October 31, 2011
B&N announces major lessening of space devoted to books
by Dennis Johnson
Do you need 2000 square feet to see this?
It’s been one of the more puzzling aspects of Barnes & Noble‘s move into the future: Why are they giving up thousands of square feet of prime bookselling space — the area just inside of entrances, which have the highest sales-volume-per-square-inch of any area in the store by far — to displays of, well, one simple, not to mention small, product: the Nook. Here in New York, the Union Square B&N has turned at least 2,000 square feet in the front of the store into a barren-looking area with nothing to show but a few lonely Nooks and a handful of staffers standing around waiting to explain it to … someone. But it’s an area resolutely bereft of customers. They’re all off in other areas of the store, looking for the new books that used to be displayed so temptingly where you walked in. Meanwhile one can easily imagine those interested in reading on a device are shopping for that device … online.
So why is a company that has historically been so smart about the nexus between sales and in-store geography willing to lose so much money in the midst of an economic crisis?
For this observer, it’s been one of the signs that B&N is looking to get out of the bookselling business, or at least the brick-and-mortar end of it, as fast as possible.
Not fast enough, according to a Wall Street Journal report by Jeffrey A. Trachtenberg that says the company “will double the size of its Nook boutiques in 40 of its most productive stores nationwide over the next few weeks in time for the holiday selling season.”
As he notes, the company’s Nook “boutiques” “typically occupy 1,000 square feet in the 704 consumer stores nationwide …. Barnes & Noble will now increase the boutiques at select stores to an estimated 2,000 square feet, it said at its annual shareholder meeting.”
While the B&N statement insists it “will do so without reducing the number of physical titles it stocks by using space formerly allocated for such products as music and DVDs” — something I’m not sure I believe given their stunning return rates of books this year — my guess is the move still represents a significant loss of income for America’s only remaining chain bookstore, all the more so as it’s the holiday season.
And that’s not all. Trachtenberg reports that the company announced plans to broaden “the assortment of non-book items it sells,” and will be dedicating another 1,000 square feet in more stores for its “toys and games offerings.”
While the company — and Trachtenberg — couch B&N’s “non-book item” growth as preparation for the pending release of a Nook tablet, and in general as a reaction to the “intensifying competition from Amazon.com Inc. on both the e-reader and digital books front,” our attention may be better directed to a close reading of the WSJ report’s last line: “Barnes & Noble helped pioneer the book superstore with its huge array of titles, but the popularity of online book buying has made it difficult for any bricks-and-mortar bookseller to compete on an assortment basis.”
We think: Not really, and in any event, not for long.
Dennis Johnson is the founder of MobyLives, and the co-founder and co-publisher of Melville House.
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3 Comments
So sad. I love my local B&N. I go there for coffee every weekend — another non-book use of the store, those coffee shops — but the point is, I may sip and sample a book or two in the coffee shop, and then buy one of the books when I leave. I just did that with “Game of Thrones” — wasn’t sure I was ready to commit to a fantasy series of such heft, but after two coffee-shop sessions reading the first book of the series, I was hooked, and now I will buy the whole series. I also read their magazines while I’m in the coffee shop – but I usually will again get hooked and purchase one of the four or five I browse. I have the Nook app on my iPad, so probably won’t be purchasing a Nook – I have purchased a few ebooks on it and will continue trying to get into the ebook thing. (I’m in my early 30s, by the way, with a master’s degree — kind of their target Nook audience.) But my B&N is one of the superstores, and I have seen them slowly increase the size of their Nook boutique, which is smack in the front of the store as you walk in. I always politely pass it by and go to the real books! B&N, I don’t think real books will ever die – hopefully you can come to a meeting of the minds and offer ebooks AND real books (and keep our beloved coffee shop, too — our local readers’ Cheers bar!)
The Nook drives traffic to their website, which most people do not know exists. (Overshadowed by Amazon, just as most people think the Kindle Fire is the first 7-inch color tablet, even though the Nook has been sold for over a year.) So, yes, they will heavily promote the Nook. That price tag also helps the bottom line for store sales… few people will spend $100+ on a book, but they will spend that for an electronic device. The Nook also encourages customers to visit the store for special offers and in-store downloads (as well as offering customer service for the Nook).
“my guess is the move still represents a significant loss of income for America’s only remaining chain bookstore”
B&N tracks sales of every category. They have a finite space in each store, and must stock it with what sells, as each square inch must pay the rent. Some sections might shrink while others are enlarged. Toys & Games sell. Book sales, in general, are tanking, as e-books outsell regular books online. If they did not adjust footage accordingly, then they would suffer a significant loss. You don’t keep selling buggy whips if everyone wants steering wheel covers.
