That Cool New Bookstore? It’s a Barnes & Noble.

From a Wall Street Journal story by Ben Cohen headlined “That Cool New Bookstore? It’s a Barnes & Noble.”

Barnes & Noble was once the enemy of independent bookstores. Now it’s trying to be more like them. And no place better explains the improbable reinvention of the biggest American bookstore chain than the Barnes & Noble on the Upper West Side of Manhattan.

That shop in one of the world’s greatest book markets has been a battleground since the day it opened three decades ago. It might be the most iconic of the chain’s 596 locations: It’s the store that helped inspire the mega-store run by Tom Hanks’s character in the classic romantic comedy “You’ve Got Mail.”

It also has been the site of a grand experiment for much of the past year. The chain invested millions of dollars to rebuild this Barnes & Noble into a model for its other stores to emulate as the company transforms into a bookseller for the modern age.

“You don’t want to go too crazy in a Barnes & Noble because one of the joys of this store is that everybody comes in here,” said James Daunt, the chief executive since the company was taken private in 2019. “But do I think this can be a really interesting bookstore that is much, much more interesting than it currently is? Oh my goodness, yes.”

He would know. Daunt was a respected independent bookseller in London before he found himself running chains in both the U.K. and U.S. He was exactly the sort of person who could make Barnes & Noble interesting.

His plan to save the company and its bookstores is to combine the power of a big chain with the pleasure of a beloved indie. By shifting control of the process to individual store managers across the country, Daunt is giving local booksellers permission to do things they were never able to do before. They have discretion over purchasing, placement and even pricing.

He wants Barnes & Noble locations to feel welcoming but not overwhelming—a chain store should be more inviting and less intimidating than a truly independent shop—and that means he needs the people who run them to make sensible decisions for their markets. “It’s only inexcusable if it’s not interesting,” he said.

The Barnes & Noble on the Upper West Side was incoherent the first time he showed me around last winter. It was cold and dreary outside and felt that way inside, where he was trying to make sense of an odd assortment of books. Viola Davis’s memoir was next to Franz Kafka’s diaries. Judd Apatow’s comedy interviews sat near a spiritual biography of George H.W. Bush. John le Carré was inches from Geena Davis.

I thought Daunt might pull the books off the shelf and rearrange them himself, but the whole point of his approach is that the CEO shouldn’t be the one making those calls. A bookstore exists to serve readers—not publishers, not investors and definitely not the bloke running Barnes & Noble.

Barnes & Noble used scale and uniformity to its benefit in the 1990s and 2000s, but those advantages have since become liabilities. Bookstores don’t have to be the same from one to another. They shouldn’t be, either. The best managers know the books they sell and the customers who buy them—and what works on the Upper West Side might not work in West Des Moines.

The idea behind the new Barnes & Noble is to make the national chain more like a collection of 596 local indies. The famous one in my neighborhood used to symbolize the company’s past. Now it offers a peek at its future. “If we can do it here,” Daunt said, “we can do it anywhere.”

Daunt agreed to give me before-and-after tours of the Upper West Side turnaround project, so we met in January and made plans to return when the shop was ready. By the time we met again in June, the vision he described had come to life.

The major renovation was necessary because the mission of bookstores has changed since this one opened in 1993. Back then, someone who wanted a specific book would visit their favorite brick-and-mortar store. Now anyone in need of that book probably visits Amazon.

This profound shift in consumer behavior prompted Barnes & Noble to reconsider the very purpose of a Barnes & Noble.

A physical bookstore competing against a $1.4 trillion online everything store must give people the stuff they know they want and the stuff they didn’t know they wanted.

“We’re here to help people browse,” Daunt said.

But first the Upper West Side location had to be a place where people wanted to spend time browsing. The bleak floor tiles were ripped out for sleek light wood. The drab carpet in that dumpy forest green was replaced with something less ’90s. The repainted walls were warmed up with splashes of pink. The space was designed to be cozier and brighter—and to keep you wandering around.

The most important change is apparent from the moment you step inside. The cash registers in the front of the store were shoved to the back. The magazines inexplicably occupying prime real estate on the ground floor were stuffed upstairs next to the relocated cafe. They had to be moved to make space for more books.

A lot more books.

You’ve got a new bookstore

James Daunt already had a job when he became the CEO of Barnes & Noble. In fact, he had two.

He got his start in the business in 1990, when he founded Daunt Books, a London indie known for its impeccable taste. His sublime boutique eventually became a group of nine shops across England that he still oversees. Then he surprised the industry by taking the top job at Waterstones, the Barnes & Noble of the U.K. After inheriting a troubled chain with roughly 300 stores in 2011, he nursed a company bleeding money back to profitability. Waterstones was bought in 2018 by the activist hedge fund Elliott Management, which kept Daunt in charge and took aim at Barnes & Noble itself.

The poorly managed chain was ripe for a takeover after cycling through CEOs and losing half of its annual revenue even after its rival Borders failed. Elliott paid $475 million in the deal and tapped Daunt to lead another unlikely comeback.

