Following the TechCrunch / Aol fall out…

Apologies for the lack of posts here recently. Most of my thoughts are being posted as columns on TheMediaBriefing.

Today I wrote a column on the site asking if big media companies will ever be able to successfully absorb digital media entrepreneurs into their corporate structures. Is it inevitable that the founder will leave? and can anyone point to success stories?

You can read the column here.  

I’d be interested to hear your views – either in the comments section of the article itself or over on our thriving LinkedIn group.

Rory.

What advice would you give to a younger you entering the media industry?

I’m starting to write more regular columns for TheMediaBriefing. If you want to follow them please head over to the site – and while you’re at it sign up for some of the weekly newsletters.

My last column followed a question on our LinkedIn group where I asked “If you could go back in time and meet yourself as a fresh-faced graduate about to enter the media industry, what advice would you give?”.

We got some fantastic responses and I have added some of my own thoughts as well. Check it out.

http://www.themediabriefing.com/article/2011-07-07/what-advice-would-you-give-a-younger-you-themediabriefing-readers-share-tips-for-young-professionals

Let’s go back to the 90′s…

A quick story (please bear with me here  friends…)

Imagine it is 1997

Back in 1997 I was running a small marketing team for a global B2B publishing company.

We were developing online versions of our print publications & starting to experiment further with e-mail marketing.

Web sites were very unsophisticated – tending to be little more than facsimile versions of our magazines. There was very little interaction with readers and we really treated the Internet just as a distribution channel rather than a great disruptor of business models.

We had little idea of the emerging advertising/sponsorship models. Pricing decisions were agreed without any science or bundled in with physical products. User data was rarely gathered or intelligently used.

Remind you of anything?

Let’s fast-forward to today. We have a new and fast growing development in media consumption. The mobile web.

With the increasing penetration of smartphones, tablets, eReaders, apps and mobile enabled websites, all the rules are changing again.

Media companies are facing the same challenges that they faced in the 90′s and I know from personal experience that many are going to be taken by surprise by the speed at which things are moving.

All too often significant decisions about mobile are being left to tech teams or rushed into as part of a ‘me too’ stampede to get a press release out about ‘our latest app’.

STOP. You need to spend some proper time setting your mobile strategy..

Rob Grimshaw, the Managing Director of the FT’s digital operations said recently that he expected 50% of the FT’s digital readers to access content via a mobile device within the next 2 years.

That’s a fundamental shift in consumption habits and really shows that the mobile web has arrived.

The commercial realities associated with this shift in consumption mean that everyone in media needs to be involved in mobile product development – tech; marketing; sales and content creators.

Set the right strategy. Right now.

On June 14th The Media Briefing will be holding our second major conference.

Mobile Media Strategies takes place at The King’s Fund in London’s West End and will hear from some of the most innovative companies in the mobile field.

Companies including: Thomson Reuters * BBC Magazines * Guardian News & Media * The Economist * Incisive Media * Telegraph Media Group * Screen Digest * comScore * Microsoft * YUDU Media * Bonnier * DK Books * BSkyB * ImpulsePay & MobileTech.

There’s a fantastic line up of attendees already confirmed (here’s a link to our advance delegate list) & we have limited places still available.

Register today

The mobile media marketplace is developing so quickly. There are huge opportunities for the companies that can stay ahead of the curve. Register for Mobile Media Strategies today and we’ll help you on your way.

The Media Briefing nominated for 2 major awards

I was delighted to hear recently that our new company had been shortlisted for 2 major awards by the Association of Online Publishers in the UK.

It’s quite an achievement for a young, growing business like ours.

The awards we are nominated for are:

• Patrick Smith – TheMediaBriefing’s Editor & Chief Analyst is shortlisted for Digital Editorial Individual 2011
• Briefing Media – is shortlisted as Independent Digital Publisher of the Year

When you look at the shortlists and see that we’re up against representatives of AOL, Emap, Econsultancy, The Guardian, IPC, UBM & News International it really puts into perspective how far we’ve come in the last 12 months.

As we’ve built the business I have kept in mind some advice given at launch. Something I’d like to pass on.

I can’t remember who it from but I was told to make sure “to spend 95% of your time on content and relationships”. Everything else was likely to be a distraction.

That advice has proven to be invaluable and I’d like to thank all those who have worked with us along the way (you can see I’m already practising the acceptance speech…).

Looking forward to the dinner on 9th June & hearing how we get on.

Quick plug:

If you work for a media business and are looking at the opportunities for the mobile development of your brands you should come along to Mobile Media Strategies in London on the 14th June.

We have a fantastic line up of attendees already confirmed and it’s an area of crucial importance for all media firms. You really should come along – there are early-bird tickets available until May 20th.

United Business Media, Informa and Reed Elsevier results – the health of big B2B media?

I know. I’m a bit odd. But I love ‘results season’.

Watching the results come through from the big media firms you get a unique perspective on how the industry is shaping up. They give you a pretty forensic view of markets, strategy and platforms. An overview you never usually get unless you’re employed directly in those firms.

In previous years I have covered the results of UBM, Informa and Reed Elsevier individually on this blog. This year I’ve been a bit busy building our new business - The Media Briefing - so it wasn’t until today that I got a chance to catch up and watch the board presentations to analysts.

