Reporter: Yang Fan
What will happen to future publications? Here we have objective perspective from the observer. Since its founding in 1998, Beijing OpenBook Co., Ltd. has recorded China’s publishing industry step-by-step by data of book retail market, which has reflected the rise of Chinese publishing over the past two decades. According to Jiang Yanping, vice chairman and president of Beijing OpenBook Co., Ltd., data can tell us both history and help us better look to the future and find the core values of publishing. She also believes that OpenBook’s products have the ability to evolve in the challenges of the competitive environment, as long as we can really find users. We are looking forward to next decade of China’s publishing industry.
CHINA PUBLISHERS: 2010-2019 is a decade of rapid growth in China’s publishing. From the perspective of OpenBook, what are the key data and cases that reflect the changes in Chinese publishing in the past decade?
Jiang Yanping: From a publishing point of view, the past decade focused on transformation from quantity to quality.
Start with quantity. After China’s accession to the WTO in 2000, the number of new titles has maintained a high-speed growth trend. Until 2012, book publishing transformed from variety creation gradually to the pursuit of quality. Since then, the number of new books tend to stabilize, and began to show a downward trend after 2017.
Then talking about quality. We have seen the rise of original works in the past decade, especially in the children’s book category. For the past ten years, OpenBook’s bestseller charts dominated by imported titles has gradually changed to more original books written by domestic authors, such as “Mo’s Mischief” series, “Diary of a Smiling Cat” series, “Mi Xiaoquan” series, and other original sets.
In addition, theme publishing has been popular over the past decade, playing an increasingly important role in the book market. The term “theme publishing” was first proposed in 2010 and has played a powerful role in the domestic book market, especially in the physical bookstore channels. After ten years of development, theme publishing has become an important section of the book market. The selection of publishing topics has been more diverse, from only macro-level information such as important nodes, important meetings, party and government at the initial stage, to the middle and microcosmic level of new topics that reflect national self-confidence, including more traditional culture, scientific and technological development, and contemporary Chinese reality.
Moreover, we have seen the publishing industry achieved internet in the past decade. Along with the rapid rise of the Internet, the publishing industry has undergone a shift from passive acceptance to actively looking for new development opportunities. More and more organizations achieve direct communication and sales to readers via the Internet. Today, there are a lot of publishing houses that set up flagship stores on online marketplaces. A large number of publishing houses have launched their own digital publishing services, including not only customer-oriented publications such as eBooks, audiobooks, AR books, but also professional databases. Furthermore, East China University of Technology Press and other publishers even take the initiative to establish their own platform through their WeChat public account as an important channel for research and development and sale of their books, which forms a closed loop for publishing.
It is worthy to talk about the development of book retail market for past decade, which showed the rapid growth of online stores, transformation of physical bookstores, and emergence of new channels. According to OpenBook data, online store channels have maintained double-digit growth rates over the past decade, and exceeded physical store channels for the first time in 2016. In the first three quarters of 2019, the year-on-year growth rate of online store channels was 24.8%, which is still the main driving force behind the growth of the overall book retail market. Online bookstores are large not only in market size, but also in a variety of business models. Some open bookstores on varies platforms, and the others use traffic to sell books to readers. Regarding physical bookstores, they have transformed different forms of bookstores, including private chain bookstores such as Yan Ji You Bookstores; feature provate bookstores such as Yue Qing Shan and Wu Liao Shu Pu; sub-brands of Xinhua Bookstores such as Xiao Ju Deng, Le Zhi, Qian Yan Hou Ji, etc.; physical bookstores derived from online platforms such as Fan Deng bookstore, Hulu DiDi, etc.; illustration books center, libraries that are commissioned by bookstores. Physical bookstores are exploring more possibilities.
CHINA PUBLISHERS: What are the core values of print book publishing in the next decade? How to maximize value of book publishing in the future?
Jiang Yanping: The core value of publishing is always content and users.
Content refers to high-quality, engaging, and original content. With more and more varieties of books and fierce competition, readers are facing difficulties in book selection, while they have limitation on focusing and memory. So in the next decade, branding and IP development will become the key to success. For readers, branding means publishers can consistently produce attractive content for specific readers, creating strong appeal and loyalty to readers. Meanwhile, IP can quickly gain readership and differentiate it from a wide range of products. For publishers, branding and IP can reflect the value of book through more business models and can differentiate themselves in the Internet era.
In the mobile Internet era, users will also become one of the core values of the publishing industry. But the users in this case are no longer readers, but rather the long term users that are valuable for operation. Operational means that a p publishers can continuously take any actions, and observe the user’s feedback on these actions. These feedbacks can help the publishing house to better understand the user’s psychology, motivation and habits, so as to provide reference for the operation of the publishers, and ultimately create revenue for publishers.
High-quality, attracting content is the most important source for users. From this point of view, without content we could not access any user. To access users, publishers shall pay attention to content creation. At current stage, publishers with good content may not pay attention to the user’s operation. In the next decade, I believe there will be more and more publishing houses begin to pay attention to this.
CHINA PUBLISHERS: From 2020 to 2029, what new trends may emerge in the age, geography and educational distribution of China’s readership?
Jiang Yanping: From the development of the book market in recent years, the readership has expanded to low-tier cities, which will continue to expand in the future. The development of online stores and logistics has greatly driven the sale of books in low-tier cities. Especially the popularity of mobile networks, readers located in remote area can easily access all kinds of books. At the same time, we also see that the ability of short videos such as Tik Tok attracting more people to purchase books, many of whom come from low-tier cities and rural areas.
