Barnes & Noble Nook Marketing Strategy
Marketing Strategy
Strategic Situation Summary:
Market Target(s) Description: Barnes & Noble Nook
1. Market Segments Identified-
Middle-Upper Class, educated, moderate- high income, heavy internet user
2. Primary Market- Business travelers
Percent More Likely Than Average U.S. Adult to….
• Have accessed the Internet outside the home via WiFi or wireless connection (in last 30 days): 199% • Have household income of $100,000 or more annually: 87% • Have accessed the Internet with a cell phone or other mobile device (in last 30 days): 154% • Be a Heavy Internet User: 116% • Have a Bachelor’s or Post-Graduate Degree: 111% • Be between the ages of 35-54: 20% • Be male: 16%
3. Secondary Market- Education- High School students, College Undergraduates
4. Market Characteristics
a. Geographic- Suburban – travel to cities for work or school
b. Demographic-
The following is a survey conducted for Nook Owners’ age distribution from 111 Nook owners • 7.21% Nook Owners between 10 and 19 - 8 out of 111. • 21.62% Nook owners between 20-29 – 24 out of 111. • 17.11% of Nook owners between 30-39 – 19 out of 111. • 22.52% of Nook owners are between 40-49 – 25 out of 111. • …show more content…
18.01% of Nook owners are between 50-59 – 20 out of 111. • 11.71% of Nook owners are between 60-69 – 13 out of 111. • Just 1 nook owner between 70-79. • Just 1 nook owner between 80-89. c. Psychographic-
• Personality:
• Values:
• Primary Motivation:
• Ideals:
• Self-expression:
• Resources:
d. Behavioral-
• User-status:
• Usage-rate:
• Purchase-occasion:
• Benefits sought:
Objectives for the Market Target(s):
Marketing Program Positioning Strategy:
A. Product Strategy
a. New Products
b. Product Improvements: Incremental Innovation - NOOKstudy
i. It will allow the student instant downloads for academic ebooks. It will allow students to search for keywords in lecture notes, syllabuses and more.
ii. It's a desktop app that will work on Macs and PCs. When installed, it provides students with access to a wide library of textbooks for less than standard books.
iii. Furthermore, the app will enable students to highlight and take notes that are searchable and customizable, and provide students access to all of their materials – eTextbooks, lecture notes, syllabi, slides, images, and other course-related documents – all in one place. Their digital library will be able to go from home, to the library, and to the classroom.
B. Distribution Strategy
C. Price Strategy:
a. Of the 181 million US consumers who are online, 14%, or 25 million consumers, say that eReaders priced at $199 or higher — the current price range for eReaders — are expensive, but they’d still consider them for purchase at that price point. What this means: The maximum addressable market for eReaders as they are currently priced is substantial, but to reach the largest market possible, the prices will need to come down. Still, they have phenomenal social and economic impact as they catalyze a new behavior of digital reading across multiple devices. We’re just at the beginning of this revolution. [pic] D. Promotion Strategy
a. Advertising
i. Banner ads inside books. The average U.S. adult reads four books a year; with a population of 250 million you get 1 billion books digested annually. At 200 pages per book, that's 200 billion potential ad impressions if just one ad was placed at the bottom of each page. Now, charge a $20 CPM for such premium placement and you have just unlocked a $4 billion advertising market. This concept can extend to college textbooks with coupons for partners, such as Starbucks Coffee.
ii. eReaders give advertisers more consumer attention because readers cannot easily surf away to other websites. Advertisers would win higher response rates because the ads are much more noticeable and could be contextually targeted to content and the user's personal information disclosed by their book purchases.
b. Publicity
c. Internet
d. Personal Selling
e. Sales Promotion
i. Visit any Barnes & Noble store and show your NOOK or mobile device to one of our booksellers, and receive a voucher for the FREE eBook. The voucher will require recipients to enter an online code to receive the free eBook. This will create more movement to the website and to promote other product offerings.
E. Marketing Research
F. Coordination with Other Business Functions
[pic]
Mediamark says there are approximately 2.1 million US adults who own eReaders.
Available this week, the new Nook WiFi device is priced at just US$149. The price on the existing Nook 3G, meanwhile, was slashed from $259 to $199, making it the first under-$200 dedicated e-reader with both free 3G wireless and WiFi, according to the company.
Barnes & Noble now offers all Nook users complimentary access to AT&T's (NYSE: T) entire nationwide WiFi network. Its eBookstore now boasts more than one million e-books, periodicals and other digital content, the company said.
Under-$200 is always a new product category's sweet spot, and B&N is probably selling the Nook at a slim margin or even a loss in order to gain market share and brand share in the digital book distribution world.