Each year I try not to read analysts reports or look at share-price movements. I don’t claim to be a financial analyst. Instead I am far more interested in:

1. How the strategy is presented
2. What levels of confidence are the management team giving off
3. Which parts of the business show opportunity or weakness
4. Are there any wider industry trends being highlighted

After watching the webcasts this is my feeling about the health of the big three.

Reed were the first of the companies to release their results. You can view the full report and view the webcast here.

Reed have been through the wringer in recent years. Chief executives have come and gone. Reed Business Information has been up for sale and then not. The company has spent big to buy a ‘non-traditional’ media company – Choicepoint. There have been continual questions about Reed Exhibitions…

All of this has meant that the analyst presentations have been made very much on the back foot.

This year Erik Engstrom was able to put on a more confident show. You could almost see his relief.

Broadly the company’s results were fairly static year on year with a small growth in revenue and a small decline in profits. On the surface, stable.

But under the surface there are clearly some big issues. The main one seemed to be the weakness of the Lexis Nexis part of the business and the high level of investment required. The legal markets are obviously still struggling, the Westlaw platform seems to be taking market share and their profits were down 12%.

It was interesting that the Choicepoint part of the business had managed to grow margins from 24% at the time of aquisition to a staggering 38% now. At the same time Lexis Nexis margins were just 14%.

So, what I took away from the Reed presentation was a perception of a company still very much in transition. Choicepoint and the re-bound of the exhibition business were collectively masking some deep underlying problems in Lexis Nexis and the continual re-positioning of Reed Business Information.

Informa’s results felt more predictable. They are still benefitting from cost control measures implemented across the business – especially in the events field where it is easier for a conference and training company to quickly cut marginal events and overheads.

Overall Informa had flat revenues but a decent growth in profits. Peter Rigby and his management team projected confidence and an uncomplicated outlook for the business. Clearly there are still challenges – for renewals in academic markets and Datamonitor sales - but this is a company firmly looking forwards.

They will continue to focus on large events, geo-clone successful formats to new territories and move subscription products up the value chain.

A theme that came from the presentation was that Informa were concentrating on premium intelligence and increasingly looking at enterprise sales of subscription content. I hear this more and more from business media companies as they search for the ‘holy grail’ of data and ‘workflow’ based products. The move from providing information to intelligence…

All in all I felt that Informa were the strongest and most confident of the 3 companies.  They announced unequivocally that they “would have a good 2011″ and that “interesting acquisition opportunities were opening up”. Their debt was under control and Adam Walker joked that for the first time in a long while the phrase “under-leveraged” had been used to describe them in an investor meeting.

We recently interviewed Peter Rigby on TheMediaBriefing and asked him what worried him most. His answer was geo-political risk and so I suppose that whilst the company seems strong he is keeping a close eye on events in the Middle East.

The UBM results yesterday (1 March) were the most intriguing. Last year I wrote about a company that was weathering the global storm pretty successfully. I suggested that they were transforming themselves steadily – and via a long stream of acquisitions - into an emerging markets exhibition company.

It’s pretty easy to understand the strategy here. Whatever is happening in individual business verticals it appears clear that the strength of growth over the next 10 years is going to come from the emerging economies of, in particular, the Asia Pacific and Indian sub-continent. Exhibitions are a market that really benefits from scale and by acting as a consolidator I thought UBM was putting itself in a good position.

A strategy of acquiring assets in these regions – as well as the Americas – seems sensible and David Levin has always impressed me as a no-nonsense leader of the business.

But…

… looking at their analysts presentation today gave me some cause for concern. In spite of the company’s “fastest rate of revenue growth in a decade” their profits were flat. This was put down to an increasing investment in new products, sales and IT systems but I suspect it is much more than that.

There was an emphasis on ‘targeting, distribution and monitoring’  (PR Newswire) side of the business that I hadn’t seen before. I cannot see how the margins for this type of service are not going to be adversely affected by the easier distribution of information online and social media. In previous presentations I got the feeling that this service was not seen as core to UBM’s future.

Likewise the focus on virtual events and development of better marketing services with print and online platforms combining to generate leads for sponsors was different. I suspect that the old CMP business is really struggling.

There was also the announcement of the sale of The Publican (and some related brands) at what sounded a virtual fire sale price compared to the valuations it enjoyed relatively recently.

I suspect what has been happening at UBM is that everyone has been extremely busy running around acquiring and integrating businesses. I know from bitter experience what a time-consuming task this can be – especially in overseas markets – and it must have been a significant management distraction. One which wasn’t helped by the global downturn and writedown of the print portfolio.

UBM’s analyst presentation was by far the most confused of the three. It felt over-long and complicated. Sometimes less is more and the clear strategy that they had shown last year seemed to have been muddied.

David Levin also gave an exclusive interview to TheMediaBriefing in October last year in which he highlighted the fact that there would be inevitable ups and downs for the company. I can’t help but feel that UBM could do with a period of stability to really concentrate upon building a world-class emerging markets events business.

I admire the company and am a long-term shareholder but David’s assertion that the re-focus of the company was done had a bit of a hollow ring to it.

Paywall Strategies 2011 – an overview of our first conference

Apologies for the lack of activity on this blog over recent weeks / months. I have been knee-deep building our new business – Briefing Media Ltd.

