Posted by
Ed Lilly on Thursday, February 14, 2008 3:47:50 PM
It's Thursday, so that can only mean one thing. Yep, I read the USA Today this morning over a cup of coffee at Panera. The feature story in the business section is on the new business strategy being implemented by Borders bookstores' new management team. Here's the gist of it:
... Borders' newest retail strategy: a digital center where you can download music or books, burn CDs, research family histories, print pictures and order leather-bound books crammed with family photos — with help from clerks who know how to do those sorts of things and won't embarrass you if you don't.
Borders, the nation's second-largest bookstore chain, hopes to reverse years of sluggish sales by reinventing itself as a hub for knowledge, entertainment and digital downloading. Exhibit A is the new store that will open to the public here Thursday — the first of 14 that Borders plans to unveil this year. Borders' plans underscore the anxiety in the bookstore industry, which has been hurt by the growing footprint of online-only sellers.
Can it work? CEO George Jones thinks so.
"We had to build something that would cause the consumer to drive five or 10 minutes past the competitor's store to come here," says Jones, who joined the company 1½ years ago from Saks.
My initial reaction thought is to wonder why they think people will go another 5 to 10 minutes past a competitor's store to do something that they can do online at Amazon.com. Or Barnes and Noble's web site. But, as I am not wise enough to understand why Volkswagen's re-badging of a Chrysler minivan with a VW nameplate is somehow a bold move into the mid-life family market, I am probably also too limited in my knowledge to see the wisdom of this move from Borders.
Reading on:
At the Borders concept store, new themed book islands are built around lifestyle genres, including travel, cooking and health. The digital centers, meantime, are geared to welcome people of all levels of tech know-how. Staffers will guide customers through the process of burning music to CDs, downloading songs to most digital music players (except iPods, which, for now, work only with Apple software) or books to a Sony digital reader. They'll even print the cover art and fold it into a CD cover for you.
Burning music to CDs? Do they actually have marketing research that indicates people have a desire to go to the store and create their own CDs the way you can go to a paint-your-own furniture or pottery store? I have to assume they do, but I find it hard to believe. Maybe it's been sitting on someone's desk since 1992 and they somehow fudged the dates and sold it to Borders as a fresh new concept. I hope for the sake of all the Borders employees that they are right on this, but so far it sounds kind of lame.
Granted, the idea of downloading to a digital music player makes sense at the outset, but the fact that they can't do anything with an iPod, which has, what, 90% of the digital music player market makes you wonder what they're doing. Are they pinning their hopes on Microsoft's Zune to somehow take off? Are there enough people with cell phones that also act as digital music players who will actually seek out this service at Borders? Maybe. My hope is that Borders is working feverishly with Apple to somehow get them on board with this. If not, my guess is it's DOA.
Continuing on:
By the end of April, Borders plans to launch its own website and take back control of Borders.com from Amazon, which has been operating the Borders site for nearly seven years. Under the arrangement, orders on Borders' website are filled by Amazon with Amazon's inventory and staff. Amazon gets credit for the sales, though Borders gets a percentage it won't disclose.
Once this change is completed, the interactive kiosks in Borders' stores will allow customers to do more online shopping in a store and even buy books, if they prefer.
Yes, you've read that correctly. It's 2008 and Borders does not have it's own website. I'm glad to see they are trying to get this business back in-house from Amazon, but how much confidence in Borders are the young, tech savvy customers that seem to be important for this strategy to succeed going to have in a business that is trying to not only incorporate all these digital and on-line features in their store AS WELL AS run their own website for the first time ever? Sounds like a pretty big bite for Borders to be able to chew and swallow all at once. Maybe they have the tech people and training to pull it all off. After all, it's only a handful of stores at the outset. But to get the entire chain working on this kind of platform? Sounds like a lot of training and equipment, meaning a lot of money and time, which would make me very nervous if I were a Borders executive.