Friday, August 29, 2008

ABC Shows More Circ Decline for B2B

B2B magazine ABC results are trickling in. Paid for circulations continue to be under pressure. Farmers Weekly down 2%, TES down 3%, Commercial Motor down 6% and Nursing Times down a staggering 26% year on year. Gulp.

Wednesday, August 27, 2008

Its Not a Joke...

I went to see Batman last night. I recommend it if only for the extraordinary performance by the late Heath Ledger as The Joker. But if you want to be really scared read this reportage of the results presentation from Johnston Press. I know its about regional newspapers not b2b, but aren't there some similarities - communities, the decline of print, the vulnerability of recruitment, the collapse of the paid sale model, online growing too slowly to compensate for the print malaise?

Try reading Peter Kirwans piece but replace all the names of people with names of your own execs, and the every time the company is mentioned, use your company name.

Done that? Feel a little chilly? Thinking that maybe you are not doing enough? What is happening now in regional newsapers is a lens on the future to B2B - and Batman isn't real - you are on your own.

Tuesday, August 26, 2008

Reed Bids Falling in Dutch Auction

It is being reported that last week,the first round bidders for RBI were given an opportunity to revise their bids, ahead of the formal second round. According to the report on Thomson Merger News bidders were given more information about trading after the first round bids had been submitted. The article claims that the revised bids are lower than those posted initially.

This is the first of several rounds of chipping. We have said all along that the price of £1.2b was always ambitious. As trading deteriorates this will run to value.

Second round bids will lilekly be lower still. Its turning into a bit of a dutch auction

RBI Deal Announced October

Dow Jones is reporting that RBI staff have been told to expect an announcement on who the buyer is during October. The article also quotes a senior Reed Elsevier source as saying that the criteria for selection of a buyer will be based on the creation of shareholder value.

I am sure this comes as no surprise, but that means the business will go to the highest bidder, not the bidder who comes up the nicest plan for the future.

Also, an announcment in October is likely to mean a completion in December - as we have said all along.

Friday, August 22, 2008

Online Ad Yields Too Low to Build B2B Profits

Fascinating research from the IAB and Bain based on a US study examining online advertising and the growing dependence on ad networks. It makes for scary reading and every business publisher should take note.

I guess this isn't news to most of you, but the study points out that as traffic grows, (and everyones traffic is growing, there is more ad inventory than the market requires. As a result a growing proportion of inventory is sold through ad networks but the achieved yield is only around 1/25th of that obtained from a direct sale.

The implications of this are obvious. First we risk devaluing the brand by allowing the networks to sell our premium audiences cheaply. Second, it is hard to ring fence the direct customers (high yield) and many will work out that they can get there stuff on their favourite sites with a 90% discount if they buy from a network (low yield). Third, an ad driven model based on a CPM achieved rate of $1 or less is not going to be a sustainable business model for b2b. A million page impressions a month is very respectabel for a UK b2b site. On ad network rates that inventory is worth £6000 a year!

So what should we do? Offer more to our advertisers than banners and skys and MPUs. Offer lead generation opportunities, section sponsorship, online events, new product presentations etc. Do things the ad networks can't and charge a premium for it. Secondly, resist the tempation to get rid of all that spare inventory by doing a network deal. In the long run it isn't a model that can sustain you, so why do it in the short run?

Third, focus your web development on how to get your users converted into leads for your advertisers. One major online b2b advertiser told me recently that their average CTR on campaigns was 0.1% and falling. No wonder the ad networks look attractive to them.

We know the print ad model is dying. Whilst online ads are growing, if we are not careful, we risk building a model of expectations that produces a business model which is completley dysfunctional.

Wednesday, August 20, 2008

UBM Remembers The Mags It Doesn't Publish

Following my scoop yesterday that The Engineer was being published by UBM, UBM has just realised it does not publish The Engineer after all and the corporate website has been edited this morning to remove the reference. Just a coincidence I expect.

Tuesday, August 19, 2008

More on Reporter Going to Jail...

Roy Greenslade, being a proper journalist (unlike yours truly) bothered to phone the regulator to get their side of the story. According to Roy, the regulator claims that the information is restricted to protect those being investigated. Yeah ok, but in normal criminal matters it is possible to report that an investigation is being made. It is also legititmate to report on aspects of the investigation providing such reporting does not prejudice the outcome of a trial.

It is not as if the reporter in question has published the "restricted information" itself. Why should pension companies enjoy greater protection than a private individual faced with an investigation into something he or she may or may not have done. Are pension companies really worthy of more legal protection than say, John Leslie?

If the Pensions Act test is merely that information it deems to be restricted (who arbitrates on what is restricted?) may not be used or referred to then this really is little more than the state deciding what we can and cannot know.

