Father’s Day Kindle Nook stand-off? $50 gift card with Nook

Deciding between the Kindle and the Nook just became a little tougher.

From today through the 3rd of July B&N have a $50 gift card if you buy a Nook at a B&N store or at their website. Given that both Amazon and B&N are already offering free shipping (free 2 day for Kindle) this is a really good deal.

Purchase a NOOK at participating Barnes & Noble retail stores or online at http://www.bn.com (EAN: 9781400599998), and receive a $50.00 Barnes & Noble Gift Card, while supplies last. This offer is only valid for purchases made at Barnes & Noble retail book stores where NOOK is sold and for orders placed on http://www.bn.com

Strangely, the offer is not available at B&N College bookstores.

It’s a great promotion and you have to wonder why B&N have it - Is it to balance the Kindle’s arrival at Target? Is it to clear out stock and prepare for the Nook 2? Is it to make the most of Father’s Day and Graduation season?

Why is B&N adding a $50 gift card to Nook purchases? 

Is this part of a Father’s Day Kindle Nook stand-off?

The first possibility is that B&N have identified the month of June as a critical one -

  1. Father’s Day is 20th June. 
  2. Lots of graduating students and graduation gifts.
  3. Lots of people are getting ready for summer reading.  
  4. Lots of school and college students are embarking on their long summer vacations.  
  5. iPad hysteria is beginning to subside and people now want a device they can actually use in sunshine and hot weather.

CNet originally pointed out the Dad and Grad season as a possible reason for the Nook $50 discount -

Needless to say, Barnes & Noble is trying to gain an advantage as we head into the important Father’s Day and school graduation buying season.

“The company will provide a free $50 Barnes & Noble gift card with any Nook eBook Reader purchase through Barnes & Noble and Best Buy,”

It’s as good a possibility as any. Amazon will have to respond – a $50 gift certificate is a big deal.

Perhaps a Nook 2 is on the way

The FCC just granted approval to a Nook Lite. It’s code name is Bravo Lite which makes you wonder if  the Non-Lite Bravo is the Nook 2 and when it’s going to show up.

If there is indeed a Nook 2 on the way it’s not unimaginable that it arrives around the time Nook Lite arrives and the FCC approval would mean that’s soon. Thus, the $50 gift card would be a thank you for helping B&N clear stock of the Nook and prepare for Nook 2.

Is it to counter the Kindle’s arrival in Target Stores?

Kindle will be sold in all Target Stores starting June 6th.

We suddenly have a big Nook advantage (retail availability, being able to touch and play with the device) nullified completely. There are also far more Target Stores than B&N stores.

It would be the first time people get to actually see a Kindle and play with it and experience all its strengths - Kindle was the #1 eReader even when people had to buy it based on photos and their faith in Amazon. Now that they can see it for themselves there’s a possibility sales tilt even more in favor of the Kindle.

B&N want to avoid that and they think $50 worth of free books with a Nook will help. They’re probably right.

Are rumors of Kindle 3 weighing on Nook sales?

There are so many rumors of Kindle 3 you’d think Apple were making it. Coffeeshops in Seattle, Bloomberg and loose-lipped executives are all atwitter about the Kindle 3 and people are probably beginning to delay their eReader purchases.

Kindle and Nook sales are likely to be affected and one way to compensate is to lower the price. A $50 gift card is almost as good as a price-cut – People equate the gift card with money saved on ebook purchases. Suddenly, the Nook is just $209 which is definitely a bargain.

Does B&N feel Kindle is pulling ahead and they have to compensate?

Perhaps the most boring, straightforward reason for the $50 gift card.

It might just be that B&N feel the Kindle is evolving too fast to keep up with – a new Kindle 2.5 release (well, hopefully soon) that has a lot of good features, Kindle for Android, a deal with Asus to get Kindle for PC, and lots of other moves.

B&N took 7+ weeks to get out their iPad app, they are still fixing Nook bugs and still working on speed issues. At some level they must feel they can’t win the software side. Perhaps the $50 gift card is an indicator that B&N have decided to find other ways to attack Amazon.

Are Publishers secretly helping B&N?

You have to wonder -

  1. B&N have an ongoing promotion with a free book every week for 5 weeks. These are books that are not being made available free at other ebook stores.
  2. Now B&N are offering $50 worth of free books with a Nook.

Perhaps the latter is connected to the former and perhaps Nook aren’t paying Publishers anything for the books customers will buy with their $50 gift cards. $50 in ebooks costs B&N just $35 as it is (Agency Model gives Publishers 70%). Perhaps Publishers are taking just $15, perhaps they are taking nothing.

