Barnes & Noble Uses Big Data to Make Their Online Business Better

Barnes and Noble has been a notable name in bookselling since the 1970’s, when its founder Leonard Riggio grew his student book exchange program into a thriving New York City business. By taking over a failing Manhattan bookstore and trade name, “The World’s Largest Bookstore,” Barnes and Noble was born, featuring 150,000 textbook and trade titles.

Over the years Barnes and Noble continued to grow in size and scope, acquiring smaller book store chains and adding more products, including music, movies, gifts, toys, and café services.

BarnesandNoble.com was launched in May 1997, continuing the company’s success with direct to consumer selling that started with catalog sales in the 1970s.

”Today, the BN.com website serves as the company’s largest store, enabling customers to order any book any time from anywhere.  Customers also have access through BN.com to millions of used and out-of-print book titles from a network of authorized book dealers, as well as a vast selection of music CDs, DVDs, gift product, and toys and games (Barnes and Noble, Inc., 2016).”

With the growth of ecommerce, many brick and mortar retailers have been forced to downsize over the last few years, this includes Barnes and Noble who has been impacted by the selling-power of Amazon and other online retailers. The company continues to close stores across the country (Leiberman & Frohlich, 2015), but as of January 2016 operates 640 shops in 50 states (Barnes and Noble, Inc., 2016).

Publishing Plays Catch Up

The publishing industry has long relied on sales data and reviews as assessments for the overall success and failure of their products. While the rest of the entertainment industry relies on tests and focus groups to analyze consumer patterns and make educated guesses on what the next big thing will be, book publishers and sellers have often been left in the dark.

This has started to change over the last few years as more companies are embracing big data and advanced technologies that allow book sellers to hone in on the wants and needs of their market (Alter, 2012).

Consolidation of Data Helps B&N with Analysis

Until about 2010, Barnes and Noble was one of the companies missing out on big data analysis by housing their data across nine different Oracle data warehouses, splitting their retail store data from their college bookstore data and their ecommerce data and so on. By deciding to consolidate this data the company has been able to truly use shopper analytics to their full potential, finally being able to see how their users interact across all the channels they offer.

“Barnes & Noble gets better understanding of customer reading interests, as well as insight into the dynamics among e-reading, online activity, use of in-store cafes, and store purchases (Information Week Features, 2010).”

Using Analytics to Stay Afloat

Despite experiencing a business backslide with the advent of Amazon, Barnes and Noble is working hard to keep their head above water in the industry. One of the ways they are doing this is with an advanced analytics system to monitor their ecommerce business.

Barnes and Noble uses a big data analytics system from the company Aster Data called Teradata Aster MapReduce Platform, “which delivers new analytic applications with high-performance and pre-packed pattern, path and graph SQL MapReduce analytic modules.”

This platform helps the company determine which titles are performing the best after they are launched on the site and in turn provide authors with different options on how they want to promote their books with the company (Lora, 2011).  

This system also lets B&N test how different presentations on their site fare in helping users navigate content and find the search results they are looking for, the company tests author layouts, chapter snippets, and book reviews in this capacity (Gill).

New Technology Equals New Insight

As e-readers grow in popularity, Barnes and Noble has also been able to gain insight into their customers reading behaviors, something that was completely impossible with traditional books once they left the store or were shipped to a reader’s home. These devices, like B&N’s Nook, offer insight into how fast books are being consumed, what passages are being highlighted, how readers interact with the book, and what behavior takes place once the title is finished. For instance what do they purchase next, what does their search behavior look like after the last page, and more.

This advanced insight can be passed along to publishers and authors to allow for greater success for all parties involved down the line. Barnes and Noble has also used the data to alter content that it offers on its Nook devices. For instance, Nook data determined that nonfiction titles often don’t hold a reader’s attention straight through like a novel does. To help readers combat their fatigue and still gain information on a subject they are interested in the company began offering “Nook Snaps,” which are shorter articles and insights into topics in the nonfiction category including weight loss, religion, and politics.

This ability to peek in on a reader’s process may also change up how titles are offered on e-readers, perhaps with the addition of video snippets in areas where the reader often slows down. The hope is also to learn how to make better books, for instance determining the right length for a chapter, the right number of books in a series, or allow for tests of books, titles, and concepts before deciding to fully publish works (Alter, 2012).

Putting Analytics into Practice for B&N

In visiting Barnes and Noble’s homepage I am immediately met with a topic that could likely be analyzed to the extreme. There’s a new Harry Potter book due out this summer and no doubt people who have read the series are psyched.

Just measuring the number of clicks this ad receives could help the company determine how popular it will be. However, if the company wanted to create an analytics goal for the book, they could set it to have users preorder the book; adding the new title to the cart and completing the transaction process, triggering the Order Complete page to appear. They could analyze the different ways consumers get to this step by testing the book in different spots on the homepage, by featuring previous books in the series from time to time over the next few months, and by using various social sites and online ads to show off the availability of the new item.

B&N could use these analytics to keep the publisher and author in the loop on potential success, too. What kind of advertising will they need to do for the release? What kind of author tour should they be prepared for? What press needs to be set up for J.K. Rowling? Where is the title predicted to sell the best and which cities will need added support?

Barnes and Noble also has the additional ability to study the previous habits of the preordering Harry Potter fans to better get an idea of what shoppers will do when this book comes out. Are they more likely to buy e-books or print editions or one of each? Do they venture to the store for their initial purchase? Should local stores anticipate this influx with events centered on the book or even café treats that callback to the story?

Of course for a company as large as B&N the potential ways to use analytics to better the business are endless. They can not only watch the way sales are made, but they can also make decisions for future product purchases and conception based off this data. B&N owns a publishing house, so studies could impact the books they choose to put into the pipeline for the future. As noted they can also use analytics to control the content they are putting on their e-readers and create new content based on habits of current readers. Marketing and advertising can also be made or altered based on results gained from the way shoppers are using the website, interacting with emails, ads and other content.

By having a fully fleshed out system for monitoring the way shoppers are using all of Barnes and Noble’s sources the company can ultimately lead itself to a smarter business model and make decisions that help it stay alive in a world where Amazon dominates the market.

References:

Alter, A. (2012, July 19). Your E-Book Is Reading You. Retrieved February 14, 2016, from The Wall Street Journal: http://www.wsj.com/articles/SB10001424052702304870304577490950051438304

Barnes and Noble, Inc. (2016). Our Company. Retrieved February 14, 2016, from Barnes and Noble, Inc.: http://www.barnesandnobleinc.com/our_company/our_company.html

Gill, G. (n.d.). Top Ten Companies that use Google Analytics. Retrieved February 14, 2016, from Gill Solutions: http://www.gillsolutions.com/top-ten-companies-that-use-google-analytics/

Information Week Features. (2010, August 5). The Big Data Era: How Data Strategy Will Change. Retrieved February 14, 2016, from Information Week: http://www.informationweek.com/software/information-management/the-big-data-era-how-data-strategy-will-change/d/d-id/1091416?

Leiberman, M., & Frohlich, T. C. (2015, March 14). Retailers closing the most stores. Retrieved February 14, 2016, from USA Today: http://www.usatoday.com/story/money/business/2015/03/14/247-wall-st-retailers-closing-most-stores/70222386/

Lora, F. D. (2011, November 14). Data Analytics Extends Barnes & Noble Insights. Retrieved February 14, 2016, from Retail Touchpoints: http://www.retailtouchpoints.com/in-store-insights/1183-data-analytics-extends-barnes-a-noble-insights-