We organised our first conference last week – on digital publishing models and how media owners can best monetise their online content.

I thought it went pretty well. There was a very senior and engaged audience and we aim to make the event an annual one.

Now on to the next projects – a new website for the telecoms industry and a conference in June on Mobile Publishing Strategies for Media Owners.

Here’s a video overview of last week.

A quick update on how my new business is going

I wrote a quick piece on TheMediaBriefing today talking about how the new business is going and sharing some stats from our first 10 weeks.

We also announced our first conference: Paywall Strategies 2011 – looking at how to monetise content online. Paywalls, registration systems and freemium models.

I hope that readers of this blog will be able to come along. There’s a great programme – and we even offer a money-back guarantee off your registration fees if you don’t love it!

My top tips for getting ahead in the media business – or any other for that matter…

About a month ago I did a short video interview for Propeller – a media PR firm in London.

I really went in to give them an overview of our new business The Media Briefing but they asked me to do a quick film for their talking heads series.

I was asked for my top tips for getting ahead in the media business & also my most embarrassing moment.

Here’s mine – but you can also see other far more worthy opinions.

Paid Content – it’s not about ideology but rather strategy and execution

This month the news has been awash with stories about paywalls – particularly the initial results of News International’s experiment with The Times and Sunday Times.

The numbers have been pored over enough by now but I would highlight Clay Shirky’s analysis (together with the comments) as being a ‘go to’ article on the subject. You can also follow a wide range of debate on The Times’ page on TheMediaBriefing.

To my mind though the problem with the paywall debate so far is that it largely seems to be centred on ideology. Murdoch shouts that quality journalism has to be paid for. Alan Rusbridger talks about the ‘mutualisation’ of content at The Guardian. Arianna Huffington stresses the importance of being part of the ‘link economy’. Really the debate has to be about business. Hard cash. Making profits.

So, quietly, and with little fanfare I was interested to read the results of the business publisher Euromoney, released today. There’s been no Twitter frenzy of comments. No polemic pieces about search engines stealing content. In fact I bet the majority of people reading this post would struggle to name either their Chief Executive or any of their major products. As I write this Robert Andrews of PaidContent seems to have been the only journalist or web commentator to cover them.

But, let’s have a look at some of the highlights and key phrases from their statement:

Adjusted profit before tax up 37% to £86.6m – a record

Adjusted operating margin improved from 25% to 30%

The resilience of subscription income, combined with a good recovery in advertising and sponsorship revenues… produce record profits…

These record profits, coming so soon after some of the toughest and most volatile financial markets in many years, underline the success of the group’s strategy to build a more robust and higher quality information business

…strategy continues to be executed through increasing the proportion of revenues derived from subscription products; accelerating the online migration of its print products as well as developing new electronic information services; investing in products of the highest quality that customers will value in tough times as well as good; eliminating products with a low margin or too high a dependence on advertising

In the announcement you’ll see no mention of ideology or waiting to see how business models settle down online. Instead you see a business talking about strategy, implementation and driving profits.

Sure, Euromoney’s traditional business model is in the midst of disruption. They talk about a changing emphasis from advertising to subscriptions and about a migration from print to online. They share many of the challenges that other media businesses face. But the customer-focused approach to these challenges has been to see the opportunity created by a move online and shape the business to take full advantage.

I know a lot of the people at Euromoney, admire the company greatly and have been a long-time shareholder. When higher profile media companies talk about how they can monetise their content online they would be well advised to pay a bit more attention to their B2B cousins. The lessons I would say that newspapers could learn from companies like Euromoney are:

• Accept that the world has changed and the things that customers will pay for online are very different from those which they did in print.
• Invest in those new information products and make them of the highest quality.
• Never set a strategy based upon ideological principles. It must be about profits.
• Plan for the long-term.
• Realise that whatever business strategy you do set will ultimately depend on great execution – maybe you should be going out and poaching those B2B marketers and publishers who really understand user-centred product development, detailed subscription acquisition/retention/upsell/cross-sell programmes and lifetime value calculations?

For any media business currently planning their online paid content strategy can I recommend TheMediaBriefing’s first in-depth intelligence report which is published this month. You can request a free executive summary by clicking here “Paywall Strategies for Online Content“. We will also be hosting our first conference on the subject (and hope to have a speaker from Euromoney) at the end of February 2011 – announcements coming soon on the site.

www.TheMediaBriefing.com – our first site launches next week

In my previous post I talked about a new company that I have co-founded with Neil Thackray called Briefing Media Ltd.

We aim to take a different approach to the business media industry.

An approach that combines many of the disciplines of traditional niche media publications with the latest semantic technology to aid the discovery of the very best third party content.

Marrying old and new media if you like.

The team are currently developing dedicated sites for six industry verticals, but our first covers the media industry itself and is due to launch next week.

It will be called TheMediaBriefing and if you work in any aspect of the media industry – B2B, Consumer Magazines, Newspapers, Radio, Digital Media, Mobile, Agencies, TV & Film or Finance – then please come and take a look.

Patrick Smith, our editor and lead media analyst, is currently refining the content and taxonomy for the site. He is also gathering up a faculty of experts from  the industry who will be providing exclusive interviews, video commentary and regular columns about what’s really going on in their businesses.

