Wednesday 18 November 2020 4:42 pm

Pearson launches new consumer division in bid to harness Netflix model

Pearson has unveiled a new division that will deliver products directly to consumers as it looks to harness the power of streaming models used by companies such as Netflix.

The FTSE 100 education giant said its new direct-to-consumer unit will help to accelerate its shift to digital services and allow it to “meet consumers where they are”.

Read more: Learning the hard way: Why do things keep going wrong for Pearson?

It marks the first major move by Andy Bird, the former head of Disney’s international operations who took over as Pearson chief executive last month.

Bird has tapped former Warner Bros executive Lynne Frank to head up the new division alongside Ishantha Lokuge, who joined Pearson from photography platform Shutterfly last year.

“With the accelerating interest in digital learning across the globe, we need to meet consumers where they are,” Bird said in a statement. “By doing this, we will be able to seize an incredible opportunity to have a direct relationship with millions of lifelong learners.”

The overhaul comes at a critical time for Pearson, which has seen its share price tumble by more than 50 per cent in the last seven years as it struggled to shift its reliance away from textbook sales and towards a more digitally-focused model.

Group sales dropped 14 per cent in the first nine months of this year, though this was partially offset by improved trading in its online sales division as more students studied remotely during the crisis.

New boss bird, who oversaw Disney’s digital transformation, has been clear about his intentions to push Pearson’s digital capabilities, and the restructuring highlights his desire to emulate the model favoured by new media giants.

Read more: Pearson sales slump amid Covid-19 closures of schools and test centres

Direct-to-consumer offerings have proved effective for streaming giants such as Netflix, while Disney has refocused efforts on its own direct-to-consumer division, which oversees Disney Plus and Hulu.

Frank, who oversaw international campaigns for blockbuster franchises such as Harry Potter, The Hobbit and Fantastic Beasts, will head up marketing for Pearson’s new division.

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