Barnes & Noble Analysis

Industry & Competitors – The online bookselling industry is an industry made up of booksellers like Amazon.com who offer no other outlet for book purchasing and those like BarnesandNoble.com who offer electronic and traditional retail book sales. Trends in the industry bode well for future growth and success, such as the fact that books ranked as the number one purchase via the Web last year, ahead of computer hardware, software and compact discs (Online, 1999, 1). Further, consumers continue to be attracted to purchasing via the Web “38% of the adult U.S. population was online as of March 1999, with 18.8 million more planning to get on the Internet by 2000. Of those surveyed, 60% said they shopped online” (Online, 1999, 1). The key industry players in online bookselling are BarnesandNoble.com, Amazon.com, Borders.com, and BestDEAL.com. A former industry key player, Fatbrain.com, was recently purchased by BarnesandNoble.com.

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“culture” and “refined” nature of Barnes and Noble’s book buyers. Methods of Competition – Barnes and Noble (B&N) competes in the online bookselling industry through its own web site: BarnesandNoble.com. In 1998, B&N raised $100 million through an initial public offering in order to “enhance its online bookstore, acquire additional business, technologies and services” (BarnesandNoble.com, 1998, 1). Positioning – B&N has positioned itself on the Web in a comparable way to its leading competitor, Amazon.com. However, Amazon.com relies on enormous advertising expenditures to promote its brand, while B&N relies on customer loyalty and a strong brand name among consumers that has been built on more than just advertising and its web presence. In fact, Amazon.com despite being the number on E-tailer in annual sales, has not produced a single penny of profit for anxious investors in the opinion of some experts because of its enormous advertising expenditures “Amazon.com is currently spending 174 percent of its entire revenue on marketing…74 percent more than the total amount of money it takes in on marketing” (Robinson, 2000, 1). Competitive Strategy – The competitive strategy of B&N includes forming strategic alliances with a numb
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