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I was really looking forward to meeting James Daunt. I love books, and had lots of questions for the man who has, by all accounts, not only reversed the decline of Waterstones by fighting off competition from Amazon and e-readers, but also got people reading again. “We don’t sell books, we sell reading,” he said recently – a subtle but important distinction.

So I wanted to talk about that – how he’s done it, who buys most books, what sorts of books generate the highest sales, and how important covers are in prompting purchase. I also wanted to know how he knew the answers – what research and insight informed his understanding of people’s book-buying and reading habits.

But it quickly became clear that Daunt has little time for market research or the companies doing it (“in the book industry, the statistics are imperfect, to say the least”). Rather, he is concerned with communicating one key message – that he has revived Waterstones’ fortunes by creating more distinctive and interesting bookshops, which makes the bookseller’s job more enjoyable, so they sell more books.

Daunt was hired to rescue Waterstones in 2011, by Alexander Mamut, a Russian billionaire who had bought it from the struggling HMV group. Mismanagement by former owners, competition from Amazon and declining physical book sales had brought Waterstones to the brink of collapse. The chain, founded by Tim Waterstone in 1982, had enjoyed a period of strong growth and success before suffering at the hands of a succession of owners. When Mamut took over, it was losing around £34m on sales of £400m.

What had gone wrong?

“Waterstones had retreated from a tight focus on old-fashioned bookselling skills to something much more akin to the standardised retail chain model,” says Daunt. “It became obsessed with ‘value’ – having a restricted range and ‘piling it high and selling it cheap’. That resulted in an identikit offering throughout the estate. That works with something like Caffè Nero, but it doesn’t work when you apply it to bookshops – or not the kind of bookshop we are, or aspire to be.”

Daunt knows what he is talking about. A Cambridge graduate and former investment banker, he set up his own chain of independent bookshops, Daunt Books, in 1990, at the age of 26. The first shop was in Marylebone High Street, London, and there are now five more in the capital. The chain, which he still owns, is very successful. He says: “Some independent bookshops have never seen any sales falls, and their customers remain loyal to them because they are run by very good and committed people. They are almost incredulous at the 30% drop in sales experienced elsewhere.”

One of the first things Daunt did when he came to Waterstones was cut costs – including shedding thousands of jobs. Half the managers and one-third of the shop-floor staff went. “From the start, I have made no bones about saying we are not good enough,” he says. “Only when we have bright, intelligent, motivated people, who know what they are doing – and are willing to do it with that overused word ‘passion’ – will we get somewhere. But that requires a significant cultural shift.”

There was a chronic lack of discipline, he says, and he introduced systems to manage stock more efficiently. “We have much better availability, we have many more titles and a much bigger range, but we carry much less stock and have fewer returns. Returns had accounted for 20% or above of what we ordered – we are now down to about 4%.”

This new efficiency has been helped by giving booksellers much greater authority over what they sell and how they sell it. Daunt is, he says, “unambiguously against homogeneity” and he is using Waterstones’ data to help inform this process. “I’m a firm believer in data and, in fact, everything we are doing is about trying to understand better what’s going on in each local catchment area.

“I really need to understand what’s going on in Middlesbrough because it’s probably going to be rather different from what’s going on in Harrogate. That informs the books stocked, how they present themselves, how they allocate space, the environment, how they do the café, and so on.”

While book sales vary by shop, Waterstones sells to “an extraordinarily wide demographic and across the entire age spectrum”, says Daunt. “Books start to be bought for you when you are in a buggy and carries on throughout your life.”

But it doesn’t always, does it, I say, citing my 16-year-old son, who has been surrounded by books since he was born, but would now rather walk on hot coals than pick one up and read it. Daunt’s response seems to reflect his own experience, rather than being informed by a broader sample.

“If you run a very good bookshop, where people have been extremely loyal for a large number of years, those kids who first came in hanging onto their mothers’ skirts turn into the adolescents you give a refuge to in the shop, though they might not buy anything; and they turn into adults who do buy from you, because you have made going into bookshops a habit for them.”

Warming to his theme, he talks about how he is encouraging his booksellers to turn their shops into ‘social spaces’ appropriate to the needs of their catchment area.

“We have put a bar in one of our London shops and it has become a fantastic meeting place – and, in effect, a Friday night pick-up joint. Bookshops should be social spaces, and I absolutely promise you that if you manage to pull in a whole load of young women, you’re going to have a few young men turn up as well.”

I’m not convinced – nor am I convinced that the reason men don’t read as much, or buy as many books as women, is because they are “too busy with their careers and family”, as Daunt suggests.

