Our congratulations to our friend Roland Agambar who leaves The Sun and News of The World and joins Associated Newspapers as CMO.
Good appointment of a really good guy into a new and significant role.
Beginning to see visible signs that Associated are prepared to take the decisions, make the changes, and ramp up the activities required to 'survive & thrive' in this challenging environment.
Must be a sigh of relief at MGN where Roland as Marketing Director of The Sun and News of the World inflicted numerous painful wounds....
Friday, 30 January 2009
Things must be bad.....
More cuts at Condé Nast: The company is shutting shopping/interior design magazine Domino, it announced today.
Wow. Conde Nast have the deepest pockets and much more patience/resilience than most other publishers so things must really be bad out there!
Shame it was a nice magazine but interiors and shopping are a little out of step with the new reality. Maybe a relaunch as Austerity - Live Life For Less (money off, promos, coupons etc)
Its getting really cold out there. Make sure you are bundled up!
Wow. Conde Nast have the deepest pockets and much more patience/resilience than most other publishers so things must really be bad out there!
Shame it was a nice magazine but interiors and shopping are a little out of step with the new reality. Maybe a relaunch as Austerity - Live Life For Less (money off, promos, coupons etc)
Its getting really cold out there. Make sure you are bundled up!
Thursday, 29 January 2009
Knowing your customer equals greater profitability - the ITV and Sky case-study
Two of the UK's media giants, ITV and Sky, are a perfect example of how knowing your customer and tying them into a relationship can generate different levels of revenue in this sector.
ITV - a traditional commercial broadcaster reliant on advertising revenues, with a set ad inventory to offer on a range of free to air channels, with a struggling digital offer bolted on as an afterthought.
Sky - a maturing satellite broadcaster with a subscription and advertising model, run with the stated intention of continued subscription growth, regardless of the current economic decline.
ITV's revenues in 2008 were about £2bn, compared with Sky's almost £5bn. Profitability at ITV in 2008 about £120m, while Sky made over £600m.
Now ITV may keep bleating about the handcuffs of their statutory obligation to provide local content, but this is a diversion away from the real issues hitting their business. ITV is a programme-led business rather than a strong brand, with an audience it can measure but not recognise or reward. Digital platforms should enable it to start identifying loyal customers (and advertiser desired customers) and engaging them in dialogue leading to recognising and rewarding their behaviour. It's pretty obvious given their commercial performance (and share price) that they are a long way from doing this. The cancellation of Hearbeat and the Royal, and the slashing of The Bill is symptomatic of the cuts needed to survive in these tough economic conditions.
A question well worth asking, which hasn't really been discussed before, is whether ITV could actually be a very high profile media casualty of the recession. It has a massive reliance on advertiser revenue, with an audience who are increasingly less interested and engaged, and a limited number of alternative revenue streams. It has no divine right to survive, and with the proliferation of alternative channels, you have to ask what would be missed? Coronation Street - definitely, but it's a programme that people would follow to another broadcaster. FA Cup football coverage - definitely not - it's reminiscent of Matthew Lorenzo's mutilation of World Cup 94 and they should be ashamed of themselves.
Back to Sky. Subscription contracts lock in customers, which while stating the obvious, is important to note. You can reward customers when you know who they are and what they are doing. If they are unhappy, and you ask them, you can address the issues. If they do leave, you know who they are, so you can try and win them back. And above all, if the content you are providing is exclusive and premium, you should reduce your churn. It also gives you a defined audience to market new products, services and technology to - Sky+ being a great example of a major technological innovation that has altered the dynamics behind subscription retention.
Will Sky suffer in the recession? Potentially yes, but not to the same degree as its rivals. Potentially it looms large to mop up even more content as its less well off, and less well run commercial rivals have limited cash to bid for, or develop new content.
Knowing your customers, recognising and rewarding their behaviour, and understanding what makes people and keeps people loyal, must be at the heart of a successful business. Apologies if we're sounding like a broken record here, but the time is now, he who hesitates loses in 2009.
ITV - a traditional commercial broadcaster reliant on advertising revenues, with a set ad inventory to offer on a range of free to air channels, with a struggling digital offer bolted on as an afterthought.
