DirectGroup Portugal Brings Círculo De Leitores And Bertrand Closer Together

"We still believe that the book market in Portugal has great potential." With these words Oktay Erciyaz, the head of DirectGroup Portugal, made it clear in which direction the latest decisions will take his company: forward. Erciyaz recently gave an interview to “Expresso,” the country’s foremost weekly paper, in which he outlined specific measures designed to further the company’s development. His conclusion: "There is no reason we should fail - we have strong customer relationships, and we have strong brands."

The second point in particular is the driver behind one fundamental decision, which DirectGroup says it will now gradually implement: The activities will be merged under a common brand, and will act as a loyalty program. This change will be visible for all customers starting early 2010, to bring the strengths of each part more to the fore. The aim is to create an even more powerful book company by linking the large number of Círculo members and their loyalty to the club more closely to Bertrand’s selling power than has previously been the case.

 

Better coordination and dovetailing

"Our customer pool is shrinking because we have failed to adapt to the new realities on the book market," admits Erciyaz in conversation with "Expresso". The traditional book club model that has been followed in Portugal was successful for many years, but times change, and today you couldn’t sell typewriters anymore, either, though they were long a successful product, the managing director points out. Erciyaz took over as head of DirectGroup Portugal in May, and will remain in this role during a transitional period. He has spent several successful years with DirectGroup in the Netherlands and Belgium. As the new managing director explained to his staff, he specifically wants the structures of both units to coordinate and dovetail with each other better. This is especially important in the day-to-day business: the strong attraction of the Bertrand brand is to be used to recruit Círculo members, keeping the entry threshold as low as possible. At the same time members will be encouraged to buy more books in Bertrand bookstores. In this way Círculo could also act as a kind of customer loyalty program for Bertrand. The well-known publishing brand Círculo de Leitores will definitely continue to exist. "We don’t want to limit our customers to one channel of distribution," Erciyaz told Expresso. He added that he was not worried about cannibalization in this context.

 

Picking the right titles and developing new authors

The merger of the units, which began when DirectGroup took over Bertrand in 2004 - for example, the central administrative staffs of Círculo de Leitores and Bertrand have occupied the same building since 2007 - will be accelerated on an organizational level as well. Erciyaz said that where functions overlap, a redeployment of jobs should be considered: "In some areas we do not have the right skills," explains Erciyaz. "In others, we have too many or too few employees." As an example he cites the company’s online sector, which certainly needs extra staff at the moment. The CEO said the external circumstances governing the new orientation could be viewed with mixed feelings. On the one hand, the book market is becoming an increasingly competitive and difficult market. On the other hand, the book market in Portugal grew by four percent last year – in contrast to other Western markets. But Erciyaz remains cautious about fantasies of major growth: “Growth tends to make publishers publish ever more titles. I'm not an advocate of this strategy. It is much more about the right selection of titles and developing new authors – as well as recognizing emerging trends. After all, book publishing is not like gambling at a casino."