If Britney Spears were to reside somewhere in the rich, leather-bound volumes of the Encyclopaedia Britannica, she would most likely be found between the mainstays of Spanish Literature and Speech. Or perhaps in the arts section in the encyclopedia’s outline of knowledge, in the category of transitory, or flash-in-the-pan.
Oh, don’t bother looking. She’s not there.
But the teen icon can be found in all her bare midriffness on Britannica’s 1-year-old Web site, with a decidedly Britannica-like contemplation on the navel and “the odd eroticism evoked by that hollow space.”
“Though not technically sexual,” said the recent essay, “the erotic terrain of the navel shifts after puberty, and what is a cute little button on a child becomes, on a teenager, a heated boundary between baby and babe.”
Oh my. Not exactly the lofty pitch we used to hear from those nice gentlemen who knocked on doors to sell the world’s best-known name in encyclopedias.
Times have changed, though, and perhaps no one knows that better than the folks at Britannica, who are putting some cultural elastic in Britannica’s historical scholastic mission in hopes that they can find a home–and, more important, a business–in the world’s information landfill, the Internet. In its sometimes quirky Web site, Britannica.com Inc. is trying to bridge the gap from the encyclopedia’s high-minded founding 232 years ago to the brutally competitive arena of the World Wide Web.
Britney Spears’ belly button is a means to that end, much like a fluorescent green and orange neon sign telling people to visit the Louvre. This attachment to pop culture may also be some measure of desperation for Britannica, which last year belatedly embraced the online and CD-ROM encyclopedic world largely because it had no other choice.
“Our challenge is to take the brand name and redefine what Britannica can be,” Don Yannias, Britannica.com’s 42-year-old chief executive officer, said at the company’s headquarters on South Michigan Avenue.
The blunt bottom-line message is that this may be the last, best chance for the oldest and biggest name in encyclopedias that, in the mid-1990s, saw its business all but evaporate. In a few short years, Britannica has made the stunning transition from selling bound books for more than $2,000 a set to offering CD-ROMs or $5 a month online subscription service to its latest gambit: giving away the information on the Web. The future is by no means secure, because few have shown they can make money off the Internet.
“It’s gonna be tough,” said Charlene Li, a senior analyst who follows Britannica for Forrester Research in Cambridge, Mass.
Since it debuted a year ago, Britannica.com has won plaudits from Internet reviews and publications. Its popularity–which at first was too much for its technology to handle–has grown, though it hardly sits atop rankings of Net traffic.
The business future of the venture is uncertain.
“It’s one thing to be seen, but it is very hard to sell advertising based on information,” Li said.
The Britannica site has elements of the old and the new–it resembles dozens of popular information sites, like NBC, CNN and Salon, and offers links to more than 70 popular magazines. It offers daily perspectives on events, as presented by the editorial staff at Britannica. And it offers the heavyweight content–the 32-volume encyclopedia, all for free.
“We’re a conglomeration of a lot of different things,” Yannias said. “We feel very confident we can turn the brand into a repository of trust and authority.”
Britannica’s reasoning goes like this: With so much uncertainty about the reliability and quality of information on the Internet–and the proliferation of pornographic sites–people will go to names they know and trust. Of course, this is the popular boilerplate recitation of online-venturing CEOs imbued with the confidence that their brand name will be left standing when everyone else has fallen. The flip side of the brand name argument is that, by themselves, they offer no guarantees of long-term business success, as companies like Reader’s Digest, Campbell’s Soup and CNN can attest.
Britannica was started in 1768 by three Scottish printers. In 1920, Sears, Roebuck and Co. bought Britannica and moved it to Chicago. Ownership passed in 1941 to William Benton, who willed it to the Benton Foundation in 1970. All the while, its reputation as the world’s most authoritative and comprehensive encyclopedia grew, and in 1990 sales reached an all-time high of $650 million.
The arrival of the CD-ROM encyclopedia, selling for $50 to $70, destroyed the printed encyclopedia business. (Today, CD-ROM encyclopedias are freebies, bundled with computer sales and attached to processed cheese packages.) Reluctantly, Britannica jumped into the CD-ROM business, but sold them at an uncompetitive price: $1,000. The sales slump continued. In May 1995, the Benton Foundation put Britannica on the block; 18 months later Swiss financier Jacob Safra bought it at less than half its book value.
