Amazon Brick-and-Mortar Talk Puts Barnes & Noble in Tailspinby
Barnes & Noble Inc. shares plunged following speculation that Amazon.com Inc. will open hundreds of physical bookstores, potentially thrusting the companies’ longtime rivalry into America’s shopping malls.
The stock fell 9.4 percent to $7.33 in New York on Wednesday, following a 5.4 percent decline the previous day. The rout followed remarks from a mall executive, who said Amazon was planning to open 300 to 400 stores. He later said that his comments weren’t mean to represent Amazon’s actual intentions.
For years, Amazon’s e-commerce empire has put pressure on Barnes & Noble with low prices and convenient shipping. But Barnes & Noble always had one edge: its chain of brick-and-mortar stores. If Amazon does push into shopping centers, the battle will have to be fought on two fronts. And Barnes & Noble is already reeling from sluggish sales and slow adoption of its Nook e-reader.
“They’ll have to spend more on their marketing -- they’re going to have to
have a better idea of what keeps people in their stores,” said Bloomberg Intelligence analyst Seema Shah.
Sandeep Mathrani, chief executive officer of mall operator General Growth Properties Inc., made the remarks about the Amazon stores during a conference call on Tuesday. On Wednesday, he walked back the statement, saying that it was “not intended to represent Amazon’s plans.”
Amazon spokeswoman Deborah Bass declined to comment, but the company has previously signaled that it wants more of a brick-and-mortar presence.
Amazon opened its first bookstore, in Seattle, in November. The store prominently features Amazon gadgets, such as the voice-activated Echo speaker and Fire TV streaming device.