Online channel hoping for new chapter on book market

With the Romanian book market still below EUR 100 million, online book sales are estimated to represent at most 20 percent. The bad news does not stop here: data from publishers canvassed by Business Review reveal a grim reality regarding reading habits in Romania.

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By Otilia Haraga

That the average Romanian is not exactly a bookworm is no secret to anyone in the book publishing and distribution industry.

“Romania is a country where people are reading less and less, although the National Institute of Statistics is lauding us with 10-12 minutes of reading every day among people older than 25. In Romania, people do not buy books because they do not read enough, since, unfortunately, education has lost from sight the mission of helping the pupil and the teen to become a reader at an adult age,” Mihai Mitrica, executive director at the Romanian Publishers Association, tells BR.

Others are more optimistic. “With regards to the question ‘how much do Romanians read?’…you know the answer. But it is related to our standard of living, which is not at all in line with the European level. Anyway, Romanians have potential in any field – reading is one of them – and after we beat the crisis, the numbers will definitely change,” Mihaela Petrovan, founder of the BookLand book fair and virtual book store, tells BR.

The book market in Romania is not yet worth EUR 100 million, including titles sold at kiosks, Mitrica tells BR. Retail in book shops, fairs and independent book stands is estimated at 80-85 percent of the market, with a 15-20 percent share going to online sales, including distributors and the websites of the publishing houses, he says.

Dan Vidrascu, CEO of elefant.ro, thinks that when comparing Romania to other nations, one should first look at the value of the markets. “In Romania, the book market hovers around EUR 50-60 million. In Hungary, for instance, it is twice this size. In the UK, book sales in 2013 were approximately GBP 1.4 billion,” he says.

He adds that reading is becoming less popular everywhere. “The downward global trend of the book market could be discerned in 2012 and 2013. In 2012, for instance, in the US, the market declined by 9.3 percent, in Spain by a little over 10 percent, in Italy by 7 percent, in the UK by 3.4 percent, and in South Korea by over 20 percent. In 2013, in the UK, the average decline on the book market was 6.5 percent. The print market shrank even more, by 9.8 percent. However, digital book sales partially compensated for this,” he comments.

When it comes to the extent to which Romanians acquire books online, Mitrica says, “The book market has shrunk such that the ratio of online sales does not weigh significantly. A contributor to this situation is the Romanian economic situation, but there is also the fact that the authorities are not in the least interested in promoting reading among the public, especially children and teens, through a consistent strategy,” he tells BR.

Data from online payment processing company PayU show that the number of online book transactions spiked by 44 percent and the value of acquisitions by 37 percent. Expectations for 2014 are that growth will be along the same lines as last year. “We are seeing greater interest from traders to consolidate their online channels; we are having more frequent discussions with partners in this field to find solutions together to trigger the growth of online sales. With such interest and involvement, there is no way but up for the industry,” Manuela Stoica, marketing & PR executive PayU Romania, tells BR.

High in Romanians’ reading preferences come fiction, children’s books, and more specialized titles in business, personal development, psychology, history and science, according to experts canvassed by BR.

Online book players share their ‘no guts, no glory’ philosophy

“At that point in 2010, Romanian e-commerce needed a comprehensive online book store with a very rich offer and a customer-oriented commercial strategy,” says Vidrascu of the inception of elefant.ro.
In 2012, the book store diversified its offer with toys and in 2013 it added clothes, footwear and accessories to its offer. “Little by little, elefant.ro turned from an online book store into an online mall dedicated to the entire family,” he adds.

Total investments in the bookstore reach EUR 3 million. “Most of the investment went into the development of the company, including stocks, but especially the software platform which is continually expanding, the operation management systems, marketing and acquisitions. We can now deliver anywhere in the world,” he says.

In 2013, elefant.ro posted a turnover of EUR 6.5 million, which was mostly generated by book and e-book sales. “While we do not have very exact data at the moment, the rough split is about 80 percent foreign titles and 20 percent Romanian titles,” said Vidrascu.

elefant.ro has over 3,000 e-books in its range, most of them digitalized by its own digital book team with the company’s investment.

“Other new categories will be added this year, most of them due to demand from present clients and targeting women, who represent 70 percent of our customer base,” Vidrascu says.

Retailer-of-all-things eMag started selling books on the eMag Marketplace in 2011, but since then the company has also launched books in Bulgaria as well.

“Book sales at eMag spiked by 90 percent in 2013 compared to the previous year. The average value of the order is RON 50-55,” says Lucia Ciuca, marketing director at eMag.

The average value of orders placed on Humanitas.ro is RON 85, with the bookstore delivering both in Romania and abroad, and readers can choose from a range that also includes e-books and audio books. The broadest majority of books sold online (95 percent) are Romanian titles while the rest are foreign.

At BookLand, the founders decided to open an online bookstore “out of passion and out of the desire to contribute. You cannot make ends meet from book sales. BookLand will only make profit five to seven years from launch. At least we hope so!” says Petrovan.

“The BookLand Caravan has cost over EUR 450,000 in over three years. The other costs, related to the e-commerce platform, the warehouse, the staff, the promotion, double this figure. Some of the costs were covered from book sale commissions… but when we draw the line, there is still about EUR 500,000 to recover,” she comments.

Last year, BookLand sales (just books) totaled EUR 270,000. Foreign titles represent 75 percent, with the exception of school manuals, while the other 25 percent are by Romanian contemporary writers, says Petrovan.

“This is in the context in which we had as sales channels the National Caravan, the online library and a few key accounts – Mega Image since April and Cora since October have been selling several hundred titles we list in the name of BookLand suppliers. This year we will expand book distribution and we will significantly grow our turnover. We cannot talk about profit yet,” says Petrovan.

The average value of orders placed on www.book-land.ro is RON 60. “This is because in our first three years – to be able to offer our clients free delivery – we set the minimum order at RON 50. This year we are maintaining our offer – the minimum order will be at least RON 75 – to benefit from free delivery. Probably by the end of the year the order will be RON 80,” says Petrovan.

The bookstore promises a project “that will really change the ‘traditional’ approach. In Romania e-book sales represent under 1 percent of total sales. At the moment, I cannot tell you more because the project is underway,” says Petrovan.

In a more niche area, Okian.ro representatives say at the beginning the company was “a book importer with a major background in Romania and we did not want to confine ourselves to strictly selling in the academic environment. We wanted to offer titles in the original language to the local market and this is why we opened Okian.ro. Later, we expanded our offer to Romanian books and more recently, games and accessories,” Bogdan Colceriu, marketing Manager of Okian and project coordinator of Okian.ro, tells BR.

Apart from traditional books, Okian.ro also sells 100,000 e-books, but only English titles.

The average value of an order placed on Okian.ro is RON 120. “This exceeds the average order placed on the Romanian book market, precisely because English titles have higher prices,” he comments.

In 2013, Okian.ro sales reached EUR 1.4 million. About 80 percent of the turnover was generated by English titles.

“If we take into account the investment from the beginnings of Okian.ro until today – including the online store, the warehouse, the ERP and many others, we are closing in on EUR 1 million,” he says.
Last year, the Okian.com website was launched, which delivers Romanian books to Romanians in the USA.

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