The global coronavirus pandemic cast a shadow over 2020, changing how we live and work. In spite of the challenges, Otava held on to its position as a major Finnish publisher under pressure from international competition.
We managed to maintain contact with customers in all our business areas by customising and creating new products and services while adapting to our new daily reality. Otava’s financial performance was excellent.
This was a tremendous achievement in a world gripped by a new virus. At the same time, the economic climate and freedom of speech weakened, the geopolitical mood tightened and both fake news and conspiracy theories spread.
In Finland, the outlook for the economy weakened as well, and the transformation of education gained momentum due to the introduction of free upper secondary education. In addition, we are facing an even tougher challenge from digitalisation and international competition in the media sector.
Employees have played the most important role in Otava’s success. Otava’s employees are flexible and willing to change – they have an excellent attitude to their work and great team spirit. Otava’s corporate culture came into its own during this exceptional period.
Otava has a high-quality and customer-focused publication programme in general literature. The book industry is going strongly digital. Otava thus launched the Digital First publication programme, in which works are published only as audiobooks and e-books.
Although people stayed in more and shopped at our bookstores less frequently due to coronavirus restrictions, their single purchase amounts were larger. A book is a thoughtful purchase. Suomalainen Kirjakauppa also has an effective webstore platform and overhauled customer loyalty programme. We ventured into a new business area with the launch of Suomalainen Plus, an e-book and audiobook service specially designed for mobile devices.
The need for reliable journalism has grown. Our media business tracked the actions and needs of readers and online visitors, and modified content accordingly. Otavamedia’s online and print media performed better than the rest of the market. We tested a new kind of collaboration in the spring, when Tekniikan Maailma started a daily live news show focusing on the coronavirus.
Otava Marketplaces’ Nettiauto.com demonstrated its effectiveness as the coronavirus boosted trade in used cars.
Otava was also helped by projects kicked off before the pandemic, such as its brand revamp focusing on Finnishness and the work of the Learning Vision working group. Otava has a valuable mission in ensuring that the Finnish school system, teachers and students continue to be more successful than those of other countries.
Otava’s net sales
The changeover to a team organisation and new or modernised premises have also played an important role in Otava’s success. They have flattened hierarchy, improved cooperation and accelerated the development of new products and services.
These overhauls were put to the test by the pandemic – and they proved their worth. I would argue that Otava’s result would not be significantly better without the pandemic.
We should think about what we should do in a new way to ensure our success going forward.
Teamwork and cooperation within the Group will help us to harness digitalisation to get onto a growth track.
A strong corporate culture and skilled employees will take Otava forward.
Chairman of the Board of Directors
Year 2020 was exceptional due to the coronavirus pandemic. Many things changed. However, it’s still difficult to predict which of those changes will be permanent.
The year was overshadowed by concerns about the health and wellbeing of our loved ones and ourselves. Fundamental values have become important once again.
As in the rest of the world, coronavirus restrictions reduced consumption in Finland, and also changed consumption habits and channels. The use of digital content and services saw substantial growth.
Otava’s financial performance in 2020 was excellent. Content is the core of Otava’s operations. The crisis showed that there is demand for reliable and high-quality content in exceptional circumstances, too. Furthermore, efficiency measures were successfully implemented in response to the pandemic throughout the Group.
The book industry is still going strongly digital. In general literature, sales of e-books and audiobooks have continued to surge.
As part of its long-term strategy, Otava Publishing Company acquired Karisto in early 2020 and Atena Kustannus Ltd at the beginning of October. The acquisitions are aimed at generating growth. For Otava, it is important to ensure that the book business remains vital in Finland and that the market has real competition and alternatives.
Finland took a great digital leap forward when schools shifted over to remote teaching on a short schedule. Otava Learning provided its digital products for free in the spring – and the number of users of the services almost doubled. History was made in the autumn when the number of digital upper secondary school textbooks ordered at the beginning of the year exceeded the number of printed copies for the first time.
In retail, sales declined in brick-and-mortar stores, which had shorter opening hours as customer numbers declined by a fifth. The average purchase was higher than in previous years, and the stores focused on service quality.
The decline in sales by the stores was compensated for by surging growth in online sales on our modernised and scalable webstore platform.
In the media business, the visitor numbers and page loads of all the major sites saw growth. Otavamedia has also performed significantly better in online media sales than the rest of the industry. The coronavirus posed greater challenges to print media sales. The greatest slump in the history of the Finnish advertising market was seen in the second quarter of 2020. In spite of this, we outperformed the rest of the market.
Changes in consumption methods and business cycles were evident in the operations of Otava Marketplaces. The focus of operations was shifted to the development and sale of products aligned with future core business.
In mid-March, Otava changed over to remote work in all tasks in which this was possible. We worked all year by combining on-location and remote work. Employees quickly adopted the new working methods in exemplary fashion.
I would like to thank Otava personnel for their good work and flexibility during this exceptional period.
As a thank you for the good result, employees will be paid incentives of EUR 2.4 million (including social contributions).
CEO, Otava Ltd