Personal Finance News from Yahoo! Finance"How did Barnes & Noble (NYSE: BKS - News) fall so far so fast?
The giant bookstore chain, whose superstores once struck fear into the hearts of independent booksellers everywhere, put itself up for sale this month, rendering it the corporate equivalent of the remaindered books it sells at a discount.
The company said it made the move because its shares are undervalued, but to me there was an air of desperation about it.
The simple explanation for Barnes & Noble's decline is the Internet, which spawned Amazon.com (Nasdaq: AMZN - News), e-readers and digital books. But that didn't have to be the end for B&N, which had a dominant market position and should have out-Amazoned Amazon, leveraging its brand and innovating when it began marketing and selling books online.
I know exactly when B&N lost me as a customer. Some years ago, to compete with Amazon, B&N began offering free same-day delivery in Manhattan if you placed your order over the Internet by 11 a.m. I did so several times -- and not once did the books arrive when promised. Everything I have ordered from Amazon has arrived on time or earlier. Then came Amazon's game-changing Kindle, and instant delivery. Nothing I've read about B&N's belated rival Nook has tempted me to try it.
My hunch is that B&N never really embraced the Internet or e-books, tied as it was to the old-fashioned world of physical books and stores. As B&N focused on managing decline, a much more nimble Amazon could concentrate exclusively on the new world it was forming. B&N needed to destroy its business model to prevail. Now it is probably too late. There is a lesson for all businesses here.
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