Monday, October 4, 2010

After Proxy Win, More Challenges for B&N

The company remains for sale. That being said, Chairman Len Riggio has made some comments to PW concerning the company's brick-and-mortar future, which involves [read between the lines below] abandoning paper-books. Italics are mine.
Although he acknowledged that bookselling faces lots of challenges in the digital age, [Riggio] maintained that there is opportunity for "explosive growth. In all the years I've been involved in bookselling, I've never been more excited about the industry." The key, Riggio said, is to have the ability to sell the customers what they want. "You can't tell the customers how to take their information," he said. For B&N, this has resulted in faster than expected sales of e-books. In the year to date, Riggio said, total spending per customer on all formats has increased 20% over 2009, with the number of units jumping 60% as more buying moves to lower-priced e-books. The number of print books sold in the same period has declined 20%. Riggio said he expects print books to sell better over the holiday period as consumers buy more illustrated books as well as titles "they want to put on their shelves."

Despite the possible bump in print sales over the holidays, it is clear fewer print books will be sold in bookstores in the future, forcing booksellers to find ways to make up for lost sales as well as to bring in customers, Riggio said. B&N stores "will remain chock-full of books," he said, and will continue to have the appearance of a grand library. But the company has already added more nonbook items, such as education games and toys, and the retailer will continue to test new initiatives over the holidays. And while the merchandise mix of the stores will change, Riggio said he doesn't expect the number of stores to change. "We tend to close a few stores every year at the end of their lease, and we move some stores to better locations. But over the next two to three years, I don't see the composition of our stores changing much at all," Riggio said.