Nick Markman, Jordan McAulay, Helena McClenny, and Karisa Gurtiza A - PowerPoint PPT Presentation

Nick Markman, Jordan McAulay, Helena McClenny, and Karisa Gurtiza

A Look at the NOOK ● First NOOK released in November 2009 ● NOOK Tablet released November 2011 ● NOOK and B&N College spun off from B&N as a part of a deal with Microsoft - April 2012 ● NOOK expands into UK - August 2012 ● NOOK HD and HD+ released November 2012

Current Standing ● Revenue: fell 34% in 2013 holiday season to $108 million ● Market share in tablet segment: 1.9% ● The Nook unit which includes e-readers, tablets, digital content and accessories decreased 12.6% ● Losses: $177 million in 2013, up $100 million from the previous year

SWOT Strengths: ● Hundreds of stores that offer one-on-one customer service ● Highest rated retailer in customer service ● More personalization options and screen resolution than price competitor Kindle Weaknesses: ● Fewer apps offered than competitors ● Small customer niche ● Consumer perception places the Kindle as a better low cost tablet than the Nook

SWOT Continued Opportunities: ● Microsoft’s investment in Nook will continue to increase Nook hardware on a yearly basis Threats: ● Many consumers find Kindle retail experience to be superior to the Nook’s ● Out performed by competitors in multimedia approach

Competitive Advantage Differentiation Advantage ● Channel advantage through B&N College stores ● NOOK Books sharability (LendMe) and trialability in B&N Stores ● Unique content within NOOK Store

Benefits Comparison

3-Circle Targeting Key Opportunities for Growth Eliminate: ● Leverage Microsoft partnership ● Get rid of pre-loaded to incorporate Microsoft Office entertainment apps into NOOK tablets for document creation and better classroom integration. ● Front facing camera ● Make eTextbooks readable for NOOK devices

3-Circle Targeting Point of Differences to Take Away Better Promote from Kindle ● NOOK Study application ● Low price leader ● Expandable storage with ● Service advantage – takes away microSD from Kindle’s new “Mayday ● Ad Free experience Button” feature. ● Non-reading features of NOOK - ● College students can have their higher focus on entertainment NOOKs serviced for free at their content B&N college bookstore or local ● Book lending and sharing superstore. features within NOOK Store

Goals and Objectives 1. Reposition Nook as a student-oriented tablet ● Increase total NOOK revenue (including tablet sales and NOOK Store content sales) 40% between 2014 and 2015. 2. Become market leader in e-textbooks ● Further incentivize eTextbook sales through NOOK’s lending and sharing features, NOOKStudy application - all-in-one universal study tablet.

Segmentation & Targeting College Students ● Barnes and Noble has 692 university stores in all 50 states. ● College stores serve over 250,000 facility and 4.6 million students. ● Underserviced in the tablet industry. ● NOOK is the low cost leader.

NOOK Positioning Educational Features Entertainment Features ● Microsoft Office ● Front and back facing cameras ○ Creating and editing documents, presentations, and ● NOOK customer service spreadsheets ○ Free servicing at Barnes and Noble College Bookstore or ● The NOOK Study Application local retail store ○ Note taking, find and search, exporting notes, highlighting, ● No pre-loaded entertainment and research online applications ● eTextbooks ● Completely ad free ○ Book lending and sharing

Positioning Statement To collegiate customers, the NOOK is the affordable and versatile tablet that maximizes educational functionality and entertainment usage because it is equipped with Microsoft Office, the NOOK Study Application, and eTextbooks for proficient learning while maintaining entertainment use by including front and back facing cameras, the NOOK application store, an ad free experience all at an affordable cost.

Communication Strategy Message Strategy: To present the NOOK as an all-in-one study tool for students ● In-store and on-campus promotions ● Print ● Digital

In-Store Promotions NOOK Purchase Promotions ● Buy a NOOK, get $100 credit toward eTextbook purchase ● Price eTextbooks 25% lower compared to print textbooks In-Store Signage and Displays ● 3, 31” x 71” Banner Stands per store ● 692 stores x 3 per store x $36.29 per stand = $75,338

Print ● University newspaper ○ Reach: 4,600,000 ○ Frequency: 1, half page ad once a week with a 25% bulk discount ○ Cost: $352 per ad x 33 weeks = 11,616.00 - 2,904 = 8,712 x 692 schools = $6,028,740 ● ESPN The Magazine ○ Frequency: 2 per month, 24 per year ■ Pulsing - heavy during Aug, Sept, Dec & Jan ○ Cost: 230,334 per ad x 4 = $921,336 ● Cosmopolitan ○ Frequency: Monthly, 12 issues per year ■ Pulsing - heavy during Aug, Sept, Dec & Jan ○ Cost: 57,800 per ad x 4 = $231,200

Digital Hulu Video Ads ● 1920x1080 30-second Video Commercial ● Reach: 4,600,000 ● CPM: $35 ● Frequency: Pulsing - heavy during Aug, Sept, Dec, Jan ● Cost: 4,600,000 x $35 / 1,000 = $161,000 Pandora Ads ● 15 second targeted Pandora Radio ad spots ● Reach: 4,600,000 ● CPM: $20.4 ● Frequency: Pulsing - heavy during Aug, Sept, Dec Jan ● Cost: 4,600,000 x $20.4 / 1,000 = $93,840

Social Media & Email Email ● Monthly email blasts ○ lists collected through e-commerce site and universities ● Distributed and analyzed through Constant Contact Social Media ● Youtube “Student Stories” ○ $20 off eTextbook for accepted submissions ● Facebook promotions (catered to each university) ● Social care and customer engagement through twitter ○ BN College Corporate feed as well as individual university feeds

Social Media & Email Promotions

Evaluation and Control ● Customer Satisfaction ● Net Promoter Score ● Percent of college textbooks from eTextbooks ● Market Share ● Sales Growth