Bertelsmann: A previously publicized decline

The world's fourth-largest media group entered China in 13 and has not been profitable.　　Its decline in China was not an accident.　　13th, Bertelsmann announced that its distribution in 18 cities in China, 36 retail outlets, will be closed this year before July 31.　　In its announcement to suppliers, the company said that despite years of management and financial investment, the current financial position of the Beijing Bertelsmann 21st century book chain Limited is "unsatisfactory and lacks the necessary scale benefits". In fact, not only is China's business shrinking. On a global scale, the decline of the Bertelsmann Book club has become apparent. According to The Economist, the number of its members declines and some book-mates lose money continuously, and American book-mates are about to sell.　　"The Bertelsmann Book Club is about to usher in a revolution that is at least-some people think they are about to topple." In the last two years, the name Bertelsmann has been moving away from its readership.　　A growing number of Bertelsmann members find that the brochure that was sent to the mailbox on time has not appeared for a long time, and that it offers fewer books and less discounts--"membership" status has been in tatters. In 2001, Bertelsmann also announced to the media: the number of Chinese book club members reached 1.5 million people, with the country's largest reading clubs.　　But in fact, the company that has been in China for 13 years has never been profitable.　　As the fourth largest media group in the world, why did Bertelsmann's development in China fall into such a position? In his early years, Huang Yuhai, the editor-in-chief of the Book Club's editorial office in Bertelsmann, is the general manager of the 99.　　He summed up Bertelsmann in China is not the main reason is: "internal and local, not acclimatized." "Book Club business model requirements must reach a certain scale to be profitable." For Bertelsmann, this is at least 200 million or 300 million of the sales. "Huang Yuhai said. "Its internal management costs are too high. "The book Club is Bertelsmann's first move up and down the big chessboard in China," he said. Membership system, exquisite printed mail book, a large proportion of book discounts, mail order ... These all make 1997 years of Chinese readers feel very fresh. But behind every link is a lot of money invested. The monthly cost of Bertelsmann is 3 million yuan per month. To expand the impact, Bertelsmann has long been advertised in the popular journal.　　For example, the company's old partner, "reader," the price per period of 2007 advertising is 185,000 Yuan. Joerg Hagen, chairman of the Bertelsmann French Book club, defines his typical membership as "a mother of two children who likes to watch best-selling paperback crime and romance novels."　　But in China, a typical member is a college student, a fan of youthful self-help books, or a regular reading of the workplace. In order to collect the historical purchasing records and consumption habits of this group, Bertelsmann has specifically established CRM (Customer management Information System), not blindly waiting for the order phone,e-mail in, but can be targeted at specific users of the telephone marketing. "You have bought the Analects of Confucius," then now launched the "Zhuangzi experience," You will be interested?　　Bertelsmann's customer service staff expanded their business by telephone. 1997, Bertelsmann established a call center, employing more than 20 employees responsible for simple hotline answering, letter reply work. At the end of 2007, the call center has nearly 150 employees to provide services to customers.　　At present, the call center annual average processing calls more than 4 million, external dial more than 2 million, SMS Send, reply to e-mail, the total number of letters are nearly 1.5 million. In fact, Bertelsmann has been trying to build its logistics and customer service system. In order to ensure a smooth and efficient logistics system, Bertelsmann won the time when the network bookstore coveted the exclusive ZIP code. To the delivery, Bertelsmann can be covered by the postmark, paste the mail, bypassing the Post Office Sorting center in Zhangjiang, Shanghai, thus shortening the logistics cycle by 3-4 days. Through with more than 20 logistics suppliers to establish long-term cooperative relations, Bertelsmann in the domestic 67 cities to establish a courier business.　　In Shanghai's own distribution network, Bertelsmann delivery of 1000 to 1200 parcels a day, but also to ensure that the book packaging neat.　　