Daunt, 59, speaks quietly, as if he were in a library, but the insight at the heart of his management philosophy is worth screaming from the rooftops: find people who are passionate about books and let them sell books as they see fit. This sounds rather obvious when he says it. But entrusting a chain to someone who not long ago was running a posh store in Central London was a radical act of corporate desperation.

“I think it had to almost die before anyone was prepared to risk that,” Daunt said as we strolled around the Barnes & Noble on the Upper West Side. “It’s no coincidence that I took over Waterstones when it died and I took over this place when it was barely breathing.”

One way to measure the health of a bookstore is the return rate—the percentage of unsold books that retailers ship back to publishers. The lower, the better.

Waterstones and Barnes & Noble both had return rates between 20% and 25% when he started. It’s down to 3.5% at Waterstones. Barnes & Noble’s is 9%, Daunt said. His target is 5%.

Not everyone is thrilled about his plans to make Barnes & Noble a more efficient business, which publishers fear will translate into the nation’s largest chain purchasing fewer books. The managers of individual stores having more control over what they stock and how they price it means the publishers have less. Others in publishing are skeptical that local tastes matter as much in a business increasingly driven by national bestsellers.

Daunt was hired by Barnes & Noble right before U.S. bookstore sales bottomed out. They declined every year from 2008 to 2019 and cratered in 2020, according to federal data. But retailers have proven surprisingly resilient since the first year of the pandemic. Sales rebounded in 2021. They continued upward in 2022. They’re on pace to increase again in 2023.

As a privately held company, Barnes & Noble doesn’t report financial results, but it’s clear that it’s no longer near death. While the number of locations has decreased 5% since the acquisition, the chain is now expanding and plans to open 45 stores this year, including some that closed and reopened with smaller footprints, like one on the Upper East Side that opened this month to a line around the block. It’s also giving facelifts to existing shops across the country. But not every store needs a complete makeover to feel refreshed. I recently popped into a Barnes & Noble off the interstate in Pueblo, Colo., where even subtle tweaks made for a delightful browsing experience.

Daunt chose to salvage the Upper West Side shop with a $4 million renovation, the same cost as opening a new store of this size, because he felt the building itself was beautiful and the location on Broadway was ideal. He also thought the chain needed a strong presence in this bookish stretch of Manhattan. Coming from London, where there are several dozen Waterstones locations, he was dismayed to find only seven Barnes & Nobles in his “extraordinarily un-bookstored” new city.

“That’s not because New Yorkers don’t buy books,” he said. “It’s because the bookstores went out of business.”

Even the bookstores in movies couldn’t afford to stay in business. In the 1998 rom-com “You’ve Got Mail,” Tom Hanks and Meg Ryan play rival Upper West Side booksellers Joe Fox and Kathleen Kelly, and she closes the Shop Around the Corner when his Fox & Sons Books chain opens down the street and promises “cheap books and legal, addictive stimulants.”

The movie was partly based on Barnes & Noble invading the neighborhood and the real-life drama that ensued. The company had a higher market value than Amazon around the time “You’ve Got Mail” hit theaters, but that was 25 years and trillions of dollars ago. It’s quaint to think of a bookstore with an espresso bar as the villainous corporate bully now that Amazon is so big it makes Walmart look small.

Every bookstore these days is the Shop Around the Corner—even a Fox Books superstore.

Of course, there are genuine indies thriving in New York today, exquisite shops like McNally Jackson and Books Are Magic and institutions with loyal customers like the Strand. They exude an ineffable charm that is almost impossible to replicate.

“An indie bookstore is always going to have that idiosyncratic, owner-operated feeling that you’re not going to get in a chain store,” said Dane Neller, the CEO of Shakespeare & Co. in New York. “You’re just not.”

Daunt happens to agree. As someone who can relate to both Joe Fox and Kathleen Kelly, he is uniquely qualified to compare indies and chains, even though he confessed to not having seen “You’ve Got Mail” until after we met. He told me Daunt Books is simply different from a Barnes & Noble—and there is a place for both. “A large store like this will always be much more and much less,” he said. But just because it’s not the same doesn’t mean it can’t be similar. “Within a chain,” he said, “you can create an awful lot of the ethos of an independent bookstore.”

The business strategy isn’t the only part of Barnes & Noble that is evolving under Daunt. So is the goal of every bookstore.

“To come in and enjoy yourself,” he said. “As opposed to effectively the raison d’être at the moment, which is to rack these books up in a way that you can find them, and then you find the book you want and leave. That’s a big old shift.”

‘I didn’t realize how bored I was’

One day this summer, Daunt was stumped. He was talking about the device that instructed Barnes & Noble’s staffers where to put each book on every shelf but couldn’t remember its name. He asked a young employee arranging hardcover fiction in the Upper West Side shop for help. She told him it was called a PDT—a portable data terminal. Then she explained that the store’s 30 booksellers weren’t really working with PDTs anymore. They were using their brains instead of following the beep-beep-beep of a scanner. He thanked her and walked away.

