Wednesday, April 30, 2008

Gossip from RBI and More Death Notices for B2B Publising

For those interested in the musings, occasional paranoia and insider insights into what its like at RBI right now, this blog, written rather bravely I should have thought, by a UK employee covers all the bases.

One of his posts considers whether Reed missed an opportunity in online advertising. With all their resources why did they need to do a deal with 24/7 in an ad network? Why couldn't RBI have been the inventor of double click. It was forgiveable to miss the search phenomenon as thats not Reeds core business, but the blogger argues, advertsing is.

Keep an eye on this blog if only because its an insider with a brain thinking about what might happen.

He does raise the killer question of course. If a company with the resources and brains of Reed don't think there is any future in b2b publishing, what hope is there for the rest of them.

Paul Conley lists the recent "slew of bad news" coming out of the US business media houses and his analysis is about as gloomy as it gets. The only gloomier outlook is the one we will have in six months time when the economy is in a worse state, business media profits have shrunk further and still no one has worked out what the future might be.

Too many pubilshers are analysing trends and trying to work out where the market is going and then dreaming up some ways of how to follow it. I'll tell you something guys - the future is twhat you determine it to be. In short innovation not replication.

Travel Weekly Editor Packing His Bags

The current editor has left after just a year. The last one survived about the same length of time being fired just a few days before his redesign hit the streets. He went on to make a success of turning round ancient wine magazine Harpers

Owners of TW, RBI are saying this is to do with digital integration. Amusing that so many publishers are now dressing up the sacking of journalists as being about a greater focus on digital.

Instead of seeing the digital revolution as an opportunity for investment and renewal, too many publishers see it as an opportunity to cut costs.

As expected, still no news about the proposed sale of RBI and I don't expect any for quite some time.

Tuesday, April 22, 2008

24/7 creates B2B Ad Network

24/7, the WPP owned ad network solution has announced a deal with a number of US business media shops to create a b2b ad network. This may be a sign of the growing maturity of online advertsing in b2b or it could be a signal that b2b publishers are finding that driving online traffic is much easier than driving online revenue. Desperate to get some revenue traction moving, this deal gets done. We don't know the details of the financial arrangements but we can speculate on the issues.

And there are some risks. There a number of problems with ad networks that tend to bite publishers on the proverbial backside. The first is that you start to lose your relationship with your own customers. Second, ad networks not only trouser a commission on all they sell, but also sell your inventory at a heavily discounted price.

Some publishers might judge that the yield doesn't matter when there is so much unsold inventory about. But it does. Ad networks set the benchmark pricing for the industry. What do you think when one of your reps is sitting in front of a customer hoping to close an online order at £50 cpm and the customer says, "but I'm already on your site through the ad network - and I only pay £3/cpm."

There is a role for ad networks, but the b2b world should be very careful of playing with the devil. If ad revenue from traffic is only worth a handful of pounds cpm, this is not going to be a very profitable business to be in. A web site with a million page views a month serving five ad positions a page creates 5m ad impressions. At £5 cpm (and that would be extraordinary for an ad network rate) and inventory sold out (also unusual)thats a max revenue of £300k/year - less than half the revenue of a not very profitable monthly business magazine.

We need to think through the ad network model for b2b so that the premium audience is not wasted on a network pricing strategy

Monday, April 21, 2008

Centaur Fires Hacks to Boost Online Edit Strategy

Centaur has decided to use its magazine teams to drive content on its MAD website, making the digital only reporter jobs redundant in the process. This news tells us something about Centtaur and raises a thorny question about online journalism.

For Centaur this is partly about cost cutting. Their business is potentially vulnerable to a downturn, being exposed to the media and marketing sector (one of the first to suffer in a recession) and the finance sector. To compound the worries of the Centaur team, underlying revenue growth (ie stripping out acquisitions) has been extremely modest indeed over the past four years.

