By HFF Public Relations Coordinator Kimberly Steele.
Barnes & Noble (B&N) might be closing the book on the format that made them the nation’s largest retail bookstore by changing the game (again). The company is in the process of rolling out a new kind of bookstore that combines a technology-enhanced shopping experience with their new restaurant concept, Barnes & Noble Kitchen, which is currently being tested in several markets with more to come.
Where the Barnes & Noble café is designed for the grab-and-go costumer, Barnes & Noble Kitchen includes comfortable seating and table-side service in order to encourage a patron to take his or her time. The company partnered with the international design/concept firm of AvroKO and The Branstetter Group, the Santa Monica-based hospitality management/advisory firm, on the restaurant and bar concept. The restaurants, which are designed to be extensions of the bookstores, have tradition table and community seating in addition to a bar area.
A full menu of breakfast, lunch and dinner is available, along with wine by the bottle or glass and beer, including local and regional craft beer. Sheamus Feeley, chef consultant for Branstetter, created the menu, which is consistent at all locations thus far; it is possible the menu will reflect a local flare in the future. The menu options feature seasonal, locally produced items, including brick-cooked chicken, slow-cooked beef short ribs, salmon, brisket burger, tabbouleh, cured meats and artisan cheeses and even offer gluten-free options. Prices range from $5 to $7 for sides and $14 to $26 for sandwiches, dinner salads and entrees.
Books are still the main focus, and the new stores put books front and center with 180-degree views of book displays. To help better help customers and increase in-store engagement, B&N has adapted and implemented new technology. Customers may purchase a book, magazine, newspaper or vinyl record anywhere in the store, including the restaurant, thanks to employees with hand-held devices, known as mobile engagement devices. Additionally, advanced interactive mapping tools used at a mounted, self-serve digital kiosk or a personal device will enable customers to quickly locate and discover new products within the store. Customers can text questions or comments to B&N staffers in order to quickly receive one-on-one service.
“Barnes & Noble is making an astute shift in business strategy, which is appropriate given the market share headwinds they face from internet-based sales of their primary product,” said Jimmy Hinton, Managing Director of Research at HFF. “By shifting focus to an ‘experience’ their online competitors cannot afford their customers, and by allowing themselves the potential to achieve higher margins with a restaurant concept, Barnes & Noble could achieve higher profitability in-store, create the ‘experience’ retailers are strategizing to achieve and improve the revenue mix shareholders have been hoping for.”
The first concept bookstore opened in late November at Vernon Hills Shopping Center in Eastchester, a community approximately 30 miles from New York City. The 22,000-square-foot store features a 2,600-square-foot Barnes & Noble Kitchen and a 3,000-square-foot outdoor patio with fire pit and bocce court. Additional stores include the Palladio at Broadstone in the Sacramento suburb of Folsom, California, which opened December 13 and features an outdoor plaza and a large water feature; the Galleria Edina in Edina, Minnesota, which opened on November 29 in the Minneapolis MSA; and the Washington, D.C.-area One Loudoun in Ashburn, Virginia, which will open in 2017. A 9,000-square-foot smaller concept store with a restaurant and bar will open in March 2017 within Legacy West in Plano, Texas.
The Sacramento Bee, which covered the Folsom store opening, reports that:
“By some Wall Street estimates, Amazon has cut into Barnes & Noble’s overall market share by more than 25 percent since 2010. Analysts said the availability of bargain-priced books on Amazon and the popularity of Amazon’s Kindle e-reader have deeply impacted B&N revenue. B&N has seen annual sales revenue plunge from $7.13 billion in 2012 to $4.16 billion in the most recent fiscal year.”
The news of the new concept stores was announced on June 23, and Barnes & Noble stock rose eight percent that same day. Three of the new stores opened in time to help increase traffic into Barnes & Noble during the holiday shopping season. Will it be enough to lure shoppers away from buying online from other retailers and back into a physical bookstore?