Incisive Media Journalist Threatened With Jail

Incisive Media has got into a very public spat with the pensions regulator. According to a statement by CEO Tim Weller, a junior journalist was threatened with jail, by phone, unless she revealed her sources for the story.

The original story is here. My understanding is that the facts of the story are not disputed. The pensions regulator argues that "restricted information" has been misused.

In his robust defence of the journalist, Weller says,
"The right of journalists to protect their sources is vital if the media is to be able to do its job properly," Here, here.

I am in no position to argue the point of law. But here are my thoughts. The right of a journalist to protect sources is not absolute. A matter of national security for example might lead both morally and legally to a journalist revealing a source. So we cannot defend the journalist simply by getting on our high horse. The question we must answer is a moral and legal one. In this particular circumstance is it right for the journalist to protect her source? First, is the public interest served by the publication of the story? Second, does publication compromise the possible future prosection of a criminal offence?

The regulator relies on the Pensions Act 2004 in which clause 72 states,

"The Regulator may, by notice in writing, require any person to whom subsection (2) applies to produce any document, or provide any other information,"

The Act also prohibits the release of "restricted information". I cannot offer a legal opinion, but it seems to me that if any offence has been committed, it is by the person who has released the information - not the journalist - and in any event it would have to be demonstrated that the information was "restricted" and that the release of the source by the journalist was in the public interest.

Second, the clause allowing the regulator to demand documents etc, appears in the legislation in the section about investigation of premises and so on. It seems clear that the intent of the law was to enable the regulator to demand access to documents held by pension companies it was investigating, not journalists to whom information about an investigation may have been leaked.

In any event, the core facts of the matter are readily ascertainable from the public record for as the original story says,
"The company no longer appears on the regulator’s approved panel of independent trustee firms listed on its website."

In other words, the action taken by the regulator is visible to all. The matter at dispute is the access the journalist appears to have had to "restricted documents".

Morally and in my worthless opinion, Weller is right. On this occasion, the journalist ought to be able to protect her source.

There is precedent. Many years ago a trainee journalist at what was then Morgan Grampian ended up in court to prtoect a source, and lost being fined £5000, and in a case between Elton John and The Express in 1990, Lord Justice Wolf said in his summary;

"When orders were to be made requiring journalists to depart from their normal professional standards of confidentiality for their sources, the merits of their doing so in the public interest had to be clearly demonstrated. The minimum requirement was that other avenues to find the source had been explored". In the Elton John case the court again ruled that the source should be revealed, for reasons not relevant to this case.

It seems to me, that at this early point in the Incisive example, de minimus, it is for the pension regulator to demonstrate that it has made efforts to trace the source by other means, and that identification of the source is in the public interest. The publisher should stand firm.

UBM Thinks it Publishes The Engineer

According to the UBM corporate website, it is the proud publisher of The Engineer.
In the age of up to the minute news, and UBM being a net savvy sort of organisation, you might have thought they would have noticed they sold The Engineer around ten years ago to Centaur. Or maybe UBM has bought Centaur and forgotten to tell anyone. Do you think there is a whole bank of empty desks somewhere in Ludgate House and everybody just thinks those guys on The Engineer are out a lot?

Anyway, here is the quote.

"UBM businesses still publish many other titles that were launched in the 19th century, including Building magazine, launched in 1843 by Joseph Hansom, as well as The Engineer and Chemist & Druggist."

Monday, August 18, 2008

RBI First Round BIds Received

The Wall Street Journal reports that first round bids are in for RBI with most at or around the speculated price of £1.2b.

This doesn't mean much. In first rounds you always bid enough to get into the second round (what would be the point of making a non binding indicative offer at a level you know to be unacceptable to the seller?), and that was always £1.2b, and then bidders can see more detailed information and come to a more intelligent view ahead of the second round.

Reed has provided bidders with vendor due diligence as part of the plan to get the deal done fast (before trading starts to be materially affected by the downturn they must hope). Reed will be very keen to complete. One interested party suggested that as the negotiation progressed Reed could be prepared to soften the deal by leaving some equity in the mix. This will help any private equity bid that is strugggling, not with the price, but rather with the mechanics of putting this level of finance together.

So what will happen next. Second round bidders will review the more detailed information, will review latest trading, consider the acceptability of the vendor due diligence and then put in their second round bids or withdraw. I have no way of seeing the information, but you would have to be an optimist not to expect some evidence of trading weakness materialising since the Information Memorandum was prepared. It would be very surprising indeed if the final price reached £1.2b.

Nielson Rumours and the RBI Deal

It was rumoured some time ago that Clive Hollick, one time leader of UBM and now big fish at mega private equity house KKR, has pondered whether it would be possible to excise the US division of RBI and crunch it together with Nielson (used to be VNU in the US) in which KKR are an investor.

