Investors don’t want to hear that a retailer’s sales are down, so when Barnes & Noble had to explain to its backers and to industry analysts why comparable stores sales figures were down 8.3% over last year, the bookseller had some scapegoats to blame: coloring books and Adele.
As amusing as it might be to imagine a huge retailer blaming its problems on one twentysomething singer, the company does get down to its actual problem, which is one that it has in common with all of its mall neighbors and even malls themselves. The problem is “declining traffic,” as the company calls it in its earnings release, or “fewer people going to malls,” as regular people call it.
While some retailers are focusing on online sales to make up the difference, Barnes & Noble isn’t doing so great in that business either. Online sales are up only 2.2%, and sales of devices, content, and accessories for the Nook e-reader are down 25.7%. The only good news out of the Nook division is that the company is spending less money on it than it used to, having left the business of actually making the tablets behind.
In addition to a sales crisis and an indentity crisis, the company is also having a leadership crisis, having sent its last CEO packing and put the the 76-year-old founder back in charge.
The part of the B&N universe that does still make money, the college bookstore division, was spun off into a separate company. What the regular bookstore division got to keep was the money-losing Nook product line and stores that just aren’t as full of customers as they used to be.
In the meantime, the company hopes to attract more foot traffic with smaller stores and full-service restaurants inside. In the meantime, Adele, you’d better get back in the studio.