James Tenser

Barnes & Noble Considering Options for Nook

January 11, 2012

FROM RETAILWIRE:
Barnes & Noble said last Thursday that it was weighing spinning off its Nook business. The move would enable B&N to focus more closely on its aging bookstore business and e-commerce operations while capitalizing on the value created in its successful e-book venture. Do you think Barnes & Noble should spin off its Nook business?      [more...]

De-coupling Nook could be a pretty smart move for Barnes & Noble, from both a strategic and financial perspective. I believe it would free Nook to find its own market value, while the core B&N business would retain ties to Nook as a semi-captive distribution channel for virtual merchandise.

Critics should consider that this option goes way beyond optimizing the B&N book business. Nook is a broad-based content platform that also delivers periodicals, music and video -- so far. It is already deep in the tablet fray, and its market share suggests that not everybody loves iPad or Kindle so much.

Meanwhile, large-format bookstores continue to work on refining their role as a "third place" where customers can enjoy sipping coffee, hanging out, browsing the merchandise, etc. There's an undeniable role there for in-store "Nook nooks" -- and these might also perform superbly in thousands of Walmarts, Starbucks, transit hubs and shopping malls.

Barnes & Noble is the sole survivor among the large bookstore chains for good reason -- it has been the most nimble and flexible of its competitors. The proposed Nook spin-off suggests to me that it has once again asked itself that crucial question, "What business are we in?"