By 2007, Bertelsmann had penetrated all the sections of the book publishing industry by using various forms of cooperation that conformed to the law. But book-mates are not completely flattering. In accordance with the Bertelsmann Initiation Agreement, Bertelsmann will issue a "warning" to members if they do not buy a book within a quarter, and Bertelsmann will recommend a book that will be carefully selected by the bookseller if he has not bought a book this quarter. Members will be disqualified if they insist that they do not pay for "recommended" books. The move has provoked many members ' displeasure. East China Normal University students, members of the king said: "This regulation is a lot of the feeling of forced shopping, book friends will not take into account the economic problems of members, nor to consider this quarter, members may not really like the book." "To quell members ' complaints, the Bertelsmann Book club has cancelled the" mandatory "purchase agreement in recent years.　　But this has hindered the development of the Book club to some extent. Insiders said that Bertelsmann China book Friends in 2003, 2004, the turnover reached the peak status of 150 million yuan, the last two years >> has shrunk to tens of millions of yuan.　　At present, the Book Club CRM system stores the information of 800多万名 members, of which more than 1.5 million members purchase an average of more than 5 times, more than 300,000 members to buy more than 10 times. When foreign e-commerce slightly decline, China's e-commerce has just entered the climax. The new site was named Www.bol.com.cn in 2003, when Bertelsmann merged with its member-oriented "book Club Online" and "Bertelsmann online" for Non-member customers. After the integration of the BOL site has a book club member area, to provide book friends recommend books. Outside the Membership zone, Bol for the public to display a large number of books, audio-visual, game products, Book club members in the purchase of these products will enjoy at least 5% discount. Bertelsmann's move is intended to expand the size of the book club to increase sales and revenue. But Ekkehard Rathgeber, president of the Aico Riesenborg Direct group in Asia, said: "Bertelsmann's main revenue in China is still from the traditional book club, with a share of about 80%, and another 20% from Bol." "When the rapid rise of large online bookstores, such as excellence, has also brought a big impact to Bertelsmann bol business." Because the Bertelsmann book friends will be outside the network platform for maintenance input, so that although sitting on the low to 40 percent of the price, can give readers still have no advantage in terms of prices.　　Considering the high postage rates, many members of the book club have opted for the "Book of choice, when or superior purchase" strategy. "Bertelsmann was out of our sight 8 years ago, not a competitor," he said.　　Dangdang president Guoqing to "first financial weekly" said. July 2002, Bertelsmann advocated the new Economy CEO Thomas Middelhof and Bertelsmann founder family-Moen family contradictions intensified after the resignation. Bertelsmann China has undergone high-level personnel changes, single-handedly created the Bertelsmann China pattern of AI branch resigned in late 2002, the original COO Unger (Christian Unger) successor.　　The German man who had been managing the French Bertelsmann Book club and the 500 direct shops for many years had no interest in book products and did not care about the pricing and sales of books, and when he took office, he shifted his gaze to the strategy of opening the Bertelsmann China Direct store.　　December 2003, with the approval of the state press and publication Administration and Ministry of Commerce, Bertelsmann won the private enterprise Beijing 21st century book chain 40% of the shares, the establishment of the First Sino-foreign joint-venture nationwide chain bookstore, trying to use the latter more than 20 large direct book chain supermarkets, to break through China's restrictions on foreign investment in "Bertelsmann's acquisition of the 21st century is a successful case of the latter, not the former wise investment case." Simply do book retail, in addition to the Xinhua bookstore has properties, taxes, textbooks advantages can do, others do is difficult.　　"said Bao Hong, a researcher at the China Publishing Science Institute. The flaws in literally's experience in the French direct shop soon became apparent. At that time, France's book Price is 4 times times that of China, the cost of rent is only one times higher than Shanghai. French readers are accustomed to reading and buying books in stores, and Chinese readers are not able to resist the temptation of big discounts on online bookstores.　　