Digital Marketing Strategy. The Mondadori Case Study

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INTRODUCTION  
 
 
 
 
Is it possible for a traditional industry such as book publishing to harness 
the digital change and technological disruption, or books are doomed to 
succumb in this new environment?  
In recent years, the growth of the book market has been slow and a wise 
digital marketing strategy can make the difference between the first and the 
second scenario. This thesis aims at answering the above question, as well as 
actively proposing new ideas, through the analysis of both the digital 
ecosystem and the publishing sector, supported by the Mondadori case study. 
Indeed, in the Italian publishing landscape the Mondadori Group is 
trailblazing in its digital activities and choices, however not every publisher 
composing the Group reaches the same high standards and in such a fast-
paced ecosystem there is always room for improvement and new tools to 
experiment with.  
The first chapter is mainly theoretical and it focuses on the six pillars of 
the digital evolution: customers, contents, touchpoints, platforms, business 
models and last but not least, engagement. As a matter of fact, engagement is 
a recurring key word through the whole thesis and the undeniable base for any 
reasoned digital marketing endeavour. Especially on social media, where 
consumers can express their opinions and feelings towards companies and 
products and become influencers themselves, through blogs and YouTube 
channels which are original and trust-worthy. In fact, another pivotal element 
in the digital ecosystem is the shift from passive and unaware to active and
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informed consumers, with the birth of the prosumer as arrival point of a long 
evolution of the purchasing process. Notwithstanding the essential role that 
social networks play in the involvement of customers and prospects, they are 
at the same time the tip of the iceberg of a way more complex digital 
marketing strategy which lays its foundations on brand building and the 
corporate marketing plan. Finally, the last two paragraphs of the first chapter 
touch on the latest e-commerce trends (such as predictive selling, mobile 
commerce and the rise of the sharing economy), as well as the huge 
opportunities this market creates for small and medium enterprises.  
The second chapter addresses the book-publishing sector and its digital 
transformation, starting from a theoretical framework of models on the 
concepts of technological paradigms, discontinuities and disruption. After a 
brief paragraph on the history of the book, the research focuses on the 
analysis of the European and Italian publishing sector, their main players and 
the competitive environment, thanks to Porter’s Five Forces. In 2014 the 
European book industry grew of almost 1 percentage point, for an overall 
value of 45.751,7 million of dollars, and it is expected to grow of 7,8% by 
2019. Italy accounted for 8,30% of the European market in 2014, according to 
MarketLine, and represented the fourth Country for market revenues, after 
Germany, United Kingdom and France. However, the Italian book sector 
contracted during the last years and it is recovering with difficulty, 
presumably because the percentage of readers remains steady and barely 
grows, a huge problem for the overall market. Noticeably though, in Italy the 
digital branch of the book industry is rising, especially when it comes to sales 
and production of e-books, and in 2014 it accounted for 7,30% of the Italian 
market, compared to the 5,40% of the European average. This is possibly 
thanks to the Italian decision to decrease the VAT on e-books from 22% of 
the EU Law, to 4% as it is for printed books.
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The second half of the chapter is about the disruption of the book 
industry: interestingly, it passes through the evolution of reading devices and 
publishing platforms (e.g. crowdfunding and social writing) as well as the 
asserting of new reading habits or services, such as eBook bundles that allow 
reading without limits on almost any platform, upon payment of a monthly 
fee, and thus combine economic convenience and the online sharing 
experience, fundamental for Millennials. Besides, disruption is brought also 
by prosumers themselves, for example in the figure of web influencers who 
can determine the success or failure of new releases and happily collaborate 
with publishers and book prizes to promote reading. Therefore, a fundamental 
query is how publishing companies react to these innovations and changes, 
and the last paragraphs of the second chapter concern exactly a review of best 
practices among independent firms, campaigns targeted at young readers and 
in retailing, including interviews to personnel of the mentioned firms.  
The third and last chapter rotates completely around the case study on 
the Mondadori Group. The Company is initially analysed broadly in all of the 
three business units: books, magazines and retail, with a subsequent focus 
particularly on the books area, with regards to history, macro goals, brands 
part of the portfolio and target customers.  In 2013 Mondadori created a 
Digital Innovation area, specifically aimed at finding new opportunities of 
business development and guiding better and increasing the innovation 
process. These goals have been pursued also through strategic acquisitions 
and they are perfectly in line with Mondadori’s mission and value 
proposition, “Quality books for everyone”, formulated on the basis of value 
curves that compare accessibility, quality, price and online presence to the 
respective performance of competitor companies. Indeed, the second 
paragraph focuses on the competitive analysis: the marketing strategy and 
value propositions of Mondadori Group imprints’ main competitors, as 
inferred by the above-mentioned value curves. The research continues in the
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third paragraph with the financial performance of the Group: the income 
statement of the last five years, revenues and EBITDA by business area in 
2015 and a focus on the books business area, where Mondadori proved to be 
the absolute market leader, with trade being the most fruitful sector.  
As regards the strategic guidelines of Mondadori’s digital approach, they 
are deduced by the interview to Giovanni Dutto, Marketing and Planning 
Director of Mondadori Libri. Specifically, social networks are seen as a way 
for the publisher to express its voice and credibility, and they need dedicated 
content according to the platform, although consistent through the different 
channels. Moreover, on-line and off-line words are not in opposition but 
based on the common elements of their marketing strategy: community, 
participation, engagement and events. Besides, Mondadori has decided to 
keep investing in its EBooks catalogue and has a constant eye on platforms of 
book crowdfunding and social writing. The digital presence of every imprint 
of the Group is then analysed, in their positive and negative aspects.  
Indeed, the last part of the chapter contains critical considerations on the 
study conducted. The first conclusion is that there is no consistency in the 
digital approach of the different publishers of the Group, as underlined by a 
particular version of the BCG matrix, specific for online presence and growth. 
Imprints such as Einaudi, Piemme and Mondadori are definitely stars in the 
BCG nomenclature, whereas Frassinelli, Pickwick and Edizioni EL should 
use more and better the plethora of digital tools. Moreover, the SWOT 
analysis of Mondadori highlighted many strengths and opportunities, strictly 
linked to the future perspectives of the publishing sector, e.g. the importance 
of Big Data and the mobile platforms, as well as creating communities and 
collaborating with other players in the industry.  
Building on the overall analysis, it was eventually possible to formulate 
personal proposals to enhance the digital strategy of the Group, including: 
better integrate the digital marketing efforts of all of the imprints; provide an
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eBook bundling service based on a specific business model that leverages on 
the Group’s large production of several book genres, as a way to increase the 
number of strong readers; take inspiration from other industries to organise 
collaborations and be more innovative in the use of social networks; and last 
but not least, tailor marketing campaigns at children, teens and Millennials, 
with specific initiatives according to the age.
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CHAPTER 1  
THE DIGITAL ECOSYSTEM 
 
