Is Borders’ “go-slow” approach to the online marketplace really a stroke of brilliance after all, as the Wall Street Journal recently postulated? The argument goes like this: despite the company’s listless approach to the Internet, which drove investors so bonkers that Borders rolled out the auction block earlier this year in search of a buyout partner, the nation’s #2 book retailer is actually sitting pretty by crafting a clicks-and-mortar bid to lure consumers into stores and cement customer loyalty.
“It’s more than just the clicks and bricks,” Borders president Tami Heim told the press at a recent briefing on the company’s multimedia plans. “We are creating a convergence experience for the customer.” As she unveiled a slew of tech-driven devices geared to blur the boundaries between terra firma and cyberspace, Heim hammered home Borders’ new corporate catchphrase: “the ultimate customer service experience.”
In other words, say “convergence” three times and click your heels. First, there’s Borders Vision, the new streaming video component of borders.com that offers video clips in six different genres and will also broadcast in-store author events, all developed with media firm Centerseat. Second, kiosks slated for roll-out to stores later this year will allow customers to search for a title and pinpoint the book’s location in the store (plus offer access to reviews, title recommendations, and email newsletters). The kiosks also enable customers to order a book from the Borders database for delivery in-store or elsewhere. And third, “E-Listening” stations, currently in test phase, will allow customers to scan a CD or audiobook barcode and listen to all tracks of the CD or a selection from a spoken-word audio track. Customers can preview 90-second trailers of films in the video departments, and a wireless incarnation is also in development that would let consumers wander about the stores freely, checking out audio selections at their leisure via a hand-held scanning and listening device. Len Cosimano, Borders vice president for multimedia, even waxed optimistic about a “complete wireless environment,” with customers downloading audiobooks in-store and popping e-books onto their Palm Pilots.
As are other cross-channel retailers, Borders is striving to integrate its “enormous” cache of customer purchasing information into one database. Theoretically, customers could log onto the company’s website and check on an order they made at a brick-and-mortar store, or vice versa. More crucial for sales, Borders hopes to leverage its customer data to create what Heim called a “one-to-one digital dialogue” with customers by pitching book and music picks via email and the borders.com site.
Of course, Borders could use the customers. The top three e-commerce websites for the second quarter of this year were Amazon (with 18.7% of consumers surveyed buying from the site), eBay (15.8%), and bn.com (6%), according to a joint study by U.S. Bancorp Piper Jaffray and Harris Interactive. But Borders.com didn’t make the cut of the top 11 sites. Moreover, Borders isn’t the only one with a few digital tricks up its sleeve. Bn.com has rolled out BNTV (produced by media production company Rain), where streaming “bookVideos” showcase various titles and where a daily author interview series is slated to appear this fall. The UK’s BOL TV, meanwhile, broadcasts interviews with writers every weekday at bol.com.
As to how Borders’ new vision will play on Wall Street, investors have yet to don their 3-D glasses. Acquisition talks fizzled last month when Borders brass rejected a reported $16-a-share offer from Apollo Management, Bain Capital, and Blackstone Group, which amounted to about $1.28 billion but was considerably lower than the $20 to $25 per share said to be expected for the company. And it remains to be seen how much a “convergence experience” will improve Borders’ standing in the marketplace. Still, the company can congratulate itself on having grasped the primary lesson of the New Economy. As Cosimano explained, “This is content, folks. That’s what this is all about.”
