Barnes & Nobel SWOT Analysis
Barnes & Nobel, enlisted in NYSE as BKS, is a well established bookseller that provides access to books, music (CD/DVD), toys, newspapers etc. It operates in two segments, retailing and college (stores). The main business is trading books (hardcover and paperback). It also has a large number of customers on its internet website that target mostly the younger generation.
• It has a strong presence regarding its products.
• Included in Fortune 500 list of companies.
• Product line includes: books, music, movies etc.
• Globally recognized as the largest book retailer.
• Strives for integrating such an environment that creates a connection with its customers.
• It has also established itself as an e-retailer (9% of its sales takes place through internet, 89% sales on stores)
• It is the market leader in book retailing with over 1,357 stores worldwide, with approximately 637 stores on college campuses. (May1, 2010)
• It has strong brand equity, and partnering with Starbucks who have cafes in these stores attracts a lot of customers.
• Uses multiple channels for product distribution, online as well as stores that cover a large network.
• Asset Leverage is yet another advantage that Barnes and Nobel incur.
• Effective communication through their stores by placing different kiosks and boards.
• Research and development is very high regarding the company.
• Innovation regarding new technology.
• Customer loyalty that is integrated with the brand itself.
• It is gradually growing online due to the way the new generation is changing.
• Management team has a strong sense of direction and customer feedback.
• Financial position is very strong.
• Also offers e-books.
• Large inventory and distribution center that support current operation.
• Nook, a new electronic product introduced by the company that stores more than a million books, with amazing features like Wi-Fi. Even Newspapers can be read read from this product with its high resolution display.
• Majority of the stores are established in the US, which shows a strong dependence on the US market.
• Recently the company is lacking in performance.
• Depends on a few particular suppliers.
• They should penetrate on a combination of making such an environment in stores that focus on selling books, music, movies, coffee and also they should indulge more in publishing books.
• Electronic commerce is growing and B&N should make use of the internet to cover more domains that would diversify the risk factor attached to the US market.
• Consumer spending is potentially increasing.
• It can start acquisitions in new markets if not established (financially strong).
• Takeovers and joint ventures of smaller yet significant companies that have good brand equity.
• Public libraries and companies such as Amazon.com are real threats to the company.
• Competition in both retailing book stores as well as online is getting tougher.
• Piracy and illegal downloading and copy of hard books in different markets is defecting the share of the company largely.
• Product substitution (books are being substituted for ebooks).
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