 
“Marketing on the Internet is becoming less about broadcasting a 
message and more about engaging in ongoing dialogue with consumers.”
1
 
This quote by Ryan and Jones perfectly highlights the challenges arisen for 
marketers from the digital revolution. Indeed, technological evolution did not 
change marketing’s core, namely identifying and meeting human and social 
needs
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, but it provided companies with several new channels to connect with 
their costumers and prospects.  
Therefore, digital marketing should not be considered a branch of 
marketing, but rather its evolution, whose main objective is to engage 
customers through digital channels. In order to master this art, it is necessary 
to analyse the digital ecosystem and its pillars.  
Fig. 1.1 Pillars of evolution 
Source: Digital Marketing Course - Maximo Ibarra, Luiss Guido Carli, a. y. 2014-2015 
																																																								
1
 Ryan and Jones, Understanding Digital Marketing (Kogan Page, 2009), 228. 
2
 Kotler and Keller, Marketing Management (Prentice Hall: Pearson, 2012), 5.		
Customers	
Contents	
Touchpoints	
Platforms	
Business	
Models	
Engagement
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1.1 Pillars of evolution 
The digital ecosystem consists of six pillars
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: customers, contents, 
touchpoints, platforms, business models and engagement. These six pillars are 
at the basis of the disruption that companies are experiencing due to the 
digital revolution; therefore it is useful to describe each pillar separately. 
 
1) Customers 
Customers can be of two types: 
• Fully Digital: these customers are willing to have only digital 
relationships with the firm, thus all the interactions with the brand take 
place online or through digital devices; 
• Hybrid: they have different degrees of digitalization and mix digital 
and physical experiences. 
This division concerns not only age groups, but most of all different lifestyle 
segments, depending on the level of technology adoption in their everyday 
life. Companies have to target both fully digital and hybrid customers, 
through two strategic approaches specifically tailored for each type. Besides, 
consumer behaviour is changing extremely fast towards a greater and greater 
degree of digitalization and companies need to adapt to this trend, otherwise 
they will soon find themselves excluded from the market. 
 
