Barnes & Noble

The last couple of decades are all just saying that traditional paper books will soon die. Experts argue that this market is sharply reduced under the influence of such powerful opponents as cinema and television. And recently electronic books were distributed, texts were published on the Internet. And the general degradation of the education system, together with the decline in the cultural level of the masses, make books unpopular.

What should happen to the book sellers? Contrary to the sad forecasts, the largest seller in America, the company Barnes & Noble, only continues to increase its sales. Behind the scenes, hard work remains to attract customers to their stores, create a special atmosphere there, the appearance of new directions of trade and the introduction of a loyalty program.

Barnes & Noble

And the beginning of the history of the glorious brand was laid back in 1873. Then Charles Montgomery Barnes opened in the town of Wheaton, in the state of Illinois, the sale of second-hand books. In 1917, his son William Barnes had already sold his share in the family business. This money helped him move to New York and buy a stake in the Noble & Noble bookstore. This shop sold educational literature, focusing on wholesale sales to schools, libraries and colleges. The company received a new name – Barnes & Noble, since 1929 in general has passed completely into the ownership of William Barnes.

In 1932, during the Great Depression, the businessman took important steps that ensured the future prosperity of the company. On Fifth Avenue, in the heart of New York City, the company was able to purchase a large space for a bookstore cheaply. The store itself continued to study textbooks, which turned out to be a good decision. After all, universities and schools worked even during the crisis, people studied, therefore, they needed books and books.

The company constantly thought about how to better serve its visitors. So in 1941, the system was introduced to each store visitor a paper strip with a number. On this piece of paper, some sellers fixed the name of the purchased books, others-packed the goods, and still others took money. So, a kind of conveyor belt was created, which allowed to speed up the maintenance.

It is worth noting that it was the Barnes store that became the first in the American bookselling business, who started to serve their customers by phone. These steps allowed the business to develop. In 1944, the company acquired a small Hayden & Eldredge publishing house and began to publish books in general.

But the strong leader proved to be the weakness of the company – after all, everything was on it. When President Barnes & Noble died in 1969, John Barnes, the founder’s son, suddenly found that there was simply no one to control the company. The heirs decided that they did not want to do this business and the company passed into the hands of the Amtel concern, for which books were only one of the directions and far from the most important.

Revenues began to fall gradually, which is why in 1971 the owners took literally the very first offer to sell such a non-core asset. The new owner of Barnes & Noble was businessman Leonard Reggio, who laid out for her a small sum of 750 thousand dollars.

The bookshop again had a good owner. Reggio worked in the book business for more than 10 years, at first as a seller in a university store, and then as an independent trader. He even owned a small network of shops located in educational institutions. Becoming the owner of the company Barnes & Noble the new owner immediately began to reorganize the business. The assortment of the New York store was dramatically expanded due to a variety of reference books, dictionaries, books on household management.

In the 1970s and 1980s the company was booming. Reggio was not afraid to experiment. He created new forms of sales of his products, invented new ways of development for business. For example, in 1974, the bookstore was the first in the country to start advertising on television.And in 1975 the company announced a 40% discount on all bestsellers from the list of The New York Times. This allowed to attract a lot of customers to the store.

Reggio even opened a special store-warehouse, where you could buy books at a big discount. There sometimes it was even possible to find bestsellers and novelties at a price of 10-40% of the nominal. To make it convenient for customers to navigate in a large room, it was divided into thematic sections. Wide passages made it possible to use carts, similar to those used in supermarkets. This form of trade has become very popular. In addition, in the assortment of the store, then appeared also fiction, gift books, books on art.

Barnes & Noble

The company also expanded due to numerous acquisitions, acquiring small book chains in different cities of the country. First they were just sales outlets located on campuses. Now this direction exists separately under the name of Barnes & Noble College Booksellers with 600 shops in the US and Canada. Then the company began to buy and traditional stores, making of them discounters in their own likeness. In 1985, Barnes & Noble spent $ 300 million on the acquisition of the second largest book chain in America B.Dalton Bookseller. She owned 800 stores in major stores and department stores.

