____________________________________Barnes

& Noble Booksellers___________________________________

Situational Analysis
Strengths:
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Nations largest retail bookseller

Leading retailer of content, digital media, and educational products
Website offers the largest in-stock selection of in-print book titles
736 college bookstores
Comprehensive childrens sections

Weaknesses:
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Introduced Nooks too late in the e-book market (2 years after Amazon Kindles)
Low demand for Nooks and online books, with a 16% falloff in sales reported by its Nook segment
Cash flow provided by operating activities is $264.1 million less than it was last year (dropped
from $320 million in 2014 to $55.9 million in 2015)
Net loss of $34.9 million (68 cents a share) for its first fiscal quarter of 2016
Closed 13 retail stores last year

Opportunities:
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Sales in the college book division have risen 5.7%

It has 714 college stores and is estimated at $774
million.
There is untapped potential for growth since 53%
of college campuses still own their own
bookstores.
Barnes & Noble has formed a partnership with Samsung
to manufacture next generation of Nook devices
This lessens individual risk.
Growth of digital reading leveled off in 2013 and tablet
sales overall have fallen over the last year
Paperbacks remain the most popular medium for
books.
Core retail business sales have increased by 1.7%
Boom in the adult coloring book market and B&N offers a wide selection

Threats:
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Barnes & Nobles plan to manufacture a new line of Nooks with Samsung may fail:
As of February, Samsung held a 14.5% share among tablet manufactures, while Apple
held a 28.1% share.
Partnering with Samsung to produce tablets will most likely have negligible effects in the
tablet market share overall, since Apple will still sell more iPads.
Both Samsung and Apple (and other tablet
manufacturers) have sustained heavy
losses over the last several quarters.

Competition:
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Amazon poses as Barnes & Nobles biggest threat.

Its Kindle and Kindle Fire products have always
outperformed the Nook, and Amazon has well over
half of the e-book market. Amazon held a 41%
share in all book category purchases (including
print) as of 2014.
Apple is Barnes & Nobles second steepest

competition, as the leading tablet manufacturer. It also dominates the music market, which is a
threat to B&Ns music store.
When it comes to brick-and-mortar bookstores, B&N has virtually no competition. After Borders
Group closed its doors in 2011, Barnes & Noble inherited a significant portion of its consumers. It
maintains top-of-mind awareness in the bookstore category.

Creative History:
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Barnes & Nobles roots began in New York by a NYU student who worked at the university
bookstore.
It was the first bookseller in American history to advertise on TV. The commercial was memorable
and largely successful, winning several awards.
It was the first bookseller to publish its own titles (B&N purchased Sterling Publishing in 2003),
offer discounts on bestsellers, and construct superstores complete with in-house coffee shops.
They released a 2014 holiday commercial that stressed that an old-fashioned print book is a gift
like no other. This ad also featured the newest Nook product, which created mixed messages.
Critics have scorned B&N for suffering from brand amnesia. The company is unable to make up
its mind regarding its Nook segment, and it has expanded far beyond that of a traditional
bookseller, selling toys and board games.

Target Audience:
B&N has defined their target audience as a 40 year old female with an income of upwards of $60
thousand a year. She is college educated with mostly dependent children (at least 53% of children live in
household). She enjoys shopping, technology, traveling, and reading. She is a loyal B&N member.
It is unclear as to the target audience B&N is advertising its Nook Tablet to. Prior CEO William Lynch
stated the target is a woman with 2.3 kids. This sends more mixed messages by suggesting the target
consumer is a technophobe, but that it is easy enough for a grandmother to use. The company also boast
that they provide in-store tech support for Nook
readers who are less tech-savvy.
This graph generated by IBISWorld Report shows that
the older generations are the primary book buyers.
B&Ns target audience of 40-year-olds limits the
segment to 12.8% of the population of book buyers.
While it makes sense to target younger generations,
especially when pushing tech products, B&N may be
alienating a very lucrative demographic.

Geography:
B&N operates approximately 647 retail stores in all 50 states. They advertise on nationally. Digital Book
World estimated Barnes & Noble had 40 million customers in 2012.

Timing:
B&N uses a flighting strategy for TV commercials. They have aired holiday commercials over the last
several years, with particular emphasis on Christmas.
They rely on social media all year long and actively advertise in-stores and on their website.

Media Mix:
B&N advertises on national and spot television. The holiday ad, A Book is a Gift Like No Other last aired
in December 2014 on WE TV during CSI: Miami. Holiday Gift Ideas aired on HGTV during Hawaii Life in
2013. Their commercials have aired on ABC, FOX, CNN, NBC, and Reelz Channel during shows like
Wheel of Fortune and Access Hollywood Live.

The company has a strong presence on Twitter and Facebook. Their Facebook page has over 1.7 million
likes. They have a membership program, free e-book giveaways to promote the Nook, and offer many
promotions and coupons via social media. They have engaged in cross-promotions with Master Card. B&N
holds Nook reading challenges and social media contests such as the My Favorite Teacher contest,
where students can write a poem about their teacher for a chance to win money for their school. The
social media pages include inspirational quotes that gain retweets and shares.
B&N relies heavily on in-store displays that promote new titles, bestsellers, toys, games, and their line of
Nook products. They use signage to advertise sales. B&N also hosts events, readings, and author meetand-greets around the country. These events generate visits and create lasting memories.
*Barnes & Nobels Annual Report of 2015 cites advertising expenditures at $58,823, $61,527 and $110,878
during fiscal 2015, fiscal 2014 and fiscal 2013, respectively. They have cut back on advertising significantly,
and this may have contributed to their loss of revenue.

