Flailing. That’s the only way I can describe what Barnes & Noble is currently doing. It’s slashing prices on all its reader and tablet models and just this morning introduced a new video consumption app that can sit on top of both its own tablets and third-party devices, including Rokus, iPhones and iPads.
These developments come just months after the company unloaded its CEO and announced that it would try to find someone else to build its line of Android tablets. Which is the same as saying, “We’re done selling Android tablets.†Seriously, what’s the point of someone else buying the Nook IP, building the tablets and selling them under Barnes & Noble name? Certainly it wouldn’t be for the brand lift.
Here’s the painful truth: Barnes & Noble built some of the best, smartest and most affordable tablets on the market and no one bought them. Clearly the name did little to help drive interest and sales. I wouldn’t expect anyone else to do any better with the brand.
A new video-consumption app should be good news, but it’s really an attempt to compete with Amazon outside of tablets. This new product is platform agnostic, meaning it’s not a new feature for B+N tablets, but is, instead, an attempt to counter Amazon Prime Videos, which can play on any device that has Amazon’s software. As usual, Barnes & Noble is playing catch-up here and, while I like the idea of subscription-free rentals, I don’t expect this to help them very much.
Rising Above
It’s a shame, really. Barnes & Noble did everything it could to compete. I reviewed most of their tablets and ereaders and was always impressed, especially when, almost a year ago, the company unveiled its new HD line of tablets.
The company had a very clear strategy: focus on content delivery and price, while delivering feature parity and, in some cases, supremacy. At the time of its unveiling, the 7-inch Nook HD was lighter, thinner and cheaper than virtually all competing products. The 9-inch Nook HD+ (32 GB) model offered a HD resolution nearly as good as the iPad retina, but for a substantially lower price.
While I still prefer the iOS tablet interface, Nook’s consumer-friendly Android overlay was easily my second favorite. It did the best job of managing multiple accounts on one device and providing a safe tablet environment for children.
Yet consumers were not enchanted and sales, by Barnes and Noble’s own admission, were flat.
I have to admit that, while I didn’t consider it a misstep at the time, I now believe that leaving cameras out of all these devices was a mistake.
Last year former CEO Kevin Lynch told me that the company’s goal was to hit a certain price point and that did mean leaving out certain features like Cellular connectivity (with ubiquitous Wi-Fi not a huge deal, right?) and, he said, cameras.
Having spent the summer here and abroad watching people using their full-sized iPads and iPad minis to take photos and videos of everything from their child’s high school graduation to Buckingham Palace, I realize this was a crucial mistake.
It’s not that every tablet has to have a camera, but if each new tablet is going to be compared to the iPad, then it has able accomplish every task you can complete on Apple’s industry-leading device. Consumers assume that tablets can take pictures â€"- even if they do look ridiculous doing it.
The only tablets that don’t need cameras are E Ink readers, which are marginally tablets. They serve a single purpose: reading.
Mopping Up
Some might fault Barnes & Noble for continuing to market and sell the moribund Nook HD tablets, but with the introduction of Google Play, the Nook devices are pretty much like any other Android device and, with the exception of that missing camera and the ability to connect to a cell network, just as usable.
In fact, they could be the perfect tablet for college-bound students who want a powerful, good-looking, and lightweight device for well under $200. Amazon’s 8.9-inch, 16GB Kindle Fire HD+ has half the storage space and costs almost $200 more (yes, it has a front-facing camera). The cheapest iPad Retina is $499 (it has two cameras and a higher-resolution display).
Barnes & Noble will still offer software updates and even new apps (like the aforementioned video one, which makes little sense if you have Google Play). Certainly, the company and its software program will survive your college career.
The Lesson
So what have we learned? Winning is not always about building a high-quality or even the best product. It’s not necessarily about distribution and visibility (Barnes & Noble filled its stores with Nook kiosks). It’s not even about trying harder. Maybe it’s about reading the market.
Why are people willing to spend more for an Apple product than more powerful and open competing products? How important is it to base your feature matrix on an industry leader? Clearly, Barnes & Noble thought long and hard about how it would compete with Apple. Lynch told me he considered the iPad “an expensive product.†So they focused on beating Apple on price. However Apple has never cared a lick about beating anyone else’s price.
Sure, Steve Jobs once called $199 the magic price point, but that was for the iPhone and was, essentially, the arbitrary entry-price point he set for industry-leading smartphones. It should be noted that the industry basically fell into lockstep behind Apple on that front.
When it comes to tablets, however, Apple pays zero attention to competing tablet pricing models. The iPad mini arrived with an astounding $329 base price, almost double what Google was charging for the Nexus 7. Based on how well the mini is selling, that premium doesn’t bother consumers at all.
Barnes & Noble assumed a rational approach to selling tablets in a universe dictated by Apple, a company that makes its own rules. In other words, if you want to compete in the tablet space, it’s best to play by Apple’s rules. If that seems unfair, it’s worth remembering that business, like life, is not fair. Barnes & Noble is not the first to fight the good fight and lose and it won’t be the last.
But like I said, Barnes & Noble built some of the best tablets and ereaders on the market and it would be a crime to ignore these bargains.
Image: Mashable, Emil Lendof
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