Faced with a wave of very well-funded textbook rental competitors, Barnes & Noble (NYSE: BKS) is firing back with a textbook rental service of its own. B&N — which is the largest operator of college bookstores in the U.S. — says that students at 25 of its campus bookstores will now be able to rent books and that it will “dedicate significant resources to expanding its rental program to more of the colleges and universities it serves.”
The move comes two months after textbook rental service Chegg raised $112 million in venture funding, which it is using in part to fund an aggressive multi-platform ad campaign and also to expand the number of colleges it serves; another competitor in the market, BookRenter, raised $6 million in a round in late November.
Both Chegg and BookRental have said they’re seeing heady growth. By contrast, B&N’s college division reported declining same store sales growth last quarter.
B&N should be a strong competitor in the rental market because of its physical locations on college campuses; Students will be able to pick up their rented books directly from their college bookstores instead of having to wait for them to arrive by mail. How the investment will impact the chain’s bottom line (which is already in the red) is not clear, however.
Still, for the college bookstore chain, the willingness to embrace a new business model rather than stubbornly try to protect an old one seems like a change. At my college, where the bookstore was run by B&N, employees famously called the cops a few years back to kick out students who were copying down ISBN numbers for a comparison textbook shopping site.