2) Contents 
Contents are the most important things on the Internet, and the term “content” 
encompasses almost everything
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. Companies need to focus their attention 
especially on these three macro-groups: 
• Vertical contents: digital goods such as music, videos, games; 
																																																								
3
 Ibarra, Digital Marketing course material, a. y. 2014-2015. 
4
 Ryan and Jones, Understanding Digital Marketing (Kogan Page, 2009), 79.
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• Social medias: the value is created by the community and the 
relationships among customers and brands; 
• E-commerce: a growing trend that allows purchasing physical goods 
and services through the Internet.  
 
3) Touchpoints 
Every source of connection between company and customers is a touchpoint. 
They are both physical, like brand stores, and digital. Relevant digital 
touchpoints are: 
• Website, the home of your brand on the Internet and a conversion 
engine for the traffic gained thanks to all of your other digital 
marketing endeavours
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; forums, where users can interact with each 
other on various topics; blogs, usually on the company’s website, they 
are used to communicate with the audience in a more informal way and 
allow readers to comment on the post; last but not least the My Account 
Area, an innovation that allows customers to easily control their 
account on the company website and manage their information. 
Nowadays, many companies also have an online store built in their 
website to sell products directly to customers without any intermediary.  
• Apps: applications are specifically designed to be used from a mobile 
device and facilitate customers’ activities on the go. Besides, apps 
make use of push notifications to target customers and grab their 
attention.   
• Social media, an immediate and direct way to convey the value 
proposition
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 of the firm and a valuable source of knowledge and 
insights on consumers’ attitudes. At present, there are countless social 
networks and they can be classified in: generalist, such as Facebook, 
																																																								
5
 Ryan and Jones, Understanding Digital Marketing (Kogan Page, 2009), 40. 
6
 The concept of value proposition will be defined in paragraph 1.3.
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Twitter and Google+; specialized like Instagram and Pinterest for 
pictures, Linkedin for job applications, Tumblr for micro-blogging, 
TripAdvisor for tourism and BlogLovin for fashion and lifestyle blogs. 
Social communities, like Facebook or Twitter again, are also used for 
Customer Services as well as CrowdSourcing support from other 
consumers or LiveChat with companies’ employees. 
 
4) Platforms 
This pillar concerns technical elements that allow interoperability among 
different devices thanks to: 
• IT architecture: a bundle of technological components, which can be 
characterized by a lower or greater level of modularity. Modular 
architectures reduce innovation costs and foster the launch of 
specialized and complementary companies
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. Strategically, this may 
result in platform leadership: “the ability of a company to drive 
innovation around a particular platform technology at the broad 
industry level”
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, generating network externalities, a virtuous cycle 
thanks to which the more people use platform products, the more 
complementary products will be introduced by complement producers. 
• Application interfaces: interfaces are necessary to connect more 
components to the platform. Open interfaces entail publicly disclosing 
the methods of connection to the platform, so that the platform leader 
can leverage on the modular architecture, as explained above.  
• Cloud computing: according to NIST
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, cloud computing is “a model for 
enabling ubiquitous, convenient on-demand network access to a shared 
pool of configurable computing resources (e.g. networks, servers, 
storage, applications, and services) that can be rapidly provisioned and 
																																																								
7
 Cusumano and Gawer,“The Elements of Platform Leadership”, MIT Sloan Management Review (2002): 55. 
8
 Cusumano and Gawer,“The Elements of Platform Leadership”, MIT Sloan Management Review (2002): 53. 
9
 US National Institute of Standards and Technology.
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released with minimal management effort or service provider 
interaction”
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. 
• Big data: collecting a huge quantity of information, it is now possible 
to convert unstructured data into structured knowledge in order to study 
customers profoundly and provide them with better services and 
improved products. 
 
5) Business Models 
Different business models mean different ways for the company to monetize 
on their products and services. Companies can decide to charge their 
customers or to leverage on other aspects. For this reason, business models 
can be classified in: 
• Free: the company does not get paid directly from their users, but it 
profits from advertisements placed on its platform or selling 
information and big data obtained from its community. Facebook 
epitomises this business model, thanks to the engaging community they 
created. 
• Freemium: This term is the crasis of free and premium. More precisely, 
the product or service is provided for free but a premium fee is charged 
for unlimited time of use and advanced features or functionality. 
Spotify is the perfect example for this business model, because users 
can sign up and benefit from the music streaming for free. However, it 
is necessary to upgrade to the premium service, paying a monthly fee, 
in order to have advanced functionalities on mobile and other digital 
devices and to be able to listen to music without being interrupted by 
advertisements. 
																																																								
10
 OECD, “Cloud Computing: The Concept, Impacts and the Role of Government Policy”, OECD Digital 
Economy Papers (2014): 8.