“The Britannica story contains morals for all businesses. The first is obvious: The most venerable can prove the most vulnerable,” wrote Philip Evans and Thomas Wurster in “Blown to Bits: How the New Economics of Information Transforms Strategy.”
In some ways Britannica’s challenge is no different from that facing any other information-based Web site: How do you make money on the Internet when the overpowering public expectation is that information on the Net should be free? The obvious answer is advertising, but that is no panacea. The painful irony of the so-called Information Age is that amid the clutter on the Internet, information has lost much of its commercial value.
“That’s a tough sell right now,” said Michele Pelino, director of Internet market strategies for Yankee Group, a Boston-based communications consultancy. “How do you get beyond all the things you have to do to get peoples’ attention, and then how do you become viable?”
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Britannica’s leap online was an inauspicious launch. The site promptly crashed from unexpected demand, which, in ways that were not intended, suggested there is business potential here. The long-term plan is to build a business on advertising, pay-subscription services to schools and other institutions, e-commerce sales to consumers and, in the near-term, sales of CD-ROM encyclopedias.
“An encyclopedia can be so many different things to different people,” Yannias said in a conference room where shelves used to hold the attractive leather volumes. Today the shelves are empty.
Britannica.com is heavily into the attention phase right now. In early September, it launched “The Annotated Dennis Miller,” a weekly cultural and historical analysis of the comedian’s “Monday Night Football” observations. Like the Spears’ navel analysis, it is not common online fodder; it can be as dense as Miller’s remarks are disjointed. It has, however, attracted free publicity.
The site has attracted some blue-chip advertisers, including Ford Motor Co., IBM Corp. and Microsoft Corp. But the privately held company is not profitable, and questions are mounting about the future prospects of online advertising.
Safra declined to be interviewed for this report. Jorge Cauz, Britannica.com’s chief operating officer, said he hopes the online operation will be profitable by early 2002.
Analysts who follow the company are guardedly optimistic. There is a future for encyclopedias as a source of trusted information.
“If they don’t overspend and if they can get a blend of revenues–from advertising and subscription services–they can make this work,” said David Card, a senior analyst at Jupiter Research in New York. Card said some of the “pop culture stuff is ill-advised. The thinking behind it is not bad because there is a younger audience you need to attract, but I don’t think they should over-invest in that.”
Scant few ventures in the Internet world are profitable. Wall Street has lost much of its confidence in online businesses, forcing many companies to postpone initial public offerings and battering shares of those that are already public.
“We’re looking at the trend in the Internet business that has gone from gee whiz to now you have to justify yourself just like any other business,” Pelino said.
All of this is duly noted at Britannica.com. “This isn’t going to happen overnight,” Yannias said.
Britannica has attributes that many of its competitors do not: It is well known. Its customers, according to company research, come from the cream of the advertisers’ target audience–upper income, well-educated and having what Cauz calls “aspirational qualities.” And the encyclopedia is a great resource, experts say, even with the explosion of information at computer users’ fingertips.
“Britannica speaks to people in a daily and relevant way that sort of enriches their lives because we go into the deep contextual aspect,” said managing editor Rodger Brown, the former editorial director at Playboy.com. “Britney Spears comes and goes but she represents something deeper in society and culture. The same with Dennis Miller. He could get canned tomorrow, but Britannica is ideally positioned to explain their importance.”
So, however, are magazines that traffic in serious cultural discourse, like Atlantic, Nation, Harpers and New Republic. Many magazines in that category are money losers or, at best, marginally profitable. They are backed by a loyal cadre of incredibly patient financial supporters or, in the case of The New Yorker, subsidized by much larger media companies.
The solution, Forrester’s Li said, will reside in educational subscription services, getting schools and large institutions to pay for services that Britannica can offer.
Yannias said he wants Britannica to have a “cradle-to-grave relationship” with consumers, starting early with schools and maintaining that with lifelong online contacts. At least in the near term, though, the company’s promise may lie with those who have comprised Britannica’s backbone for many years–schools and other educational institutions.
“They could potentially make this work,” Li said. How much time they have depends on the number and patience of investors, she said.
“Good brands come and go,” Li said. “No company will subsidize a money loser forever, no matter how illustrious its past.”