Sky - a maturing satellite broadcaster with a subscription and advertising model, run with the stated intention of continued subscription growth, regardless of the current economic decline.
ITV's revenues in 2008 were about £2bn, compared with Sky's almost £5bn. Profitability at ITV in 2008 about £120m, while Sky made over £600m.
Now ITV may keep bleating about the handcuffs of their statutory obligation to provide local content, but this is a diversion away from the real issues hitting their business. ITV is a programme-led business rather than a strong brand, with an audience it can measure but not recognise or reward. Digital platforms should enable it to start identifying loyal customers (and advertiser desired customers) and engaging them in dialogue leading to recognising and rewarding their behaviour. It's pretty obvious given their commercial performance (and share price) that they are a long way from doing this. The cancellation of Hearbeat and the Royal, and the slashing of The Bill is symptomatic of the cuts needed to survive in these tough economic conditions.
A question well worth asking, which hasn't really been discussed before, is whether ITV could actually be a very high profile media casualty of the recession. It has a massive reliance on advertiser revenue, with an audience who are increasingly less interested and engaged, and a limited number of alternative revenue streams. It has no divine right to survive, and with the proliferation of alternative channels, you have to ask what would be missed? Coronation Street - definitely, but it's a programme that people would follow to another broadcaster. FA Cup football coverage - definitely not - it's reminiscent of Matthew Lorenzo's mutilation of World Cup 94 and they should be ashamed of themselves.
Back to Sky. Subscription contracts lock in customers, which while stating the obvious, is important to note. You can reward customers when you know who they are and what they are doing. If they are unhappy, and you ask them, you can address the issues. If they do leave, you know who they are, so you can try and win them back. And above all, if the content you are providing is exclusive and premium, you should reduce your churn. It also gives you a defined audience to market new products, services and technology to - Sky+ being a great example of a major technological innovation that has altered the dynamics behind subscription retention.
Will Sky suffer in the recession? Potentially yes, but not to the same degree as its rivals. Potentially it looms large to mop up even more content as its less well off, and less well run commercial rivals have limited cash to bid for, or develop new content.
Knowing your customers, recognising and rewarding their behaviour, and understanding what makes people and keeps people loyal, must be at the heart of a successful business. Apologies if we're sounding like a broken record here, but the time is now, he who hesitates loses in 2009.
Newspapers - how to survive and thrive in 2009
There are 3 things that UK newspapers must do to ensure they survive and thrive in 2009
1. subscription - get your purchasers on a contract, onto a database and into a relationship
2. customer relationship management - recognize and reward purchase loyalty
3. monetize reader relationship with 'direct to customer' sales of goods and services
Its that simple ;-)
If there is anyone out there in Newspapers who would like to chat about how to execute these 3 critical strategies please let us know. We are here to help.
1. subscription - get your purchasers on a contract, onto a database and into a relationship
2. customer relationship management - recognize and reward purchase loyalty
3. monetize reader relationship with 'direct to customer' sales of goods and services
Its that simple ;-)
If there is anyone out there in Newspapers who would like to chat about how to execute these 3 critical strategies please let us know. We are here to help.
Monday, 26 January 2009
Bankers!
Ive been giggling ever since that story pre xmas that investment bankers were this years panto badies. But hey this is serious stuff. These are the guys that set the worlds economy alight and seem to have very little remorse.
Does seem as the media is now moving toward specific finger pointing and the blame game. The Sunday Times displayed prominent bankers (and Gordon Brown) as criminal mugshots in yesterdays paper (The Bosses that broke Britain). The FT recently carried an op-ed openly attacking individuals for their part in the woes of the world economy.
News today that John Thain (ex Merrill Lynch, now ex BofA and pictured above) will repay the $1.2m cost of renovating his office (items bought included $87,000 for rugs, $68,000 for a 19th century credenza and $35,115 for a "commode on legs") . Good of him, eh.
