if you want, with greater ease than many other markets."

Total revenues for Christian publishing have been growing for the past several years at a clip of around 6.5 percent a year, about double the inflation rate, says Byron Williamson, president of NelsonWord Publishing Group, a unit of Nashville-based industry leader Thomas Nelson, Inc. His company's sales rose nearly 21 percent through the first six months of the current fiscal year.

Religious markets other than evangelical Christianity are experiencing healthy growth as well. According to a study by NPD Group, a New York-based market-research firm, religious book publishing increased 92 percent between 1991 and 1994, to 70.5 million books from 36.7 million books. The religion share of the overall book market rose to 6.9 percent from 4.7 percent.

"If someone in religious publishing, regardless of the flavor, isn't happy, he needs to go talk with his marketing department," says Phyllis Tickle, religion editor of industry bible "Publisher's Weekly" and author of the new book "Rediscovering the Sacred: Spirituality in America" (Crossroads). "There's never been this much interest in the history of the business."

Nevertheless, there are significant signs that there are troubles on the horizon. Last fall, the price of Nelson's stock dropped 40 percent, and industry analysts predict that its 1996 earnings will dip about 15 percent from those of 1995, which were 88 cents per share. Revenues for 1995 were $265 million. Nelson says higher costs, greater competition, and debt repayments have decreased earnings.

SHARPER COMPETITION: The growth rates and profitability of Christian retailing have been drawing in some of the nation's largest corporations, including retailing giant Wal-Mart and megapublisher Random House.

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The arrival of multibillion-dollar corporations in the Christian market has changed the merchandising dynamics for independent bookstores and ministry-minded religious publishers.

On the retailing side, Wal-Mart and Kmart have added and expanded religious-book sections. Sam's Club warehouses now routinely feature Christian bestsellers among their limited book selections.

Barnes & Noble, one of the country's largest, trend-setting bookstore chains, has increased its number of religious book titles by 35 percent since 1993, a primary part of the company's expansion of offerings to consumers.

"We're making a strong effort to work with more small and independent publishers, which includes many religious-book publishers," says Lisa Herling, a Barnes & Noble spokesperson.

Ingram Book Company, a leading book wholesaler, ships 350 percent more religious books than it did two years ago and more than doubled the size of its religious-books product team in 1995.

For the first time, the American Booksellers Association in 1995 included a religious-titles section at its annual convention, and it proved a popular destination for retailers.

"There's a strong appetite in the general market for spiritual issues, and a tremendous opportunity for Christian publishers to put books on the table for people," says Bruce Barbour, publisher at Moorings, the Christian imprint created last year by Random House, one of the nation's largest book publishers.

Traditionally, Bibles and religious books have been the mainstays of Christian retailing. But today, there is increased focus on religious-theme merchandise, the coffee mugs and T-shirts end of the business.

For the past ten years, Christian retailers have seen book sales (excluding Bibles) grow in absolute numbers but remain flat as a portion of sales volume. Music sales, likewise, have hovered between 15 and 20 percent, while Bibles have remained steady at about 15 percent.

As retailers have increased the number and variety of merchandise, they are less and less reliant on books and recordings. The product categories that are growing proportionally are relatively new ones, such as clothing, collectibles, and children's items. Popular gifts for Christmas last month included the Chariot Family (a $15 set of toy Philistine and Israelite soldiers), Adventures in Odyssey audiotapes, and the McGee & Me video series.

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CONSUMER SATISFACTION: As bigger players have come into the Christian market, the 2,500 members of the Christian Booksellers Association (CBA) have been refocusing their line of products and services in sometimes dramatic ways to maintain their standing.

More CBA outlets are reshaping themselves toward a department store, "one-stop-shopping" model. "We're keeping up with the benchmarks that have been established for us by other media purveyors," says Bob Streight, whose Illinois-based consulting firm has redesigned more than 90 Christian bookstores. Following a formula established by Blockbuster video stores and Media Play outlets that offer huge variety and a fun shopping environment, Streight strives for more complete inventories, "user-friendly" environments, "extended-stay techniques," such as refreshment bars, and sparkling-clean restrooms.

"We're all fighting for the same disposable income along with Wal-Mart and Macy's," says Chris Childers, owner of Macon (Ga.) Christian Bookstore, CBA's Store of the Year for 1995. For Childers, a remodeling and expansion last year included the addition of a 34-seat coffee bar.

These new techniques aimed at customer satisfaction rival those of any roll-out-the-red-carpet retailer. For example, employees, including Childers himself, send handwritten cards to an arbitrarily selected handful of each day's customers. And a database-marketing program enables Childers to target his promotional mail with great precision. He can send a flier promoting Carman's new release only to the 600 customers who have bought music by the artist in the past year.

