Should Best Buy Stop Selling Amazon's Kindle?

Target (NYSE: TGT  ) is throwing down the gauntlet in the war against e-tail.

The cheap-chic retailer will stop selling the Kindle this month.

Target's statement -- as retold through The Verge -- is brazen:

Target continually evaluates its product assortment to deliver the best quality and prices for our guests. Target is phasing out Kindles and Amazon- and Kindle-branded products in the spring of 2012. We will continue to offer our guests a full assortment of ereaders and supporting accessories including the Nook.

Barnes & Noble's (NYSE: BKS  ) Nook isn't cheaper than Amazon.com's (Nasdaq: AMZN  ) Kindle, and they're both quality devices. Why would Target stop selling the market leader?

Oh, right. Target is tired of subsidizing Amazon's global domination. Why sell consumers a device that will send them off to Amazon's ecosystem the next time that they need to buy books, CDs, or DVDs? This is war between the bricks and the brick-nots. Why send enforcements and ammo to the enemy?

This naturally leads us to Best Buy (NYSE: BBY  ) .

If Target is reportedly planning to stop replenishing its Kindles after Mother's Day, why should Best Buy keep birthing these demon babies? Amazon's success may or may not have come at Target's expense, but it's clear that the past year of sluggish sales and cascading profitability at Best Buy is largely Amazon's handiwork.

One can argue that booting Kindle gadgetry from its real-world stores would simply speed up the online migration, but what does it have to lose at this point?

Booting the Kindle -- hot off the heels of Target's eviction -- would send a strong message. It may also lead some consumers to wrongfully believe that the Kindle is a flop.

Target and Best Buy were two of the first physical retailers to validate the Kindle by stocking the e-reader. Why can't they be the tastemakers trying to sway consumers to go with rival ecosystems that aren't directly funding their demise?

It's a delicate balance, of course. Target isn't known for its consumer electronics. It's no big deal if it only sells the country's second most popular e-reader. Best Buy has more to lose. Then again, given the company's problematic state, does it really have anything to lose by making a tactical move that would embarrass its fiercest competitor?

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Longtime Fool contributor Rick Munarriz calls them as he sees them. He does not own shares in any of the stocks in this story. Rick is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early.

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Read/Post Comments (9) | Recommend This Article (3)

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Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On May 03, 2012, at 12:24 PM, jdmeck wrote:

    Yes. They never should have carried them at all.

  • Report this Comment On May 03, 2012, at 12:29 PM, jdmeck wrote:

    Amazon is very lucky that management at Target and Best Buy were so stupid as to carry it ever.

  • Report this Comment On May 03, 2012, at 12:41 PM, ETFsRule wrote:

    It makes no difference. If they stop selling kindles, then they will lose those sales, and people will just go online and buy the kindle on Amazon instead. So they are shooting themselves in the foot either way.

  • Report this Comment On May 03, 2012, at 12:43 PM, Borbality wrote:

    Would be surprised if Target carries any major electronics at all in five years. Should stick to girl stuff. Girls love that damn place.

  • Report this Comment On May 03, 2012, at 12:55 PM, Turfscape wrote:

    >>It makes no difference. If they stop selling kindles, then they will lose those sales, and people will just go online and buy the kindle on Amazon instead. So they are shooting themselves in the foot either way.<<

    This is the statement of someone who does not know or understand the Target shopper. Shopping at Target is the ultimate embodiment of impulse purchasing. Countless consumers enter the doors to purchase a single item, like socks...and leave with a cart full of curtains, throw pillows, a new blender, 10 boxes of cereal, a digital camera and three new DVDs.

  • Report this Comment On May 03, 2012, at 1:00 PM, CluckChicken wrote:

    Think maybe they should stop selling phones that have Amazon Barcode scanner apps, it is easier to scan the barcode and get an instant price and option to buy then to type in and search on a kindle.

  • Report this Comment On May 03, 2012, at 1:43 PM, sheldonross wrote:

    "It may also lead some consumers to wrongfully believe that the Kindle is a flop."

    I know you should never underestimate the stupidity of the consumer, but kindle is to e-reader what Google is to search.

    Target is wannabe trendy, so they'll sell Apple electronics, but not much else.

    Best Buy is electronics and tech. Those who know electronics and tech pretty much shop online anyway. To the remaining portion of people who want electronics and actually go to best buy, it really won't make a difference either way if they have or don't have the kindle.

  • Report this Comment On May 03, 2012, at 7:01 PM, Dethklok wrote:

    There is no easy decision here, but I would go with yes, BBY should still carry it. Best Buy probably ends up making more (PROFIT) than Amazon does on the Kindle when you look at acessories, warranties, and the unit itself.

    I'm pretty sure Amazon isn't making anything on the Kindle. Even this notion that it is a trojan horse of sales, I'm not so sure. The Kindle Fire is a piece of garbage "tablet" that cheap people buy. It isn't purchase by people who love to spend money on consumable media.

    Not selling it would kill Best Buy's already hurting revenue. Thinking the sales would substitute is laughable. It's like saying let's stop carrying the iPad, and sell Android in its place.

  • Report this Comment On May 03, 2012, at 8:47 PM, BMFPitt wrote:

    Whether or not Best Buy digs their own grave, they're not walking out of the woods here.

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