Note: Though this interview was carried out in November 2020, it gives a comprehensive explanation of approaches Chinese traditional publishers have adopted in the new era. The figures shown may not represent the current situation, however, the methodologies and trends are still valid even today.
The "Era of Big Data" was first coined by McKinsey & Co., the world's leading consulting firm. As McKinsey says, big data has brought new growth and explosion to all industries. It has been used for a long time in fields such as physics, biology, and environmental ecology, as well as in the military, finance, and Telecommunications industries. Today, big data is also bringing many changes to the cultural and publishing industries.
As marketing and promotion continue to shift towards digitalization, socialization, direct-to-consumer, and leisure in the era of big data, a series of questions such as “finding ways to run a promotion campaign”, “figuring out the characteristics in sales revenue”, and “the changing role of publishers” appeared waiting for responses. Bai Bing, editor-in-chief of Jieli Publishing House gives us the answers.
1. Marketing and promotion in collaboration with cross-circle media and integrated dissemination channels
In the era of big data, one of the biggest changes in marketing methods is that media are transformed into sales attributes. In addition to cultural dissemination and information transmission, industrial operation and sales functions are enhanced, and promotion and sales are deeply integrated. In 2020, Jieli Publishing House joined forces with over 20 platforms to deliver nearly 400 live broadcasts for 800 hours in total, achieving sales of 20 million yuan in cover price. This is sufficient to illustrate the phenomenon of dissemination as sales.
Traffic (customer acquisition) is a prerequisite for sales conversion. In order to obtain traffic, live streaming, and short-form videos have become a new way to initiate conversations and gather consumers. In September this year, Jieli Publishing House joined hands with Fan Deng Reading (樊登读书), now Fan Shu (帆书), to launch a mid-autumn festival themed live streaming, which sold more than 1.05 million yuan in cover price within three hours. In October, a special live broadcast was launched with Hunan TV host Zhang Dandan, bringing in more than 1.6 million yuan in cover price.
In the era of big data, media functions are further extended, with diverse content forms and subdivided dissemination channels. Which to choose? Bai Bing tells us that only utilizing a variety of media and multiple dissemination forms can produce good promotion effects.
He pointed out that the effect of dissemination through single form and single medium is now becoming minimal. Only through the collaboration of rich media forms such as films, television, and audiobooks can a book have a greater and wider cultural impact and social benefit, and its future market value and profit margin will tend to be unlimited. "In the future, companies that go earlier and put more effort in this direction will have greater market share and coverage in the future, and will go faster in terms of convergent development."
2. the proportion of sales revenue from direct customers is gradually increasing, and the trend is becoming more obvious
In the process of online marketing and sales integration, the focus of the sales channel is also quietly changing. At one time book distribution was dominated by the general distribution of Xinhua Bookstore. After that, Xinhua bookstores at province, region level, or even local branches, were able to stock books independently. Then after that, private wholesalers, retailers, and sales chains also developed and grew to become important distribution channels. With the development of the Internet, the rise of e-commerce platforms such as Dangdang and JD.com, the development and growth of third-party sellers on Taobao and Tmall platforms, and newly emerged retail channels such as communities and short-form video, sales channels became more multi-dimensional, diversified and inter-connected.
Bai Bing revealed to us Jieli Publishing House’s sales figures by channels in the past three years (2018 - 2020). In terms of shipped books in cover price, the percentage of B-end customers (including physical bookstores and e-commerce platforms) dropped from 94.3% in 2018 to 85.3% in 2020, while the percentage of C-end customers (including Douyin communities and Tmall flagship stores) gradually increased from 5.7% to 14.7%. In terms of sales revenue, over the past three years, the proportion of B-end customers has slowly declined from 91.4% to 82.4%, while the proportion of C-side customers has continued to rise from 8.6% to 17.6%, and the trend is becoming more pronounced.
In the last three years, the share of shipped books in cover price for physical bookstores is continuing to decline, especially after the pandemic, from 45.1% in 2018 to 23.8% in 2020. The share of shipped books in cover price for Tmall third-party distributors and flagship stores is continuing to rise, with online bookstores accounting for 76.2% of shipped books in cover price. In 2020, Dangdang's share of shipped books in cover price (32%) surpassed that of physical bookstores (23.8%), making it the highest share among all sales channels.