It’s a small price to pay to reduce the threat of the Kindle turning them into relics.

How important are physical stores for selling ereaders?

Apparently the Kindle might be coming to BestBuy soon (Kindle World) -

A long-time commenter at Engadget, David Wixom has posted that he is an employee of Best Buy (sells cameras there) and says today that:

  “I have a feeling we are going to start selling the Kindle at Best Buy as well seeing as we just got cases for them in on the truck today.  I find it hard to believe we will sell cases for a product we don’t sell.

  My impression is that the comment is genuine (not rumor-mongering), as he identifies himself, unlike the bulk of anonymous posters

This is in addition to claims that Kindle is going to start selling at Target on April 25th (TechFlash via Engadget) -

… Kindles may be headed to Target store shelves by April 25. Perhaps Amazon sees a greater need for a brick-and-mortar sales channel for its e-readersAsked about the Kindle-Target report, Amazon spokesman Drew Herdener said “we don’t comment on rumors or speculation.”

We also have news from Engadget that B&N’s Nook will start selling at BestBuy on April 18th -

… now multiple sources are telling us that Best Buy will start selling the Barnes and Noble Nook on April 18th — a rumor we can back up with this shot of Big Blue’s inventory system.

We’re also informed that units are arriving at stores right now, so keep your eyes peeled …

So in the space of a few days we hear that Amazon might start selling the Kindle via Best Buy and Target and B&N might start selling the Nook via Best Buy.

By the end of April we’ll have the Kindle available for the first time in physical stores and Best Buy will be the stage for the War of the eReaders and Pretend eReaders – Kindle vs iPad vs Nook.

How badly do Kindle and Nook need retail presence?

(Of course, for Nook we mean in addition to B&N stores).

Very badly.

Apple has managed to get more publicity for the iPad than perhaps any product ever. It’s also trumpeting sales numbers (now at 450K iPads sold).

The way Steve Jobs is promoting the iPad is a master-class in sales psychology -

  1. ‘A Magical and Revolutionary Product at an Unbelievable Price’ - That phrase is a work of copywriting art.
  2. The constant reminders of sales invoke Social Proof – notice how they are always referred to as amazing and magical sales numbers and when possible contrasted against lower figures.
  3. At the iPhone OS 4.0 announcement Steve Jobs kept harping about how they can’t make it fast enough – which is exactly what he would say whether 1 million iPads had sold or 100,000. That and the convenient sold-out status a week before launch invoke Scarcity.
  4. Selectively talking up good points (reading light, color screen, Winnie the Pooh) while ignoring negatives (reading in sunlight, advantages of eInk, lack of range in iBooks). 
  5. The constant bombardment of the Press increases familiarity and that creates a Liking for the product. It’s why advertisers always try to get their brand/product brought to customers’ attention again and again.
  6. There’s always talk of 600,000 books downloaded on iPad without mentioning how many are free books. Note that Amazon got blasted for their Christmas ‘more ebooks than books’ press release even though they did NOT include free book downloads.
  7. The constant reminder of the promise of Apps and of the sheer number of apps.

Apple is just destroying eReaders in the War of Perception – Steve Jobs’ Reality Distortion Field is in full effect. The best response to that is Reality.

The Kindle and Nook need retail presence badly to provide a dose of reality. A shot of eReader reality will create three main effects -

  1. Familiarity – All the iPad articles and press coverage are getting people very familiar with the iPad. Amazon and B&N need to ensure that users get a chance to see their devices regularly too. If all things are equal the more familiar device will get picked. 
  2. Fair Representation - The Press have downplayed the strengths of eReader devices. When people try them out themselves they’ll be able to tell the difference instantly – eInk vs LCD, unitasking vs multi-tasking, weight, portability, glare. Things that all the iPad reviews and Kindle vs iPad comparisons completely miss out. 
  3. Financial Reminder - A reminder of the price and of cost of ownership really helps eReaders. $259 is a LOT less than $499 - Especially when you get a chance to see the Kindle has free Internet (with a limited browser). 

The importance of reality brings up another question.

Could Kindle and Nook win against Steve Jobs on Perception?

Quite frankly that’s almost impossible as long as the Press are in bed with Apple. In a few years when the Press realize that Apple have exploited them just like the Internet did they might be more likely to paint a fair picture. For now, it’s best to assume that it’ll be a guerrilla war against the main stream media and Apple’s full-out invasion of people’s minds.