John Thain, of course, is the guy that sold ML to BofA during the time of the collapse of Lehman brothers and promptly sanctioned $4bn of bonuses to ML staff. This would have been a huge award even in profitable years but given Merrills lost $40bn its extraordinary (and we suggest alittle naughty!). Heres the sequence of events (FT)
● Sept 13-15 2008: John Thain agrees deal to sell Merrill to Bank of America
● Dec 8: Merrill board approves $4bn in bonuses to employees
● Dec 17: BofA’s Ken Lewis asks federal government for $20bn infusion
● Dec 29: Merrill pays the cash portion of its bonuses; remainder paid out in BofA stock on Jan 2
● Jan 16: BofA discloses $2.4bn fourth-quarter loss – dwarfed by a pre-merger loss of $15.3bn by Merrill
● Jan 22: Merrill’s accelerated bonus payments revealed by the Financial Times. Lewis dismisses Thain
In other news Sir Fred Goodwin, the former chief executive of the Royal Bank of Scotland, has been forced to step down as head of the Prince of Wales’s personal charity. Ouch. Whats next for the 'the worlds worst banker'? His title?A blast from the past - a moment in history
Heres Steve Jobs, the worlds greatest living entrepreneur, the man who has radically transformed computing, music and now telecoms showing the world the Apple Mac for the first time. Its 1984 and there are 3,000 people in the audience.
Its worth watching through to the end just to see how completely crazy the crowd goes.
We wish Steve Jobs a speedy recovery and return to his business
Its worth watching through to the end just to see how completely crazy the crowd goes.
We wish Steve Jobs a speedy recovery and return to his business
Friday, 23 January 2009
The power of a good press execution
This caught my eye as great press ad placement, down under.
The power of good press advertising has been lost somewhat in these digital days, but when it's done well, it can still have great impact.
Well done, both to the brand owner, and the media owner, for having a sense of humour.
Thursday, 22 January 2009
What next for the Standard, and for London?
Alexander Lebedev's purchase of the Evening Standard from DMGT is a key development in the newspaper sector on a number of levels.
Firstly, by selling the loss making ES, DMGT can now concentrate on the loss making London Lite, free of the shackles of cannibalising advertising revenues(remember them?)from its paid for sister title. Though by keeping a stake in the Standard, it does look a bit like DMGT are hedging their bets. If London Lite can now start to make some headway in this difficult advertising market against The Londonpaper and also the ES, the sale of the Standard could be a great deal for the wider group. However, the scale of the challenge must not be underestimated in today's recessionary times, this should be seen as a 3 year play. It will be interesting to see how News International react now to the new situation in their crusade to move the Londonpaper towards break-even.
Secondly, Lebedev is promising to invest millions into the Standard as his "social mission" to make it a success. Given how many millions DMGT has "invested" over the last 5 years, will the Russian be able to turn round the financial performance? It's a tough ask, but if he brings in the right senior team to run the paper free from any Group constraints, and invests in the right strategic initiatives (see numerous posts on this blog) you have to believe that he could give it a good go. The worst thing that could happen is for him to tinker around the edges as that'll be reminiscent of the band playing on after the iceberg had been struck.
Thirdly, discussions about whether a former KGB spy is a "fit and proper person" to run an august British media institution raises a smile, particularly as it's Peter Mandleson who will set any inquiry into motion. While we've moved on from the Maxwell and Conrad Black standards of "fit and proper", you've got to assume that if the Standard's news agenda is set to become a London-based Russian oligarchial mouthpiece, the public will vote with their feet and give the Standard a miss.
Firstly, by selling the loss making ES, DMGT can now concentrate on the loss making London Lite, free of the shackles of cannibalising advertising revenues(remember them?)from its paid for sister title. Though by keeping a stake in the Standard, it does look a bit like DMGT are hedging their bets. If London Lite can now start to make some headway in this difficult advertising market against The Londonpaper and also the ES, the sale of the Standard could be a great deal for the wider group. However, the scale of the challenge must not be underestimated in today's recessionary times, this should be seen as a 3 year play. It will be interesting to see how News International react now to the new situation in their crusade to move the Londonpaper towards break-even.