If you’ve got something to say about the strategic aspects of running a media business in today’s digital world we’d love to hear from you. Please e-mail: contributions@briefingmedia.com

Our site is not live yet but if you would like to register to see it first please leave your e-mail address in the box on the homepage and we’ll be in touch.

Much as I hate the concept, we will be launching in beta so if you spot a glitch or miss-classification please do let us know.

Related articles by Zemanta

• Briefing Media (businessmedia.co.uk)
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The Michaelmas Itch – and a new beginning in business media

I took my kids back for their first day of school today. They were kitted out in new uniform and it felt like a new start to the year – but it’s not. It’s September. So why that feeling?

Then I remembered a phrase I had heard in the mid-1990′s in my first management job in B2B media.

I was working for a company called Metal Bulletin in the armpit of Surrey (apologies to Worcester Park residents). I had just been promoted to Head of Direct Marketing & had built a good team around me. The company was growing fast and we were doing well. I was young, extremely cocky and thought I was not only the world’s greatest marketer but also a ‘natural’ at this management game.

Then, during the space of about 3 weeks, half my team resigned. And it was not only my team, a lot of good people from other parts of the company all seemed to leave as well.

In a slight panic I went to our Chief Executive, Tom Hempenstall, and said that something must be wrong. We needed to up our pay scales and do something drastic to stem this loss of key people. I remember Tom smiling at me and reassuring me that the sky was not falling in “It’s just the Michaelmas Itch” he said “it always happens at this time of year because people have been brought up with the new academic year signifying change”.

So now, as the Michaelmas (Autumn) term begins I am pleased to announce some new plans myself.

In the coming weeks I will be launching a new business media company – Briefing Media Ltd.

My co-founder is Neil Thackray who was previously CEO at both Quantum and Nexus Business Media. Over the past few months Neil and I have been discussing the opportunities to launch a series of niche B2B sites without the legacy issues that many traditional publishers face. Neil has already written a post on his blog explaining a little more about what we are trying to do, but in summary we are looking to combine some very clever semantic technology with traditional niche publishing disciplines to create a series of websites. I’m delighted that Patrick Smith has also recently joined us as our first Editor.

The initial site aims to launch towards the end of September and I will post further information on this blog as we gradually open up the curtains on what we are doing.

It’s exciting, hard work and fun. Like starting a new academic year at school. Just without the hurty shoes.

Wired UK – How is the UK’s magazine launch of the year doing?

Just over 12 months ago I wrote a couple of posts on this blog talking about the brave and exciting launch of Wired UK.  In them I suggested that the publishers (Condé Nast) were missing a bit of an opportunity to build their subscriber base.

Last year the magazine won the British Society of Magazine Editors “Launch of the Year” award. They also released their audited circulation figures recently so I thought it was an opportune moment to review how they had done.

The numbers

Average circulation for the last 6 months was 50,009 copies per month. The circulation was broken down as follows:

17,488 subscription copies of which:

• 793 were sold at full rate
• 13,659 were sold at between 50% of full rate and full rate (the current sub offer is at 51%)
• 2,869 were sold at between 20% and 50% of full rate
• 166 were sold at less than 10% full rate
• 49 were sold as multiple subs

Full rate for a subscription is listed as £47.88

In addition they sold an average of 22,472 copies per month on the newstand – largely at the full cover price of £3.99 per copy.

The Money

So, let’s make an estimate of the current annual circulation revenue for the magazine.

Subscription revenue = c. £425,000 per year.

Newstand revenue = c. £1,075,000 per year minus (say) 30% for the retailers = c. £750,000 per year.

Total circulation revenue estimate = £1,175,000 per year.

Now, clearly Wired UK is a great advertising vehicle for brands wishing to reach an attractive demographic. I can only guess what they charge for a page (anyone who can find a link to their print media pack online please leave it in the comments below) but the latest issue has an advertising/editorial ration of 1:5 with 31 pages of advertising.

They’ve obviously sold their advertising on the back of a circulation of 50,000 because they are currently giving away 10,000 free copies per month on airlines, in clubs and spas. They also have an interesting web offering that I would hope brings in some decent revenue and which I know they are looking to develop.

How should we judge the launch?

As I said previously you have to admire any company launching new publishing products in early 2009 – especially a big, expensive print glossy. Hats off to them.

Wired UK had been tried a couple of times previously with no long-term success. In 1997 it was closed with an average paid circulation of 40,000 (similar to today). It was suggested that it needed to be selling double that amount to break even – mind you, it did have a staff of 32 at the time.

At launch the editor claimed a £2m first year promo spend. I doubt it was that much but even so their production, distribution and marketing costs must be pretty sizeable so the company probably haven’t seen a return on their investment yet. It will be interesting to see now if their momentum can be continued.

I still firmly believe that they missed a massive opportunity to sign people up for subscriptions at launch, when the buzz was highest. I like the magazine but have never seen a single piece of subscription promotion for it (and god knows I’ve now written enough to show up on someone’s radar…).

As a result I have probably only bought about one in four of their monthly issues.

So, it’s great that Wired UK has established itself. The editorial team have done a great job with the product but I think the subscription marketers need a bit of a kick up the backside!

Sorry team – with a better early promotion schedule I think you could have easily had  50,000 subscribers by now.