“Men are not lost to us completely, but they are certainly considerably reduced, particularly during certain phases of their life,” he says, adding that one way of reaching them is to appeal to their ego. “Depending on the demographic, that might be something like persuading them it’s necessary to have a certain new book sitting on their bookshelf to show other people that they might read – even if they don’t actually read.”

Again, his observations seem to reflect a very Daunt-centric view of the world; it may be true in the parts of London where there are branches of Daunt Books, but I suspect it’s very different not just in his token northern town of Middlesbrough, but throughout the country. I don’t know why men read less than women – or if that’s even the case – but I do know that, for my son’s generation at least, books fall victim to a number of competing claims on their time and attention, most of them technology-related.

So the marked shift away from technology in the form of e-readers is interesting. Daunt says that the reaction against Kindles has taken the form of a sort of ‘flight to quality’ – people haven’t just reverted to books, they’ve reverted to hardback books. Why so?

“When you get a new gismo, particularly one that’s quite useful, everyone buys one,” he says. “The Kindle seems superficially attractive – it saves you lugging a tonne of books on holiday, for example. Then, suddenly, you look at it and realise you have 20 or 30 books in there, and what’s happened to the bookshelf? There’s nothing on it. And you can’t lend the books on your Kindle, or browse them, and people can’t walk in and look at that nice shelf of books. Books are a lovely physical thing, a tangible expression of what you’ve read.”

Which brings us to Daunt’s nemesis, Amazon – “a ruthless, money-making devil”. High-street bookshops’ market share has declined “in pretty much a straight line” from around 85% in 2000 to about 50% today because of the influence of Amazon and the Kindle, he says. UK bricks-and-mortar book sales peaked at around £1.4bn and are now closer to £800m. “So there was a huge collapse, and Dillons and Borders both went bust.”

The high-street share is beginning to grow again, and Waterstones’ sales – which have been in ‘modest’ growth for 18 months – are slightly ahead of the rest. What’s more, after a very good Christmas the business is, says Daunt, “back in the black”. He is, however, impatient with those who focus on market share as the measure of success.

“People here used to spend an immense amount of time worrying about market share. I said this is utterly irrelevant to us; what we need to do is grow our sales and win back our customers, and we’re not going to do that by taking sales and customers from WH Smith, because we appeal to different demographics. This is not a zero-sum game. The only competitor I would love to see us take back market share from is Amazon.”

And the way to do that is to engage with customers more effectively. “We have to get better at attracting people into the shops and persuading them that it is better to leave with a bag of books than it is to wait for them to come through their letterbox.”

He has not done any research on the factors that motivate people to buy from Waterstones or Amazon. “We don’t need to know that, not at this stage,” he says, arguing that his instinctive sense of what sells books – “I have been doing this for about 100 years, this is my world” – is more valuable than looking at “endless spreadsheets”.

But the challenge is getting the right people. “We depend on our booksellers. Whatever we do centrally – however attractive the bookshop and however beautiful the books – none of it matters if we don’t have the right people selling the books. So we have to make the career of a bookseller sufficiently rewarding that very good people want to do it.”

One of the ways of making people’s jobs more interesting is by getting them to spot potential ‘bestsellers’ – and Daunt’s approach to the books that Waterstones promotes has transformed its relationships with publishers.

“We inherited a very strange, very adversarial relationship with publishers, because most books had money attached to them – Waterstones would say ‘we will only take a certain book if you pay us’. That was worth £27m to Waterstones when I joined, and I stopped it. It becomes utterly toxic if those sorts of payments dictate what you sell.”

Conversations with publishers are now completely different, he says. “Clearly, we both want to sell as many books as we possibly can – and, clearly, our views will differ sometimes – but that’s fine providing the conversation is based on the merits of the book.”

Some books are guaranteed to do well. When I met Daunt, Julian Barnes’ new novel, The Noise of Time, had just been published and, he says: “He writes good books, we will sell lots of them; it is an important literary event and we will promote it very professionally”. But these sorts of things are “not as exciting as spotting hidden stars – and first novelists are inherently more exciting”. January’s book of the month, A Whole Life, by Robert Seethaler, is one example.

“It’s a sweet little book – short, powerful – and it started to be sold in a couple of shops, and our data showed that people liked it,” says Daunt.

“So you have a read and, quite quickly, it’s book of the month and you sell a massive quantity, because it is a good book.”

That, he says, is good retailing: “It’s very reactive; the impetus comes from customers and booksellers rather than being dictated by the centre.”

The principles that underpin how Daunt Books runs are very much a model for how he wants Waterstones to operate. “The fact that any of our shops sits within a chain should become irrelevant; the chain is there to support it, not dictate to it.”

You wish him well, but it’s hard to escape the conclusion that investing in some properly focused research to test and refine some of his assumptions could provide a useful tailwind.