Secondly, Lebedev is promising to invest millions into the Standard as his "social mission" to make it a success. Given how many millions DMGT has "invested" over the last 5 years, will the Russian be able to turn round the financial performance? It's a tough ask, but if he brings in the right senior team to run the paper free from any Group constraints, and invests in the right strategic initiatives (see numerous posts on this blog) you have to believe that he could give it a good go. The worst thing that could happen is for him to tinker around the edges as that'll be reminiscent of the band playing on after the iceberg had been struck.
Thirdly, discussions about whether a former KGB spy is a "fit and proper person" to run an august British media institution raises a smile, particularly as it's Peter Mandleson who will set any inquiry into motion. While we've moved on from the Maxwell and Conrad Black standards of "fit and proper", you've got to assume that if the Standard's news agenda is set to become a London-based Russian oligarchial mouthpiece, the public will vote with their feet and give the Standard a miss.
Tuesday, 20 January 2009
Congratulations America
Today marks the day when America rediscovered itself. With the inauguration of Barack Obama as the 44th President America enters a new era, following a fresh course in these troubled times. Good luck to soft power and to a path of practicalities not ideologies.
Well done to the people of America for making this historic choice and good luck to the new President and the men and women of his Administration
What's the point of WAN?
News from MediaGuardian that the World Association of Newspapers (WAN) has cancelled its annual congress and forum, the largest annual international gathering of newspaper executives and editors, which should have taken place in India in March this year, due to the effects of the global economic downturn.
Bertrand Pecquerie, World Editors Forum director said:
"Our belief is that newspaper companies will, by necessity, learn to live with the crisis over the year and will be more willing to invest again in conferences and travel by the end of 2009. The exact new schedule will be confirmed shortly. We need your suggestions in this difficult period."
"It is just a management decision based on facts. A newspaper association is at the end of the chain of the newspaper industry: when managers and editors cut costs and ask not to travel, evidently conferences and seminars are the first to be threatened."
Traditionally, the meeting attracts at least 1,500 delegates. Today the number of confirmed delegates for the March conference in India stood at 227.
Two things stand out from this news.
Firstly, that the Association is a busted flush. In times of trouble and challenge, it should be strong and should be leading its members, communicating best practice, innovation and efficiencies from one publishing group to another, globally. It is best placed to do this job, and if it can't fulfil this role it does beg the question of what it can deliver at precisely the time when the vast majority of its members need it most.
Secondly, its obvious that the industry doesn't value the Association highly enough to continue with funding attendance at the Annual events, presumably because the return on the investment to the member is negligible at best.
This is sadly symptomatic of an industry generally struggling to cope with the now, let alone the future. We know there are forward thinking newspaper and media executives out there, as we work with them, but is the decline in the sector overall just down to the consumers choosing not to buy newspapers as often as they used to? Of course not, it's more to do with media and newspaper businesses not generating content and alternative routes to market that they can generate profitable revenues from.
Bertrand Pecquerie, World Editors Forum director said:
"Our belief is that newspaper companies will, by necessity, learn to live with the crisis over the year and will be more willing to invest again in conferences and travel by the end of 2009. The exact new schedule will be confirmed shortly. We need your suggestions in this difficult period."
"It is just a management decision based on facts. A newspaper association is at the end of the chain of the newspaper industry: when managers and editors cut costs and ask not to travel, evidently conferences and seminars are the first to be threatened."
Traditionally, the meeting attracts at least 1,500 delegates. Today the number of confirmed delegates for the March conference in India stood at 227.
Two things stand out from this news.
Firstly, that the Association is a busted flush. In times of trouble and challenge, it should be strong and should be leading its members, communicating best practice, innovation and efficiencies from one publishing group to another, globally. It is best placed to do this job, and if it can't fulfil this role it does beg the question of what it can deliver at precisely the time when the vast majority of its members need it most.
Secondly, its obvious that the industry doesn't value the Association highly enough to continue with funding attendance at the Annual events, presumably because the return on the investment to the member is negligible at best.
This is sadly symptomatic of an industry generally struggling to cope with the now, let alone the future. We know there are forward thinking newspaper and media executives out there, as we work with them, but is the decline in the sector overall just down to the consumers choosing not to buy newspapers as often as they used to? Of course not, it's more to do with media and newspaper businesses not generating content and alternative routes to market that they can generate profitable revenues from.
