April 14, 2010, 12:00 AM

Borders looks to web site upgrades and mobile commerce to fuel growth

Borders plans to better connect with consumers via more upgrades to Borders.com and mobile commerce initiatives, says Mike Edwards, interim CEO. Web site search and checkout improvements are expected to build on 32% e-commerce sales growth in 2009.

Borders Group Inc. plans to better connect with consumers via upgrades to Borders.com and mobile commerce initiatives, Mike Edwards, interim CEO, said on a recent year-end earnings conference call with Wall Street analysts. The retailer of books, other media and accessories plans web site upgrades to build on e-commerce sales growth in 2009.

“Based on the sales volume we are experiencing on Borders.com relative to our competitors, it is clear that we have a significant and potentially large upside,” Edwards said. “That is why we are investing in improving the customer interface, checkout and search capabilities. With respect to digital books and e-readers, we have the unique opportunity for Borders as a device-neutral, content-focused, digital book provider. We are excited about our investment and partnership in Kobo announced last December.”

Borders is No. 212 in the Internet Retailer Top 500 Guide.

In March, e-books retailer Kobo introduced an e-book reading application designed for use on multiple e-reader devices. In addition to unnamed hardware manufacturers who will begin preloading the app on their devices this year, Kobo plans its own device, dubbed the eReader. The Kobo eReader will be available at Indigo Books & Music in Canada in May, followed by Borders in the U.S. Kobo was previously known as Shortcovers.

Information about e-books and e-readers will be available this year in Borders stores in new Area-E additions to the traditional information desks, Edwards said.

“The first Borders branded mobile application will be launched through Kobo, a relationship that will enable customers to purchase e-books from Borders on popular smartphones such as the iPhone, Blackberry as well as other devices, such as the iPad,” Edwards said.

Borders is uniting web and store sales channels via an In-Stock Guarantee program it rolled out in the fourth quarter of 2009. Store shoppers who can’t find a title can have it shipped to their home free by store staff who will order the title on Borders.com.

The company also soon will name an e-commerce leader at the executive vice president level, Edwards said.

For the year ended January 30, 2010, Borders reported:

  • Web sales were $60.4 million, a 32.2% increase from $45.7 million in 2008. Borders operated its web site internally for eight months of 2008; before that its web store was operated by Amazon.com Inc.
  • Total sales were $2.26 billion, a 13.7% decrease from $2.62 billion in 2008.
  • Comparable-store sales declined 14.4% and 8.1% in the Borders and Waldenbooks segments, respectively.
Based on Internet Retailer calculations, the web represented 2.7% of sales in fiscal 2009, compared with 1.7% in 2008.

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