Every local book store in China is facing a crisis in which Bertelsmann is hiding. "While 99% of Bertelsmann's employees are Chinese, the CEO is always a foreigner, and there is a conflict with the local culture," he said. Even if they recruit Chinese managers, Bertelsmann is more interested in the experience of returnees and MBA management, which ignores the cultural characteristics of the book itself.　　"Huang Yuhai said. Involved in the publication of the Bertelsmann setWith its overseas publishing operation mode-----------------------------------outright copyright "For example, Anne's baby's book, Bertelsmann first holds 2 million past, the book's copyright robbed, but often make a promise after selling." "Huang Yuhai said. "What is the concept of 2 million yuan in a book that sells 20 dollars?" Bertelsmann may sell only 20,000 copies through direct mail and website recommendations. Sales do not do well, liquidity is heavily occupied. "Big moves quickly make partners uncomfortable. June 1, Li Huan with his team from the Bertelsmann and "under the Banyan" Web site created by the Banyan Publishing company resigned, since the end of 2007, Bertelsmann has only a 49% per cent stake in the Bertelsmann book distribution company, established with Liaoning Publishing Group,　　No longer involved in publishing matters. By the impact of publishing and online business integration, Bertelsmann offers readers fewer and less diverse bibliographies. The request for market demand for the introduction of a popular book club and the demand for a full range of the direct shop has clashed. While unified purchasing lowers the price per book, it also forces a shrinking stock.　　The Bertelsmann Bookstore in Shanghai, Fuzhou Road, opened in 21st century, with no more than 10,000 books sold, and the Shanghai bookstore across the street had hundreds of thousands of books in a row. According to the group tradition, the Bertelsmann subsidiaries have their own management systems, as is the case in China. Each other and contradictory state of confusion arises accordingly. "For example, the marketing department will take the best books to recruit members, because the assessment of his only membership number, the sales department complained that good books are white, readers have nothing to pick."　　"Huang Yuhai said. Liang, a student at Shanghai University, is the "victim" of this chaotic state. One time, he said, he received a list of Bertelsmann's leaflets about the lottery that would take a trip to Hong Kong as long as a certain amount of books were purchased. He did not know that this was a mail-order catalogue organized by the Department of the event, will ask the phone into the member chain. Chain Stores said there was no such activity.　　Such messy management has left many people with a loss of trust in Bertelsmann and a retreat from the book club. In the 2006, Bertelsmann Direct group to store adjustment for the first time, close to Beijing, Hangzhou, more than 10 chain bookstores, instead of "Shop shop" in the way, with the then in 31 cities have 83 large stores Carrefour cooperation. Carrefour in the shopping malls within the allocation of units from 50 to 100 square meters of business area, for book friends will operate independently.　　However, Carrefour itself has its own books, and the books are similar to those of Bertelsmann, most of which are bestsellers. According to Huang Yuhai estimates, Bertelsmann's investment in China has been huge and has not yet reached a break-even. After the dissolution of the direct group, Bertelsmann (China) decided to convert the call center and its system into an educational service-oriented website. And Bertelsmann's training of the logistics system will be directly merged into the European company, become a pure logistics service provider, for China Merchants Bank, Oriental airlines and other companiesLogistics and distribution. Shanghai's 7 chain stores belong to the Shanghai Bertelsmann Culture Industrial Co., Ltd., and the 21st century book chain has nothing to do. The Bertelsmann Service hotline staff said that with the closure of the 36 chain stores, its member center will also be canceled.　　At present, the business of 18 cities in China depends on book meeting and online ordering. Bertelsmann, a staff member who declined to be named, said Bertelsmann decided to 割弃 its direct group's China branch. The company did not look for any buyers and was dissolved directly, and now Chinese executives have all left. In China, the direct group operates the country's third largest online book retailer, Bertelsmann Online, the Bertelsmann Book club and the Bertelsmann Ground Direct bookstore business. With the disappearance of direct groups in China, the book business that Bertelsmann has worked for years without harvesting has drawn a full stop in China. Although this is a not surprising outcome.