By Robin Wauters
Barnes & Noble‘s recently appointed CEO (and former BN.com President) William Lynch this morning sent a long letter to all of its shareholders in connection with the company’s Annual Meeting, which will be held on September 28.
The company has been embroiled in litigation with private equity firm Yucaipa after the firm’s CEO Ron Burkle recently challenged the company’s stockholders rights plan. In the wake of a nasty proxy battle, B&N (BKS) published the letter in an effort to detail its strategy to grow its business and to create shareholder value.
Interestingly, Lynch shares a lot of information and numbers about its current and expected future business.
You’ll have to forgive me if some of the information was already publicly disclosed in the past, but the letter provides a solid overview of where B&N stands today.
On physical books
Barnes & Noble expects an industry shake-out will come shortly, which will result in a consolidation of the physical book business, as there are increasingly fewer bookstore competitors on the market while other retail outlets (mass merchants, drug discounters, etc.) are expected to wind down their book-selling efforts.
The company expects the physical book market to contract significantly over the next four years, from approximately $21 billion to $19 billion. B&N adds that it hopes to grow its current share of the U.S book market (18%) to 20-25% over the next three years.
On digital books
Barnes & Noble in the letter says every metric they are tracking with regards to its digital business is exceeding its expectations. One year after kicking off its digital content sales efforts, the company already holds 20% of the digital trade book market, they claim.
Note: this is in fact a higher share than the 18% of the physical book market B&N claims to