Related articles by Zemanta

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My top 10 highlights from SIPA Washington

This week I was really pleased to attend the recent Specialized Information Publishers Association annual conference in Washington. Many of the sessions could be blog posts on their own but I don’t really have time to write them all up so, instead I wanted to give a list of my top 10 takeaways.

1. The icebreaker recruitment challenge. When hiring salespeople Richard Londesborough of Business Monitor explained the development of their assessment centres. Generally they try to screen the initial batch of candidates into a group of around 15 people who show promise. These candidates are then put through to a half day assessment centre where they are paired off with eachother. The pairs are set an icebreaker challenge of meeting eachother for 2 minutes and having to pitch back their partner to the group.
2. Create a holiday. If you have a product line that needs a boost then Adam Goldstein of NIBM recommended that you declare an ‘official week’ and gave the example of HR Professionals Week that they had in Singapore but not in the US. You can then bundle a package of products, webinars and events into a week long period and offer time limited discounts. It gives extra emphasis to your marketing and a real opportunity to excite your customers and prospects.
3. Don’t call virtual events ‘webinars’ if you want to charge. Torry Burdick of Mortgage Success Source talked about the success they were having with virtual events but recommended that the word ‘webinar’ had become too associated with sponsor led, free to attend events. To charge a registration fee she recommended coming up with another name.
4. Delve into your site analytics to get new product ideas. Matt Bailey of SiteLogic gave a great presentation looking at the site analytics reports of a travel company to see what people were searching for. From this his client got a wide range of of ideas of existing reports that should be featured more prominently on their site and also new products to create.
5. Look to syndicate other people’s content on your pages. David Schwartz of 2Market Information suggested that publishers look for other organisations in their field who provide content but don’t necessarily think of themselves as publishers. He highlighted consultancy firms, lawyers & academics as rich seams of content. His company approached these firms and re-packaged / co-branded content to sell – generally at premium rates and on a 50/50 split.
6. Apply ‘good enough’ technology & publish fast. In a great presentation Kevin Delaney from the Wall St Journal talked about the importance of speed-to-market for news providers in a web-first operation. The WSJ set up a speedy@wsj e-mail address for reporters to file to and gave their journalists simple Kodak Z18 video cameras to record stories on. He highlighted the success of the WSJ Now edition on the iPad which auto updates in the style of the paper every 30 minutes.
7. Change what you call your journalists. Another tip from Richard Londesborough at Business Monitor. As the company had developed its online information services all of the editors had been re-named analysts. Richard said that this gave a higher perceived value to their content and also encouraged customers to contact the company for consulting level services.
8. Make sure your mobile products are suitable for an Android platform. James McQuivey of Forrester Research suggested that Android would be the dominant smart-phone mobile platform by 2011.
9. Your audience development team should evolve to take on an analyst role. Sean Griffey of FierceMarkets gave a great case study of how online metrics formed the bedrock of his company. Their audience development team circulated the best performing headlines of the week around their team. All editors were targeted and bonused on key metrics like open rates for their newsletters and internal teams competed each week by product.
10. Don’t assume the old product pyramid still applies. Publishing models traditionally look at their audience in a pyramid with prospects being taken on a journey from casual to registered user, paid customer and then consulting client. David Foster of BVR said that because of well-optimised sites they were seeing more and more clients coming straight in at the top level. He recommended that you highlight your premium services prominantly.

All in all it was a great conference. Huge credit goes to Andy McLaughlin & Matt Salt for their work in putting together such an engaging programme.

If you’re interested in seeing more of what SIPA events offer please remember that the SIPA UK Congress takes place in London on 12th & 13th of July. I recommend anyone in the European specialist information industry makes a point of coming along.

Media owners – learn the lessons from other disrupted industries

One of the things that I find most irritating about media industry ‘punditry’ is the fact that a lot of the commentators tend to exist in their own little bubble.

There are endless articles written about paywall strategies; CPM rates for online advertising; must-have vs. need-to-have content and whether our current problems will resolve themselves as the economy turns. These are all well and good but only get us part of the way.

To cut to the chase, can we all please agree that we are still only in the early stages of radical disruption of all media businesses?

A radical disruption that has been brought about mainly by the internet & its ability to change media consumption habits and reduce the power of old media models.  

If we all agree and start from this point then maybe we can look outside our media world and look at some of the lessons from other industries that have experienced the same disruption in the past.

How did companies in tech, music, transport or telecoms industries cope? Which companies survived and prospered? Which ones withered and died; and what can we learn as a result?

With all this in mind I was particularly interested to hear a keynote from Simon Waldman at Incisive Media’s E-Publishing Innovation Forum recently. Simon has recently left a senior digital position at The Guardian newspaper and joined LoveFilm.

His presentation “Creative Disruption – or OMG! The Internet ate my business” was based on an upcoming book of the same name. I wanted to list a few of the highlights for me and suggest that you pre-order his book (due out in October this year).

Simon started his talk by highlighting that a process of creative disruption is an essential fact of capitalism. He quoted Joseph Schumpeter from 1939 explaining that a railroad through new country “upsets all conditions of location, all cost calculations, all production functions within its radius of influence; and hardly any ‘ways of doing things’ which have been optimal before remain so afterwards.” 