Saturday, 17 January 2009
Mecom - whoops
The news came in yesterday that mecom finance director and all its five independent directors had resigned en masse
Thats en mass alright. To lose your finance director in the midst of a financial crisis is, i suppose, just about acceptable if the independent directors remain (to ensure fair play) and conversely its probably ok to lose your independent directors with you finance director in place. But all together en masse. Whoops. By the way Monty (David Montgomery) remains as CEO but he has been forced to relinquish the Chairmanship.
Just what went one is unclear but it must have been one helluva power play. We know the (ex) finance director John Allwood. Having worked closely with him at the Telegraph and at mecom we can vouch for John. John is good guy, a straight guy, practical and sensible. Just the kind of guy you need in a crisis. Well John is no more and that's bad for business.
Its hard to blame the credit crunch for this one. This is old fashoined boardroom antics. Shame
Thats en mass alright. To lose your finance director in the midst of a financial crisis is, i suppose, just about acceptable if the independent directors remain (to ensure fair play) and conversely its probably ok to lose your independent directors with you finance director in place. But all together en masse. Whoops. By the way Monty (David Montgomery) remains as CEO but he has been forced to relinquish the Chairmanship.
Just what went one is unclear but it must have been one helluva power play. We know the (ex) finance director John Allwood. Having worked closely with him at the Telegraph and at mecom we can vouch for John. John is good guy, a straight guy, practical and sensible. Just the kind of guy you need in a crisis. Well John is no more and that's bad for business.
Its hard to blame the credit crunch for this one. This is old fashoined boardroom antics. Shame
Tuesday, 13 January 2009
09 - time for Positive Mental Attitude (PMA)
This my first post of 2009 and I cant work out quite how the year is going to play out for us in the media world.
On the surface its looking pretty dire in media land. '08 was horrible across the board and the prospects for this year aren't too rosy.
But lets be positive as a positive mental attitude is the key to turning the economic tide.
My sense is the dire economic environment actually presents us with a unique opportunity. Hard to see right now as we face worsening conditions, job losses etc but please read on.....
It gives us permission to execute all those necessary changes and improvements that companies on our beat have known they would have to make but have been able to defer because conditions were so benign. Its now a no choice, no defer situation. These changes are now about survival not enhancement!
Good news is that those brands that make the necessary changes will emerge from this economic train wreck and will do very well indeed.
Hold on to the following thoughts
you have a trusted brand
you have addressable audience
you have reputation
you have skilled workforce
you have a quality product
This give you durability, opportunity and a fighting chance.
But you have to recognise your assets and be willing to put them to work more effectively, more relevantly and more creatively.
In some ways the economic climate has precipitated the defining moment for media companies. We've long known that digital would eventually change everything for ever and most were happy wait and watch (head in sand). No longer. We have no choice but to embrace change, explore alternative models, lower our cost basis and move on. We cannot vacillate any longer.
I for one think this is good news. Ours is a sector that has stagnated. Its been starved of fresh new ideas and what innovation we have seen has been dreamt up else and co-opted by us as band aid.
Its time for our own ideas and innovations based on a strongly held belief that servicing the customer is a really winning strategy.
Where for example is electronic paper or if not paper electronic readers for newspapers and magazines? How long do we have to wait for goodness sake? Its such a great idea. Reduces costs (no more trees, printing presses, distribution vehicles and agents fees etc), unleashes the digital brand and gives the consumer bang up to date quality content where and where he wants it.
In the age of the iphone and the Amazon Kindle (which is actually quite good) surely an electronic reader model is feasible. Quick back of an envelope calculation tells me that that it can work economically. The case is partic strong against subscribers and home delivery customers. Now its clear that not all these types of customers will want to transition from paper to electronic but some will and that trickle will turn into a torrent.
Is this the year that media cos are forced by economic conditions to make those tough decisions and investigate new models for revenue generation and hopefully work on programmes to recognise and reward customers (and get them to spend more).
Lets hope so
HAPPY NEW YEAR
On the surface its looking pretty dire in media land. '08 was horrible across the board and the prospects for this year aren't too rosy.
