Nook Kaput? Maybe…

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http://www.nytimes.com/2013/02/25/business/media/barnes-noble-weighs-its-nook-losses.html?ref=technology&_r=0
In her article, Barnes & Noble Weighs Its E-Reader Investment, Leslie Kaufman has succinctly portrayed a company that has a product that will sell, but due to name and brand recognition, cannot connect with the market to make the product profitable. What is a possible strategy that could turn this ship around?

Strength to Offset the Weakness

The Nook HD was picked as a certain challenger and eventual winner in the clash with the Kindle Fire when it was first released in 2012.

“Going into the 2012 Christmas season, the Nook HD, Barnes & Noble’s entrant into the 7-inch and 9-inch tablet market, was winning rave reviews from technology critics who praised its high-quality screen. Editors at CNET called it “a fantastic tablet value” and David Pogue in The New York Times told readers choosing between the Nook HD and Kindle Fire that the Nook “is the one to get.”

Sales did not meet expectations even with infusions of cash from Microsoft and Pearson. To offset this disparity, Barnes & Noble needed to take their strength, which is their collection, and reduce the prices on those backlist titles that people want to purchase. Frontlist titles would stay at the same cost structure agreed upon with the individual publishers. Also, instead of going head to head with both Amazon and Apple, B & N should have reached out to Apple to wage a consistent fight against Amazon. The way to get at your opponent is always to do the unexpected. In this case, the enemy of my enemy can be my ally and friend. The deal could have been made to make B & N titles available at a highly reduced fee for the Ipad. Thinking logically, the Ipad is not necessarily used as a reading device, so aligning with Apple would have had strong repercussions with publishers.

Could Publishers Be Allies?

The second phase in this two-pronged corporate offensive would be to work with Publishers to get a much more favorable deal in place to distribute their e-books via the Nook. All of the Publishers are looking at Amazon as the 800 pound gorilla in the room, while Apple is so diverse that the Ipad and all the other devices they are selling more than makes up for any market share hit they are taking from going head-to-head with Amazon. B & N needs to start focusing on the old Hertz strategy from the 1970s, “Number 2 Tries Harder”… in this case they would be number 3 though. Everything depends on how much B & N can leverage the influence it still retains with the mass of publishers selling e-books. Some advertising that portrays Amazon as the “Death Star” from Star Wars and Barnes & Noble as the colonial rebels may make some inroads into the Amazon behemoth.

In Conclusion

I do not think Barnes and Noble is out of the running yet, but they are down by a run in the ninth and number 42, Mariano Rivera is coming into the game to seal the deal. If Barnes and Noble can engineer a Luis Gonzalez/Sandy Alomar hit to offset the set of circumstances they are presented, there might yet be a happy resolution and new life imbued to the Nook HD in the ongoing e-book wars. What’s that I hear: “Enter Sandman”? Tick, Tick, Tick…

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1 Comment

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One response to “Nook Kaput? Maybe…

  1. Ken Crismon

    I am not certain Nook or Kindle have a lasting future when you compete with an Open, unlocked Android tablet like the Nexxus 7 or 10 or the iPad. Both of which support NOOK and Kindle software. I own an iPad and read my eBooks from all major vendors; B&N, Amazon, Apple and Google(Through my phone only).

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