He then asked the audience to replace the words railroad with the internet.

Imagine that a railroad has just been built through our industry. That railroad has opened up the market to a load of previously unknown competitors from other territories – many of whom we have never heard of. It has changed the cost base of doing business. It has reduced the price point that we can charge for what was previously scarce content. It has allowed our commercial customers to do more of their own marketing and provided access to new tools for publishing and distribution.

That’s disruption on a grand scale and Simon highlighted 4 possible hazardous reactions to these changes.

It’s possible you might recognise some:

• Denial – the numbers are getting fewer but I still hear some senior publishers who refuse to accept that this process is taking place. They talk about a cycle that they have seen before.
• Bewilderment – aka the Private Frazer school – we’re all doomed and there is nothing we can do.
• Delusion – OK. So I accept that this is happening to some parts of my industry (maybe controlled circulation titles?) but those trends don’t apply to my niche, premium content subscription business. We’ll be fine. We’re too good to fail.
• Distraction – Yup. I get what’s happening, and we’ll get on to it, but first I’ve got a couple of important conferences to promote, we’re redesigning a website and then have to do a budget re-forecast.

All of these reactions will get you to only once place – a spiral of pain.

So, what lessons did Simon learn from other industries that have been through these disruptive phases? What should media owners be doing about it?

1. Start with change in mind. Right from the top. He highlighted the Fast Forward change programme that Tom Glocer introduced on taking over at Reuters to make very clear where the company was coming from and going to.
2. Fix the core first. Don’t spend time searching for something that is too radical. Lou Gerstner, the IBM Chairman said that “the last thing IBM needs now is a new vision“. His (ultimately company saving) approach in 1994 was to get the company’s core business right by adjusting their product mix, working on the cost base and getting the business profitable. That allowed him to generate cash and buy time to move away from the mainframe and into the services business. Smart things come from stable cores. They are very hard to do when you are fire-fighting.
3. Look for key adjacencies. Where are the opportunities at the edges of your markets to expand? What do you do better than your competitors and how can you move those skills into new areas? This is something that media owners have generally been good at with brand extensions, taking advantage of new platforms, geo-cloning products to other territories etc.
4. Innovate around the edge. You might need to do this away from the main business (anyone up for another Euston Project?) but these activities should be focused experiments to test and feed back into the core business. It was interesting that upon becoming acting CEO of Apple, Steve Jobs cut their research and development budget in half but gave a much clearer focus to the spend. They could only develop the iMac/Pod/Phone/Pad after they had reduced headcount by 1/3, sorted out their supply chain and made their desktops profitable.
5. Build your teams to enable change – this required a combination of Firestarters, Rockstars and Fixers (combined with great leadership at the helm).

All in all I thought it was a great presentation and provides a good roadmap for anyone wrestling with the changes in the media market.

I look forward to reading the book when it is out in October and cannot help but see a little irony in the fact that Simon has chosen to leave the media industry prior to it being published…

4 great events coming up for media folk

Apologies for the brief hiatus on blog posting, I have been incredibly busy with a range of projects over the past couple of months.

Normal schedule will be resumed shortly but in the meantime I wanted to highlight some great media events that are planned for the coming weeks.

1. The Frontline Club will be hosting an event tomorrow evening (May 19th at 7 p.m.) covering “Will Apple save the news business? Apps, iPads, paywalls and how to make money from news“. It features Gurtej Sandhu, the digital director of The Times who will discuss News International’s upcoming launch of its paid for online services. Should be fascinating. I’ve only been along to one event at the Frontline (in Paddington, West london) but they are starting to put on some great events under the able direction of Patrick Smith.
2. Incisive Media’s E-Publishing Innovation Forum takes place next week (May 25-26) in London. This event was launched by my old division of the company and is in its 3rd year.  They’ve got a great line up of speakers and I am particularly looking forward to hearing Simon Waldman talk about his upcoming book Creative Disruption.
3. In early June I will be heading over to Washington for the Specialised Information Publishers Association (SIPA) conference. Always an inspiring meeting and nice to catch up with my U.S. colleagues in the association.

and finally I wanted to flag up the SIPA UK Congress (opens a PDF) on the 12-13 July in London. This is probably my favourite event of the year and features some amazing speakers, roundtables, discussion forums and the SIPA awards presentation.

I plan to write up coverage of some of these events on this blog and will also post updates on Twitter.

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SIPA Website Conversion Secrets from the Experts workshop – Monday April 19th, London

I wanted to give a quick plug for a Specialised Information Publishers Association (SIPA) event that I will be hosting in London on Monday April 19th.

This half-day workshop is designed to give publishers a range of practical tips on how to get their websites to convert better – whether that be registrations, subscriptions or e-commerce. We’ve got a great line up including:

• Graham MacFadyen of the Financial Times, who will explain how the FT maintains its astonishing conversion rate for trialists. You’ll get a ‘behind the scenes’ look at how their marketers transition occasional readers to registered readers, and then paid subscribers
• Karl Blanks, co-founder of Conversion Rate Experts, will explain the specific strategies you can implement straight away to increase profit from your website visitors, and show the power of video in converting visitors to customers
• Daniel Rowles at Art Review and Graham Ruddick from NEC Group on the key stats you need to monitor on your analytics reports to segment your customers and improve your conversion rates
• Simon Nixon and Jason Buck at Econsultancy how to design your website with your user in mind to increase conversion and ROI
• Jon Bentley of Incisive Media will explain the methods Incisive are using to successfully up sell and cross-sell their website customers
• Angus Phillipson from WORKSsitebuilder will draw all the strands of the morning together, using practical case studies from his experience as both a publisher and a supplier

For a full programme and biographies of our knowledgeable speakers, click here.

