By Porter Anderson, Editor-in-Chief | @Porter_Anderson
‘A Continuous Decline from January’In its assessment of the performance of the Chinese book publishing market this year from January through June, our associates at Beijing OpenBook see a decline of 13.8 percent in the market’s growth rate over the same six-month period last year. This, compared to the first half of 2019, represents a 12.8-percent drop.
The culprit, as expected by many international observers, has been the rash of outbreaks and spread-mitigation measures in the still-ongoing coronavirus COVID-19 pandemic. The continued instability, for example, has caused organizers of the Shanghai International Children’s Book Fair to postpone for a second time this year, first from March to July, then from July to November.
China’s online and physical retail index—which goes back to 1999, when OpenBook began tracking the market—”showed a continuous decline from January,” according to the staff in Beijing, “and the index rebounded after May when epidemic prevention and control became better.”
In the first half of 2022, the physical-store channel fell by 39.7 percent year-over-year, the research indicates, and the digital-store channel fell by 5.8 percent in the same period.
These data points now have been reported by research manager Xiaohui Feng to the market’s key players in OpenBook’s annual “Reading X” presentation–this year staged only as an online event, a sobering reflection of today’s report from Jason Douglas for the Wall Street Journal.” China is expected to record its weakest growth rate in more than two years,” Douglas writes, “a measure of the costs imposed on the world’s second-largest economy by Beijing’s zero-tolerance approach to COVID.” This is particularly challenging news for the Chinese book industry, which is bracing for what many in Shanghai fear will be a second rollout of lockdowns as the BA.5 variant becomes increasingly dominant. More on that is in Christian Shepherd’s report for the Washington Post.
The OpenBook team makes the point that a part of the impact the lockdowns have had on the industry includes supply-chain disruptions. “The epidemic in the first half of 2022 not only affected the sales of online purchase,” the team writes, “but also had a greater impact on logistics and warehousing, which also dealt a blow to the highly logistics-dependent online store channels.”
Mixed Results Among Sales Channels
In terms of physical retail, China’s bookstores saw a 51.8-percent decline by comparison to the first half of 2019, and that 39.7-percent drop by comparison to January-through-June 2021.
What is on its way up, however, in 2021, is the share of online retail’s activity, hitting almost 80 percent of the overall market. OpenBook looks at the digital retail structure in three parts—ecommerce platforms, short video e-commerce, and other e-commerce options. Despite the buzz around short-video marketing, as in TikTok, OpenBook sees the more traditional platforms holding as the main e-commerce retail channels, not least because of their broad inventories.
Promotions were a major part of what success could be managed in digital retail. The annual “618” promotions in mid-June opened early, in May, the researchers tell us, and discounts offered were especially aggressive on short-video retail channels, reaching 62-percent-off deals in some cases. On the more traditional platforms, discounts ran as high as 46 percent. These numbers can be compared to physical-bookstore pricing that offered only 10-percent discounts.
Even in the higher discount ranges, OpenBook cautions that drastically cutting prices to best competitors is hardly a long-term strategy, of course. “A discount competition,” our associates politely put it, “does not bring sustainable development.”
Among those sales channels and their many discounts, sales were clustered around sectors and genres of content.
- On short-video e-commerce some 61.3 percent of sales were in children’s books
- On more standard e-commerce platforms, children’s books were strong, as were social-science titles, each at 26 percent
- In physical stores, teaching materials were the bestselling titles, at more than 30 percent of sales
An interesting couple of parallels can be found in how frontlist and backlist were moving in the first six months of this year in China.
- Frontlist titles sold best on short-video channels
- Backlist titles sold best on the more traditional e-commerce platforms
And when looking at titles that sold between January and June in totals of 1,000 and more units:
- More traditional e-commerce platforms were representing as many as 52,000 titles
- Other e-commerce outlets were offering as many as 31,000 titles
- Physical retail had some 20,000 titles
- Short-video e-commerce channels were offering a far smaller range, at some 6,000 titles
So we see from this that despite the robust performance of the short-video channels, the breadth of inventory they offered in the first half of the year was quite narrow by comparison to the other channels.
There are more nuances to be worked out in how short-video e-commerce sales are understood to be working in the Chinese market, and we’ll be returning to them for more coverage. Our thanks, as always, for translation and coordination assistance from Jiang Boyan.
More from us on the coronavirus COVID-19 pandemic and its impact on international book publishing is here.