Price, meanwhile, is a "very important" factor in that competition -- particularly the sub-$200 price point, which is "psychologically very important for consumer adoption," she asserted.
"Any time you deflate the margin on a product by merely adjusting price, it has consequences to the bottom line," he explained. "Another option to just dropping price would have been to add a coupon for up to $50 worth of content; this would have fulfilled the urge to drop price -- however would have kept topline revenue flat."
Style:
The Nook has a color menu, whereas the entire Kindle display is focused on black and white," he explained. "The Nook is lighter. The Nook is now cheaper -- and the Nook is a little more aesthetically appealing."
Potential Target Markets
Specifically, "individuals interested in a very focused reading experience" are one; the education market is another, she pointed out.
"If device manufacturers and educational and professional publishers are successful at getting that constituency, we think e-readers will be able to hold their own against media tablets," Kevorkian said -- noting, however, that while there's "great potential, it has yet to be realized."
A total of 7.6 million media tablets, including the iPad, will ship worldwide in 2010, growing to 46.7 million units in 2014, IDC has forecast.
The e-reader category, on the other hand -- including both connected e-readers and USB-enabled ones -- will ship 6.5 million worldwide this year, the company predicted, increasing to just over 9 million in 2012 before declining to 7.9 million in 2014, Kevorkian noted.
NOOK for Android-based smartphones and devices.
The new application offers those with devices using Android OS 1.6 and higher the ability to shop Barnes & Noble's expansive eBookstore of more than one million eBooks
The new Android app is also the first eReader software to feature Barnes & Noble's new NOOK-centric branding, leveraging the strength of the company's NOOK brand across its entire eReading offering.
The new eReader software branding aligns with the company's current NOOK offering - NOOK 3G and NOOK Wi-Fi eBook Readers, and the recently announced NOOKstudy online study platform and software solution for higher education.
NOOK for Android will soon be followed by an updated NOOK for iPhone, NOOK for iPad, and others in the coming months, the company noted.
Barnes & Noble is diving deeper into the education market with an expected August release of NOOKstudy which will run on Macs and PCs and not require a NOOK or any other mobile device. NOOKstudy will act as a hub for eTextbook, class notes, syllabi, scanned handouts, and even non-educational eBooks. It will allow students to take notes as well as highlight passages in eTextbooks. Users will also be able to tag items for easy retrieval using common terms like: "for the final exam". It will provide full searches of anything, in the eTextbooks or your notes, and link into Google or Dictionary.com to look up terms.
Multiple eTextbooks can be opened at the same time, or two pages from different sources can be simultaneously displayed.
The program is currently being piloted at Penn State, University of Nevada, Queensborough Community College, and the Rochester Institute of Technology.
Barnes & Noble’s ability to market the Nook through its bricks-and-mortar stores, along with the comparative newness of the device, were keys to that competitive edge.
Under the terms of the Best Buy agreement, the Nook’s e-reader software will come pre-loaded on a number of PCs and smartphones sold through the retailer. Both Barnes & Noble and Amazon have focused on porting e-reader applications onto a number of devices, including ostensible rival iPad, in a bid to increase the potential audience for their proprietary e-books.
Barnes & Noble announced a software update for its Nook e-reader, including a Web browser and Android-based games, on April 23. Another feature, “Read In Store,” allows Nook users to browse the retailer’s e-books for free at any Barnes & Noble bookstore, with the entirety of each book accessible for an hour.
NOOK Wi-Fi eBook Reader marries innovative technology and sleek minimalist design with Wi-Fi connectivity.
This latest addition to the NOOK family gives customers the opportunity to take advantage of the proliferation of both in-home and public Wi-Fi hotspots, where they can browse the Web and shop the Barnes & Noble eBookstore of more than one million eBooks, periodicals and other digital content. With its latest software update for all NOOK devices (now available at www.nook.com/update), Barnes & Noble is offering all NOOK customers complimentary access to AT&T's entire nationwide Wi-Fi network, including Barnes & Noble bookstores which have previously been available to NOOK
customers.
As part of the NOOK eBook Reader family, NOOK Wi-Fi features Barnes & Noble’s breakthrough LendMe technology, enabling customers to share eBooks with friends for up to 14 days. NOOK Wi-Fi also offers the same great in-store features like Read In Store to browse complete eBooks in Barnes & Noble stores at no cost, and More In Store, offering free, exclusive content and special promotions. http://floridaresearchgroup.wordpress.com/2010/02/16/demographics-of-kindle-and-other-ereader-users/ http://www.thoughtgadgets.com/2009/10/barnes-nobles-nook-10-billion-ad-slot.html
Strategic Situation Summary:
Market Target(s) Description: Barnes & Noble Nook
1. Market Segments Identified-
Middle-Upper Class, educated, moderate- high income, heavy internet user
2. Primary Market- Business travelers
Percent More Likely Than Average U.S. Adult to….
