The Future of Book Stores

A very interesting article from last week's Wallstreet Journal examining planned alterations to Barnes and Noble's business model in response to changes in the market. According to the piece they are predicting that 20 -25 % of sales will come from e-books by the year 2012. The company now has to re-evaluate the roll of their brick-and-mortar superstores in the face these changes. While the owners maintain optimism, it is going to be interesting to see if they can sustain so many stores with so many employees, with future market trends heading in the direction they are.

Barnes and Noble, unlike Borders which many are predicting will not survive the coming years, has adapted fairly quickly to Amazon's game-changing Kindle. Their e-reader, nook (not the nook mind you, just nook), was released last November and quickly became a competitive alternative to the Kindle (I'll have a more thorough reviews of both items in future posts). Unlike the Sony e-reader, which predated the Kindle, or some of the smaller alternatives like the EnTourage eDGe, nook has been able to garner a stable portion of the market for a couple of reasons: First, unlike the other devices, it has hundreds of the stores with nook stations which allow B&N to grab customers that online sites may not have access to, and it was able to improve it's device based on consumer response to the first generation Kindle.

With a respectable foothold in the digital future of publishing some are predicting that Barnes and Noble stores will shift their focus from book sales to a more meeting place/browsing paradigm. With their cafes and music/movie sections, some envision nook-armed customers coming to the stores to read, browse selections that they will invariably buy on their e-readers, and to hang out. This transition will require a diversification of the products and services offered by the company and still might necessitate a reduction in staff and size, but hopefully it will provide a stable enough platform to ensure the survival of bookstores in at least some form. I think even to most ardent tech-lover will agree that it is still nice to have a non-digital place to browse for new books.

Furthermore Barnes and Noble is trying to use it's e-reader as a platform to get customers coming into their stores. One of the features of nook is that when you enter B&N store, the device automatically syncs up to the WiFi and you can get special in-store only coupons. You're also given an allowance of 1 hour a day to read books for free while connected to the store's internet. Even with these incetives to continue to come in, I'm just not sure that they'll be able to maintain their superstores. What do you think?