How Barnes and Noble could get its Groove Back

This post originally appeared at talanhorne.com

A post dealing with the book industry? How novel.

More specifically, this post is entirely about a single bookstore. You know its name. You’ve wandered its shelves. You’ve eaten its brownies. And after eating them, you probably sat at the same table for five hours with your laptop, doing who knows what.

Are you proud of yourselves?

That’s right: today we will be discussing Barnes and Noble—the bookstore everyone used to hate.

Used to?

Yeah, it’s kind of funny that way. For a long time, everyone thought Barnes and Noble would be the death of books.

For a long time, the only way people could get books was from their local, Mom-and-Pop bookstores. And most of those were put out of business by either Barnes and Noble or Borders Books. A lot of people hated this, and some even tried to fight it. But economic pressures won out in the end, as they always seem to do.

But people don’t hate Barnes and Noble or Borders Books anymore. Part of this is because their loudest critics eventually capitulated. But a bigger part is because Barnes and Noble is now the underdog.

What do I mean?

Well, you may be thinking that Amazon.com is slowly killing all the brick-and-mortar bookshops. But that’s not quite true. In fact, Amazon is starting to roll out some brick-and-mortar stores on its own, in an experimental way.

And while Amazon is certainly upending a lot of paradigms and causing trouble for Barnes and Noble, there is one other retail store that is in direct competition with the bookselling franchise. I am, of course, talking about…

Now, I don’t hate Walmart, but there can be no denying that it contributed in a big way to the demise of Borders Books. Of course, even Walmart is feeling the heat from Amazon, but people haven’t stopped hating Walmart. They have, for the most part, stopped hating Barnes and Noble.

Because Barnes and Noble is not invincible.

Because it is struggling.

A New Challenger Approaches

And, to help me explain how to save Barnes and Noble, I have enlisted the help of an old friend. He has been a part of Mr. Horne’s Book of Secrets since the beginning, mostly operating from the shadows, doing some fact checking, offering opinions, suggesting post topics, and much more. Now he has finally agreed to be a part of the conversation. Please welcome my good friend, Mr. Devil’s Advocate.

DA: “Delighted to be here, I guess.”

So glad you could be. Now, are you ready to help me tell everyone how to save Barnes and Noble?

DA: “Save Barnes and Noble? Are they going under?”

Well, it’s impossible to say what their exact financial standing is at the mo…

DA: “So you don’t know if they need saving?”

Well, they might not need it right away. But there’s no denying that they need to make some changes.

DA: “And you know what those changes should be? This is a multinational corporation you’re talking about. You think they don’t know how to run their own business? The business they’ve been doing for decades? Are you convinced you could do better?”

I think I have to right to suggest…

DA: “Have you ever run a company?”

No, but…

DA: “Do you have a business degree?”

Not a business degree, but…

DA: “Have you ever worked in marketing? accounting? chain of supply?”

I can still contribute.

DA: “Are you on the board of directors for any kind of business?”

Yes.

DA: “Then what makes you think you can…wait, you are?”

Yeah. It’s kind of a long story.

DA: “Oh. Well, carry on then.”

The Travails of a Book Buyer

I don’t know how close Barnes and Noble is to going bankrupt, but I do know that they’ve seen better days. I don’t know a lot about working in retail, but I do know what it’s like to be a consumer. And, as a consumer, I can say that my shopping experiences at Barnes and Noble only seem to be getting worse and worse each time I walk in.

Let Me Give You an Example

For a long time, I have wanted to read the fourth book in the John Cleaver series, by Dan Wells. This is a spine-tingling series written by a local author and I loved the previous three books. So, on the week that it came out, I went to my local Barnes and Noble. Some books have a hard time being categorized by bookstores, but this one is unquestionably a horror novel. So I walk into Barnes and Noble and look for the horror section.

And there is no horror section.

I search the store top to bottom, but cannot find it, so I ask one of the attendants if they have it.

They’ve never heard of the book. They’ve never heard of Dan Wells, even though he lives only a few towns over.

Flustered, I leave. A few months pass, and I buy a copy from the King’s English Book Shop in Salt Lake City. Happy ending, right?

Wrong.

The Destin Incident

At some other point, I was in Destin, Florida, far from home. My trip just happened to coincide with the release of the new Mistborn book, Shadows of Self. On the day of release, I went to the nearest Barnes and Noble, late in the afternoon, to pick up a copy.

I began my search at the front, where the new releases are.

It was not there.

I ask the attendant, and, checking the computer, she tells me that they do not have any copies and have not ordered any copies.

