Barnes and Noble tried to bury some very bad news by releasing it during CES-NOOK sales for the holiday season were dreadful. Plenty were quick to blame Amazon’s lower prices, but while that’s no doubt a factor there are some bigger issues here than prices on a few bestsellers…like marketing, and whether B&N plans to maintain the NOOK another year!
Let’s start with marketing. If Barnes and Noble is at all surprised by the nosedive in NOOK sales, they should fire their ad team ASAP. B&N’s main ad for the holiday season featured Jack McBrayer running around in a hyperactive tizzy, buying all sorts of items from a Barnes and Noble for all his relatives. He spends two sentences discussing NOOK products and that’s it…meanwhile, Amazon has been flooding the airways with ads reminding everyone that the new Kindle Fire HDX is lighter and cheaper than the iPad Air. Where were B&N’s ads reminding people that the NOOK HD and HD+ line are even cheaper than the Fire? Where was B&N’s ad explaining that the NOOK with Glowlight is better than the Kindle Paperwhite because there are no ads in a Glowlight? Where was ANY ad highlighting that B&N has an affordable lineup of quality devices? Sure, there were no updates to the products this year, but most of the public isn’t paying attention to the release date, just that they’re hearing ads. If Barnes and Noble had actually bothered to remind people they sell NOOKs, maybe people would have bought them?
Then there’s the very uncertain future of the NOOK at all. Remember, the last year and a half or so has featured Barnes and Noble repeatedly declaring they plan to spin off the NOOK division — they even enlisted Microsoft and Pearson as major investors in the NOOK and college bookstore units. The plan was to split between digital/college and the retail bookstores, but they abruptly changed their minds and stopped discussing or pursuing that option. Essentially, Barnes and Noble has repeatedly shown investors and consumers they have no clue how to run a digital business, so is it at all surprising that consumers don’t want to buy into B&N’s digital business? We live in an age where information spreads very quickly, and it’s not hard to stumble across articles outlining B&N’s various stumbles and reversals in the NOOK space. This is a failure of how B&N manages their business as well as another marketing failure. In the absence of any ad campaign reminding people the NOOK is a good idea, is anyone going to read article after article portending doom at B&N and then rush out to snap up a NOOK that’s tied to B&N?
And yes, Amazon’s lower prices aren’t helping. But a customer who reached the point of comparison shopping B&N and Amazon is a customer B&N had the chance to capture some other way because that means that customer made it past the gauntlet of bad news and crappy advertising for the NOOK brand. It mystifies me why B&N doesn’t offer the 10% membership discount on eBooks, as it would help close the price gap immensely between Amazon and B&N. B&N’s membership is a paid one, meaning that you spend $25, and B&N knocks 10% off just about everything you buy (except NOOK books). More paid members are a great way to lock someone onto a platform, and now that agency pricing is repealed there’s no reason B&N couldn’t use it on their digital books.
In the end, I honestly think Barnes and Noble wants their ebook division to fail. They’re putting an absolute minimum amount of effort into it, and they’re surprised that minimum effort in a competitive landscape is not enough to improve sales. This is a company that has roots going back to 1886, that took shape in its current form in 1971, and has weathered mergers, acquisitions, expansion, and a vastly changing retail environment. For them to mishandle the digital markets so completely means either the company itself is falling apart, or there’s simply no desire to put any effort or money into the eBook business at all. Since they’re managing to keep the retail side up and running, it’s not hard to believe it’s a lack of desire, not lack of ability, causing the NOOK business to flounder.