Most Indians, especially those who have been to schools affiliated to state boards or even Central Board of Secondary Education would have studied Navneet Education’s science, math, english and social science textbooks. In an era when ed-tech start-ups such as Byjus and Unaccademy have taken the education industry by storm, Sunil Gala, MD, Navneet Education, likes to believe that Navneet was the first mover in the world of digital education. “We introduced animated digital books way back in 2010 in English, Gujarati and Marathi, with the belief that it would reduce the workload of teachers and help students understand concepts better. We also launched digital question banks.”
The publishing and stationery major’s digital foray was ahead of its time and didn’t have too many takers. However, a decade later, the company is making aggressive investments in ed-tech yet again — it plans to invest Rs 100 crore per annum for the next three years. The plan includes developing a B2B app for schools that would not just have digital teaching material but also features like learning management system, ERP and teacher training modules. Also in the pipeline is a B2C app targeted at children in the two-eight years age group. “Our platform will offer fun learning to students with a lot of animated games in math, english, science and social sciences,” says Gala. He is confident that digital adoption in the Covid era will make it easier for Navneet to convince schools to adopt its B2B product.
Not adopting digital is no longer an option for legacy publishing companies. In fact, they need to quickly do so to ensure they don't become extinct. "Books will not be bought the way they were earlier. Publishers have to think of becoming more relevant to their consumers and they can do so only by embracing digital," says Ankur Pahwa, Partner and Leader (e-commerce and consumer internet), EY. Also, like the new-age edtech companies, the legacy companies also need to personalise content for the students. "My needs as a student would be different from other students. A one-size-fits-all solution on digital will not work, that's where student drop-outs happen. While embracing digital, legacy companies also need to personalise," says Pahwa.
There is an urgent need for publishing companies such as Navneet to re-look at their existing business model, agrees Anindiya Mallick, founder of strategic consulting firm Mindcomb. "Even after the pandemic ends, education would be hybrid. Legacy companies not just have to make digital textbooks, they also have to ensure that they are interactive. They also need to continuously update their content to ensure stickiness. Students are expecting content providers to be in tune with the times."
The education company is also making inorganic investments in the edtech space. In July this year, it acquired a 46.84% share in Carveniche Technologies, which owns math tutoring platform beGalileo. “They are currently selling only to overseas clients, but now that we are on board, we will promote it aggressively in India. We will also do regional content,” says Gala.
Navneet has also taken a 14.8% stake in Elation Edtech, which owns STEM learning platform Tinkerly. The company is also planning to launch online platforms that will focus on counselling, teacher training and sports management. “Our focus is clear, wherever students are benefitted, be it physical, emotional or academics, Navneet will be there. There will be physical interventions but bulk of the revenue will be generated through the online platform,” says Gala.
The biggest challenge for legacy publishing companies, says Mallick of Mindcomb, is building their own platform as well as talent to build the platform. "Building a content platform is an expensive proposition. The skill-sets required are also quite different. Therefore, we are going to increasingly see legacy companies merging with new-age companies. The new-age companies need the old ones for their content library and also connection with educational institutions." He cites the example of Byjus acquiring brick-and-mortar tutorial chain Aakash Educational Services for $950 million.
Digital contributes barely 3% to Navneet's Rs 817.49 crore revenue, but by 2025, Gala expects at least 25% to come from ed-tech. The Covid pandemic has been especially difficult for the education company. The company’s revenue eroded from Rs 1,467.19 crore in FY20 to Rs 817.49 crore in FY21 as schools were closed. Gala is obviously pinning his hopes on ed-tech for the next level of growth. “All our physical books will have a digital component. Initially whoever buys our physical book will be given a digital book free of cost to drive penetration. Once the usage of digital books improves, physical infrastructure costs would dip and that would be passed on to consumers.”
Giving away complimentary digital books to increase penetration may not be enough. Pahwa of EY stresses upon the need to make the content attractive through gamification. "Content has to be aspirational. One needs to gamify and give rewards. They could either give stars to a student for solving an exercise correctly, step-mark him/her or even reward bonuses. A student who manages 500 stars could probably get rewarded with a cap or a pen," explains Pahwa.
The mindset change required for a legacy company like Navneet to embrace digital was huge, admits Gala. “We have always focused on revenue as well as bottom line. But with new-age companies flushed with capital and splurging, it is difficult for legacy companies such as ours to even think on those lines and spend as much. Convincing ourselves whether there will really be an alternative to physical books or whether schools will be benefitted by these products took a few years.”