Dive Brief:

• Bookseller Barnes & Noble’s digital chief Fred Argir is unfazed by Amazon’s venture into physical retail, Quartz reports. 

• Without much elaboration, Barnes & Noble itself recently said it will be opening “digital prototype stores,” which presumably will help it compete with Amazon.

• Argir suggested that Barnes & Noble’s new stores will be a fun place for people of all ages to hang out. The company saw improved results in its recent quarter and said it would close fewer stores than it once anticipated.

Dive Insight:

Barnes & Noble has long enjoyed a loyal following, and physical stores have been its forte, almost like a giant local bookstore.

But its venture in the digital book space has been a disaster—its Nook business is struggling. Loyalty in that area is actually a problem for the company, as it can’t “rip the Band Aid” off cleanly because the device also enjoys a fierce, if too small, following. 

Still, the company's plans to wind down its digital Nook business, which Argir confirmed, according to Quartz, comes as e-book sales are falling amid higher prices. And local bookstores have fared well, shrugging off the "Amazon effect" that challenged them two decades ago to survive, despite their inability to compete on price.

Recently, under new CEO Ron Boire, the company has expanded its retail business to well beyond books, and reported strong sales of toys, games, and coloring books in its latest quarterly report. 

Boire, who came on in September, appears to have a vision (in addition to experience), something a retailer in turnaround desperately needs. Perhaps that’s why the company’s digital chief is sanguine about its prospects, despite Amazon’s foray into physical retail.

Observers haven’t really known what to make of Amazon’s moves to go beyond its massive website. Some note that e-commerce sales remain a small percentage of retail sales, while others believe it’s really a chance for Amazon to collect customer data via another channel, and yet others say it’s Amazon putting its Kindle and Echo devices on display. 

“My win percentage on predicting what Amazon is going to do is very low,” Argir said, according to Quartz. “They’re going to do whatever they want to do.”