Barnes & Noble Beating Up Borders?

Customer spend at big book retailer Barnes & Noble (NYSE: BKS) is up 11% since April 2008 while chief rival, Borders (NYSE:BGP), is down 4%.  This, according to new Main Street Spending Index (MSSI) compiled by Geezeo, a personal finance Web site that helps consumers track their spending.

In April 2008, users were spending approximately the same amount at each bookstore, $33.08 at Barnes & Noble, compared to $33.17 at Borders. As of October, Barnes & Noble monthly consumer spending has grown to $36.62, while Borders shrunk to $31.89. 

Is the book closed on Borders? Maybe not, Borders has made great strides online during this same time period. Borders has seen 500%+ growth in internet visits since April, 2008, compared to negative growth for Barnes & Noble, according to Compete.com.  Barnes & Nobles is still attracting twice the online visitors as Borders, however that figure was greater than 10x just a year ago.

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Given the growth in their internet channel expect to see a Borders rebound this holiday season.

Disclosure: no positions

Comments

[sbrunton1956:]

Uptick rule NOW...

2008 Nov 21 02:03 AM

[B&N_Man:]

Borders online store *opened* this past spring; before that if you visited borders.com you were aliased over to Amazon. So the chart about unique visitors to borders.com vs. barnesandnoble.com isn't terribly meaningful.

Sure, borders.com is getting more traffic now that they've got their own store and are willing to promote it. But how much *business* are they stealing from barnesandnoble.com?

Truth in advertising: I'm an employee of Barnes & Noble.com.

2008 Nov 24 12:02 PM

[Shawn Ward:]

This note came in from a Barnes and Noble employee providing more color to the online comparisons:

In your article dated November 20, you state that “Borders has seen 500 percent growth in Internet visits since April, while Barnes & Noble has seen declines.” You also attribute this information to a source called Compete.com. Let me say first that we rely on Comscore, the leading Internet marketing and data services provider, for our traffic measurement, as do most reputable e-commerce companies. Based on what we know to be true, the statistic you provided to your readers couldn’t be further from the truth. Here are the facts:

Although Borders did not launch its e-commerce website until July 2008, they did have three online destinations drawing substantial traffic prior to launch. These three sites included: Borders.com, which re-routed to Amazon; Bordersstores.com, their store locator; BordersMedia.com, their content site. Borders emails sent traffic, for example, to both Bordersstores.com and Bordersmedia.com.

According to Comscore, Borders pre-launch average was 3.184 million unique visitors (this includes their store locator and content sites). Post launch, which would be from July-October, 2008, Borders saw only a 25 percent gain over the pre-launch average. It is also likely that the bulk of this gain in traffic was simply the shifting of traffic that previously went to the Borders.com site at Amazon and thus counted as Amazon traffic now officially being counted as Borders traffic. The facts indicate that Borders traffic gain after the launch of their website was relatively insignificant.

I should point out that this much smaller gain by Borders did not come at the expense of Barnes & Noble as our traffic, measured by Comscore, increased by 13 percent during the same post launch period.

Sincerely,
Mary Ellen Keating
Senior Vice President
Corporate Communications
Barnes & Noble, Inc.

2008 Nov 24 10:35 PM