Barnes & Noble Hires New CEO
By Anna Rose Welch, Editorial & Community Director, Advancing RNA
New CEO Michael Huseby optimistic about showrooming and future of the Nook
After a six-month search following William Lynch’s resignation, Barnes & Noble has named a CEO. Michael Huseby, the head of the company’s digital division, has been named the new CEO, effective immediately. This is a big step up for Huseby who, while a B&N veteran, has only been with the company since March 2012. Huseby joined the company as its CFO and was promoted to president a year later. He has also held positions for Cablevision Systems, Charter Communications, and AT&T Broadband.
After former CEO Lynch’s swift and mysterious departure in July, the company has been working to turn around its losses brought about by slowing Nook sales. Now with a new CEO in place the company can hopefully see more progress. As chairman Leonard Riggio says, “Although a relative newcomer to the retail book business, he has quickly developed a comprehensive understanding of the unique opportunities and challenges the company faces, and he has a vision for the future in which I am in complete accord.”
Huseby is going to have a lot of work ahead of him during his tenure, including figuring out what to do with declining interest in the company’s Nook e-reader and rising numbers of showroomers. Indeed, it was a rough holiday season for the bookseller, which reported that retail holiday sales fell 6.6. percent to $1.1 billion. Nook sales (including digital, devices, and accessories) plunged 61 percent during the nine weeks that ended Dec. 28th. The decline in this segment is being attributed to the fact that the company didn’t release any new tablets this year, compared to two during last year’s holiday season.
Regardless of these results, Huseby remains optimistic. In an interview with The Wall Street Journal’s MarketWatch, he points out that this year’s 0.2 percent decline in retail comparable store sales was smaller than the prior four quarters. Husby says, considering that retail stores account for two-thirds of the company’s business, “That’s significant. That gives us some reason to believe we had a good holiday season.” He sticks by the company’s new marketing campaign “It all happens at Barnes & Noble,” which aimed to portray the company as the premier shopping destination for a wide assortment of goods beyond books this holiday season. In addition, while the company is facing more competition from Amazon, Huseby says he’s not necessarily worried about showroomers. Instead, he calls it “a fact of life because of the percentage of the business that’s moved online. We have customers that come into our stores and find out we have a lot of products. They find value in the human element to interact with our booksellers and wind up buying our books in the stores. It’s ok, because we are driving more traffic to our stores.”
As for the troublesome Nook, which has caused a lot of financial grief for the company lately, Huseby says it’s in a “rebuilding period.” Competition from Apple and Amazon is too large for the company to “compete head to head with” he says, but the company will continue selling its color tablet because it has contributed fairly significantly to digital content sales. In an interview with the Wall Street Journal, he says Nook manufacturing costs are a key issue the company will need to address in the future. The company has been looking into various outsourcing options for a while now in order to save on manufacturing costs, however no definite plans to do so have been announced.
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