From Bloomberg:
Barnes & Noble Inc.’s sudden firing of its chief executive officer after only 14 months on the job dealt another setback to the embattled book seller as it struggles against stiffer competition from Amazon.com Inc.
The sudden vacancy at the top leaves Barnes & Noble treading water while it looks for a new leader, said Neil Saunders, a GlobalData Retail analyst. “And in this kind of environment that’s really fast-paced from all the new competition, you can’t really afford to stand still for very long,” Saunders said.
. . . .
For years, Barnes & Noble has fought an uphill battle as shoppers flocked to online outlets — especially Amazon, which got its start specializing as an online book seller. Its chain of brick-and-mortar stores was plagued by sluggish sales and the slow adoption of its Nook e-reader. The holiday season prior to Parneros’s appointment was the company’s worst in more than a decade.
. . . .
Parneros had originally backed off his predecessors’ efforts to boost revenue through sales of gifts and non-book merchandise. Then last month he said the retailer would make a renewed effort in toys and games following the shutdown of Toys “R” Us Inc.
In a conference call with analysts in June, Parneros acknowledged there was more work to be done before he could turn the business around. “Retail dynamics continue to present headwinds for our business,” he said.
. . . .
It’s not just Amazon that Barnes & Noble has to worry about. International book sellers — including Toronto-based Indigo Books and Music Inc. — have been eyeing the U.S. as an opportunity for expansion, said Robin Sherk, an analyst at Kantar Retail. Barnes & Noble needs to focus on making its stores more of a destination for its customers, Sherk said.
“It’s not that people aren’t buying books, it’s not that people don’t want to buy in the categories that they play in,” Sherk said. “You have to offer them an experience they want if you’re really going to succeed in this space.”
Link to the rest at Bloomberg and thanks to Dave for the tip.
PG says hiring another CEO with more than minimal competence is going to be extremely difficult after this latest premature departure.
Remember, Paneros was the fourth Barnes & Noble CEO in the last five years. Revolving door is too slow a metaphor to describe the pace at which Leonard Riggio fires people.
PG also notes that firing Paneros for undisclosed reasons without any severance payment will spook a whole bunch of prospective replacements. PG doesn’t remember any explicit details from the Paneros employment agreement, but a severance arrangement is a standard employment contract provision for a CEO of anything bigger than a lawn mowing service. PG seems to remember that Barnes & Noble paid several million dollars in severance payments for a couple of Paneros predecessors.
As a result of the way Barnes & Noble handled this termination – no real reason disclosed leaving people to suspect the worst, announcing that no severance would be paid to imply the behavior was very bad – Paneros is damaged goods on the executive employment market. Anybody being recruited to replace him will wonder why Barnes & Noble didn’t permit him to resign and didn’t agree to point to the continued poor financial performance of the company as the major reason. Regardless of Paneros’ sins, this firing was punitive in more ways than one.
Yah. The CEO was ditched in a way that made it appear that he was a sexual harasser. I saw one comment on another forum from someone who had worked at Staples when he was there and said there was never a breath of impropriety with the guy. If B&N hung an innocent CEO out to dry, the whisper network will know. And B&N will, as PG says, have a very hard time finding a quality replacement.
B&N may follow thru in putting more toys in their stores now that Toys R Us is gone, but I read today that Amazon is putting out a printed toy catalog this month.
Revisionist history.
NOOK wasn’t slow to be adopted.
While the thing was buggy as heck at launch, adoption was brisk for the times. Brand loyalty was moving them really was in 2010/11. At their peak they bragged of 8 million active accounts and 26% of the market at a time Amazon was down to 56%.
They “coulda been a contendah”. And they were well on their way but their mistakes were numerous and they quickly friterred away their brand loyalty with reader (and Indie) hostile policies.
Their ebook wounds were all self-inflicted as is typical of tech industry roadkill. Amazon did not kill them; they were too busy tending to readers and Indies to spare much thought to B&N once the four hour price war ended.
CEO, Schmeo. Riggio is calling the shots at B&N. He’ll probably continue to run it into the ground while collecting big fat stockholder checks.
Poor Bloomberg, they just had to add ‘Amazon’ to the title or no one would bother to read their rag.
Nothing Amazon could have done would explain the way B&N’s CEO got tossed out the door – unless he was taking bribes from Jess to sink B&N, which they’d yell from the mountaintops if that was the case.
This was damage control for something big, and the way they did it means people will be trying to find out just what.
Oh wait – there ‘is’ an Amazon angle – I’m ordering more popcorn! 😉
Jeff, not Jess … dangit …