Borders.com has not lived up to the market's potential. Why? - Borders' failure on the ...

Borders.com has not lived up to the market's potential. Why? - Borders' failure on the web is due to a lack of promoting and positioning says Steven Cody, managing partner of Peppercom.

Borders.com has not lived up to the market's potential. Why? - Borders' failure on the web is due to a lack of promoting and positioning says Steven Cody, managing partner of Peppercom.

So, you're the Borders Group. The second largest bookseller in the country. With stores in all 50 states. And 1997 sales of $2.6 billion.

Intent on capitalizing on the growing wave of online book sales, you decide to play catch-up with Amazon.com and Barnes & Noble by establishing a web presence.

Yet, just five months later, trade publications are reporting your possible abandonment of the entire e-commerce sector. What went wrong?

It wasn't the consumer book publishing industry, which, according to Veronis, Suhler & Associates, has become the hottest segment of online commerce.

And, Borders certainly didn't lack web partners to drive traffic to its site: after its launch, Borders.com entered into strategic partnerships with such Internet powerhouses as Snap!, Infoseek, and Salon Magazine.

To be sure, Amazon.com got a head start. First to market in 1995 with a virtual bookstore, Amazon.com has become a powerhouse, offering three million books, CDs, audiobooks, DVDs, computer games and more. And Barnes & Noble, although a relative latecomer to the online game, has more than 650,000 titles in stock and the strength of international media giant, Bertelsmann behind it.

Yet despite these handicaps, Borders has the resources to compete, including deep pockets, and built-in distribution and mail order channels.

So, what went wrong with Borders.com? To my mind, it was a classic case of not properly positioning, publicizing or promoting the site.

Since founding brothers Louis and Thomas Borders opened their first store, Borders has prided itself on being a 'serious' alternative for the serious reader.

Yet, when Borders.com, the web site, went live in May of this year, one review termed it 'not very involving.' There is no direct connection with the firm's 'serious reader' positioning.

To compete effectively against two larger and better known web competitors, Borders should have started with a competitive analysis. What did Amazon.com and Barnesandnoble.com offer at their sites? What could Borders.com offer that would reinforce their established position and attract the more serious-minded web browser?

For example, in addition to its listing as Borders.com, the site could have also billed itself as 'the community for serious reading.' Partnerships with like-minded firms such as literary societies, universities and book clubs could have offered browsers a host of interesting forums, chat rooms, etc. The site could have been launched with a co-branded survey, perhaps focusing on the arcane and sophisticated. If it was serious about e-commerce, Borders should have leveraged its brand equity and launched a series of ongoing promotions aimed at the serious reader, i.e. free but serious tomes for the first 100 log-ons. It also needed to publicize with news, events, etc.

The bottom-line: it's all about positioning, partnerships, promotions and publicity. Had Borders.com followed that formula, they'd be facing a much different web scenario today.

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