• Have accessed the Internet outside the home via WiFi or wireless connection (in last 30 days): 199% • Have household income of $100,000 or more annually: 87% • Have accessed the Internet with a cell phone or other mobile device (in last 30 days): 154% • Be a Heavy Internet User: 116% • Have a Bachelor’s or Post-Graduate Degree: 111% • Be between the ages of 35-54: 20% • Be male: 16%
3. Secondary Market- Education- High School students, College Undergraduates
4. Market Characteristics
a. Geographic- Suburban – travel to cities for work or school
b. Demographic-
The following is a survey conducted for Nook Owners’ age distribution from 111 Nook owners • 7.21% Nook Owners between 10 and 19 - 8 out of 111. • 21.62% Nook owners between 20-29 – 24 out of 111. • 17.11% of Nook owners between 30-39 – 19 out of 111. • 22.52% of Nook owners are between 40-49 – 25 out of 111. • …show more content…
18.01% of Nook owners are between 50-59 – 20 out of 111. • 11.71% of Nook owners are between 60-69 – 13 out of 111. • Just 1 nook owner between 70-79. • Just 1 nook owner between 80-89. c. Psychographic-
• Personality:
• Values:
• Primary Motivation:
• Ideals:
• Self-expression:
• Resources:
d. Behavioral-
• User-status:
• Usage-rate:
• Purchase-occasion:
• Benefits sought:
Objectives for the Market Target(s):
Marketing Program Positioning Strategy:
A. Product Strategy
a. New Products
b. Product Improvements: Incremental Innovation - NOOKstudy
i. It will allow the student instant downloads for academic ebooks. It will allow students to search for keywords in lecture notes, syllabuses and more.
ii. It's a desktop app that will work on Macs and PCs. When installed, it provides students with access to a wide library of textbooks for less than standard books.
iii. Furthermore, the app will enable students to highlight and take notes that are searchable and customizable, and provide students access to all of their materials – eTextbooks, lecture notes, syllabi, slides, images, and other course-related documents – all in one place. Their digital library will be able to go from home, to the library, and to the classroom.
B. Distribution Strategy
C. Price Strategy:
a. Of the 181 million US consumers who are online, 14%, or 25 million consumers, say that eReaders priced at $199 or higher — the current price range for eReaders — are expensive, but they’d still consider them for purchase at that price point. What this means: The maximum addressable market for eReaders as they are currently priced is substantial, but to reach the largest market possible, the prices will need to come down. Still, they have phenomenal social and economic impact as they catalyze a new behavior of digital reading across multiple devices. We’re just at the beginning of this revolution. [pic] D. Promotion Strategy
a. Advertising
i. Banner ads inside books. The average U.S. adult reads four books a year; with a population of 250 million you get 1 billion books digested annually. At 200 pages per book, that's 200 billion potential ad impressions if just one ad was placed at the bottom of each page. Now, charge a $20 CPM for such premium placement and you have just unlocked a $4 billion advertising market. This concept can extend to college textbooks with coupons for partners, such as Starbucks Coffee.
ii. eReaders give advertisers more consumer attention because readers cannot easily surf away to other websites. Advertisers would win higher response rates because the ads are much more noticeable and could be contextually targeted to content and the user's personal information disclosed by their book purchases.
b. Publicity
c. Internet
d. Personal Selling
e. Sales Promotion
i. Visit any Barnes & Noble store and show your NOOK or mobile device to one of our booksellers, and receive a voucher for the FREE eBook. The voucher will require recipients to enter an online code to receive the free eBook. This will create more movement to the website and to promote other product offerings.
E. Marketing Research
F. Coordination with Other Business Functions
[pic]
Mediamark says there are approximately 2.1 million US adults who own eReaders.
Available this week, the new Nook WiFi device is priced at just US$149. The price on the existing Nook 3G, meanwhile, was slashed from $259 to $199, making it the first under-$200 dedicated e-reader with both free 3G wireless and WiFi, according to the company.
Barnes & Noble now offers all Nook users complimentary access to AT&T's (NYSE: T) entire nationwide WiFi network. Its eBookstore now boasts more than one million e-books, periodicals and other digital content, the company said.
Under-$200 is always a new product category's sweet spot, and B&N is probably selling the Nook at a slim margin or even a loss in order to gain market share and brand share in the digital book distribution world.
