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Online Strategy
Strategic Marketing Roundtable
Vail, August 28, 2006
Leon Levitt
Cox Newspapers
Changing Media Landscape Up against HUGE lifestyle headwinds…
– Discretionary time is precious and we compete with everything from expanding entertainment options to longer commute times. It is a zero sum game.
– Expectation that news/information is free
– Way people get news and information- graze many different sources (and seek out a point of view)
Technology changes the game (iron and carrier force no longer provide a safety net)…
– Barriers to entry/local market protection diminished
– Broadband has a big impact on newspapers… wireless BB will soon be ubiquities and thinner/cheaper laptops means tuning our sites for content on demand
Changing Media Landscape
50 Million Americans turn to the Internet
FOR NEWS on a typical day
Adult Internet penetration is 70%
Home broadband penetration now 40%+
Not a zero sum game, broadband drives
usage of more news sites
Unlimited options create a very different
business model
Alignment print & online business models & strategy
Aggregation of audience, driving past 7-day market share and extending incremental reach (25 – 34/39)
We can offer advertisers a suite of solutions
It’s all about the engagement of local audience (differentiator)
And don’t forget frequency! (how do we better measure?)
Managing supply and demand
Sales and business plans drive technology
Changing Media Landscape HOW WE WIN!
CNI Online - Three Goals
Grow past seven-day local market share (25% goal) 30day: Austin 27%, Atlanta 26%, Dayton 22%, PB 22%
Drive incremental audience by focusing on the 25 to 34 year old demographic
Develop ad programs which will leverage audience and better transition revenue
CNI Philosophy More than a newspaper site (different medium)
Credibility is not the same as news judgment
Reengage youth (not all eyeballs are equal)
Own breaking news!
Content that drives revenue (not all journalism)
Produce for broadband (video and interactivity)
Determine and own franchise topics
Produce & play into trends / pockets of passion
Daypart content plans (broadcast model)
Conversation is critical but… (blogs, Pod Casts)
Aggregate before being aggregated, RSS feeds work both ways
CNI Revenue $31.1 $39.4 $54.0 $65.7
CNI Expenses $36.9 $39.4 $46.4 $50.9
Profit ($5.8) -- $7.6 $14.8
IBDA % NA NA 14% 23%
2003 2005
2004
2006
CNI Online Financial Performance (Millions of Dollars)
AJC.com Consolidated Sites
Numbers that are important to us… – 481,718 ACTIVE registered user profiles (67% in
DMA)
– 80% do not subscribe to print newspaper and 67% read occasionally, rarely or never
– AJC print only past 7-day reach is 39%
– AJC print and online adds 10% to 49%
– AJC online adds 5% to 54%
– 224,484 online only readers
– 16.3% past 7-day / 26.2 past 30-day reach
– 80M page-views, up 24%, BUT !!!
CNI Online 5 Areas of Focus
1. Creating a greater sense of urgency… We simply must move much faster.
2. Developing consistent and timely competitive business intelligence, both from a national and local market perspective. Barriers to entry are gone, newspapers no longer have the protection of the local marketplace.
3. Revenue momentum is at a critical stage. Online revenue has increased 125% the past 3 years. Must reduce dependency on classified.
CNI Online 5 Areas of Focus
4. Drive market share by vertical. In most markets
CNI is the clear online market share leader with
respect to overall audience, but this masks a
critical problem.
5. We cannot afford to dismiss collaborative effort.
As the Internet evolves and Craig’s List type
sites multiply, job aggregator sites gain footing,
and Google and Yahoo shift their focus.
Changing Media Landscape
Online is a form of distribution, not a product
Think in terms of what we need NOT what we
have
Utility is as important as content (ZEST)
Search means many things
Home page bypass and driving the impulse click
Free classifieds should be used as a Trojan
Horse
Changing Media Landscape
Winning online means fighting many different
wars all with a different competitive sets
Transition of display revenue must be a priority
We must develop spectacular creative
We are a hybrid newspaper/broadcast model
and Yield management is critical!
All about local PAGE VIEWS
Craig’s list is overrated
Web order entry is key (classified and display)
Changing Media Landscape Questions we continue to ask
How can we create strategic and business alignment across all of our products (print and online)?
How do we transition audience and revenue across verticals each with different business plans/set of competitors?
Do we manage or push print erosion? (eyeballs versus $)
Need better analysis tools on a more timely basis!
Are we being aggressive in using nontraditional content?
How can we attract more women to our sites?
How will people’s info needs change in a world of wireless broadband & cheap/thin laptops?
How do we better control distribution?
How can we be more aggressive developing partnerships?
Do we understand that we must prioritize and reconcile what is cool with a sustainable business model
Changing Media Landscape
Tougher times… online is a big part of the revenue answer and can help drive the overall enterprise…
– In 2006 online will represent over 7% total NP revenue
– Much of NP YOY revenue growth driven by online (76% in 2005)
CNI online is profitable- 14.1% 2005, estimated 23% 2006
Credibility is a differentiator
Building a new asset!
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