Barnes & Noble SWOT

B&N leader in sales and market share for offline book sales, but lags far behind Amazon.com in online book sales.

Industry trends show declining book sales in offline outlets with increasing book sales for online outlets.

Strong video game sales and an upswing in book sales due to September 11, 2001, gave B&N a quarterly profit for the first time in eight quarters.

Barnesandnoble.com continues to be an unprofitable enterprise, losing more than $43 million annually.

539 Superstores; 339 Mall stores; 978 Game & Software stores

#1 U.S. and World Bookseller; #1 U.S. video game retailer; 1995 Sales: $1,622.7 million

Growth of online book sales, 5.4% annually

Barnes & Noble, Inc. is the world’s largest bookseller. With nearly 1,000 book stores and 1,000 video and entertainment stores, the company maintains a presence in all 50 states and the District of Colombia:

Barnes & Noble’s Chairman Leonard Riggio owns approximately 23% of the company, whose 1995 sales were $1,622.7 million (Hoover’s 5). Barnes & Noble also owns mall-based stores B. Dalton, Doubleday, and Scribner’s. The company went online in 1997 with a 3

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00, while Amazon gained more than five points to capture 62.1% of the market (Brady 63). Barnes & Noble started later than Amazon.com with its online offering, and when it did so with little to differentiate its products from theirs it was forced to discount its books by 30% from its store prices (Brady 63). Further, the company failed to leverage its greatest asset by tying the Web site to its store sites. As one analyst notes, “The chain should have plastered stores with ads and helped its shoppers go online. Instead, it squandered its top asset, leaving it unable to leverage the name and get synergies” (Brady 63). Another weakness of the company is failing to ensure that its online commerce sites are designed with integrity and ethics. A major lawsuit was brought against the company by Amazon.com. Amazon.com representatives alleged barnesandnoble.com web site designers infringed on Amazon.com’s patent for its “1-Click” system where customers can virtually buy a product with one click of a mouse. The suit charged that barnesandnoble.com’s Web site used a technology that was too similar to Amazon.com’s. Recently, after years of legal expenses and appeals, Barnes & Noble, Inc. settled the suit, “The Seattle-based Internet
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Approximate Word count = 2852
Approximate Pages = 11 (250 words per page)

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