Companies sending delegates include the following: BNA International * Business Monitor International * CityWire Holdings * CRU Group * Electric Word plc * Euromoney Institutional Investor * Global Water Intelligence * Guardian News & Media * Incisive Media * LexisNexis * Melcrum Publishing * Newsquest Specialist Media * Report Buyer

We only have 8 places left, so if you want to come please e-mail Karen Hindle as soon as possible.

The workshop will take place on Monday 19 April between 09.30 and 13.00, followed by a complimentary networking lunch.

The venue is the Novotel London Tower Bridge, Pepys Street, London EC3N 2NR. Price for SIPA members: £147 + VAT; non-members £247 + VAT.

Book your place today – call Karen on 020 8288 7415, or email: uksipa@btconnect.com.

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Ashley Friedlein of eConsultancy talks about the Times plans for paywalls

Really great interview with Ashley Friedlein on the Times / Sunday Times plans for paywall implementation.

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7 strategic questions business media leaders should be asking

Over the last few weeks a major swathe of the quoted business media companies have been reporting their results. While I have covered some of them on this blog I have not done so from the perspective of a financial analyst. Instead, I find it fascinating to see the leadership teams of these companies present their strategy for their businesses.

Individually these results presentations tell a lot about how an individual business is shaping up. What are the threats to their traditional markets? How are they making the transition to a digital future? How strong is the management team? etc. What gets more interesting though is when you aggregate these presentations and try to distil some key themes from them.

So here I would like to pull out 7 key questions that I believe business media companies should be asking themselves if they are to prepare themselves for the years ahead.

1) What business am I in?

Before any company starts down this road it is probably worth reviewing your company’s mission statements, goals and values.  The media landscape has changed radically in the past 5 years. It will change radically again in the next 5 but there should be some key underlying themes that remain true and consistent. Try to document in real language what your business is and, please, don’t just sit there waiting for things to return to the past *cough, recruitment revenue, Centaur results presentation*

2) What does my company do really well?

It’s all well and good to have many spokes to your wheel and a multi-platform strategy is sensible. However, underneath that each company should be able to easily identify their key strengths. What do you do better than your competitors? What is your key advantage as an organisation? Shouldn’t you be spending a lot more time trying to build on those strengths and add complementary offerings around those particular skills rather than worrying about areas where you are weaker?

3) In which markets do we own brands with ‘last-man standing’ advantage?

In the UBM results presentation David Levin spoke about the business media industry being ‘over-published’ in many key verticals. He was specifically talking about print products but we all know that strong media brands don’t work with only one channel. In which media markets do you have real strength? Where do you own real brands rather than just products? Concentrate on those and get out of the markets where you don’t – sell them quickly (there are still plenty of buyers..), close them or accept that you are running them for short-term cash.

4) What is our emerging markets strategy?

Healthy business media properties rely on underlying growth in the markets they serve. Geographically it is clear that the major growth in the world economy is likely to come from the developing rather than the developed world. What is your company doing to benefit from these markets? What operations or partnerships do you have in the BRIC countries (Brazil, Russia, India, China) and other growth economies?

5) What are we doing to move up the value chain of information in our chosen markets?

In all but the most specialist markets, news is becoming commoditised. Businesses that in the past have relied on charging for news are rapidly finding that their business models no longer work. If you want to stay in these market sectors what are you doing to move your content and services up the value chain? Where are you able to add data and analysis to your content mix? What about the development of workflow solutions and software products? It’s not easy and is no quick fix but a drive towards higher value and renewable revenue streams should obviously be a goal for all business media companies.

6) Is my business structured for the past or the future?

In the UBM presentation it was interesting to hear Levin talk about a significant re-engineering of management teams in the past year. Whilst modern media businesses clearly still need a lot of the skill sets they always have – content development,  relationship building and talent management - increasingly technology is playing a much bigger role. Do you have the right people in place? Are there bottle-necks in your structures? Are there people in charge of business units who are responsible for making decisions on areas in which they have little experience?

7) Can I explain my company strategy clearly, simply and believably?

A couple of the CEO’s who presented their results recently gave me very little confidence in their company’s future strategy. While you don’t have to be a great presenter to run a great business; you do have to be able to give confidence to your customers, investors and staff that you have a plan about where you are going and why.  After the recent turmoil in many media markets I’m not convinced that some companies have made up their minds.

Here are 7 questions.

Any others that you’d like to contribute? Please put in the comments below.

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United Business Media results – an emerging markets exhibition company

Today it was the turn of United Business Media (UBM) to release their results. I was expecting UBM to have been hit harder than most during the downturn – given their exposure to the events industry and tech magazine publishing in the US.

However, their overall numbers came in a lot better than analysts had expected and their share price received a significant bounce this morning as a result.