New partnerships are also emerging. Macon Christian, along with more than 300 other independent CBA stores, has joined Parable Group, a California-based cooperative-marketing organization that provides services such as national sales campaigns for independent CBA stores--much as True Value does for its member hardware outlets.

Change has not been limited to on-location retailing but has also rippled into the mail-order business. Christian Book Distributors (CBD), the Peabody, Massachusetts-based industry leader, is growing by acquiring a competitor, Christian Book Bargains. Among its other activities, Book Bargains has been selling books through the Internet via Christianity Online, operated by Christianity Today, Inc.

"There's probably more hype about retailing on the Internet than is actually occurring in sales, so the jury is still out on it," says CBD president Stephen Hendrickson. "But it's certainly going to grow."

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CBA says that Christian retailing overall now amounts to a $3-billion-a-year business--triple the amount in 1980. Thanks to format and merchandise changes, the association says, many of its members are experiencing sales growth of 15 to 30 percent annually. Whereas a decade ago only a handful of Christian retailers pierced the $1 million mark in sales, now there are more than 100 such stores.

Looking toward the future, Christian retailers take heart from the results of a recent CBA survey that indicates CBA stores draw in 33 percent of active church attenders, up from 25 percent in 1991.

GROWING PAINS: Yet the Christian retailing success story has spawned difficulties within the industry. Buyouts of family-run independent stores and book and music publishers, as well as the trend toward high-volume merchandise, has ruffled feathers among some of Christian retailing's loyal customers.

Although the Grand Rapids, Michigan-based Family Bookstores--the industry's largest chain with 175 stores in 29 states--has less than a 5 percent share of the overall CBA market, additional buyouts of mom-and-pop stores will be increasingly important to growth. According to Family Bookstores president Les Dietzman, "The economics of the industry are running against the independent store, so it's hard for all but the very best-run stores to survive."

In Atlanta, Derek Leman, children's minister at Morningside Baptist Church, says he is disappointed that a national chain took over a local shop formerly called Christian Armory. He says the literature section has been "dumbed down" by the removal of serious commentary in favor of "greeting cards, gifts, and little self-help books."

Other signs are cropping up that the industry's high growth rate will be hard to sustain. "There's become too much product chasing too few customers," admits Thomas Nelson's Williamson.

In fact, Williamson says, Nelson will be halving the number of new titles produced this year by its biggest Christian-publishing unit and will "focus more on the quality of what we do publish." Nelson also has eliminated a dozen jobs by idling one of its newest imprints, Two Rivers, which encountered little success appealing to non-Christians, its target.

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WARM AND FUZZY THEOLOGY? While many retailers have devoted much attention toward sales revenues and profitability, other leaders in the industry are worried about product contents and messages.

During the angel-merchandising craze, which probably peaked in early 1994, Christian retailers benefited greatly even though much of the trend blurred the lines between biblical belief about angels and non-Christian New Age spirituality.

And while Barnes & Noble is greatly expanding its spiritual offerings in its superstores, Christians still are not going to mistake the chain for their local CBA outlet. At one Milwaukee-area Barnes & Noble, for instance, New Age and Eastern Thought occupy individually marked sections. While there is a Bibles section, explicitly Christian literature is not distinctively identified. Instead, it occupies niches in the Inspiration section. Yet, Christian publishers are eager to place their new titles into full-service bookstores, seeing them as a natural growth market.

In addition, many religious publishers remain unafraid to stick with the basics of Christianity. "We're not watering down our message or making the gospel some kind of unitarian mumbo-jumbo," says Moorings executive Barbour. "We're being forthright, but sensitive."

The use of new technologies and cutting-edge marketing methods to market the gospel is not troubling to CBD's Hendrickson. "If you're changing the message, that's one thing," he says. "But if you're using a new medium to convey the same message, that's something else."

As Christian retailing has grown, some of its leaders are re-examining whether they can better address the spiritual questions of non-Christians. One Christian educational ministry, the Navigators, now has a secular imprint, Pinon Press, that has published more than 25 titles.

In a few instances, Christian retailers are becoming more involved in outreach possibilities. During the holiday season, storeowner Childers began to run local television ads on Wheel of Fortune and the Oprah Winfrey Show, in part to pursue nonbelievers.

"We're seeing tremendous interest not just from church people but from the general population" in Christian retail merchandise, says CBA president Bill Anderson. Many of those wandering into a CBA store for the first time, he says, are non-Christian parents who come looking for family values-based literature to share with their children.

Retailers expect that the growth trend will be long-lasting. "I think the best days of Christian retailing are still ahead of us," CBA's Anderson says.

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