Former textbook rental juggernaut Chegg is on the home stretch to turn itself into a 100% digital company. Ingram Content Group will take over the entire physical textbook business of Chegg and market it under the Chegg brand starting May 1st 2015. Chegg will exit its warehouse operations by the end of this year.
The strategic Chegg Ingram partnership was launched in August 2014. Under the partnership Chegg will only earn 20% commission on printed textbook, but CEO Dan Rosensweig believes that digital revenues from services will balance out the loss in the long run.
Overall digital revenue grew 71% year-over-year to $28.5 million and made up 34% of total revenues in Q4 2014, up 12% from Q4 2013. The year-over-year growth of subscribers to Chegg’s digital services is 54%.
Chegg will use the freed capital from textbooks to further grow its digital services. The Student Hub currently reaches 50% of college students in the US and 75% of college-bound high school students.
Further Reading
- Chegg outsources Textbook Distribution to Ingram in its Transition to Digital Company | EDUKWEST
- Chegg and Ingram Content Group Announce Agreement in Principle Setting Chegg on Path Towards 100% Digital Revenue | Press Release
- Chegg Reports Fourth Quarter and Fiscal Year 2014 Results | Press Release
- Chegg Will Outsource All Its Print Textbooks to Remake Itself as a Digital-Only Company | Re/code