Thinking Outside the Covers of a Book: The Rise and the Fall of Amazon vs. Borders in the Online World

In contrast to Borders Group, Barnes & Noble which is a leading bookstore in the US recorded an 11% increase in their share value in the past year with the introduction of their e-book reader “Nook”. It is clear that Barnes & Noble were not “Myopic” in their approach and were able to retain and even grow their customers as well as profits by embracing a new product.

The bookstore chain has been decreasing in profit in the US over the past 20 years. Most of the books retailers are shutting down their operations and only a few are still operating in the country. Barnes and Noble has become the largest bookseller in the book retailers industry. The firm has integrated its business philosophy into web presence though eBook marketplace. This business strategy assisted the firm to be able to reach a large scale customers and remain as a strongest competitor in the book retailing market.

Jeff Bezos, an entrepreneur, created Amazon.com in 1994; the business was originally run out of his garage in Washington. With the additional investments from Nick Hanauer and Tom Alburg, Bezos was able to create the more user-friendly website that we are used to. As Amazon.com’s customer base began to grow Bezos realized that he was going to have to add variety to the products Amazon.com offered. Bezos hit on a successful idea when he added the feature that allowed customers to write their own book reviews. In 1997, Amazon.com went public and it continued to increase its product lines to include CDs, movies, and toys to its inventories. Amazon.com was

Amazon.com has successfully managed to make its customers to feel that anything they could possibly want could be found on their website. Additionally, its products are marketed at a competitive price. Another important factor is their speedy delivery with their usage of UPS and FedEx (United States) and Royal Mail (United Kingdom). The company also caters for people that prefer online shopping with extra services such as Amazon Prime - a service with a yearly payment, customers are eligible for free next day delivery. Even though Amazon.com is known to be an online seller of most things, it still excels in its original market of book selling. Evidence of such is

Globalization is a growing part of everyday businesses. This is the process of interaction and integration among people, companies, and governments of different nations. With the world of online retail, the buying and selling to one person to another has grown drastically. There has also been a substantial change in technology and what we as people can do in today’s time rather than in the past. Amazon is a huge retail giant and buying and selling items is one of their key functions. The impact made on Amazon is nothing but an advantage. Amazon currently is the 56th largest company in America by market capitalization. Being one the largest retailer around, 15th in the nation at that, Amazon has made a name for themselves. Amazon has made some very substantial growths and with these opportunities they face they can make even more advances in the future. (Globalization 101, 2016)

However, Amazon.com made this chain or supply useless. At amazon.com, unlike traditional bookstores, there are no bookshelves to browse. All contact with the costomer is either through its web site or by email. At the firm’s web site, customers can search for a specific book, topic and etc. Customers can browse, fill up a virtual shopping basket, and then complete the sale by

The company I have chosen to investigate for this assignment is Barnes & Noble, Inc. Originally founded in Illinois, USA, in 1873, this business has risen to become a Fortune 500 company. This bookstore chain boasts over 600 physical locations (cite source) in the United States, as well as a strong online presence. The success of its stores, and of its subsequent web and mobile applications, is proof of its dedication to offering a wide range of quality products and providing an excellent customer experience at all times.

In this case, the traditional bookseller’s niche is overlapped the Big box retailers’. Because of the limited resources: only certain amount of people demand for popular books, they have to compete for the market of popular books. However, scale difference generates selection pressures. Obviously traditional booksellers have smaller scale and less purchasing power to compete with “Big box” retailers. When the electronic books came out, traditional booksellers struggle more. Although all booksellers were affected, “Big box”

Barnes and Noble Incorporated is currently the largest book and media-content retailer in the United States. Founded in 1873 in Wheaton, Illinois by Charles Montgomery Barnes, who had started it as a family business, it has since evolved into the biggest book marketplace of our time. Although Barnes and Noble has had a long-run of success, it is currently near the edge of bankruptcy. It’s lack of sales and the shift of interest in reading physical books has forced most book retailers to “close-up shop”, with Barnes and Noble being next on the list. Therefore, Barnes and Noble is not worth investing in, because of its loss

Brenner states in his article, “No Borders”, how “bookstores are victims of changing times, technologies, and economics.” In the literary, economic world, there had been two national bookstores that competed in the nation, Borders and Barnes & Noble. Sadly Borders, Barnes & Noble’s largest competitor, went bankrupt and was forced to close, due to the national recession being at its highest in 2010. Since then it has become more and more difficult for bookstores to even make it since for, “You can surf the web for a book on Amazon and probably get a better deal” (Brenner, 81). Despite this, Barnes & Noble has successfully survived in the dying literature market and has become, “One of the largest booksellers in the US” ("Barnes & Noble, Inc. SWOT Analysis", 3). Booksellers around the world are becoming rarer in our technological advance society, as these shops seem to die out

Barnes and Nobles is one of the biggest bookstores that has a brick-and-mortal store concept. In the past they were know as a “big bully” that drove small book stores to close down because of their aggressive tactics to have competetetive advantage over them. Nonetheless, with the evolving circle of technology they have had a hard time in keeping up with the E-book era. In 2014 E-books increased its reader subscription by 28% compared to 23% in 2013. This number will continue increasing because 50% off American’s have access to devices that are either an e-reader or a tablet. B&N changed its business model to adjust to this new setting before it suffered a

Threat of New Entrants: By the late 1980’s Super Bookstores such as Barnes & Noble caused an industry re-alignment. This new chain of individual and powerful stores, which were supported by big corporations, tapped into large economies of scales; their goal was qualifying for major volume discounts. Between 1900-2003 conglomerates confronted an increased pressure to maintain profitability while cutting costs due to large economies of scales. For instance, within the publishing industry, printing was a commodity driven by large economies of scale.

LaVecchia, O. (2016, November 29). Report: how amazon’s tightening grip on the economy is stifling competition, eroding jobs, and threatening communities. Retrieved September 9, 2017, from https://ilsr.org/amazon-stranglehold/

When Leonard Riggio opened Barnes & Nobles he wanted it to be more of a social gathering verses just a bookstore. It was a BIG HIT, one of a kind. 1995 Amazon.com emerged. In 1997 Mr. Riggio launched the barnesandnoble.com in order to keep up with the customers wants. This is a continual battle Barnes & Nobles is fighting, constantly changing their company to fit the world around it.

The threat of substitutes for Amazon is high. With the exception of its patented technology, there are quite a lot of alternatives to Amazon’s products and services. In addition to physical presence, most companies have an online store as well. Amazon’s products can be purchased all over the internet and they are just spread out among different web sites. The companies operate in brick-and-click mode providing the similar product categories and competitive prices have become the biggest threat for Amazon. However it is extremely difficult for Amazon to establish physical stores or launch price