With Reed not minded to break up their business, it has been rumoured that Nielson is now up for sale. All the talk in the press has been about Hollywood Reporter, the weak number 2 to Reeds Variety. (CEO of which is a Brit who, many years ago, used to be ad manager of Commercial Motor)

The real story of course is whether the eventual buyer of RBI is minded to be an aggregator and hoover up Nielson too. The missing piece of the puzzle for me is what the strategy would look like. Both Nielson and RBI have a lot of print based revenues - and simply having a bigger print based business is no protection from the downturn.

Meanhwile Reed staff have been told that their deal should complete in October. I am still betting on December.

Friday, August 15, 2008

Less Often with Fewer Staff. The Brave New World.

Centaur announced a couple of weeks back the move of Precision Marketing from fortnightly to monthly "to concentrate on features." This is beginning to look like a familiar strategy. Huge cost savings, (fire some journalists - in this case the Editor himself is leaving - , piggy back the circ with another title -this really works in a postal price system that is size not weight dependent and reduce print costs.)

It used to be true that the most profitable magazines were those that pubished most frequently. It is increasingly obvious that few of the weekly titles will survive the current gloom. Depressing that, whilst no doubt necessary, none of this is about growth. Even the claim that there will more focus on the web is disingenuous when all these strategies involve producing copy with fewer journalists.

No wonder the City has turned against the business media sector. We look bereft of ideas. Lets make a pact to do better.

More PG Tips

Poor old Dominic Ponsford, Editor of Press Gazette, is getting a bit of pasting on his own blog from readers cross that they haven't been properly informed or that the cost of the new monthly edition is too much.

You can tell from Ponsfords reponses that he is pretty hacked off with the whole thing. First Roy Greenslade wails that its The Guardian what did em in, and then his own readers start bellyaching.

Well heres the truth. If journalists want independent commentary on their profession they had better pay for it, or advertise in it. The reason PG is in the mess its in, is because its readers won't pay and its advertisers have vamoosed.

Although its coverage of b2b is sparse at least it has a go every now and then. Remember that b2b employs around 10000 journalists - thats a lot more than the national press- so why PG doesn't pay more attention to it is a mystery to me.

If you want PG to continue, pay for it, or advertise in it, don't whinge about it. If you don't care and are happy to get your coverage from free blogs like this one, or Roy Greenslade or Stephen Glover then fine. If does it for you - then fine.

This blog and the media commentators are useful, intelligent, insightful, occasionally brilliant. (Ok I know I am getting carried away here) but none of us are a substitute for proper reporting. All of the media commentators, me included, come with an agenda. In my own case, I write for no one. I have no masters. I don't have to please my readers or represent their interests. What you say is what you get. Opinonated comment on the business media world we live in. If you don't like it I don't care and I don't need to. I am not your champion. PG can be. If you let it.

Wilmington, the owners of PG may have made a bit of shambles of the relaunch messaging and a twelve month sub for £115 seems very expensive, (in fact it is bonkers - the publisher has made a mistake in my view) but don't kill em for trying.

Sunday, August 10, 2008

PG Tips 40 Years of History Down Drain

Press Gazette has confirmed that its frequency is dropping to monthly from weekly. PG has long been only barely profitable, and indeed lost money under the ownership of Piers Morgan. The drop in frequency has always been resisted in the past because it compromises the recruitment and subs revenue. Well the recruitment revenue has all but gone anyway and copy sales have been in decline for years.

As Ian Reeves,former Editor says, if the journalist community cannot support a magazine about the business of journalism, what hope is there for any of us.

The test for PG is whether they use this as an opportunity to improve the online offering with more frequent and analytical posts, more blogging, more deep linking, the introduction of tools for journalists, online training, rich media, or whether this is just a publisher Tony Loynes toy with no real vision.

Lets hope this is a vision thing not just a cost cut to keep the brand alive and continue to make money from the British Press Awards. If the national newspapers abandon the Awards, which they might, then it is all over for PG.

Wednesday, August 6, 2008

A short hol

On the day that Press gazette is rumoured to be becoming an online only beast, this blog signs off for a few days to have minibreak. Back on Monday. Any interesting nuggets do please email, and we will have a look.

Tuesday, August 5, 2008

Success is Failure. Failure is Success.

The announcement picked up by Private Frazer who has now returned from his embalming holiday, that The Cruise Ship has merged with the Ferry Technology (Yes, yes I know, I hadn't heard of them either,) has spawned the most astonishing guff in explaination from its publishers. I have extracted a handful of the dafter pieces from their press release, and parsed it through the Business Media Blog Babel Fish.