Union Square is not a typical B&N. The general layout of the freestanding box stores divides the store in half. Nooks are positioned on one side of that power aisle, and other product (usually the new releases, calendars, or bargain books) on the other side. The DVD/CD department is self-contained (for security reasons), so as those media dramatically decrease in sales, the space must be utilized for something else. Moving Nook accessories and other electronics, which require tighter security, to that area makes sense. That’s what’s happening at the Union Square store as well, as seen by the white drapery in the DVD/CD section at the back of the ground floor.
The Wall Street Journal is correct. Too often, if a store does not have an item, the customer “will get it online”. Not from the store’s website, but from Amazon. Even if the store offers to process the order right then and there in front of the customer, the customer will most likely do it themselves later. (And then there are the ones who scan barcodes with their cellphones, treating stores as showrooms for Amazon.)
Stores can compete, but it’s difficult to compete with a giant warehouse which can ship an item in two days anywhere in the country.
Mr. Johnson –
I’m a little mystified by your post. You seem to excoriate B&N for abandoning printed books in favor of Nook ereaders, record your disbelief when the chain protests they *haven’t* abandoned printed books, and conclude that B&N is doomed *because* they’re cutting back on printed books. Meanwhile, I notice you’re selling ebooks on this website, so I assume you’ve noticed how popular they’ve become … and how that popularity is unlikely ever to be considered a fad.
For the record, I was laid off from my job as a merchandising manager by Barnes & Noble.com last January — the third such January in which layoffs took place. Meanwhile, the company has been hiring furiously on the Nook side — including establishing a Nook design and engineering studio out in Palo Alto that, as I understand it, has at least 100 employees.
So I have a certain residual insider expertise about the company as well as some intuition about where online and offline bookselling is headed.
I’m frankly skeptical about whether B&N can survive as a brick-and-mortar bookseller, but it’s not because the company is cutting back on the floor space it devotes to printed books. I’m in complete agreement with Mr. Adair’s comment when he concludes “Stores can compete, but it’s difficult to compete with a giant warehouse which can ship an item in two days anywhere in the country.”
The future of printed books can be foretold by the past of music CDs. CDs haven’t disappeared, they’re still sold, but if you want to buy one in a store you’re either going to go to an electronics chain like Best Buy, which sells them as a sideline, or a mom-and-pop record shop. Chains like HMV that used to specialize in them are gone with the wind. The rest of us will buy them online or, more likely, just download the songs we want from iTunes.
For me the surprising thing about ereaders is that their success revealed a category of reader I’d always been vaguely aware of but never quite understood how dominant it was. I’m speaking of the voracious genre reader, who consumes romance or mystery or thriller or sci-fi/fantasy novels the way some people consume bon bons — by the box. Their trips to the bookstore were obviously frequent, time-consuming, and tiring, so when Amazon invented wireless ebook ordering back in 2007 they hopped on board and never looked back. And as a market they were big enough to get the attention of the entire publishing/bookselling industry, push it toward ebooks, and pull the rest of the reading public along with them.
Oddly, for the past few years — since B&N and the late lamented Borders got into the ereader device market — ereaders have mostly been Model T items: crude, basic, functional boards that could display text adequately and do almost nothing else well. But it didn’t matter because genre consumers, who mostly read *only* text anyway, loved the instant ordering and cared little about anything else.
And thanks to the last decade’s growing fetishism with mobile devices — cell phones, iPods, and then smartphones — ereaders naturally drew the curiosity of non-genre readers, too. The result has been an ereader market that’s reached critical mass faster than most anyone could have predicted.
Sadly, though, once ereader book readers discover the convenience of ebooks they appear to abandon printed books altogether. So that everything B&N has tried to do to persuade them to return to the stores they once shopped in — free in-store Wi-Fi, wireless book browsing, and electronic cafe coupons — has fallen short. These amenities can’t compare with buying the latest James Patterson from your bed at 11 PM on a Thursday night.
And then there’s the state of the economy.
So if you believe, Mr. Johnson, that B&N is doomed *because* they’re abandoning printed books in favor of toys and tchochkes I’m afraid I couldn’t disagree with you more. It’s a desperate gambit to keep its core customers — women 30 to 60 — coming into its stores to shop for their children or grandchildren. These women are no longer shopping for printed books for themselves. Their Nook or Kindle handles that task for them quite nicely, thank you.