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Knowledge@Wharton staff
Presented here for discussion is a section of a current article published with permission from Knowledge@Wharton, the online research and business analysis journal of the Wharton School of the University of Pennsylvania.
While a recent New York Times op-ed argued that lax government policy toward giant corporations has allowed Amazon to take over the book business and made it impossible for Barnes & Noble to compete, experts from Wharton and elsewhere say there are other trends at play.
“It would be really easy to say it is Amazon that drove Barnes & Noble out of business,” said Wharton marketing professor Peter Fader. “I don’t think that’s true. I think it’s Barnes & Noble that [will drive] itself out of business by not adapting to the times and moving with its customers.”
He pointed out that Best Buy, the retail electronics chain, has been able to survive and thrive in the face of competition from Amazon with smart strategies.
Barnes & Noble has also been unable to cash in on a revival in the fortunes of physical bookstores and yielded ground to smaller local shops.
“There is a tremendous resurgence of local bookstores that’s underway, but these have relevance because they’re coming up out of the ground as green shoots in the communities in which they are appearing and they’re not trying to be all things to all people as Barnes & Noble has always tried to be,” said Mark Cohen, director of retail studies at the Columbia University Graduate School of Business. “
According to Ray Wimer, retail practice professor at Syracuse University’s Martin J. Whitman School of Management, customers want a personalized experience and Barnes & Noble’s staff typically isn’t able to make personalized recommendations and have conversations with book lovers. He said, “Barnes & Noble is not that kind of unique experience anymore, giving people the ‘reason why’ to go in and shop, other than [a salesperson] taking you to the book that you’re looking for. There’s really no discussion.”
Wharton marketing professor Barbara Kahn noted that Barnes & Noble’s big bookstores don’t translate into an intimate or cozy customer experience like many independents and Amazon’s book stores offer. But she also feels the convenience, lower pricing and larger assortments offered on Amazon.com is hard for Barnes & Noble to overcome. Said Ms. Kahn, “The problem is they’re stuck in the middle.”