Getting actual eReaders in stores is a big step.

Equally big is positioning eReaders well and focusing on their strengths -

  1. The focus on reading.
  2. Reading in sunlight.
  3. Reading for longer periods.
  4. Battery Life.
  5. Reading purchased books on PC, Mac, Blackberry, and so forth. With iBooks you can’t.
  6. Lack of distractions.
  7. Portability – smaller size, lower weight, one-handed reading.

At this point it might make sense to talk up the price difference a lot. With the understanding that an iPad Mini down the line (perhaps, in Q1 2011) means price can’t be relied on as the main advantage.

If eReader companies really do want to stick to only books (and not expand the Kindle and Nook brands to multi-purpose devices) it might be worthwhile to paint Kindle vs iPad as book lovers vs the world. 

It’s really difficult though – Apple are masters of psychological influence and the one thing that’s keeping dedicated eReaders in the game is that Apple’s strategies don’t work that well with people who read books. Which is perhaps why they want book lovers to buy a device that’ll lead to reading less books.

Thoughts on eReader Strategy

There are just so many things going on – the most important of which might be the almost sold out status of nook and sold out status of the Sony Reader Daily Edition.

Kindle being the only eReader in stock is just one of many facets of eReader strategy that are interesting this Holiday Season.

Most Interesting Things about Amazon’s Kindle Strategy

  • Sacrificing almost everything else for a focus on reading.
  • Focus on easy purchases.
  • Books being $9.99.  
  • Allowing independent authors.
  • Going International with a US base.
  • Cutting prices non-stop this year.
  • Having enough stock this Holiday Season.  
  • Not releasing Kindle 3.
  • Creating a platform (the beginnings of one).
  • Grabbing a piece of almost every part of publishing.
  • Amazon Encore and the choice of authors.
  • Eliminating the used books market and sharing of books (for ebooks).

Most Interesting Things about Barnes & Noble’s Nook Strategy

  • The super aggressive price point.  
  • The design and the two screen strategy.
  • Going through the Top 10 Kindle complaints list and incorporating most of them into the nook (PDF, expandable memory, replaceable battery, etc.).
  • Selling ebooks at higher prices even though that gives Kindle a BIG advantage.
  • Thinking up Nook Lending.
  • Not having an execution strategy for Nook Lending.  
  • Partnering with Google to such a ridiculous extent.
  • The store-nook tie-up which might be genius.
  • Not having Nooks to play with in-store. Having to buy in-store and then get Nook by mail.
  • Pushing up the nook’s release – the lack of store models, the stock selling out, etc. all point to a rush job. 
  • Having Android and WiFi and a LCD screen and not having a browser.

Most Interesting Things about Google’s Strategy

  • Saying they’ll jump into selling ebooks next year.
  • Delaying till next year.
  • Providing a million free ebooks to everyone. 
  • Telling Publishers they can sell ebooks at hardcover prices.
  • Pushing Android for eReaders.
  • Trying (and probably succeeding) in getting an exclusive right to exploit orphan works.
  • Going into News - In fact, putting a ton of effort into News.  

Most Interesting Things about Sony’s eReader Strategy

Well, to be quite frank Sony’s strategy is rather boring. They have done a few things worth mentioning -

  • Partnering with Google and trying to beat Amazon on book range by using public domain books.
  • Library Finder feature.
  • Persisting with touchscreens even though the touchscreen layer obviously kills readability.
  • Finally releasing a wireless capable eReader.
  • Selling out before release – even before pre-orders were available it seems.
  • Telling people they can’t get the Daily Edition by Christmas.

Random Thoughts on eReader Strategy 

Good Strategy:

  • B&N saying that eReaders are almost sold out and are now shipping on December 18th.

That way people who want it for Christmas will rush and buy one.

Bad Strategy:

  • Sony saying that the Daily Edition eReader will ship somewhere between December 18th and January 8th (and that no delivery dates can be guaranteed).

People want an eReader by Christmas so sales go to zero.

Good Strategy:

  • To have a device sell out in a few days. To tack on 2-3 week waits.

People assume it must be good. That and their investment (the fact that they waited weeks for it) means they will love it no matter what.

Bad Strategy:

  • To actually sell out during holiday season. Something that Amazon seem to have gotten over and B&N and Sony seem to have discovered.

Is it eReader screens? Could the underlying reason be the same?

Good Strategy:

  • To keep cutting prices and keep forcing competitors to match. Both Sony and Amazon are doing this well.

Bad Strategy:

  • To build up a ton of buzz and then not have an Apple Slate for this holiday season.