Now it’s time for experiments already with the format of outlets. Small shops from Barnes & Noble began to gradually disappear, and instead appeared progressive, as it seemed, bookstores. These establishments were very different from the usual stores, and from the discount warehouse, which brought the company’s success in the 70’s. The stores from Barnes & Noble were so huge that they could number up to 150,000 book titles. Often the goods were offered at a discount, which sometimes reached 40%.

But the most important thing in such stores was that visitors were really comfortable in them, long-term pastime was stimulated. For children there were created special play areas, adults could have a snack and drink a cup of coffee in a cafe. Visitors were invited to relax in small and cozy reading rooms, in the aisles were placed armchairs and soft benches. Periodically, store managers arranged meetings with the authors, poetic evenings, puppet shows, in every possible way attracting visitors.

In 1993, the company issued its shares to the stock exchange, which gave it the means for further development. Leonardo Rigio himself had 33% of shares, the same number was with the Dutch Vendex investors, who in 1971 participated in the acquisition of the book brand. The active expansion of Barnes & Noble led to the redesign of the entire American book market. Most of the giant suffered small shops, whose owners were independent entrepreneurs. The share of their sales in the market has sharply decreased. Other booksellers began to open such supermarkets themselves, but they began to do it only in the 1990s, hopelessly behind.

And the problems did not come from old and familiar competitors. In 1995, the company was born Amazon, which began to offer the sale of the same books via the Internet. In 1997, its sales amounted to $ 150 million, all started talking about the fact that traditional book sales will soon die under the pressure of online sales. But Barnes & Noble reacted quite promptly. So in early 1997, a trade agreement was concluded with America Online, which gave the seller of books the exclusive right to implement them among the 8 million users of the service.

And in March of that year appeared the site True, this resource did not develop for a long time, which was the reason for reasonable criticism. Observers noted that the company frankly fears that Internet sales could bring down its core business. As a result, the site was not advertised, resources were not invested in it.But in those years there was an Internet boom! As a result, by mid-1999, the market capitalization of Barnes & Noble was three times lower than Amazon, although the company owned 15% of the total US book market. Investors were also interested in other figures: on the Internet 75% of all books were sold by Amazon.

At this point, Reggio became nervous – in the bookstores of the company began to sell video, gifts, games, music. So the company tried to catch up with Amazon. In 1999-2000, more than $ 400 million was invested to purchase stores selling video games. The management wanted to attract adolescents to their institutions. The company has become even bigger, closing small, albeit profitable, points from B.Dalton. And in 2001, the virtual economy collapsed, burying the skeptics’ predictions about the imminent transition of everything and everything to online.

In 2002, the new general director was the younger brother of Leonardo Riggio, Stefan. This castling only strengthened the team of managers, because the new head of the company was much softer and more diplomatic than his predecessor. And in the first half of the 2000s, Wal-Mart hypermarkets, Costco and others began to penetrate the American book market. It was already more dangerous than the virtual Amazon. Supermarkets offered bestsellers with discounts, which was unpleasant. The company Barnes & Noble has chosen several ways to fight. She made her stores even more comfortable, they came to Starbuck coffee houses.

In order not to yield to the price struggle, the company reworked the loyalty program. And the site began to play a much more prominent role in business. Although it does not give more than 10% of sales, but it perfectly performs the role of online catalog. The company reduces costs, paying attention to large stores. And its own publishing activity does not stop, let it and brings only 5% of income. Barnes & Noble is trying to increase its own competitiveness, turning shops into cultural centers. All this does not have competitors, although the books there are slightly cheaper.

Barnes & Noble

Recently, the company has joined the race to create electronic books. Its devices are distinguished by low price and high quality. It was assumed that users using such electronic readers will buy books from the company’s online store.

And again they started talking about the decline of traditional books. But the head of the company does not see an occasion for panic, the more steadily the sales of illustrated children’s books grow steadily. Today the turnover of the company exceeds 5 billion dollars, and more than 40 thousand people work for it.

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