And then she did something that made me really mad.

She told me that the store usually only orders new releases that they think will sell, by well-established authors, and that if I wanted to get any other book on its release day I needed to call in advance and reserve a copy, so the store would know to order some.

This is not the thing a consumer wants to hear, especially when the book in question is the latest one from a #1 New York Times bestseller, who has fans in every city in the nation, and in many other nations besides. And this book was a continuation of one of his most popular series.

I tweeted Brandon Sanderson about the incident, and he replied, saying that his publisher, TOR Books, had contracted with Barnes and Noble to have copies sent to every one of their franchises. I appreciated his condolences, but I was still frustrated with my experience.

And this event, more than any other, got me thinking. Wondering if there was a way that Barnes and Noble could be reborn into a new kind of bookstore—one so great that I would refuse to shop at any other. And so I began to pay attention. I began to get ideas.

This is what I decided.

A Barnes and Noble Renaissance

If I was CEO of the Barnes and Noble corporation, I would make some changes. Maybe these changes wouldn’t work. I am only human. This is only my opinion. But I think these ideas have some merit, and would be worth investigating by anyone who has control over that company.

My plan begins with three steps:

Step 1: Get rid of the Nook

DA: “Heh. This should be interesting.”

Let’s face it, Barnes and Noble’s personal e-reader device, commonly known as “The Nook,” is a failure.

In fact, it is one of the greatest product failures of the last decade. The Nook has been demolished by Amazon’s Kindle e-reader. People would rather read books on their iPhone than on a Nook, and using an iPhone is perhaps the worst conceivable way to read anything.

And yet, whenever you walk into a Barnes and Noble, what is the first thing you see?

“My Glob. It’s full of stars.”

When you look at the above picture, please take note of how BIG this place is. It is the Nook sales station at a Barnes and Noble store. You’ve probably seen others like it. And you know, as a B&N customer, that these stations can fill up to a third of the total floorplan of the store. This creates a void, where no bookshelves can be put.

This is important to note because shelf space is the lifeblood of any bookstore. Most laymen don’t know this, but the entire publishing industry revolves around the idea of shelf space. Publishers are required to tell their authors to write shorter books, because Barnes and Noble demands that their shelf space be preserved. Bigger books get ordered less. And books that don’t sell are quickly taken off the shelves so that space can be conserved, because shelf space is the most important asset in the entire publishing industry. Yes, even more important than creativity and artistic whimsy (sorry, but it’s true).

And yet, Barnes and Noble has demolished the shelf space in every one of their stores to make room for what is, essentially, the tablet version of New Coke.

Somebody call Stephen Hawking. I just found the equation he’s looking for.

Whenever I see this gaping hole in the middle of my local franchise, all I can see is the flood of money hemorrhaging out of it. I may not know the exact financial outlook of the Barnes and Noble corporation, but with a liability like that, it cannot be stellar. You disagree?

DA: “No. I have to give you this one. Personally, I never liked the Nook.”

You and everybody else.

Step 2: Get rid of the Toys

DA: “Now let me stop you right here.”

Oh, is something wrong?

DA: “It is, if you’re going to suggest that Barnes and Noble should stop selling toys.”

And why shouldn’t I suggest that?

DA: “Because Barnes and Noble makes a killing by selling toys. It’s one of the reasons they’re still in business. As soon as they’re gone, Barnes and Noble will suffer the same fate as Borders.”

That’s right. Selling toys was the crutch that kept Barnes and Noble afloat after Amazon and Walmart starting encroaching on its business. But that’s all they are: a crutch. Or, to use an even better metaphor, when Barnes and Noble started selling toys, it put a Band-Aid on a mortal wound. The Band-Aid stopped the bleeding, but, like all bandages, it eventually became infected.

Barnes and Noble will never be the go-to destination for toy buying. Stores like Toys R Us have already cornered that market. And since a good 70% of B&Ns share a parking lot with a Toys R Us (made-up statistic, but it feels true, doesn’t it?) they’re not doing themselves any favors in the long run.

DA: “But what’s the harm in selling toys, if they’re making money at it?”

The harm comes, once again, from the idea of shelf space. For every toy in their bookstore, one or more books is displaced. This upsets their core business model, unless, of course, they want to stop selling books altogether and just become a toy store.

DA: “Fine. Why not do just that?”

Well, let me ask you this: how big is the average Barnes and Noble?

DA: “I dunno. Middling-big, I guess.”

A good answer. Now ask yourself: how big is an average Toys R Us?