Of course, some people are still waiting till 2010 just for the Slate which now might be delayed to the latter half of 2010 (Doubt it – March 2010 at the latest). 

Good Strategy:

  • To make buying books effortless and add-on wireless access.

It’s so easy to buy books for the Kindle it should be illegal.

Bad Strategy:

  • To add-on $2 outside the US even when you do USB downloads. Surely, if people download to their computer and transfer there are no wireless broadband charges.

A lot of people are upset about it – most of it seems to be the (misconception?) belief that US customers get a better deal.

Good Strategy:

  • To tap into other channels i.e. iPhone, PC, Mac.
  • Now Sony are going to release Sony Reader for iPhone and PC.

Bad Strategy:

  • To wait for nook for pc before releasing Kindle for PC.
  • Sony waiting to let Amazon control the iPhone ebooks channel before entering.

Good Strategy:

  • To keep customers anticipating a new release – both Apple and Amazon seem masters of this. 

Bad Strategy:

  • To keep customers waiting too long.
  • Apple is guilty of this. As is Plastic Logic.

Good Strategy:

  • To pick  a short, catchy name – like the Slate, or the Kindle.

Bad Strategy:

  • To pick a name that is long and confusing – Kindle International and US Wireless? Sony Reader Daily Edition?

Kindle Global is so much better – Amazon are finally getting around to it.

Good Strategy:

  • To release lots of free books and keep customers visiting Amazon and potential Kindle owners thinking (rightly) that they’ll get lots of free books to justify the $259 price.

Anyone considering a Kindle can’t help notice tons of free books, tons of cheap books and then factors that into their decision.

Bad Strategy:

  • To price eBooks high and make customers choose Amazon instead.
  • Both B&N and Sony are guilty of this.

There are a lot of people stopping by to mention that B&N’s ebooks are too expensive and that potential Nook owners should look at ebook range and price before buying.

Deja Vu – This Christmas Nook ereader will be out of stock

BrightHand broke the news that Nook preorders are now shipping on December 11th (Nov 30th was the original shipping date).

those placing pre-orders now are being told that they won’t get it until the second week in December.

Wall Street Journal have their own take on it -

A second wave of customers was told it would ship Dec. 7. Now new customers are being told that their pre-orders will ship Dec. 11

Buying a Nook sight unseen for Christmas?

The way things are trending it seems that soon people will have to buy a Nook without touching it or playing with it if they want one for Christmas -

 Those who would like to give the Nook as a Christmas present will apparently have to seriously consider buying it unseen, as devices pre-ordered next month might not ship until too late.

Also, it seems like stores will only have demo units (this might be a bit of an exaggeration by BrightHand) -

 At this point, it’s not clear if B&N stores will have more than demo units this year; all sales may have to happen on the Web.

Growing Pains? Smart selling?

There are a few possibilities -

  1. The Nook is a bigger hit than thought. Possible.
  2. Barnes & Noble simply underestimated the eReader market thanks to Amazon’s secrecy. This is the most probable reason.
  3. B&N want to push sales and are trying to replicate what happened with Kindle 1 and the ensuing rush to buy Kindles before they sold out. Nintendo Wii and Apple products have used the strategy before (knowingly or unknowingly).
  4. B&N want to sell as many Nooks as possible before the lawsuit when an injunction might halt sales. This is the second most probable reason.

The news arriving so soon after Alex’s request for an injunction certainly points to it as a reason. If B&N were simply trying to pump sales they’d wait until Thanksgiving.  

Why does the BN site not say any of this?

As of 6:18 pm PST the Barnes & Noble site did not give any warning of the delays. Perhaps it only shows up after you order – which defeats the purpose.

Has Amazon managed to fool B&N into underestimating the market for eReaders?

This is the most probable reason that B&N are out of stock.

They simply had no idea of what the demand would be (and certainly no idea of how big Christmas Season could be).

They probably came in expecting 100,000 to 200,000 sales and then found out that a few million eReaders are going to sell this holiday season and Nook’s share (25-30%?) amounts to a lot more than 100,000 Nooks.

The two extremes i.e.

  1. Stealing Amazon’s strategy of ‘sold-out’ to create demand. 
  2. Getting fooled by Amazon’s secrecy.

Point to just how clueless we are about the actual eReader market.

You have to give Amazon credit - even after 2 years no one has any credible idea of actual Kindle sales figures.

