Digital Transformation

Shaping Change

Watching TV on tablets, reading on e-readers, using apps to leaf through magazines…the digitization megatrend is changing the way people use media. Bertelsmann aspires to be at the forefront of shaping this change, and therefore the transformation to digital of its media and services businesses is a strategic priority for the company. Bertelsmann publishes books – and has done so for nearly 180 years. If you look at how book content is created at Penguin Random House, Bertelsmann’s book publishing arm, you will observe an almost entirely digital process – all the way through to the purchase of digital or printed works by their readers. Many thousands of e-books in English, Spanish and German are available from Penguin Random House; Bertelsmann book publishers now generate more than 20 percent of their global revenues in the digital business.

In the U.S. this figure is over 25 percent, or even higher for some bestsellers. And growing. Publishing isn’t the only area where this is happening. Digitization has arrived in the middle of everyone’s lives and all of Bertelsmann’s business activities. Digital media use has reached the mainstream. The transformation to digital has not only affected all businesses, but is already making a substantial contribution to the core businesses. Digital devices like smartphones and tablets offer topicality, interactivity, and social networking, thereby creating new customer groups and sales channels. The example of e-books shows that Bertelsmann already takes a leading role in actively shaping the media change by aligning its business to the new circumstances.

Digital offerings reach millions of users

The same is happening in other divisions: Arvato, Bertelsmann’s services arm, delivers all kinds of digital services for large and small customers on a daily basis. RTL Group is steadily expanding its video-on-demand services, and numerous "second screen" offerings on apps keep viewers engaged even if they use a smartphone or tablet while watching television. With homegrown content and program-driven channels, RTL Group's production arm Fremantle Media also has a strong presence on online video networks such as YouTube. Gruner + Jahr is working to serve the specific interests of online users – for example with the help of Internet verticals or communities like "Kochen” (Cooking) or “Eltern und Familie” (Parenting and Family).

Great opportunity for Bertelsmann

Digitization is a great opportunity for Bertelsmann. In seizing it, the company is relying on enhanced exchange, cooperation and transparency. Training programs to strengthen technological and digital skills help to ensure a high level of expertise in the company. The digitization of media and changing consumer habits are evident everywhere you look. For a media company, a successful transformation to digital requires the reinvention and upgrading of content and services. In the digital world, too, successful products are the ones that best meet the needs of consumers.