DA: “Toys R Us is a kind of warehouse store. So all of them are quite big. Oh, I see what you’re saying.”

Exactly. In fact, the toy and electronics departments at the average Walmart are bigger than an entire Barnes and Noble store. If B&N wanted to convert entirely to a toy store, they would have to forsake every piece of real estate they own to make the change.

DA: “I hadn’t thought of that.”

And that’s why Barnes and Noble can’t compete when it comes to toy sales. Unless they abandon their ambitions in that direction, they are in for a rude awakening.

DA: “Alright, fine. But what’s your third idea?”

I’m so glad you asked.

Step 3: Stop Selling Books

DA: “Well now you’re just being crazy.”

Right, perhaps I should clarify:

Actual Step 3: Stop Telling Us which Books to Buy

DA: “And what, exactly, does that mean?”

I mean that, since its beginning, the sales model for Barnes and Noble revolved around the idea that customers would browse for books.

That’s how it was in the old days. The customer would come into the store, not knowing the exact title they wanted, but having a vague idea of the type of book they were looking for. They might be in the mood for a sweeping romance, or a dark mystery, or maybe a biography they could put on their coffee table but never get around to reading. It didn’t matter. They would just graze through the bookstore until they found something that caught their eye.

That was before the invention of the internet.

People don’t browse for books inside bookstores anymore. People have evolved. These days, they browse for books on social media, or on Amazon, or by reading a book blog. Then, once they know exactly which book they want, they drive down to Barnes and Noble to get it, only to find out that it’s not there.

And even if it is there, it is not easy to find. The customer has to hunt for the book, looking through shelves segregated by genre to find what they’re looking for. And if the desired book straddles multiple genres, as books increasingly do, then it may be shelved in a place the customer wouldn’t think to look.

This is the most important problem that Barnes and Noble, as well as all other bookstores, are facing right now. They are storing their books according to a system designed decades, maybe even centuries, ago. The entire human shopping experience has changed in the last few years, but these stores have not adapted to it.

My proposition is this: Barnes and Noble should optimize all their floorplans for shelf space, and then they should make sure that only books are taking up shelf space.

And then they should get rid of genre-based shelving, and have the entire store alphabetized by book title.

In this scenario, each customer would come into the store, knowing what they want (having previously browsed for books online). As soon as they walked through the door, they could find their book, whose location would be no mystery because the whole store is alphabetized. Within ten minutes, the customer finds all the books they had come for, pays for them, and leaves, relishing the idea of how easy the experience was.

This is a huge change. A lot of people would resist it, but, unlike the current model, it is compatible with the modern needs of book buyers.

If I was the CEO of Barnes and Noble, I would make this the company slogan:

“Shop for it on Amazon, then buy it at Barnes and Noble.”

The idea being that our customers identify which books they want by browsing Amazon and other sites (since browsing on those sites is free), and then, once they are ready to buy, they don’t bother waiting the days and days for an Amazon delivery, instead opting to come to their local Barnes and Noble, which could get them their desired book instantly.

DA: “But you can’t guarantee that the book will be in stock.”

Not with all books, no. But I would institute a policy where all new releases, from all the publishers we have contracts with, would arrive in our stores on their day of release. If people don’t buy them, then we’ll just return/destroy the books.

DA: “You can do that?”

Yes. Bookstores are the one kind of retail store that can return any of their inventory to their suppliers. In many cases, they can even destroy the books that aren’t selling, and the publisher has to pay them for doing so.

DA: “But it would take a great deal of effort to alphabetize an entire store. Think about it: every time a new book arrives, you’ll have to rearrange all the others to open a space for it.”

Not necessarily. After all, not every letter of the alphabet will have the same amount of shelf space. The first letters of book titles follow statistical patterns that are easy to understand. Over the course of a year, we could predict how many more “S” titles than “N” titles we would be getting, for example. With a few good actuaries, we will be able to plan out shelf space in advance. And if we optimize the floorplan for shelf space, then its not unthinkable that we would have a little wiggle room left over, which we could keep within certain tolerances.

DA: “You can’t be sure any of this will work.”

I am almost never sure about anything. But I believe in this idea. And I think others will agree. I hope some of those others will be people who have the power to change things at Barnes and Noble. And if things do change, then I think it could become something amazing once again.

DA: “Dream on.”

And that’s the best advice you’ve ever given. I’m sure my readers will look forward to hearing from you in the future.

Now, if you’ll excuse me, I’d like to start reading this copy of The Devil’s Only Friend, which I only got yesterday.

 

 

[This week’s tagline: “Where people come…looking for answers.”]