Media Objectives

Reach 10% of bibliophiles in the nation aged 45-64 who watch television with our message at
least once by the end of the fiscal year.
o Rationale: Barnes & Nobles current target audience is in conflict with the current
market. Older generations purchase more books than younger ones.
Increase Facebook likes by 3% and Twitter followers by 6% by the end of the fiscal year.
o Rationale: It is important to build a positive brand persona and remind consumers of
what Barnes & Noble offers that Amazon and Apple do not.
Decrease the advertising spending in the Nook segment by 75% by the end of three months.
o Rationale: Nook is bringing B&N down, and we should cut spending in that product to
redistribute those funds into areas that inspire potential growth.
Increase the advertising budget by 20% and establish a PR budget by the end of three months.
o Rationale: B&N has cut back significantly over the last few years with little success. To
make an impact and drive purchase decisions, B&N must maintain a strong presence
within the media.
Generate $90 million in sales by the end of the next fiscal year.
o Rationale: Cash flow has been low since the Nook line took a nosedive. B&N has to push
in-store purchases, which have slightly increased since 2014.

Strategies
Refocus the target audience to bibliophiles aged 45-64, with secondary target audiences being mothers
with a median age of 40 and college students attending schools with Barnes and Noble college stores.
B&N should readjust the brand focus from the Nook to their in-store and online services and focus on
people who may not be technophiles, but are still in love with old-fashioned print books. Moms and
college students should be secondary, because moms are the largest consumers in America and there is
massive potential within the college textbook market.

TV:
B&N should continue to advertise on television during holidays, especially considering half of broadcast
TV viewers are 54 and older. B&N should cut spot advertising and focus on national TV exclusively. They
should advertise holiday ads on ABC, NBC, FOX, and CNN during shows like Wheel of Fortune, Jeopardy,
and news programs. These programs are generally on during early fringe and prime time. By maintaining
the flighting strategy, B&N can drive purchase decisions during the key winter months, while saving
money during the rest of the year.
B&N should also choose to advertise during TV shows that are based on books; Steven Kings Mr
Mercedes, Lemony Snickets A Series of Unfortunate Events, Neil Gaimens American Gods, and Gary
Shteyngarts Super Sad True Love Story are all contemporary novels being made into TV series, though
their schedules and networks have yet to be announced. The creative team should develop a series of TV
commercials that emphasize the sheer joy of print books and the experience of visiting Barnes & Noble
storescreative should steer away from the Nook line entirely. The commercials should also include the
novels that the TV shows are based on in order to pique interest in the audience.

Social Media:
Launch social media campaigns on Twitter and Facebook that tie in TV shows and the books they are
based on. Start debate forums that discuss similarities and differences to offer incentive for the audience
to read the books and watch the shows at the same time. All campaigns should focus on print books
instead of Nooks. The creative team should implement witty campaigns that will inspire retweets and
shares and ultimately attract more followers. B&N should continue to offer sales and promotions via
social media that draw people in stores.
-There should be a special sales promotion for college bookstores. By offering sales like 50% off,
or Buy One, Get One Half Off will draw college students to B&N college stores to purchase books
stealing potential business away from Amazon and other textbook rental sites.

In-Store Displays:
B&N should sponsor a traveling rare/historical book museum that visits various B&N retail stores across
the country. B&N would need to partner with museums to acquire rare books like first editions of a
Gutenberg Bible or first edition King James Bible, Shakespeare plays, Darwins Origins of the Species,
Cervantess Don Quixote, along with historical documents, like letters from Columbus. This would be
quite expensive, but it would increase visits to stores and promote themes of honoring the print medium.
Taglines could include There is nothing like ink on paper. The tour would begin in Cambridge,
Massachusetts (the most well-read city in the country) and travel to a Barnes & Noble in Manhattan,
Pittsburg, Washington, D.C., Minneapolis, Chicago, St. Louis, Seattle, Portland, and Los Angeles. It
should be a summer campaign that begins in May and ends in August. This tour will heighten brand
appreciation throughout the country.
-Social media and PR would play a major role in documenting this traveling book show. Social
media would advertise when and where the museums would be coming to certain cities, and PR would
work on attaining the rare books prior to the show along with generating earned media through the
various news outlets.
Beyond that, B&N would continue to have in-store displays that advertise best-sellers, new releases, sales
promotions, and seasonal decorations. B&N should advertise as a physical space people can visit and
enjoy. With thousands of titles to peruse, frequent events and readings, and comfortable cafs and
reading areas, B&N is the kind of store people can spend hours in.

Key Takeaways:
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Tailor target audiences to more appropriate markets.

Get people into the stores.
Limit advertising of Nook products.

Proposed Allocation of
Budget
Traveling Museum
Campaign
Social Media
Public Relations
Television