Barnes & Noble Case Study

1. Value chain helps in identifying ways to create the best value for the customers and it’s a 3 step process: activity analysis, Value analysis and lastly evaluating and planning. Five forces of competition according to Michael porter are: threat of substitutes, rivalry, supplier power, buyer power, and barriers to entry. Barnes & Noble, publishers and other book retailers thrive to survive in the current competitive environment and with the internet posing all this challenges. Internet has enhanced development of e-books and e-learn which have become substitutes to physical books. This has threatened existence of both publishers and book retailers since people have adapted to using the current means which is of low cost and easy to access. The internet has enhanced the bargaining power of suppliers since the products are just advertised via the internet and thus their accessibility is easy. It has also enhanced the bargaining power of buyer such that for e-book and e-learners it costs a lower price. For example Customers who visit B&N’s web site buy three digital books for every one physical book thus posing a threat to the booksellers of physical books though they make profits. It has provided barrier to entry to the publishers and the booksellers of the physical books.

2. Barnes and Noble was depending on physical, brick and mortar stores to run their business but with the stiff competition from Amazon who transformed to e-books, they have shifted and put a lot of energy in developing and marketing Nook system and tablets to enable them venture into the e-book industry. Book publishers on the other hand have been forced to adjust their allocations of printed books and new titles for stores while books are beginning to be released as apps in addition to physical books.

3. I don’t think the new strategy for Barnes & Noble will succeed since we obviously know how the tablet turned out. My wife enjoys to read,