What really caused Borders to lose ground and forever languish in the tumultuous publishing and media battle?
I am going to miss Dennis and his friendly sales team at Borders BWI Airport stores.
He made my recent book signing happen flawlessly. He ensured my Starbucks latte awaited me when I arrived. He was genuinely proud to host nationally-recognized authors at his location.
Sadly, his enthusiasm was not enough to keep his stores afloat.
The halcyon days of Borders airport book signings have vanished.Their demise leaves me wondering: what drove Borders to liquidation, and what can any growth-oriented business leader learn from its downfall? Here is my read:
1. Borders responded too slowly to seismic technology and publishing shifts. They revised their website too late in the game to adapt to the new book selling paradigm. From 2001 until 2008, they chose a strange bedfellow–Amazon–to outsource their online sales.Their version of an e-reader, the Kobo (who?), premiered in 2010. Too little, too late.
2. They over-invested in their (antiquated) bricks and mortar model. Borders signed 15- and 20-year leases for huge retail properties. When it came time to shed cash-draining properties, they were left with serious debt. Their 2011 bankruptcy filing explained this strategic error.If they had looked outside the retail publishing sphere, they would have found several examples of viable, pared-down retail models. Umpqua Bank’s Ray Davis once boasted to me that they could launch a bank store within four months for less than $400,000. ING Direct, which was recently acquired by Capital One, cleverly launched a finite set of cafes in select cities. They created a retail presence without breaking the bank.
3. They never created a powerful community of customer evangelists.Have you ever heard a colleague profess their undying loyalty to Borders and eschew amazon, Barnes & Noble, Netflix, or file-sharing networks? I thought not. During tough economic times, it’s easy to focus too much of your time on expanding capacity and forget to invest time with customers. Think of the last time you visited customers or interacted with prospects in your call centers, executive briefings, advisory group meetings, or other live gatherings.
As an author and avid reader, I am sad to see another media retailer disappear. I am hopeful that Dennis and his loyal team find a new home that rewards agility and customer-centric strategies.
What are your thoughts? Please share them here.
copyright 2011, Lisa Nirell. All rights reserved.