Principles of Marketing: Final Exam

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BSA310

Principles of Marketing: Final Exam
Question #1: The concentration of my marketing plan is focused on the declining sales for the company, Barnes & Noble (B&N). Barnes & Noble is in the process of renegotiating our leases and assets in attempts to cut costs. Our sales are declining and we are faced with stiff competition from Amazon, Wal-Mart, Costco, and other discount retailers. According to MSN Money, Barnes & Noble has experienced declining sales, with only 7% increases over the last three years, as compared to Amazon’s 32% (Brush, 2012). Amazon’s increased sales are driven by the introduction of the Kindle Fire and their larger inventory of digital books. The difference in price between Barnes and Noble’s Nook and Amazon’s Kindle Fire are significant, with Kindle Fire being considerably cheaper for a comparable product. Until recently, Amazon was ahead of Barnes & Noble, in offering digital downloads of movies and music. However, announced as New! on our Barnes & Noble website, we have now partnered with Netflix and Marvel to offer streaming movies and comic books. This will increase our connection to the younger generation. While our products are desired and used by all varieties and ages on the spectrum, my suggestion would be to target the college student and younger genres. When we begin to segment the public, we must begin with Generation Y. Their buying power and sheer numbers can not be ignored. They are a tech-savvy group raised on phones, computers, and hand held devices. With their numbers comparing to the Baby Boom generation, they saturate the buying market. In looking to the future, two other generations that should not be overlooked are Generation Z and AO (Always-On-The-Go). These two generations exhibit the need for instant gratification and access at their fingertips. Barnes & Noble will need to step up our digital world and online offerings to meet the demands of these groups of individuals. There are several ways we can meet the demands of the target segments mentioned above. The first being the ability to offer music downloads through our website and via The Nook and phone app. Currently, we do offer music and DVD’s for sale, but the option to purchase a single track or song digitally is not available. With today’s youth downloading more music than ever, this option would meet that demand. This would also increase the purchase of B&N’s gift card sales, which could ultimately compete with those sales of the iTunes card. Another option would be to offer the ability to share any of your downloads between devices. If you download a song on your iPad, your Nook, or your phone, let’s make it easy to share it between all of them. We need to focus on customer service and convenience. This would encourage customer loyalty. We should open up our eReader format to allow other devices to view books from our digital library. Right now, our digital books are in a format that is strictly proprietary and can only be viewed using The Nook or a free downloadable app. The current format we offer is Epub, which is not readably viewable by all operating systems. We need to refocus on selling the book and not limiting its viewing ability. If we began to offer our books in .pdf format, any user with any operating system would be able to purchase a book from us. We may not be able to fully compete with the iPad reader or the Kindle Fire, but we can still have people buy our books. Lastly, we should address the possibility of offering price matching, in order to rebuild our loyal customer base and let them know we are serious about keeping their business. If a customer can show us where they can purchase a book cheaper than we are selling it, within reason, we will match that price. It would encourage an increase in book sales and would reduce the amount of overhead costs on