First Financial Weekly: Bertelsmann's Death.
1995, 30-year-old Echo Riesenberg came to Shanghai with his wife. The German who speaks Beijing dialect has studied Chinese in Peking University for 8 years. He wears a tie every day, walks through the vegetable market on Fuzhou Road, and works in the small attic of Shanghai Science and Technology Book Company.
This person is not a nobody, but the CEO of Bertelsmann's group directly under China District-1998, Bertelsmann, one of the four media giants in the world, officially entered China.
In Apotheker's eyes, this is a huge market with a population of more than one billion. What he holds in his hand is the successful experience that the group has been copied constantly, and this market is in its infancy, waiting for him to create a bright future.
The history of 170 years is enough to make this company proud, and at the same time, it has the experience of successful implementation all over the world. Its book club customizes books for its members and promotes direct sales of books, with 40 million users worldwide. Sensitive topic planning ability, rich publishing experience and mature capital operation have brought the company an annual income of over 10 billion euros. Bertelsmann paid $654.38+00 million for a copy of Clinton's autobiography-a deal that can rank among the highest copyright transactions in American publishing history.
Bertelsmann let China people find their own book catalogue from the mailbox for the first time, accompanied by the unique contents aimed at the consumption characteristics of users. This is an alternative book direct selling mode besides Xinhua Bookstore and "two channels".
Then, after all this, they did not succeed. Although they are so close to success.
13 years, they forced China scholars to remember the embarrassing name Bertelsmann; They have 6,543,800+5,000 members in China and founded the largest book club in China. Their annual income reached 654.38+0.5 billion yuan; They moved almost all their business to China.
Besides these, they even have two more precious qualities: patience and determination.
But success still didn't come as scheduled. 13 in June, Bertelsmann announced the closure of 38 2 1 century chain bookstores distributed throughout the country. The directly affiliated group responsible for the book club and BOL business has also been dissolved recently, and all the senior executives have left China. In fact, this result first appeared in 2002, when former CEO Thomas Middelhoff stepped down.
This ambitious company has encountered almost all the problems that a multinational company can encounter in emerging markets in China.
The most direct impact comes from the policy level. The China Municipal Government explicitly prohibits wholly foreign-owned enterprises from carrying out book publishing business in China. After China's entry into WTO, although the policy has been loosened, we can only adopt various forms of cooperation that meet the legal requirements. Bertelsmann doesn't know when it will become a publishing company like Germany or the United States, not just a "Shanghai Bertelsmann Cultural Industry Co., Ltd." registered in the Industrial and Commercial Bureau and cooperating with domestic publishing companies. Without publishing rights, it will always be subject to people, and it is even more difficult for the global headquarters to make practical plans for this overseas company. Although Bertelsmann intervened in all aspects of the book industry chain in various ways in the following years, he was always constrained by partners and policies and could not make efforts.
The strategic mistakes made by the German headquarters in the application of new technologies also made Bertelsmann's online business lose the opportunity. In 2002, Middelhoff, who advocated group listing and a new round of M&A, couldn't bear it any longer. He hastily closed his global online business and temporarily forgot his plan to develop his business in China, a virgin land of e-commerce. Apotheker also resigned this year, and BOL, the company's first e-commerce website in China, has been in a state of stagnation since then, contributing only 20% to the annual revenue.
Next, it is the most common mistake of multinational companies to copy the successful experience of the past and abroad indiscriminately. This time Bertelsmann did not fight back on e-commerce, but moved to the experience of a direct store in France.
In Europe, going to bookstores to buy books and read books has become people's living habits. High book prices and low rents have also become favorable conditions for bookstores to blossom everywhere. In Germany, reading clubs are not only welcomed by empty nesters who love German folk music and hold traditional ideas, but also attractive to family members of any age. Many members of Bertelsmann don't even want to go to the physical bookstore to buy books, and the book club is almost the only channel for them to buy books. Knowing this, Bertelsmann launched a large number of direct stores in Europe, but mainly engaged in book clubs and online business in the fast-paced United States.
But in China, none of this works. The consequences of directly copying the French direct store model to China soon came out. Rising rents and personnel costs, as well as people's general indifference to physical bookstores, make Bertelsmann overwhelmed.
Although Bertelsmann did his homework before coming to China, he still underestimated the cultural gap between China and the West. The clause in the membership agreement of the book club about "recommending" purchases every quarter has become the most criticized thing for readers. After the number of members of the book club climbed to the peak, Bertelsmann still promoted youth inspirational books without changing his original intention and never considered more meaningful books.
At present, Bertelsmann's book clubs all over the world are showing signs of depression, and American book clubs have been actively looking for their next home. However, with the help of the power of the Internet, the book club may develop in a professional direction. After all, for those professional books, bookstores cannot compare with book clubs. Roger Cooper, the former editor-in-chief of Bertelsmann's American Reading Club, has clearly expressed his disappointment with the mainstream reading club, but Bertelsmann's reading club in China has never shown his thoughts on a new way out.
Germans are dedicated, patient and more willing to invest. In order to maintain the book club, Bertelsmann invested 40 million dollars before and after, and established a call center with 150 people, with a CRM system storing 8 million users' information and a self-developed logistics distribution system.
The number of members has not increased, but the cost remains high. Only one stamp album costs 3 million yuan a month; Its advertisements published in popular publications every month cost 6.5438+0.8 million yuan for only one reader. When rival Dangdang let readers know about this month's new book without spending a penny, Bertelsmann's stamp album was just for readers to find books on Dangdang, and even Li Guoqing, president of Dangdang, expressed disdain for it.
When all these problems happened, 38 2 1 century chain bookstores became the last straw to crush this behemoth. Slow checkout, poor cash flow, arrears, and no new good books from the publishing house. Bertelsmann's national book chain seems to have entered such a vicious circle, which directly led to the final closure.
Sometimes, patience and determination are one thing, but success is another.