Why Bertelsmann Failed in China

By Cindy M. Carter, published

Claire Li's post on the Make Do Studios website analyzes some of the reasons Bertelsmann AG's business model failed in China:

"Why did Bertelsmann's China business fail? Some people say it has to do with the prevalence of pirated books here. But obviously, people who hold this view have not caught on to the state of the book market in China nowadays [...]

"Bertelsmann continued opening bookstores around the country without realizing how greatly the internet would influence people's shopping habits. People buy books on Dangdang and Joyo for its wide selection, low discounts, fast delivery, its payment-upon-receipt system, and freedom from any membership requirements like having to buy a book each month. Bertelsmann, by contrast, not only had a limited choice of books and poorer discounts, but it added another requirement last year that its platinum members had to spend RMB 299 per year or else be bumped down to a lower level. An understandable amendment, since the book club's overhead is high, but nobody wants to be forced to spend money."

read the complete article

Update: Another take on Bertelsmann's China venture (from Chen Gang, a journalist at China Publishing Today)

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