Barnes and Noble is gravitating their Nook section from the front of the store to the back. Hundreds of locations have already moved the entire display area and the rest will be doing it within the next few months.
Relocating the entire Nook section to the back of the bookstore will have its drawbacks. It will result in fewer impulse buys and less e-readers and tablets will be sold on a daily basis. B&N lost $7.9 million this quarter and e-book growth is waning, it remains to be seen if moving the display area will move the needle, resulting in further losses.
One of the most interesting aspects of relegating the Nook section to the back of the store is their relationship with Samsung. The bookseller has been developing Samsung Galaxy Tab 4 Nook tablets for the past four years. The way the contract is structured is that B&N commits to buying a certain number of units and if they remain unsold, they are still on the hook for paying the full amount. B&N realized that their customers were not buying expensive Samsung tablets in great numbers and they were literary losing millions of dollars every quarter due to unsold units. This prompted B&N to revise their tablet strategy and in 2017 they issued the Nook Tablet 7. Going forward it makes sense that they will continue to develop their own hardware and phase out Samsung.
What I find most interesting is whenever B&N issues quarterly results they constantly hyping up their concept stores, how print is making a comeback and how their revised website is driving sales. They seldom mention Nook at all, and when they do, it is in a roundabout way. They never divulge any future strategies or say anything to assure investors that they have a plan. It seems they are unconcerned with turning their digital business around, and have no plans, other than cutting costs.