Another Weak Quarter from Borders; Expands Non-book Offerings:
Watch for changes as Borders scrambles to reposition itself in the consumer world:
Capital expenditures in the quarter increased to $7.7 million from $1.2 million as the company invested in digital programs and Borders said its ‘Area-e’ digital section will be opened in all stores by the end of October. The section will sell an array of (low price) dedicated e-readers. Earlier this week, Borders lowered the price of the Kobo e-reader to $129.99 and on the Libre Pro to $99.99.
To improve the customer experience at its physical stores, Borders said it is adding more non-book product in an effort it said to differentiate itself in the market. ‘We are taking steps to transform our retail model, in part through high-impact strategic partnerships, like Build-A-Bear Workshop, that enable us to offer a compelling mix of lifestyle focused products,’ said CEO Mike Edwards in a statement. ‘By offering a rich and relevant selection of product – both book and non-book – together with an exceptional customer experience, we will differentiate Borders from others in the marketplace.’
In addition to the Build-A-Bear Workshop, Borders is adding more educational children toys and games, adult games and puzzles, stationery and will expand its bargain book and value book segments. According to Edwards, its research shows that its customer base is largely female and that fact will drive all of its strategic efforts moving forward.
