I read an article over at the
Forbes blog the other day with the auspiciously dire headline "
The NookColor Won't Save Barnes & Noble."And even though I've been harping on the demise of the printed book for some time now, this caught me by surprise.
But several points it made got me to thinking, and over dinner at Andrade's last night I discussed a few of them with my folks. Like most parents, mine are always slightly behind the current trends, being now a few generations removed from the cutting edge, and only moderately up to date on modern technology. But my mom's an avid reader, and she likes to browse the aisles at the local B&N, though I know she also orders books online, since they live out in the country now and the local B&N is not quite as local since they retired. So I asked her where she does most of her actual shopping, and her answer was Amazon.
Not Barnes & Noble's online store, but Amazon. She'll browse the local shelves at B&N, and maybe even buy a book or two from time to time, but more often than not she'll go home to compare their price with Amazon's first, and even put a title in her Amazon wish list until she has enough to get free shipping, and only order then. She doesn't shop at B&N online at all.
And this brings home a major point about B&N that the Forbes blog was making: Barnes & Noble have been unable to take the lead - or even keep up - when it comes making the shift into the internet age. Whereas Amazon is fully focused and committed to an online presence (and taking advantage of every aspect of it that they can, like customized recommendations and email marketing), B&N are saddled with the albatross of brick and mortar stores, and all the requisite operating costs involved. And I would hazard to say that it effects their perspective on book selling negatively, tending to make them too conservative in their vision rather than forward-thinking and innovative like Amazon and Apple.

The NookColor is a perfect point in case. As sharp and exciting as it first appears (and I was quite excited by it), on closer inspection it really has nothing new to offer in the ongoing battles of the electronic gadget war. As Forbes points out, it's not quite a tablet and it doesn't add anything relevant as an ebook reader. In fact, the one and only feature that the Nook has over other reading devices is its lending program, which was already available on the original eInk Nook, and which Amazon will dutifully implement on the Kindle shortly. Basically it's a mini iPad with a fraction of the real estate and fewer features. Consequently, it's stuck somewhere in the middle with no real dedicated market. 7" tablets have yet to impress (or even prove themselves financially viable), and $249 has already proven too steep a price point for a general consumption eReader.
Now, Forbes is a finance-oriented publication, so when they say Wall Street greeted the NookColor with a yawn, I give that some credence. The blog post points out the Blockbuster comparison that I had mentioned in a previous post, only to say it's an unfair comparison because B&N is more willing to "evolve" than Blockbuster was. This is certainly true overall, but only to a point. They may not recall Blockbuster's abortive attempt to emulate Netflix - though I do, because I was working there at the time - and it was a vastly superior program, allowing the renter to return online movies in store for immediate exchange rather than having to wait for it to be mailed back. And while this came fairly late in their final death throes, it didn't save them any more than the NOOKcolor and B&N's online store will likely save them without a radical change in the traditional outlook. The operating expenses of brick-and-mortar stores are just too great. The fact is that we're rapidly transitioning into a global economy in which the vast majority of commerce is done online. Only physical stores with enormous inventory turnover will be able to survive, and that means diversification. Like it or not, the local independent retailer is dead. And the smoking pistol is now a Gatling gun.
Forbes points out three main factors working against Barnes & Noble's future success, these being:
1. Execution. While Barnes & Noble's brick-and-mortar stores are world-class, that same level of execution has not yet translated to the internet age. Gauging by market share alone, Amazon is firmly in control of the online bookselling game. The NOOKcolor may help some here, but it's unlikely to take the lead away from the Kindle anytime soon. This point inevitably leads to the next...
2. Economic viability. The divided interests of having both online and physical stores limits Barnes & Noble's ability to focus fully on either, and the costs of operating one fundamentally detract from the other. However, this is really a question of the viability of brick-and-mortar bookstores in general, which is only going to get worse going forward. Without some fundamental shift in operations, such as introducing Print-On-Demand kiosks in place of physically stocked backlist titles, the brick-and-mortar bookstore will not survive. And the introduction of eReader "stations" and WiFi networks within those walls will not help, since there's inherently no need to go there to get your digital content. In fact, as the Forbes post very aptly points out, you can buy books on Amazon from within the walls of a Barnes & Noble store.
3. Scope. Amazon's embracing of virtually every product available gives it a distinct advantage over both B&N and Apple (and nearly everyone else for that matter). While Amazon began strictly as an online book retailer, they didn't restrict their inventory options for long. This wide ranging outlook gives them a revenue stream that allows them to dabble and experiment in areas that may not prove fruitful initially, but which tend to pay off over time. Barnes & Noble just doesn't have that luxury, and is, in fact, saddled with huge operating costs which prohibit it to a large degree.
I haven't purchased anything from Barnes & Noble for quite a long time - several years in fact - while I've ordered literally
tons of stuff from Amazon. However, I still go into Barnes & Noble stores from time to time, mostly to browse the graphic novels section and see what the latest works
look like, something which is still imperfectly presented online, almost entirely due to format issues: you often have to
see a graphic novel spread laid out to comprehend the overall flow and experience completely the atmosphere which it presents.
So while I was initially quite excited about the pending release of the NOOKcolor, after looking into it further I've decided to wait for a color eInk reader, and to get an iPad in the meantime for reading graphic novels. And that leaves Barnes & Noble out in the cold.