Barnes & Noble has been tagged as either the savior or the destroyer of the book industry in its 100-year history. Lately, it’s the bookstore chain itself that needs saving.
Enter James Daunt, a lifelong bookseller who built his own mini-chain of bookstores and got the credit for turning around Waterstones, the biggest bookseller in Britain. Elliott Management, the hedge fund that took B&N private last year, brought in Daunt to resuscitate Waterstones’ much larger American cousin. Wall Street Journal reporter Jeffrey Trachtenberg, who has been covering the ups and down of B&N for decades, profiled Daunt this weekend and offers a detailed look at the new CEO’s strategy.
Although Daunt (and Trachtenberg) give a few nods to Amazon in the piece, you won’t find any mention of barnesandnoble.com. In fact, there’s barely a mention of Daunt’s strategy for online sales in the entire 2,000 word article:
Mr. Daunt is working to improve Barnes & Noble’s online store, but his focus is mainly on physical stores. “It’s in the stores where you win the loyalty from your customers,” he said. “If you get your stores right, your online sales will follow. If your stores are crap, your online will be as well.“
As the pandemic ravages traditional retail outlets and fuels further growth of online shopping, it’s a curious decision to ignore online selling. The rise of Instagram book influencers and bookshop.org, the new fast-growing online site supporting independent bookstores, are similarly not discussed. And there is absolutely nothing about B&N’s ebook platform, the Nook, despite a surge of ebook reading this year for the first time in ages.
In fact, Daunt’s whole strategy, which relies on localizing the content of chain stores and making books easier to browse, seems right out of the 1990s. It doesn’t seem to take much advantage of B&N’s massive scale in just copying what makes small indie bookstores good. Daunt’s effort could stabilize things for a bit. But it hardly seems like a plan to carry Barnes & Noble through another 100 years.
Aaron Pressman
@ampressman
aaron.pressman@fortune.com
NEWSWORTHY
Reading is FUNdamental. Speaking of books, a book publishers trade group asked Apple to lower its commission on ebooks to 15% from 30% for authors and companies that don't make much money. And Amazon may finally agree to make some of its homegrown line of ebooks available to libraries. The company is in talks with the Digital Public Library of America, one of the small suppliers of ebooks to libraries, to offer titles from Amazon Publishing's self-publishing unit Kindle Direct Publishing, Publishers Weekly reports.
Source of power. Leading electric carmaker Tesla published its first workforce diversity report on Friday. The workforce included 21% women in total and 17% among leadership roles. Black workers made up 10% of the total and 4% of leaders. Also, after Tesla's stock has risen more than sevenfold this year, analysts at Goldman Sachs raised their price target to $780, or about 30% higher than the stock's current price of $599.
You can rely on the old man's money. Wall Street's IPO desks will certainly be popping champagne corks at the end of 2020. It's going to be the busiest December ever for initial public offerings and both DoorDash and Airbnb are looking to raise even more money than expected, $3.1 billion each. They're doing it the traditional way, but Stem, the energy storage company that relies on A.I. management software, will go public by merging with a SPAC called Star Peak Energy Transition.
Mo data, mo problems. A story from Bloomberg reports that Snowflake CEO Frank Slootman's compensation package includes vesting of stock options now worth around $100 million per month. Slootman told me after the company went public that he plans to give away 98% of his wealth via his family foundation.
Who got there first. In a follow up from Friday's essay, Amazon wrote in to note that it offered the first database app in the cloud, SimpleDB, a few years before the formation of Snowflake, which I called the "inventor of the cloud database." You may or may not agree with me that there is a difference between a database program hosted in the cloud and a cloud database program.
FOOD FOR THOUGHT
Algorithms, not people, now make important decisions about extending credit, renting, and even medical care. MIT Technology Review senior reporter Karen Hao takes a look at research showing how the algos can be biased, and what some lawyers plan to do next.
A growing group of civil lawyers are beginning to organize around this issue. Borrowing a playbook from the criminal defense world’s pushback against risk-assessment algorithms, they’re seeking to educate themselves on these systems, build a community, and develop litigation strategies. “Basically every civil lawyer is starting to deal with this stuff, because all of our clients are in some way or another being touched by these systems,” says Michele Gilman, a clinical law professor at the University of Baltimore. “We need to wake up, get training. If we want to be really good holistic lawyers, we need to be aware of that.”
IN CASE YOU MISSED IT
Nearly a third of workers don’t want to ever return to the office By Lance Lambert
Backlash against Google grows over firing of prominent Black A.I. researcher By Jeremy Kahn
5 software acquisitions Salesforce’s Slack deal could spur By Robert Hackett
Why Mastercard is publicly trying to fix its gender and racial pay gaps By Maria Aspan
How Ulta Beauty is using tech to spur in-store shopping during the pandemic By Phil Wahba
The best books of 2020, according to Fortune staff By Rachel King
Europe is missing out on the A.I. revolution—but it isn’t too late to catch up By François Candelon and Rodolphe Charme Di Carlo
(Some of these stories require a subscription to access. Thank you for supporting our journalism.)
BEFORE YOU GO
Rapunzel of the famous German fairy tale is named after a type of radish that her mother craved, leading to all the trouble with the witch and so on. Hopefully the astronauts on the International Space Station won't draw the ire of any powerful sorcerers with their latest gardening experiment, in which they grew healthy (and edible) radishes in less than four weeks. Let's power through the week with healthy food, wherever it's grown.
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