But lets be positive as a positive mental attitude is the key to turning the economic tide.
My sense is the dire economic environment actually presents us with a unique opportunity. Hard to see right now as we face worsening conditions, job losses etc but please read on.....
It gives us permission to execute all those necessary changes and improvements that companies on our beat have known they would have to make but have been able to defer because conditions were so benign. Its now a no choice, no defer situation. These changes are now about survival not enhancement!
Good news is that those brands that make the necessary changes will emerge from this economic train wreck and will do very well indeed.
Hold on to the following thoughts
you have a trusted brand
you have addressable audience
you have reputation
you have skilled workforce
you have a quality product
This give you durability, opportunity and a fighting chance.
But you have to recognise your assets and be willing to put them to work more effectively, more relevantly and more creatively.
In some ways the economic climate has precipitated the defining moment for media companies. We've long known that digital would eventually change everything for ever and most were happy wait and watch (head in sand). No longer. We have no choice but to embrace change, explore alternative models, lower our cost basis and move on. We cannot vacillate any longer.
I for one think this is good news. Ours is a sector that has stagnated. Its been starved of fresh new ideas and what innovation we have seen has been dreamt up else and co-opted by us as band aid.
Its time for our own ideas and innovations based on a strongly held belief that servicing the customer is a really winning strategy.
Where for example is electronic paper or if not paper electronic readers for newspapers and magazines? How long do we have to wait for goodness sake? Its such a great idea. Reduces costs (no more trees, printing presses, distribution vehicles and agents fees etc), unleashes the digital brand and gives the consumer bang up to date quality content where and where he wants it.
In the age of the iphone and the Amazon Kindle (which is actually quite good) surely an electronic reader model is feasible. Quick back of an envelope calculation tells me that that it can work economically. The case is partic strong against subscribers and home delivery customers. Now its clear that not all these types of customers will want to transition from paper to electronic but some will and that trickle will turn into a torrent.
Is this the year that media cos are forced by economic conditions to make those tough decisions and investigate new models for revenue generation and hopefully work on programmes to recognise and reward customers (and get them to spend more).
Lets hope so
HAPPY NEW YEAR
Wednesday, 7 January 2009
Virgin Atlantic makes a good ad
There's some decent enough advertising around, but you can count the number of great ads you see in a year on one hand.
Virgin Atlantic's 25th anniversary ad is one of them, distinctive, well shot and memorable. It's an execution from a confident brand that really works.
I like it. First old-school great ad of the year.
http://www.guardian.co.uk/media/video/2009/jan/05/virgin-atlantic-ad
Virgin Atlantic's 25th anniversary ad is one of them, distinctive, well shot and memorable. It's an execution from a confident brand that really works.
I like it. First old-school great ad of the year.
http://www.guardian.co.uk/media/video/2009/jan/05/virgin-atlantic-ad
Monday, 5 January 2009
New Year, new price
Monday January 5th, and the snowy start back after the festive break.
The first indication in 2009 of the hardening economic climate sees the weekday Times increase its coverprice from 80p to 90p, expressly stating in Saturday's paper that this is due to newsprint prices and the current economic climate.
Not surprising in itself, but the 80p coverprice had only come into effect in September 2008, which suggests the need to drive increased news-stand revenues has become increasingly pressing over the last few weeks. It also consigns the price wars of the 1990s to the history books, unlikely ever to be repeated in this sector.
The rest of the quality market will probably follow over the next few days, so our first prediction of 2009 is that all of the quality titles will have a £1 price point by the spring for their Monday-Friday editions.
The first indication in 2009 of the hardening economic climate sees the weekday Times increase its coverprice from 80p to 90p, expressly stating in Saturday's paper that this is due to newsprint prices and the current economic climate.
Not surprising in itself, but the 80p coverprice had only come into effect in September 2008, which suggests the need to drive increased news-stand revenues has become increasingly pressing over the last few weeks. It also consigns the price wars of the 1990s to the history books, unlikely ever to be repeated in this sector.
The rest of the quality market will probably follow over the next few days, so our first prediction of 2009 is that all of the quality titles will have a £1 price point by the spring for their Monday-Friday editions.
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