Borders Group Inc., gutted by the Internet, threatened by electronic books and plagued by inconsistent management - filed for Chapter 11 bankruptcy protection today, 40 years after Borders started as a used bookstore on South State Street here in Ann Arbor, MI.
To be sure, some see new opportunities in the problems facing Borders. “The way something is sold influences the way it is made, and the book industry has always been about bookstores,” said business book writer Seth Godin.
What will be published in the future will have less to do with what bookstores carry and more to do with what readers tell each other about new books. “Small publishers and self publishers have as many tools to reach readers as big publishers do,” said Mr. Godin, whose next book, “Poke the Box,” will be published March 1st via an alliance with Amazon.
"Anyone who's trying to get the attention of the young Internet user now has to compete with the dominant position that Facebook has there. On the other hand, they have opened up a lot of opportunities," said David Cowan, a venture capitalist at Bessemer Venture Partners in Menlo Park, CA.
Facebook, which has more than 600 million users and was valued at $50 billion in a recent funding round, is grabbing online-advertising from Yahoo, MySpace and others. Facebook executives aren't shy about their aspirations. "We think every industry is going to be rebuilt around social engagement," Chief Operating Officer Sheryl Sandberg said.
Facebook already helped spur a new crop of videogame companies designed around interacting with friends, Ms. Sandberg said, adding, and “News, health, finance, shopping and commerce— we think similarly, all of these things will be rebuilt by companies that work with us to put social at the core."
So far, Facebook's key battleground has been in online marketing. In just two years, Facebook's share of online display ads has surged to 13.6% from 2.9% of the U.S. market, which reached $8.88 billion in 2010, according to research firm eMarketer. Facebook's growth comes at the expense of companies such as Yahoo and AOL Inc., and the site is also likely taking ad money away from traditional media like newspapers and TV.
For businesses, integrated marketing campaigns across paid search, search engine optimization (SEO), and email improves brand recall and purchase intent. This also helps marketers gain a more holistic view of their customers to aid measurement and future campaign targeting.
Search marketing accounts for 59% of the overall interactive budget due to keyword costs and program volumes. In contrast, email is cheap: It makes up only about 5% of interactive marketing budgets, even though 97% of marketers use it.
Coordinating email and search via social networks may improve overall cost efficiencies. Email and search are two of the most used and most effective marketing tactics. For three years running, more than 90% of marketers use or are planning to use these tools with no significant growth or decline in adoption.
When incorporating users’ networks of friends into the search and email equation, people are now allowed to spread-the-word of what they like to their friends and others who share their preferences. Using social network platforms to take the place of traditional news, political and commercial communication methods is quickly becoming the new normal.
Sources: The Wall Street Journal, http://www.annarbor.com/ and Forrester Research, Inc. To read more: http://online.wsj.com/article/SB10001424052748704593604576141350618351030.html#ixzz1E8UKcZie