This case tests market entry analysis and business model cannibalization considerations. It requires candidates to size a nascent e-book market, calculate profitability under specific constraints, and weigh strategic opportunities against execution risks. The case balances quantitative financial modeling with qualitative strategic thinking about customer segmentation and competitive positioning.
Our client, Classic Bookstore (CB), is a traditional bookstore chain in Spain, specialized in non-technical books. CB’s revenue has stagnated for the past 3 years, with a stable and loyal customer base. Now, as part of its new growth strategy, CB is considering whether to enter the electronic books market.
The client is considering to sell a CB branded reading device and develop a website to sell e-books for it.
Our client asked us to analyze this opportunity and provide a recommendation.