SWOT Analysis
Strengths:
Largest chain of bookstores in U.S. Strong web presence through e-commerce site barnesandnoble.com Complimentary distribution channels to reach maximum number of customers NOOK brand well-received; complimented by in-store offerings and services Newest NOOK HD products will compete directly with other tablets on the market at an attractive price Sale of NOOK products through other retailers Attracting investment from industry heavy-weights |
Weaknesses:
Significant and continued investment in digital business drains cash Most rivals have deeper pockets and fewer modes of competition Significant costs associated with maintaining physical store locations Potentially lower profit margins realized on the sale of digital content vs. traditional print and A/V materials Pressures to return to profitability may affect future business decision regrading continued expansion and lines of business |
Opportunities:
Nook HD and HD+ launches in November Partnership with Microsoft Potential spin-off of NOOK Media LLC Possibility of increased international presence through NOOK Media LLC Increasing demand for offerings of digital content Dwindling number of chains and independent booksellers Promotion of retail locations as community gathering spaces Growth opportunities in B&N College as colleges and universities continue to outsource their bookstore operations |
Threats:
Cannot operate indefinitely at a loss Continued rise in purchases of e-content may threaten long-term viability of traditional retail stores Rapidly changing digital content technology Heavy price discounting by competitors Increasing number of providers of e-content Increasing number of e-readers and tablets Increased offerings of e-materials by libraries Suspension of dividend payments may discourage investment in common shares Partnership with Microsoft and Preferred Stock arrangement with Liberty Media may lessen company's direct control over its operations |