UBM’s CEO, David Levin gave a very confident and strong presentation this morning. He spoke a lot of sense explaining the nature of the business that he was trying to build and saying that the world had changed. He wanted analysts to stop looking to the past and instead to concentrate on where UBM was going.

A few highlights of his presentation for me were:

• UBM’s biggest activity is in the events field but they are a very different business from Informa, who also released their numbers this week. Whereas Informa is largely a conferences business UBM is clearly exhibition led. It is important to understand the difference between the two. Large exhibitions businesses generally have significantly higher margins than conferences and benefit from greater forward visibility of earnings from stand re-bookings.
• In spite of the global downturn UBM have been very actively developing their events portfolio in emerging markets. In 2009 the company generated 20% of group profits from activities in China and China was their largest single market. They have successfully made the jump that a lot of media businesses have tried to do away from declining, and more crowded, markets.
• David pointed out client spend on stand bookings for exhibitions had been ’rock solid’ during the past year. This made up c. 80% of their events revenues. The remaining 20% – sponsorship and attendee revenue – had been hit much harder. He showed some strong figures to back up these arguments although I do wonder about how successful their re-booking was in 2009 during the height of the market turmoil. Maybe there is more to come out here?
• For their print publishing operations – the old core of UBM - David was very clear that many of their B2B markets were over-published. UBM had closed 31 titles over the past 12 months, seen revenues contract dramatically and cut a lot of costs. Whilst he argued that there was still a place for print in the mix David said that we would rapidly move to a situation of ‘the last man standing’ in individual verticals. Unless you were a leader, or strong number two in a market with good dynamics you were unlikely to prosper.
• It was clear that there had been a significant overhaul of the divisional leadership at UBM. They explained that in the past they had a lot of media people making decisions on technology developments and inferred that they hadn’t been qualified to do so. Their emphasis over the past 18 months had been to bring in more people from a technology and web background to aid their evolution.

Overall, these were clearly a good set of results. UBM had managed to clear up some long-running tax issues, highlight the success of their acquisition policy, expand their operations in high growth markets and largely move away from the past. They are clearly prioritising  further opportunities in the exhibitions space and explained that this market was highly fragmented and ripe for further consolidation.

It will also be interesting to see what the lead player in the market – Reed Exhibitions – decides to do.

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Informa results reviewed positively

Another day, another results presentation. I aim to cover as many of these as I can on this blog and then post a review of overall sentiment sometime towards the end of this month.

Today it was the turn of Informa – who bill themselves as ‘global business information specialists‘. It’s an interesting group having grown following a merger of Lloyd’s List Publishing and IBC Conferences. Since then the company has been very acquisitive with Taylor & Francis, IIR and Datamonitor joining the stable alongside various smaller acquisitions.

Informa has scale:-

• £1.2bn of revenues
• an operating profit of £146m
• 8,500 employees
• 2,500 individual products spanning academic, professional and commercial markets
• offices around the world
• and they host around 8,000 conferences and training courses annually

as such Informa is a good barometer for the business media industry. So what do their results tell us?

On the surface their results seem fairly similar to all the media companies that have released results recently – tough markets, falling revenues, extensive cost savings, growing business in emerging economies, well positioned for the recovery etc… but it is only when you dig a little deeper (and listen to the company webcast) that you get the full flavour for what is going on.

Informa is a company with a good spread of activities and should have been better prepared than most as we entered the downturn. The thorn in their side has been that (along with many of the larger business media companies) it took on a lot of debt at an inopportune time – in their case for the acquisition of Datamonitor at the relative peak of the market. As such, there have been concerns over the past 18 months about covenant headroom and this has clearly placed pressure on the business.

That pressure now seems to have been relieved. Debt has been reduced by nearly £470m in the year and Adam Walker – the CFO – joked that it was lovely not to be talking about covenants this year.

On the business side Peter Rigby – CEO – stated that he felt the business was now ‘bumbling along the bottom’ in revenue terms. Informa had taken a lot of costs out of the group to protect margins in the downturn. They had cut around 2,500 of their smaller events and training courses and that had also led to significant head-count reductions. The remaining events portfolio had held up reasonably well, largely due to the performance of their largest conferences and exhibitions.

Peter pointed out that Informa’s top 200 events generate 28% of their events revenue but contribute 55% of the profits. As a result of cutting out the smaller events and associated variable costs the margins of their events business had been kept at 15% for the year. This was the cyclical area of Informa’s business that can change very rapidly when business confidence returns and corporate training / event attendance budgets are released.

Other highlights of the presentation were:

• A star performance from the academic information side of the business – driven by a lot of new journal launches, better inventory management of their book stocks and an increasing use of ‘print on demand’ services.
• Strong renewal rates on subscription information products – which are increasingly served online and delivered on a site licence basis
• The investment in core products like Lloyd’s List – which had seen profits rise by 400% year-on-year and had launched a new Lloyd’s List Intelligence Service
• The further integration of Datamonitor – taking advantage of the Informa global network of offices and a reduction in the cost base
• Currency benefits from having US$ revenues significantly ahead of US$ costs

All in all a good set of results, delivered with confidence by the management team. Informa has a nice mix of businesses that give it both the stability of a strong subscription base and the ability, through their events portfolio, to rapidly take advantage of an upturn to grow profits.