May 27, 2008, 12:00 AM

Borders breaks away from Amazon with new e-commerce site

Two years in the making, Borders’ new e-commerce site moves the bookstore experience online and turns its former platform host into its chief e-commerce rival.

Borders Group Inc. today rolled out its long-anticipated e-commerce site, moving off the Amazon.com platform that’s supported its e-commerce operation for seven years and turning its former host into its chief online rival .

The site already was in the planning stages when Borders announced in March 2007 that it would create its own e-commerce site and sever ties with host Amazon in a bid to improve its financial performance, according to Borders Group vice president of e-commerce Kevin Ertell. Under that agreement, Borders’ site passed online purchases through to Amazon for fulfillment, with Borders receiving a portion of each sale.

For the year ending February 2, 2008, Borders Group reported a net loss of $157.4 million on revenues of $3.8 billion. Borders did not break out online sales volume through Amazon.

The new Borders.com debuts with a rich feature set that aims to replicate the experience of being in one of the chain’s 1,100-plus stores, leverage the Internet’s ability to deliver content, and more tightly integrate shoppers’ online and offline interactions with the brand.

“By creatively combining the assets of our new online channel with the many advantages of our store and vice versa, we’re now giving customers an elevated experience that we believe they’ll find more satisfying than anything else in bookselling today,” says George Jones, Borders Group chief executive officer.

Smack in the middle of the new Borders.com home page is the Magic Shelf, a feature carried over from the beta site Borders launched in October. The Magic Shelf mirrors Borders’ in-store strategy of displaying books with covers rather than spines facing out for greater visual appeal. Shoppers can click on the Magic Shelf’s book covers to bring up a Quick View window with book details and the opportunity to buy, and view more titles by moving the mouse from one side to the other.

Shoppers can expand the Magic Shelf on their computer screens to show a total of 20 shelves with multiple titles on each shelf. Consumers also can personalize what’s on the shelves with the Picked for You feature by selecting a category, such as mysteries. The Magic Shelf reloads instantly to restock the Picked for You shelf. Returning customers will find their shelf refreshed with new category titles every week.

Ertell says initially, Picked for You shelves will be stocked with selections picked by Borders editors, but that when the new site accumulates sufficient customer and sales data those selections will be automated by algorithm to display items likely to appeal to each customer. Movie and music products, which Borders also sells on its new e-commerce site, can also be added to a Magic Shelf.

Another site feature is a wide selection of video applications. Borders Book Club allows visitors to view a professionally produced video of a book club meeting with a twist: the book’s author is sitting in and participates in the discussion. Another site video program, Live at 01, streams in-store events, such as author readings and music performances, while Borders in the Kitchen features author-chefs. Other video programs showcase leading poets and their work, interviews with authors, and life coaching from syndicated radio host Mel Robbins.

In a major build on the Borders Rewards program, which has more than 26 million members, the new site allows members to earn and redeem Borders Bucks and Reward coupons online. Previously, members could only redeem coupons in stores. And in a bid for tighter web and store integration, a version of the new Borders.com is now accessible to Borders shoppers at the six to 12 kiosks in every Borders store.

Whether at the kiosks or at their own PCs, customers can log on to the Borders site to check inventory at a local store or order online for home delivery or get free delivery to a neighborhood store. They also can access and add to their personal Wish Lists, use a new Send to a Friend e-mail template to share video or book information, and search and buy used titles in the new Borders Marketplace, made possible through a new partnership between Borders and independent used book dealer Alibris. Alibris is No. 112 in the Internet Retailer Top 500 Guide.

Borders’ contribution to category sales on Amazon hasn’t been disclosed. In 2007, when Borders.com was sending online sales to Amazon, the media category represented $9.3 billion, or about two-thirds of Amazon’s total sales of $14.8 billion. Amazon is No. 1 in the Internet Retailer Top 500 Guide.

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