Igloo overhaul puts business back on track

Igloo Books, the mass-market children’s books business owned by Bonnier Publishing, has undergone an overhaul thanks to its new chief executive officer, who has affirmed the division’s future profitability.

Paul Gregory, who until 2015 was the president and chief operating offficer of Parragon, and thereafter managing director of another publisher, Hometown World, said it was a "difficult time" for the Igloo business when he took over its leadership last summer.

"Bonnier is not fundamentally a mass-market player and it acquired this mass-market business [in 2014], which was a logical piece in the jigsaw of Bonnier building a host of complementary businesses. But it operates so differently from a traditional publisher," he told The Bookseller. "John [Styring, Igloo’s founder] left [in 2016], so there were several months without any continuity. Then Dan Shepherd came in as chief executive officer for 10 months, but when he left the business was back to having no management."

Igloo's base in rural Northamptonshire

Making plans
When asked what goes wrong when a company such as Igloo is lacking leadership, Gregory said: "our numbers". "We’ve got £40m turnover and 25 million books, the volumes are incredibly high, but our margins are running behind the industry average. You can easily see that if you don’t have control of your costs or if you don’t have control of your buy-in, it becomes problematic."

Igloo has closed one of its two warehouses and will this year produce fewer books—around 750, compared to 1,000 in 2017. Gregory has also made "significant" changes to the leadership structure, hiring Darren Witherall, his former right-hand man at Parragon, as chief operating officer, and Steve Wakely, formerly of boiler company Vaillant, as financial director. In the US, Bonnie Hunter, also a former Parragon staffer, has joined as joint vice-president to lead the US business alongside Jeremy Nurnberg.

Gregory has split the UK sales team to maximise its Disney business and created new publishing structures. Some former members of the team, including publisher Mike Phipps and art director Nick Gage, have left the company. Gregory confirmed their departures were not voluntary but was keen to stress he has made appointments, too.

"Staff numbers year-on-year have not changed significantly [and hover around 160]. The reality is that Igloo is still growing. All businesses, but particularly ones in growth, need to remain agile. Our focus is a staff structure that has the best people but also the right number of people: an efficient business with great staff that love their role."

The global perspective
There are also international plans. "We are looking around the world to find distribution solutions for key territories and in Germany we are transferring the business to another Bonnier business, Blank," said Gregory. "We would love to expand in Scandinavia and the US is a key growth area."

Earlier this year Bonnier Publishing saw its chief executive Richard Johnson depart abruptly, with the business appointing as an interim c.e.o. Jim Zetterlund, chief operating officer and chief financial officer of Bonnier Publishing’s Swedish parent company, Bonnier Books.

At the time, Zetterlund highlighted profitability concerns for the UK business and said his priority was a new strategy for a "sustainable, long-term future", a sentiment Gregory agrees with: "We have to be profitable. Sales growth is nice but not if it comes at the expense of profit. This business will be profitable.

"Mass market is so different [from trade publishing]. You have to have entrepreneurial skills, the buying and selling skills of a remainder dealer, the ability to publish and print like a trade publisher . . . and we supply every facet of the retail industry, from Aldi and Lidl to Matalan and Poundland. We always say we have to think like a retailer, because we have to. We have to adapt to how the retailer wants to sell books."

The Disney connection

One of Gregory’s major responsibilities is looking after Igloo’s Disney publishing after Perminder Mann, Bonnier Publishing’s UK c.e.o., signed a deal with the media giant last year.

Gregory said the deal is one of the reasons he took the job and a "breakthrough" for Igloo, which will produce 170 titles this year via its Autumn imprint. The contract covers Disney, Pixar, Marvel and LucasFilms and "most" formats, excluding some such as annuals and soundbooks. Highlights include middle-grade novels, already taken by Asda and Tesco, and an upcoming advent calendar that comes with 24 individually wrapped Disney stories.

Parragon—where Gregory worked between 2004 and 2015—previously had the UK’s major Disney licence but Gregory dismisses the idea that its losing of the licence, and the subsequent closure of the business, was any reflection on the strength of the brand. "[Retail demand] only fluctuates with the strength of the movies. The core base of princesses, Pixar, ‘Toy story’, Mickey Mouse, Minnie Mouse . . . is always there, and next year we’ve got ‘Frozen 2’, which will be enormous. In 2019 the sales will be massive."

He said he "doesn’t know" why Disney and Parragon didn’t continue their relationship but stressed that Parragon’s failure was not a reflection of the sector it was in. Disney book sales have, over the past 15 years, fluctuated annually by as much as 25%, based on the strength of the licence, and "not one retailer" has pulled away from the brand, Gregory said. "Parragon increased sales, at peak, five-fold from Penguin [which had a licence before Parragon]. It did an incredible job but, for whatever reason, it fell apart."

On the back of the original deal, Igloo books has secured further contracts for Disney and Marvel franchises overseas, including southeast Asia, South Africa and Greece. The coedition team will promote the products in more than 50 countries. “Parragon was our one big competitor, but it’s gone. We are capitalising on that,” Gregory said.

Supermarket sweep

Igloo books partnered with Aldi last year to publish a picture book based on the supermarket’s Christmas campaign, with Kevin and Katie’s Christmas Adventure a runaway success for Igloo when it hit Aldi shelves.

Written by in-house writer Melanie Joyce, and illustrated by Adam Horsepool, the book is about two carrots who win tickets to ride on santa’s train to the North Pole.

The company had only eight weeks to bring the project to fruition and supply 100,000 books to Aldi’s 762 stores in the UK, but the first print run of 100,000 copies sold out within two days of publication. Another 100,000 copies were delivered within a three-week period, and sales reached 200,000 units in four weeks, the company said. Sales of Kevin & Katie’s Christmas Adventure didn’t track through Nielsen bookscan’s TCM, but it was the second biggest-selling children’s book of Christmas 2017, according to Igloo.

The price was set at £2.99, to keep the book affordable for all readers, but copies are currently selling on ebay in excess of the r.r.p.; one seller has listed the book and a set of plush toys for £60.