Monday, January 9, 2012

MONDAY MUSINGS: Are Huge Bookstore Chains On Their Way Out?

I subscribe to several newsletters and I enjoy reading about the latest marketing/promotion news as well as what market analysts have to say about digital publishing.

I was saddened, but not greatly surprised, by the news on Barnes and Noble. I do believe Barnes and Noble (as well as other large chains) stores, as we know and love, are going to be a thing of the past. Oh, Barnes and Noble is not going to disappear this year or even next but there is a strong indication that is on the path, according to market analysts such as IDC , The Daily Finance, and reports from The Bottom Line  Even Publishers Lunch had something to say about it. 

Barnes and Noble has been busy the last week with not so great quarter in sales and now talking about spinning Nook off into a separate business. There’s a lot of concern that making the Nook a stand alone company will nail the coffin on the chain’s physical stores and Barnes and Noble will go the way of Borders.

It’s hard to compete with Amazon and while Barnes and Noble had a whole quarter in which to bask in the glory of its color android based Nook e-reader, with Amazon releasing the Kindle Fire and at a more affordable price, their glory was notably short lived. Nook holds only a small portion of the market (at one time they were second only to ipad). The iPad is the dominant media tablet; Amazon definitely is surging ahead of Barnes and Noble with over four million of the new fires shipped out over the holidays. Overall, Barnes and Noble hasn’t had a great or even good year.

According to Tom Mainelli, IDC, the United States holds about 80% of the e-reader market, but he expects that to change. Mainelli also suggests that Barnes and Noble may not have the financial resources to compete with Amazon in creating the necessary international presence within the next few years. Speculation is the spin off is a step in attracting a money partner for expansion without the high maintenance of physical stores.   

So what does that mean for huge book store chains like Barnes and Noble?

Rick Aristotle Munarriz (aka The Motley Fool) had this to say:
There's no denying that digital delivery is the future of media. We saw it happen with music, and now most of the record stores have closed down. We are seeing it happen with movies, as streaming and downloads replace physical DVD purchases. Video games are also being dished out by server farms to Xbox Live users and smartphone owners… Progress is inevitable. Every quarter finds millions of bibliophiles making the switch to e-readers, and the migration continues as hardware prices continue to drop.”

He continues:

“This doesn't mean that books will go completely obsolete. We may never see a world where everyone owns an e-reader or tablet. However, the demand for gargantuan dedicated bookstores will dry up -- and with that, Barnes & Noble's livelihood.”  You can read the full story here, Why Barnes And Noble Will Never Be Great Again 

With the event of Print On Demand technology, this isn’t surprising. We’ve all seen the changes for the publishing industry since it has. The demand for digital delivery is everywhere and changing how we get our media.

Online stores can offer more variety and less expensive products, than physical stores and as far as media goes, instant gratification.

We can rant and rail over this turn of events, but it’s like spitting into the wind. There is no stopping it.

Meanwhile, I think I’ll make a trip to Barnes and Noble, grab a cup of coffee, and savor the smell and sight of all those lovely books. At least I’ll have tales to tell to my grandchildren.

Once upon a time the only way you could get something to read were bookstores and libraries…huge ones… 


welcome to my world of poetry said...

This was interesting to read as I am in the process of selling my book.
It would be a shame to see a book store close down.I hope it dosen't as I love to browse through book shops here in the UK.


Tonya Kappes said...

WOW! I didn't read that. But it does make a lot of business sense. It's super sad because I do love going to the book store. I think I'll go grab a cup from there today too!

Jo said...

I haven't been in a book store for years, I get masses of books from the library, but if I wish to buy a book, I do so on line, either a genuine book or these days I buy more and more ebooks. Although I now have a Kindle, I have had an ereader (Palm Zaire) for years.

Alex J. Cavanaugh said...

I guess I'm part of their downfall, as all of my book purchases are now on my iPad.

Kat Sheridan said...

The thing is, the closing of massive chains actually re-opens the opportunity for neighborhood/independant book stores. There's been a resurgance of the mom and pop, locally owned store, which can also have a big web presence (think Powells). And B&N is less and less of a bookstore as they turn more and more shelf space over to toys and other items.

I love my e-reader, but I will always want paper books as well. I've seen so many changes in technology over the years (anybody remember WordPerfect? cc:mail? WordStar? Betamax? Vinyl?) that I worry about whatever platform I'm reading on becoming obsolete and/or inaccessible. My paper books will be there no matter what, and I need no form of electricity to enjoy them.

Karen Walker said...

It's very very sad. I am still sad over Borders closing.

Jo said...

The trouble with this is that publishers are running scared. I have a friend who is a well published author but who cannot get a contract for her current novel.

Anonymous said...

Sia, B & N needs to re-invent itself or face extinction, just like so many other businesses that have a declining legacy base and a growing alternative (think Netflix). Spinning off the Nook might make sense -- or not. To be successful in the e-reader business, companies need to have a clear business model. Amazon is using the Kindle to sell Amazon content, so they're driving the price down. Apple makes their money on equipment, and they've been able to convince users to pay a premium. I'd say B & N needs to reduce their bricks and mortar footprint to its more profitable stores and double down on it's investment in e-books, POD and a bolstered online presence. B and N still has a strong brand and they need to capitalize on it while they still can.

Mason Canyon said...

I hate to think of them coming to an end, even in a few years. I love visiting bookstores. Guess I'd better drop by the local B&N soon.

Thoughts in Progress

Renee said...

We just saw this with Borders and I fear we may see this with many bookstores.

Hilary Melton-Butcher said...

Hi Sia .. I can't unfortunately see a way forward - some specialist type bookshops will stay open -eg with food attached, or coffee lounge .. but I suspect books will be found in supermarkets, garden centres, museums etc ..

We're all buying ebooks (well most with Kindles etc - I'll get one one day!) ..

.. and education is changing so much too - fewer books in classrooms .. etc

Interesting post to read - thank you .. cheers Hilary