Over the past three years, sales from physical bookstores have continued to decline and sales from online bookstores have continued to rise. 2020 saw a significant decline in sales from physical bookstores due to the pandemic, slipping to 17.4% from 49.5% in 2018. Sales from Dangdang and Tmall distributors have exceeded the total sales from physical bookstores in the general book sales of Jieli Publishing House, accounting for over 50%, of which Dangdang (31.2%) and Tmall distributors (22.7%）.
Bai Bing said that Jieli Publishing House sensed the changes in the sales network in the era of big data two years ago. In order to adapt to the changes in the market and network, and adapt to the shift from traditional distribution to new retailing, and strengthen online marketing, Jieli Publishing House has carried out organizational reforms.
At the end of 2018, Jieli Publishing House split its distribution department into three. Unit 1 is responsible for physical bookstores, Unit 2 is responsible for traditional e-commerce and its communities, and Unit 3 is responsible for the Tmall flagship stores and the Tmall channels and their communities. This year, in order to strengthen the growth of the Tmall channels and Tmall flagship shop, as well as the community e-commerce, Jieli Publishing House has added Unit 4, which will take over the Tmall channels from Unit 3 and operate independently.
3. Publishers are transforming from traditional content providers to IP developers
In the era of big data, the operational structure of the cultural industry has transformed from a one-way supply chain model to a pan-centric networked, dynamic and platform-based production model, and as a result, the role of publishers themselves is also changing. Bai Bing points out that publishers have now transformed from traditional content providers to reading service providers, data analysis users, and IP incubation developers.
As a reading service provider in the industry, Jieli Publishing House’s Swan Reading relies on a comprehensive and multi-dimensional one-stop reading service, bringing together 500,000 Jieli community leaders and organizing a total of 2,000+ online events in five years, with an average of 400+ events per year, and reaching a total of 15 million views on its official website so far.
In terms of analyzing and using data, Jieli Publishing House tap and capture readers' hobbies through analysis of data such as user reading behavior and characteristics, purchase records, book information, and the number of visitors on serial books, enabling innovation in selection content and processes. This improves the quality of selections on the one hand, and also provides data support for on-demand publishing, thereby providing a viable rate of selection, reducing market risk, and expanding readership and market coverage.
In addition, Jieli Publishing House begins to operate in an IP-based manner. Using content as a grip, the publisher is aiming to meet the diversified needs of users by opening up the industry chain to maximize the cultural and social impact of the content and profits.
The phenomenal IP Peppa Pig is a good example of an IP-based book. Peppa Pig was birthed from a toddler cartoon by Entertainment One UK Ltd. The Peppa Pig series was published by Anhui Children's Publishing House and then cooperated with well-known brands to produce various kinds of animation derivatives. It currently has over 800 licensed derivatives and licenses and is available in DVDs, books, movies, toys, stationery, food, clothes, theme parks, stage plays, and more. In the era of big data and through the commercialization of social media, the energy released by Peppa Pig's IP has gone beyond a cartoon or a set of picture books. eOne launched Peppa Pig's emoji pack on WeChat in 2016, through promotion campaigns on different platforms such as WeChat, Weibo, Meipai, and Douyin, Peppa Pig's image was downloaded over one million times within two weeks across social networks, with sent volume reaching 5.25 million times. In 2020, the retail sales of Peppa Pig’s derivatives reached 13 billion yuan.
In addition, Miyanishi Tatsuya's Tyrannosaurus IP has not only been published as picture books, but is also being produced, in collaboration with film and television companies, to major motion pictures, prepared for live-action stage plays, and licensed to audiobooks and stationery and other peripheral derivatives. In terms of China’s original IP, Monsters in the Forbidden City, created by Chang Yi, is being developed as an online movie in collaboration with Tencent. The familiar images of Pipiru and Rusisi are also under IP industrialization and operation.
Although in the new era, the vehicles and marketing methods of publishing are changing and sales platforms are becoming diversified, Bai Bing pointed out that no matter what time it is, the content will remain the core value of the publishing industry, and the one who has the content will win the world.
"In the era of big data and new retail, our effort will still focus on content, title selection, and the constant adjustment, exploration, and innovation between meeting and leading readers’ demand."