New eReaders – MSI eReader, Bridgestone Color eReader

The rush into the eReader Market continues with two more companies drumming up their new eReaders (both 2010) -

BridgeStone Color eReader Prototype using QR-LPD

BridgeStone has a news release (translated by Google) with details on its new superhero eReader -

  1. 13.1 inches pages (A4 size) refresh in 0.8 seconds.
  2. However, they also mention 10.7 inches screen size and that might be the actual size.
  3. Color with 4,096 colors. It looks impressive -

    Bridgestone QR-LPD eReader - Color

    QR-LPD means Color Bridgestone eReader

  4. Touchscreen that supports handwriting.  
  5. Ability to connect to mobile phones.
  6. Focused on ebooks, newspapers and documents.
  7. Kansai Urban Banking Corporation will start a trial in Spring 2010.

It certainly seems like color eReaders might go mainstream in 2010.

Liquavista wows with Prototype eInk that supports Video, Fast Refreshes

Engadget has the scoop on 3 new ePaper technologies from Liquavista –

The main focus seems to be on supporting video and faster screen refreshes. They also have a color eInk technology they’re working on (no release data indicated), and something called Vivid that comes out in 2010 or 2011. As opposed to electrophoretic displays (which is what eInk is) these are electrowetting displays and that allows for faster refresh speeds and video support.

MSI eReader with Tegra Chip

The MSI eReader is based on NVIDIA’s Tegra processor. Digitimes has the actual scoop –  

Micro-Star International (MSI) chairman Joseph Hsu revealed that the company is currently in development of an Nvidia Tegra-based e-book reader, but since the device still has some problems are waiting to be fixed, the company will wait until the first half of 2010 to announce further details.

 The Tegra series of chips have features that make you wonder why it’s used (these are for the lower powered chip) -

  1. 720p HD video playback.
  2. Low Power.
  3. Ability to access visually intensive applications like mapping and gaming.

The use of Tegra hints at an eReader/Netbook hybrid, much like MSI’s netbook rival Asus. Electronista also arrives at the same conclusion.

Apple Slate rumors reappear - Apple ready to give Newspapers 70%

The Sydney Morning Herald thinks the Apple iReader/Slate might be out early next year, based on Apple talking with Australian media companies -

Apple is preparing to release a groundbreaking tablet computer in Australia and around the world early next year and has been in discussions with media companies …

 It will have a touch screen and be targeted at users who mainly want to surf the web, read books and newspapers or watch movies

While early next year definitely doesn’t gel with imminent Apple Slate, it does confirm that books and newspapers will be targeted.

What should be really interesting for newspapers is the Herald’s claim that Apple is offering newspapers 70% of revenue -

Apple’s model has been to give developers 70 per cent of the revenue and to keep a 30 per cent cut. It is expected a similar deal will be offered to media companies

Since Apple users pay their mobile carrier separately for network use, the bandwidth prices that drive Kindle subscription costs higher don’t apply.

Meanwhile, Peter Kafka at Media Memo claims that Bill Keller won’t confirm or deny the Apple Slate and that other news organizations aren’t privy to Apple Slate information (which obviously clashes with the Herald’s report).

Barnes & Noble to sell Plastic Logic Que eReader in stores, will only have demo Nooks in some stores

In a strange twist Barnes & Noble announced two news items that make little sense together -

Some B&N Stores will only have Demo Nooks

Paid Content confirms that only some BN stores will carry the Nook for on-the-spot sales.

That means at other stores users get to play around with a Nook and then wait for their Nook to be shipped to them. The Paid Content Article also includes a Q&A that dispels some myths i.e.

no browser, no Text To Speech, some publishers have opted out of LendMe or blacked out portions of their catalogs.

more favorable sharing of revenue with publishers – However, B&N will own the customer relationship.

No discount on Nook for B&N members. No Advertising initially beyond B&N’s in-store and online promotions.

Good to get confirmation on some of these ideas. Wonder what cut B&N will offer Publishers.

B&N Stores will sell Plastic Logic Que eReaders next year

While B&N won’t be selling Nook at all stores, they will be selling Plastic Logic’s Que.

The only conceivable reason B&N are doing this is that they feel the Que takes on the Kindle DX and not on the Nook. Nonetheless the fact that we might end up with Barnes and Noble stores that sell Ques and not Nooks is weird.  

ReadWriteWeb asks a valid question – Are B&N partnering with too many eReaders?

The answer would be yes. What’s worse than the confusion of choosing between Que, Nook, iRex?

There will actually be stores where you can get a Que or an iRex instantly – but for the Nook you have to wait to get it in the mail.

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