Barnes & Noble CEO James Daunt Talks 'The Odyssey', Potential IPO

**SPEAKER_1** (0:02)
Bloomberg Audio Studios, Podcasts, Radio, News.

**Romaine Bostick** (0:07)
All right, well, you remember a while back, investors wrote off Barnes & Noble. This is when Elliott took the company private back in 2019, and then appointed a new CEO, James Daunt. But Daunt's strategy is now working. Plans to open 60 stores in the US this year, and a lot of talk out there about a potential IPO sometime soon. Joins us now here in studio too, the CEO of Barnes & Noble, James Daunt. Great to have you. Pleasure. So you've had a long career in book selling with your own line of bookstores named after you. Then you took over a business over there in the UK, and now Barnes & Noble got folded into that.
Books, physical books, I thought they were dead.

**James Daunt** (0:46)
No, they're not dead at all.

**Romaine Bostick** (0:48)
What happened along the way to this death march? Because it seemed for a while we were either reading everything on e-readers or not reading at all. And then it seemed like not only were people gravitating back to paper, but they were gravitating back to the actual physical bookstore, so not just buying paper books off of Amazon or somewhere else, but actually going into the bookstores and looking for that experience. What happened?

**James Daunt** (1:09)
I think people hadn't stopped reading physical books. I think the narrative had got slightly muddled, but the real problem was they weren't buying them in physical bookstores. And that was, I think, because the stores actually, frankly, had lost their way a bit, they'd lost their confidence, and they weren't fun enough. They weren't enjoyable places enough to be in. So sales started dropping, and they started closing stores, and obviously, borders went bankrupt, and the whole thing got a bit dicey.

**Romaine Bostick** (1:33)
I remember when the chains really became popular, Borders, Books of Million, Barnes & Noble. I mean, there were spaces to hang out. Like, yeah, you went there to buy your books through magazines or whatever, but you hung out there, and I assume that drove sales. What was the strategy shift that happened at Barnes & Noble where people stopped treating a Barnes & Noble store as a place to hang out?

**James Daunt** (1:55)
Well, I wasn't here, so I- No, I know. I'm not, no blame. I'm just curious. But when I turned up here in 2019, the stores were very uniform. They were identikit, and actually, if you do that, they become uniformly less interesting. And then they were full of an awful lot of things that shouldn't have been in there, things that didn't make sense in a bookstore, which they were selling plenty of, you know, warm water, Duracell batteries. You know, it became a sort of a mix of strange other retailers, quite a lot of CVS in it, and that's out of there now and we're first and foremost books, but then we sell quite a lot of round books, but things that make sense in a bookstore, vinyl records, DVDs, newsstand, you know, and a certain amount of toys and games and things, and that makes sense. And also we just liberated the stores to have fun.
And if you allow the stores to have fun, you know, all the kids come in, as you say, schools are over, bang, they become great meeting places, and then all ages are in, and then your sales start going up and everything starts getting rosier again.

**Emily Graffeo** (2:51)
What is the strategy for creating fun? Is it about, you know, adding more couches, adding, you know, a Starbucks in there that people can come to? How do you manufacture an environment where people can really enjoy themselves?

**James Daunt** (3:04)
Above all, you let the store team decide what to do in their store, because every community is different, every place is different, and we liberated them from central control. We said, you know, it's, you know, treat it like it's your name that's above the door.
Have fun with your teams, build up really good bookstores, and we're not going to tell you how to do that beyond the principles attached to it. No rules. Common sense. Have fun.

**Emily Graffeo** (3:30)
You know, speaking of fun, it's interesting to see, you know, TikTok, Gen Z, readers. There's all this talk of, oh, Gen Z doesn't read as much. But then you look at something like Book Talk, and actually, there's a lot of young people talking about all the different kinds of genres. One that's gotten a lot of attention is Romantic.
Romantic, you know, fantasy books. Is that driving sales? How is that genre specifically, you know, generating foot traffic and sales at the Barnes & Noble?