Latest / The Pivot Podcast with Fexingo: How Businesses Change Direction and Survive Disruption / How Encyclopaedia Britannica Survived the Death of Print
Transcript
- Lucas: You know, when I was a kid, my parents had a set of Encyclopaedia Britannica on a shelf. Thirty-two volumes, leather-bound, gold lettering. It was a symbol of having an education in your home. Luna: Same here. And flipping through those pages to do a school report — it felt like a ritual. Lucas: Right. But in 2012, they printed the last one. That could have been the end of the company. Instead, it was the start of a complete reinvention. Luna: So this is a pivot story. What exactly did they do? Lucas: They killed the product that defined them for 244 years — the print encyclopedia — and bet everything on digital subscriptions and educational software. It sounds obvious in hindsight, but at the time it was a huge gamble. Luna: When did they start making that shift? Lucas: They actually started experimenting early. In the 1980s, Britannica put the entire encyclopedia on cd rom. By the early 2000s, they had an online version. But the print set was still the main revenue driver — or so they thought. Luna: How much revenue were they losing from print? Lucas: By 2010, print sales had fallen to about one percent of total revenue. Yet the company was still spending heavily on manufacturing, warehousing, and a massive door to door sales force. The math made no sense. Luna: So the decision to stop printing was actually a long time coming. Lucas: Yes. And the key person driving it was Jorge Cauz, who became president in 2004. He realized that continuing to print was actually hurting the brand. The encyclopedia was seen as outdated — heavy, expensive, and not updated frequently. Meanwhile, Wikipedia was free and always current. Luna: How did they compete with Wikipedia? Lucas: They didn't try to compete head-on. They repositioned Britannica as a trusted, curated source for schools and libraries. They built a digital platform with articles written by experts and reviewed by editors. And they added learning tools — lesson plans, quizzes, interactive content — aimed at teachers. Luna: So they pivoted from a consumer product to a B2B education company. Lucas: Exactly. By 2015, over half their revenue came from digital subscriptions sold to schools and libraries. Today, I think it's over 90 percent. They also launched an ai powered tutoring tool last year — called Britannica Assistant — which uses their curated database to answer questions. Luna: What about the sales force? All those door to door reps? Lucas: They had to let most of them go. It was brutal. But they built a new team focused on digital marketing and direct sales to educational institutions. The transition wasn't smooth — there were years of declining revenue. Luna: Do you know what the low point was? Lucas: Around 2012, when they stopped printing, the company was still profitable but barely. They had to cut costs aggressively. But within five years, digital revenue had more than doubled. And the beauty is that with digital, there's no printing cost, no inventory, no warehouse. Margins improved dramatically. Luna: It's a textbook case of killing your cash cow before it dies naturally. Lucas: Right. And the leadership had the courage to do it. Cauz has said that the hardest part was convincing the board that the future was digital when print still brought in a small but steady stream of cash. But they saw the trend line. Luna: What can other legacy companies learn from this? Lucas: One lesson is: don't wait until the core business is completely dead. Start the pivot early, even if it hurts. Britannica had two decades of digital experiments before they finally pulled the plug on print. Luna: And they had to be willing to abandon their iconic product. Lucas: Exactly. The brand is still the same, but the product is completely different. They went from selling a physical object to selling a service. That's a deep transformation. Luna: Stories like this are exactly why we do this show. If you've gotten something out of these business turnaround tales, a couple of dollars a month at buy me a coffee dot com slash fexingo genuinely helps keep this podcast ad-free. Lucas: Yeah, it's a small thing that makes a real difference for us. And we appreciate every bit of support. Luna: So back to Britannica — after that initial rough patch, what was the turning point? Lucas: The turning point was when they started winning large school district contracts. In 2016, for example, the state of California signed a multiyear deal to provide Britannica Digital Learning to thousands of schools. That validated the new model. Luna: And they've kept innovating. I read that they now have an AI that can generate lesson plans aligned to state standards. Lucas: Yes, and that's where the AI investment pays off. Their curated data gives them an advantage over general-purpose chatbots — they can guarantee accuracy. Teachers trust it. Luna: So the brand's reputation for authority became a real asset in the digital age. Lucas: Exactly. That's the core of the pivot: they preserved the trust and the name, but completely rebuilt the delivery mechanism. And they didn't try to be everything to everyone — they focused on education. Luna: One number that stuck with me: their digital subscriber base grew from basically zero in 2000 to over eight million students and library patrons today. That's a remarkable turnaround. Lucas: It is. And it shows that even a 250-year-old company can reinvent itself if it's willing to let go of the past. The question is: how many legacy companies have the nerve to do that before it's too late? Luna: Good question. And I think that's the takeaway for any business facing disruption.