Borders evaluates its e-commerce options
Though the company is releasing few details, Borders Group Inc. is reviewing its e-commerce strategy, including its relationship with Amazon.com.
A company spokeswoman says Borders Group is completing a strategic review and will announce any changes by the end of the first quarter. “We are looking at all options of our strategic plan and we are looking at Amazon,” she says.
Borders currently uses Amazon.com as its e-commerce arm. But Borders CEO George Jones recently told the Reuters news service that the company’s five-year relationship with Amazon is under review. Borders also has mentioned that its e-commerce strategy is being reviewed in the company’s most recently filed quarterly earnings report. “The company is currently exploring alternatives to its e-commerce retailing business, which could result in changes to the existing e-commerce structure in 2008,” Borders says.
Under its existing relationship with Amazon, No. 1 in the Internet Retailer Top 500 Guide to Retail Web Sites, Amazon operates Borders.com, Waldenbooks.com, Borders.co.uk and Booksetc.co.uk. Amazon is responsible for the fulfillment of all products sold through the Borders’ web sites and retains all payments from customers. In return, Borders receives referral fees for products purchased on Borders.com and its affiliated sites.
In recent months Borders has been working to expand its Internet and digital business base. In September Borders launched an online Borders Book Club video program at Bordersmedia.com. The program presents group discussions with authors, and viewers can click a nearby link to purchase the featured book. With competition in book-selling ranging from bookstore chains to big-box discount chains to drugstores and newsstands, Borders Group also is using rich media and an online loyalty program that attracted 6 million members in its first two months to engage customers as a source of knowledge and entertainment, executives said at the Internet Retailer 2006 Conference and Exhibition.
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