The book publishing industry has been disrupted, disrupted and disrupted some more. Book publishers have a reputation of being dinosaurs that don’t know how to embrace digital, headed towards extinction. But higher-education publisher, Pearson, has schooled itself on innovation, exploring new digital commerce business models and acquiring EdTech startups, and it’s paying off. Today, digital makes up 50 percent of its revenue, with a goal of 70 percent by 2015.
What are some of the key ingredients of Pearson Education’s digital strategy? They dished at paidContent Live last week, and we’ve got the scoop.
Sense of Entitlements
A digital textbook can be monetized by a variety of business models. For example, a student might buy time-limited access to content or buy only the chapters associated with the course syllabus. Textbook content could also become available as part of a semester-long subscription bundle. Supplementary material like study guides, sample tests, video or learning games could be accessed within content through micro-transactions.
A digital content commerce platform needs to recognize entitlements (rights to access content) and to support re-monetization like renewals, upsells and upgrades.
Programmers as Merchandisers
Busting up a 400-page textbook into granular pieces requires this micro-content to somehow describe itself. Of course, this supports search features, but it also creates personalization and even guided-learning.
Pearson Education gives an example in which the textbook diagnoses a student struggling with the quadratic equation and prescribes a way out of the rut through supporting materials, perhaps within other publications. APIs make the content-fetching and push-recommendation possible, while analytics drive the intelligence.
Though these content recommendations could be monetized through micro-payments, with content, it’s not as much about continuous transactions as it is lifetime, customer value. Operational business intelligence is a big part of this, continually learning and shaping business models and the consumption requirements that are unknown today.
Melting the Snowflakes
Large organizations like Pearson can find it challenging to get different departments and business units to come together, especially when acquired teams come with their own ways of doing things. When different groups see themselves as unique “snowflakes,” it ends up building a lot of point solutions. Pearson’s working on bringing many groups together to identify similarities, so less marginal work is done and more core work that can be scaled across groups is accomplished. Not only does this spare resources, it also creates more opportunity to integrate content across groups into new apps and products.