On the other hand, along with more post-80s and post-90s becoming parents, their education level is generally higher than the parents, so they will pay more attention to scientific parenting and to develop children’s reading habits. These not only drove the sales of maternity and children’s books, but also stimulate parent-child reading. In recent years, there have been many illustration libraries and family libraries throughout the country. Many bookstores have also begun to provide parent-child reading areas. At the same time, the new generation of parents pay attention to the new children reading and education concepts such as graded reading, comprehensive ability development and so on. The emergence of the “two-child” policy has brought more demand to the parent-child reading and children’s education market.
CHINA PUBLISHERS: In the third decade of this century, what should print books transform to maintain their position and not replaced by other book formats?
Jiang Yanping: Print books will not be completely replaced. They will continue to exist and continue to evolve in the challenges of other products. There have been many new changes in print books compared to print books from 20 years ago, such as books becoming more appealing; books becoming more fun and strengthening reading and learning experience; books that can interact with sound, video, 3D models, holograms and other digital content through AI technology; books can be a medium for socializing. And in the future, some books will be more prominent as a print book, while some books will be integrated with other Internet products. Both will attract large demand depend on publishers’ choices. I believe that as long as the content is good enough, there will be development for book publishing.
CHINA PUBLISHERS: The pace of internet technology companies and content convergence is accelerating. What will be the attitude of the publishing industry towards more internet companies entering content creation?
Jiang Yanping: All publishing houses want to dominate the cooperation and game with Internet companies, but the results include competition, cooperation or dependency. In addition to policy factors, the result depends on capability rather than intention or attitude. Such strength is economic strength on the one hand, and core competence on the other.
Not long ago, Bertelsmann bought 100% stake of Penguin Random House. Bertelsmann’s report of the first half of 2019 showed that the group’s revenues continued to grow, reaching its peak for the past 12 years. The full-year net profit was expected to exceed 1 billion Euros for the fifth year, largely driven by strong digital business.
One of the big problems in China’s publishing industry is that publishing houses are too dispersed without leading position. China’s national conditions make mergers between publishing houses difficult to achieve, while Internet economy is characterized by winner-takes-all. Therefore, in terms of economic strength (excluded textbooks and supplementary books), each single publishing house is in a weak position compared to any internet service company.
Regarding core capacity of enterprises, China’s Internet enterprises survive with strong core competence after fierce competition with a large number of new entries. How does the core value of publishers should be developed in the competition with them? What is their value-added service or secondary development capability of the author’s content? What about the size of the readership or the loyalty of the readership? Do publishers pay attention to branding? I think we need to continue to think about and improve our ability in these areas.
CHINA PUBLISHERS: From 2010 to 2019, China’s publishing industry has developed clear landscape in terms of publishing system and rankings. How about the future of the publishing industry?
Jiang Yanping: It depends on how the industry is defined. For the industry with book as a product, in the existing system, the publishing industry is in relatively stable structure. Neither state-owned nor leading private enterprises will not change much for the next few years. In the field of trade books, the change in the market position of publishing houses is closely related to bestsellers, which requires excellent content resources and excellent publicity distribution. The rise of unicorns in this industry is difficult, but emerging brands and enterprises focusing on market segments may occur at any time.
The publishing industry is not a zero-sum game. First, people who don’t read now may become new readers in the future, such as the case of psychological self-help market in this year. Next, bestsellers from online and physical bookstores are different, which implies different readership that publishers could focus on. Finally, print books and eBooks can be complementary products in terms of marketing, sales, and achieve a win-win situation for both products.
In another perspective, the boundaries of all industries are now being broken. Books – or definite content and information, as books are constrained by single version and will not change as soon as they are published – are products with high added value, high relevance, and high externality. If we define a new “reading industry” by books as center or brand as the core value that includes all products that may be associated with it, then the industry’s future is still very variable, and the rise of unicorn-like companies is possible. In my opinion, the capital that entered into the publishing industry in recent years is because they have seen that opportunity.
CHINA PUBLISHERS: Large e-commerce and brick-and-mortar bookstores have not yet settled the competition, with many new sub-channels growing rapidly. What do you think about the future development of book sales channels, more concentrated or more diverse?
Jiang Yanping: I think it will be more diverse, and at the same time will form two fragmented markets. On the one hand, the size of online bookstores represented by T-mall and JD.com will grow. On the other hand, enterprises that target end users will focus on integrating customers. As long as there are people, there will be book and reading service, but not necessarily a bookstore. They could be a coffee shop, bank, car wash shop in physical forms, or perhaps some social media account or internet celebrity that sell books, The market will be fragmented.
For publishers, on the one hand, they need more precise topic planning. On the other hand, they also need support on sales and service capabilities from flexible policies. The diversification of channels leads to the continuous segmentation of the readership. Big data showed that different channels have different reader demographic. Then publishers need to adjust topic according to these data and the channel. At the same time, the book distribution is not necessarily limited to the “bookstore”, but need different sales strategy to find the most effective way to reach the target readers.
For bookstores, they need to transform their business from “selling books” to “selling services” by either forming super brands with specific categories that attract traffic, such as DaikanyamaT-Site, the Eslite Bookstores, big V stores, etc., or learn to use traffic to attract consumers in a shopping center, or open an online shop, or the use of platform algorithms to generate traffic. In the future, there will be more and more small-scale, personalized, online and offline bookstores, with and more and more styles, offering different types of services to better meet the needs of different groups of people. At the same time, bookstores should also improve their multi-product management capacity, integrate products according to groups of target users, and provide one-stop service bookstores. There will be greater space for survival and development.
In addition, the change of channels will also bring some emerging industry capital into the book industry, at the same time, the Fandeng book club, YiTiao, Ten-o’clock Reading began to develop offline distribution of print books, which in turn promote the industry’s to transformation.
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