Price, meanwhile, is a "very important" factor in that competition -- particularly the sub-$200 price point, which is "psychologically very important for consumer adoption," she asserted.
"Any time you deflate the margin on a product by merely adjusting price, it has consequences to the bottom line," he explained. "Another option to just dropping price would have been to add a coupon for up to $50 worth of content; this would have fulfilled the urge to drop price -- however would have kept topline revenue flat."
Style:
The Nook has a color menu, whereas the entire Kindle display is focused on black and white," he explained. "The Nook is lighter. The Nook is now cheaper -- and the Nook is a little more aesthetically appealing."
Potential Target Markets
Specifically, "individuals interested in a very focused reading experience" are one; the education market is another, she pointed out.
"If device manufacturers and educational and professional publishers are successful at getting that constituency, we think e-readers will be able to hold their own against media tablets," Kevorkian said -- noting, however, that while there's "great potential, it has yet to be realized."
A total of 7.6 million media tablets, including the iPad, will ship worldwide in 2010, growing to 46.7 million units in 2014, IDC has forecast.
The e-reader category, on the other hand -- including both connected e-readers and USB-enabled ones -- will ship 6.5 million worldwide this year, the company predicted, increasing to just over 9 million in 2012 before declining to 7.9 million in 2014, Kevorkian noted.
NOOK for Android-based smartphones and devices.
The new application offers those with devices using Android OS 1.6 and higher the ability to shop Barnes & Noble's expansive eBookstore of more than one million eBooks
The new Android app is also the first eReader software to feature Barnes & Noble's new NOOK-centric branding, leveraging the strength of the company's NOOK brand across its entire eReading offering.
The new eReader software branding aligns with the company's current NOOK offering - NOOK 3G and NOOK Wi-Fi eBook Readers, and the recently announced NOOKstudy online study platform and software solution for higher education.
NOOK for Android will soon be followed by an updated NOOK for iPhone, NOOK for iPad, and others in the coming months, the company noted.
Barnes & Noble is diving deeper into the education market with an expected August release of NOOKstudy which will run on Macs and PCs and not require a NOOK or any other mobile device. NOOKstudy will act as a hub for eTextbook, class notes, syllabi, scanned handouts, and even non-educational eBooks. It will allow students to take notes as well as highlight passages in eTextbooks. Users will also be able to tag items for easy retrieval using common terms like: "for the final exam". It will provide full searches of anything, in the eTextbooks or your notes, and link into Google or Dictionary.com to look up terms.
Multiple eTextbooks can be opened at the same time, or two pages from different sources can be simultaneously displayed.
The program is currently being piloted at Penn State, University of Nevada, Queensborough Community College, and the Rochester Institute of Technology.
Barnes & Noble’s ability to market the Nook through its bricks-and-mortar stores, along with the comparative newness of the device, were keys to that competitive edge.
Under the terms of the Best Buy agreement, the Nook’s e-reader software will come pre-loaded on a number of PCs and smartphones sold through the retailer. Both Barnes & Noble and Amazon have focused on porting e-reader applications onto a number of devices, including ostensible rival iPad, in a bid to increase the potential audience for their proprietary e-books.
Barnes & Noble announced a software update for its Nook e-reader, including a Web browser and Android-based games, on April 23. Another feature, “Read In Store,” allows Nook users to browse the retailer’s e-books for free at any Barnes & Noble bookstore, with the entirety of each book accessible for an hour.
NOOK Wi-Fi eBook Reader marries innovative technology and sleek minimalist design with Wi-Fi connectivity.
This latest addition to the NOOK family gives customers the opportunity to take advantage of the proliferation of both in-home and public Wi-Fi hotspots, where they can browse the Web and shop the Barnes & Noble eBookstore of more than one million eBooks, periodicals and other digital content. With its latest software update for all NOOK devices (now available at www.nook.com/update), Barnes & Noble is offering all NOOK customers complimentary access to AT&T's entire nationwide Wi-Fi network, including Barnes & Noble bookstores which have previously been available to NOOK
customers.
As part of the NOOK eBook Reader family, NOOK Wi-Fi features Barnes & Noble’s breakthrough LendMe technology, enabling customers to share eBooks with friends for up to 14 days. NOOK Wi-Fi also offers the same great in-store features like Read In Store to browse complete eBooks in Barnes & Noble stores at no cost, and More In Store, offering free, exclusive content and special promotions. http://floridaresearchgroup.wordpress.com/2010/02/16/demographics-of-kindle-and-other-ereader-users/ http://www.thoughtgadgets.com/2009/10/barnes-nobles-nook-10-billion-ad-slot.html