“She has no idea who I am,” Daunt whispered.

The CEO of Barnes & Noble was standing in the front of a busy store that was completely unrecognizable from six months earlier.

He was surrounded by books.

There were 87,756 in stock on a recent day, including 2,000 titles on the ground floor alone, which Daunt estimated to be “a ton more” than before. There were piles of bestselling fiction, nonfiction and mysteries. There were popular cookbooks and children’s books hugging the columns where shoppers naturally gravitate. There was an upstairs level that stretched across the building on a full city block. And there was still an entire wall of bare shelves waiting to be lined. “We need more books,” said Victoria Harty, the assistant store manager.

But swarming Barnes & Noble shoppers with books wasn’t enough. The books themselves also had to be optimized for discovery. Many covers face outward instead of spines. Handwritten staff picks float off shelves. Neatly curated tables are organized in clever ways that transcend algorithmic recommendations.

It had been grueling to keep the store open during construction, but the booksellers could see the results of that work in this humming store, even if it wasn’t nearly done yet. “There’s a thousand little things that need doing,” said Jason Byrnes, the store’s manager.

Byrnes went to elementary school in the neighborhood, so this was his childhood bookstore long before it was his office. After working in other Barnes & Nobles around Manhattan and Brooklyn, he was recruited back to the one where he grew up. Daunt said the store’s former manager oversaw the initial phase of the construction so well that he moved her into a new role handling those projects elsewhere. To fill the vacancy, he looked for talented booksellers with local knowledge and skills that would fit well together, and he found people like Harty and Byrnes. It turned out having the authority to make their own decisions was more stimulating, gratifying and way more fun than taking orders from a machine.

“I didn’t realize how bored I was,” Byrnes said.

To run hundreds of stores the way he runs the one with his name, Daunt needs to recruit more full-time employees and pay them to stick around. They won’t become model booksellers overnight. Many won’t be booksellers forever. But most can grow to be great at one part of the job and show their peers at nearby stores how they do it. The person studying data to order books at one Barnes & Noble in Atlanta can train inventory specialists at other stores in the area more effectively than an executive from corporate headquarters. It’s a brilliant formula when it works: Daunt likes to say that the less he does, the smarter he looks.

But to look around a Barnes & Noble with him is to see the questions worth thinking about in every nook of the bookstore. What is the optimal table density? Does “Life” by Keith Richards belong with other memoirs or music books about the Rolling Stones? How should the history section be arranged?

There’s not always a right answer. But there are wrong answers. It baffles Daunt that 20% of the chain’s locations sort history books alphabetically by author. “This was a store that had history arranged A-to-Z,” he said last month. “Now it’s chronological.”

A bookstore should be intuitive enough for a child to navigate but compelling enough that adults don’t mind getting lost. Because this one has an eccentric layout over 28,000 square feet—books on two floors, gifts and toys on the mezzanine—Byrnes and his team made it a priority to improve the flow. They reconfigured the map based on customer feedback. On the upstairs level, where toddlers run around and teens flirt after school, they moved entire sections around. “Then moved them again and moved them again,” he said. Rows of books became rooms of books. Displays on the side of bookcases were treated like vertical tables. Shelves grew two rows taller to “reclaim the air” without reducing inventory, Daunt said.

There were another thousand little things that still needed to be done—and those small details would turn into something much bigger. Daunt has learned from his decades of experience that there is a direct correlation between how a bookstore looks and how it performs.

“It’s really peculiar if good bookstores don’t sell more books,” he said. “They always do in the end.”

The real question is how many more. Daunt expects this Barnes & Noble’s sales to double from their 2019 levels by 2026.

But the remodeled store is already seeing a sales uptick because of the shrewd decisions of its booksellers. By the front door is a table of literary historical fiction that includes “The Weight of Ink” by Rachel Kadish and “People of the Book” by Geraldine Brooks, paperbacks that had been hiding upstairs because they were published several years ago. Harty moved them downstairs. She knew they would interest highbrow Jewish readers on the Upper West Side more than the median shopper in the average market. She was right. They went from selling one copy a month to 20.

“One of the first things we did when we first got here was to start building the tables,” Byrnes said. “To watch the titles we brought in consistently show up as our top-selling books was very satisfying.”

Daunt and I were standing by that table last month when a shopper walked past us with a Daunt Books tote bag—the ultimate sign that something unexpected is happening at Barnes & Noble.

“We’re giving them what I think they recognize as a really good bookstore,” Daunt said.

But I was curious for one more opinion of the Barnes & Noble on the Upper West Side. So a few weeks ago, I emailed Joe Fox himself: Tom Hanks.

As it happens, Hollywood’s most famous bibliophile recently published his first novel, which is featured on its own table in this chain bookstore that’s beginning to feel like an indie.

“I’ve never been in the newly transformed B&N,” Hanks wrote, “but I approve the concept.”

Ben Cohen writes the Science of Success column for The Wall Street Journal about what makes people, teams and ideas work in business, culture and beyond.