So this is Christmas... And What has Borders Done? Another Year Older... And...
well you know the rest.....
It has finally been confirmed this afternoon that Borders UK will be closing all it's stores at the end of today; no new buyer has as yet been found, although talks are ongoing. The news confirms definitively the worst fears of the 1150 staff who have effectively been 'dead men walking' since it was announced in November that Borders had collapsed into administration, with increasingly little hope of a Christmas Miracle...
They will be relieved of their posts on the 24th December, Scrooge would have been proud.
Many of those who have shopped at Borders, or in fact ever bought books, knows what fundamentally went wrong with Borders. And there were a few things....
The Borders US arm was a successful chain in the US in the nineties (they are also struggling there now though), encompassing as it did the 'Friends culture' that had been wholeheartedly embraced- people didn't want to browse fusty little bookshops any more, they wanted to buy cds, drink generic coffee, lounge on sofas and meet hot singles; in a nice big out of town store (they have to drive everywhere anyway so this is nothing unusual for them), with the 'buying books' bit a casual afterthought to all the other 'Central Perk' style fun. Brits who had visited a store while in the US were extolling the virtues of the Brave New World of 'book shopping without bookshopping'.
By the time Borders established it's UK presence towards the end of the 90s, there were obvious flaws with the business model that became more of a problem over time.
Borders located themselves in a number of out of town 'retail park' locations. Whilst visiting out of town malls is standard shopping behaviour for US customers who have to drive everywhere, that's not 'how we roll' over here. Retail Parks tend not to be destination stops for customers over here. We go because we work close, or we are killing an afternoon before we pick up the kids, or importantly- because we have a specific purchase in mind (usually a sofa- they all seem to have a sofa store on-site!). We don't wake up of a morning and decide we simply must go to Speke Retail Park, and spend the day there, wandering around B&Q and buying CDs. And we definately don't decide we need to spend time milling around a bookshop, in a retail park, in the middle of nowhere. So location was a big problem.
The second issue was that the 'Friends' model itself has grown tired. Not only is everyone doing it- you can grab a coffee and preview your book purchase in plenty of places these days, but also- we have grown wary of multi-nationals and our own big players enforcing their generic view of the purchasing experience. (Think 'You've Got Mail' the mediocre Meg Ryan/Tom Hanks movie in which she runs a little book store threatened by the heartless chain bookseller he represents) Retailers have had to adopt more of a 'glocalisation' approach to trading, to inspire loyalty. In these uncertain times we shuffle back towards what we know, and heritage (such as M&S '125 years'campaign and the myriad other retailers also trading on their history recently) and local (e.g. the 'save our high street' campaigns to fend off the rise of the super-supermarket.... ) values become more important.
Borders had nothing to trade on here- they could be said to be a perfect example of the faceless soulless corporation we feel no loyalty for and are happy to desert when a more favourable alternative presents itself...
Which brings me to the third and most important factor in Borders' UK demise... The internet... aka 'The Amazon effect'. For those of us not rushing back to our local bookshops to help them in the fight against Tom Hanks, there was Amazon. It revolutionised book shopping, changing the book industry forever.. Buying a book was suddenly so quick, so simple, and so cheap, and with online sellers able to ferociously undercut due to lack of crippling overheads. This has been competition too fierce for many to contend with, and has only grown over time... It is now estimated online sales of books are actual set to overtake high street sales within 10 years. According to Verdict research, pressure on retailers that rely on bricks and mortar is set to “intensify” and that 2020 will be a “tipping point” for retailers of books....
I'm; not even going to mention the recession because Heaven knows that isn't a unique problem to Borders- although it does force the adage 'Adapt or Die' to be truer than ever..
And there you have it. Despite their best efforts- a slick new IT system, a cost-cutting headcount reduction, a diversified product offering... Borders could not ring the changes enough to survive, and are another 2009 casualty of the current 'economic climate'...
So who was the Grinch who stole Borders UK's Christmas? Well I guess it was the Internet, the Customer, the US arm... And Borders UK themselves. These things are never simple, but also usually more simple then they seem....
Tuesday 22 December 2009
Thursday 17 December 2009
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