THe solution you seek depends upon whether or jot you use a Mac or a PC.
1) If you use a Mac, iBooks is now a separate, optional application rather than a part of iTunes. Open the Mac App Store, download iBooks. Once iBooks is installed, open it, click on the upper left-hand corner of the application window where it says "Library", and you should be able to see all of your purchased books. If you don't see anything, click "Store" from the toolbar, and click "Sign In". Once signed in, your content will appear. Download the books you want to store locally on your Mac. Once you have done this, open iTunes, connect your iPhone (either by wifi or lightning cable), and you will see "Books" on the list. Sync the books you want to your device and you are all set.
2) If you are on a PC, iBooks will still be its own tab in the iTunes application. Make sure that you have "Show iCloud purchases" enabled. If you are unsure of whether or not you have this option enabled, click "View" from the menu bar, then click "Show iCloud Books". Once your books are visible, the process is much like the one described above for Mac.
Best of luck.