1) "Riviera Maritime Media has merged two of its technical journals, The Cruise Ship and Ferry Technology, "

Translates as, "Riviera Maritime Media has closed one its titles"

2)"The cruise ship and ferry markets have much in common from a technical point of view, and a title covering both has always been an option considered by RMM."

Translates as, "We sometimes thought, that if things get really bad we can crunch two mags together, fire some people and save some cost. Obviously, from a publishing/edit point of view this is a bad idea otherwise we would have done it when times were good."

3) "The decision to merge the journals was a response to readers' requests for a larger journal that is able to cover more topics in depth."

Translates as, "We haven't had any mail from our readers in ages. We know that you know that readers don't care enough about our magazines to send in requests for larger issues, but we have to say something - however daft it sounds."

4) "Maintaining the successful format already established in Ferry Technology and The Cruise Ship...",

Translates as, "We failed. There is no hiding from it. But even though we failed we are going to stick to the same failed editorial formula. We aren't changing so we had better hope our readers will. Ungrateful bastards."

5) "A dedicated website for this publication will be introduced soon. In the meantime further information can be obtained from Daniel Bragg, Sales Manager:t: +44 20 8370 7003

Translates as, "This wasn't planned. We are having a bit of a panic. Please call me. I need friends."

Monday, August 4, 2008

Downturn starts to hurt Job Boards

The Guardian reports that Johnston Press is making eight redundancies as it closes the London sales office of its jobs board business.

It is hardly news that regional newspaper groups are having a tough time. but surprising that recruitment - and online recruitment at that, is in the firing line. In the pre online world, it used to be said that when GDP growth falls below 2%, there is a recruitment ad recession. It looks like that may be true in the on line world too.

We might pay particular attention to this news and whether it might mean that RBI's TotalJobs is also feeling the pinch and how that might affect the sale process.

Friday, August 1, 2008

Haymarket Cuts Costs With Suggestion Box.

Press Gazette is reporting an internal email sent by Lord Heseltine to his UK staff asking for cost saving suggestions. There is a reward pot of £10,000 (don't overdo it Michael!) to be shared amongst the best ideas. Mmm. I am not normally one to offer free consultancy but I will offer a couple of health warnings.

1) How will you discriminate between ideas that drop out of ones own job and those that are truly innovative?
2) What will you do if ten people have the same idea?
3) If lots of people send in ideas, but only a few of them get a money reward, will you not take up the other ideas? Or will you pursue all the cost saving ideas and only reward some of the people? Or pursue all the ideas and reward everyone with a very small sum? Any which way isn't there a risk of demotivating more people than you please?
4) The best cost saving initiatives involve all the staff all the time not a few people for a moment. Might not a better scheme be, to declare your cost budget and pay out to all staff, equally a percentage of the savings made in a co-ordinated margin improvement programme. That way you will be surprised at the peer pressure not to waste anything from stationary to travel, to paper, to pointless devlopment projects.

A 1% improvement in costs increases Haymarkets profits by 7% or more than £2m in a full year. Paying out 1/2% of the saving at best looks less than generous.

In short, the kind of scheme proposed is normally treated with cynicism by staff and at the end proves to be divisive and morale sapping and not very effective at cutting costs. That someone sent the internal note to PG suggests to me that Haymarket staff might already have worked that out.

More page views doesn't mean more advertising

Folio magazine in the US has started an interesting community of discussion around b2b and recently hosted a debate about digital strategy. There are several common themes. The advertisers are saying that simply quoting page views won't grab their attention. They want to see evidence of community engagement through the downloading of information, the provision of registration details, participation in discussion and so on.

One media buyer said he doesn't care about price only about quality. He will pay more if he is sure it is the right audience fully engaged with the web property.

The notion of community is not new. Business magazine publishers have bragged for years about how their magazines are the hub of the community. Now, in the digital world we can test whether these brands really are the heart of the community.

Just as with print publishing where it became standard practice to have requested circulations and independent readership data, now in digital, in the US at least, ad buyers are demanding rather more than the mag online. Essential de minimus activity seems to include,
Downloadable info
Registered user activity
Active and relevant forums.
Tools and information in the site to aid decision making and product selection.
The provision of validated leads to advertisers/suppliers.
Proof that the audience is relevant.

The last of these really matters. Claiming page views is hugely misleading. Even this modest blog gets readers from all over the world, 38 countries to be exact. That overseas readership is around a third of my traffic. If I was trying to sell ads, it would be dishonest of me not to declare when I brag about my page views, that 30% of those views come from parts of the world where UK advertisers may not sell product.

I have seen some web publishers explain how they try and monetise traffic on each page with many alternate solutions (ads, sell content, lead gen etc). Now is the time to talk about how to meet customers needs. Adverstisers in b2b do not want to buy banners and skys against spurious page view stats. It's time to raise the game.