There are rumours about that Centaur may look for a way to get off the public market and cost cutting is a normal preparation for maximising value. It all depends of course on what founder Sherren wants to do. He may back an MBO but that depends on how enthusiastic he is about CEO Geoff Wilmott. An MBI with the coessence of the founder is equally likely.

In any event with little prospect of meaningful revenue growth in the months to come, expect further cost reduction announcements dressed up as strategy.

And what of the editorial issue? What most publishers fail to grasp is that online writing is not the same as off line writing. Journalists whose first loyalty is to their printed magazine will often avoid scooping themselves - holding back on stories that they could break online until the mag deadline. Few print journalists pay enough attention to deep linking to third party source material and background. Nor do they properly tag stories so they can be relevantly retrieved on future occasions. It is also usual for the audience footprint of the web site to be different from the magazine. Often the website will have an international audience. It will come from several parts of the industry value chain too. That should mean it should have its own editorial characterisation, style and content map - but left in the hands of the print guys, it will be ersatz the mag stuff put online.

If b2b publishers are ever going to crack the online world they will have to take it seriously - as seriously as they would have taken a weekly magazine launch in the last century. That means proper research, detailed content, design and taxonomy planning, focussed resources and a clear vision of what the product is, what it does, how it says its, who it says it for and why it should matter to its audience. If they don't magazines will continue to die and the web sites won't be up to much, will lose money and eventually lose share of mind to alternative solutions.

Thursday, April 17, 2008

Charterhouse on the funeral pire of b2b

Charterhouse Communications, a specialist financial mortgage mag b2b house has finally fallen into administration. Its share price had collapsed to almost zip and revenues were falling off a cliff as the credit crunch bit. But this is not just a story of the US sub prime crisis destroying a good business. Even before the recent crunch this was a business with a poor outlook. Too small and too dependent on magazines to walk across the shifting sands of the b2b media industry, the crunch has simply accelerated the demise.

This is further evidence that survival for everyone in this sector is going to depend on substantial and meaningful innovation on a scale not seen before in the sector. Too many survival strategies are based on;

More events and conferences and awards.

More companion web sites to magazines.

Cost cutting.

This is unimaginative and insufficent to turn the revenues into growth. As the economy downturns publishers are already seeing a tightening in the events sponsorship market. The exhibition and conference sector is overpopulated with events, print advertising decline is accelerating and web initiatives as currently unimaginatively invented are struggling to build meaningful advertising revenues.

The challenge is to create something entirely new that will enthuse users and customers. Here are three possible areas to think about:

1) Building professional networks (vertical LinkedIn)

2) Developing a better recruitment solution that focusses on push marketing rather pull from users.

3) Solving the vertical search conundrum.

We'll explore each of these in future posts.

Monday, April 14, 2008

It's over for Business Magazines

Press Gazette conducts an analysis of UBMs results here. Print advertising is now in terminal decline, down 10% this year. This blog has been warning of the death of print for nearly two years and suddenly the combination of a shift in advertiser behaviour, the impact of several years of cost cutting on editorial quality, the impact of the Internet and the economic squeeze has tipped magazine publishers into near meltdown.

Lets summarise where we have got to. EMAP, one of the biggest and most successful business media companies has been sold off and has yet to emerge with a transparent strategy. Reed Elsevier, the sleeping giant of business media, has announced the sell off of all its business magazines. UBM, containing the remnants of the once great Miller Freeman and the darling of the eighties in business media, Morgan Grampian, is focussed on "data" and "events", Centaur trades on a share price 20% below is float value four years ago, has fired (made redundant) many of its most senior managers and has not demonstrated underlying revenue growth for at least three years., Nexus - once the fastest growing business media company in the UK has sold all but a handful of its magazines to concentrate on digital development.

Watch out for more magazine closures, falling enterprise values of magazine dependent companies, swathes of redundancies amongst magazine sales staff and journalists. The era of the business magazine began 150 years ago. Its all but over.