The online business journal Knowledge@Wharton (@knowledgwharton) scrutinizes the possible future of Barnes & Noble (@BNBuzz), which operates 689 bookstores in 50 states and 674 college bookstores.
The chain is caught between the need to bolster its in-store experience, and the drive to keep up in an ever-growing tablet market as readers increasingly turn away from printed books.
Barbara Kahn, director of the Jay H. Baker Retailing Center (@whartonretail) says Barnes & Noble's merchandising isn't giving consumers much of a reason to visit stores. "The best retailers are experiential," she says. "Online retailers can provide big assortments and better prices. If a retailer focuses on price and category, online [retailers] will always win. Barnes & Noble has to ... do what online can't do -- social interaction, physical presence, and experience."
...One of Barnes & Noble's core assets may be the people on its sales floor. "The more the retailer can provide service with a face on it and provide amenities, the better chance it has of surviving," says Wharton management professor Daniel Raff. "You can create a destination for merchandise and prices, but service and a response to your desires will get you ambiance.... If Barnes & Noble is just about buying books, customers can get that online. But what if it can also provide customers with insights from, and conversations with, people who understand the experience? Barnes & Noble has to figure out what makes it a good retailer and play to its strengths."
In an interview in The Wall Street Journal ("B&N Aims To Whittle Its Stores For Years"), CEO Mitchell Klipper says that, while B&N still sees growth left in the physical book business, it plans to close about 1/3 of its stores over the next decade, bringing the total remaining shops to around 450 to 500. Klipper says less than 20 of B&N's total retail stores are money losers. Overall, the retail stores still make solid profits; enough to offset losses from the Nook business.
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