B&N results are disappointing, and one wonders if prior success with NOOK might deserve part of the blame
Barnes & Noble announced some holiday sales results this morning and they were universally disappointing.
Overall sales are down. Same-store and online sales (the year-to-year comparables) are down 8.2%, while total sales are down 10.9% (because they have closed more stores than they’ve opened.)
NOOK sales were down 12.6% for the holiday period. Digital content sales were up 13.1%, but that’s alarming too. The company has sold a lot of devices since last Christmas (I don’t know, but one would expect the number of NOOK devices in the market has gone up by more than 13.1% in the past year) and last year they reported (according to Publishers Lunch) that NOOK business rose 43% during the holidays.
But what was most attention-grabbing (to me) was that the core sales decline was attributed to “lower bookstore traffic”.
Since the results were announced this morning, I had a conversation with a journalist who pointed out that the indies (anecdotally) seem to be reporting a very good Christmas. Why would the indies be up and B&N be down, this person wondered?
Thinking about that yields one piece of anecdata, one bit of conjecture (offered in yesterday’s forecast post), and one newly recalled (and somewhat frightening) insight.
The anecdata is that a Big Six CEO told me a couple of months ago that a very major book being published by that house (certainly one of the ten most anticipated releases of 2012) was not primarily promoted at B&N because they couldn’t get the bandwidth and cooperation on the B&N side to put something together. So the book was instead primarily launched through Walmart.
The conjecture in the last post was that the independents were more focused on selling printed books than B&N was. Indies are selling Kobo readers, but I’ll bet not one of them is devoting the prime sales space and portion of the paid staff to them that B&N does to the NOOKs. They’re focused on selling books, not devices, so they’re merchandising them better.
And the insight is that B&N has converted much of its store traffic to an online customer base because of their success at selling NOOKs. Those people may not be coming back, except virtually. These results may be the evidence of that.
B&N demonstrated with last week’s sale of NOOK equity to Pearson that what they have is of value to other companies. But that’s not particularly encouraging to the publishers and authors who are counting on them to sustain a bookselling presence.
B&N has a tough row to hoe building an international NOOK business without the store base they used to do it here. If the core US business declines faster than expected, that’s no help.
We always knew that the “old” Barnes & Noble was a fantastic US-based brick-and-mortar bookseller and that the “new” Barnes & Noble would be a global company based on devices and content. It always seemed tricky to get from one to the other and the challenge doesn’t appear to be getting any easier.