You wouldn’t necessarily expect a trendy nightclub to take its design cues from a news media company. But in the Kent region of England, that’s exactly what has happened.
When Blake’s Club was preparing to launch, its management hired KM Media Group’s advertising division, KMCreate, to design a logo, branding materials, and an advertising and social media campaign. Now that the nightclub is open, KMCreate continues to create branded video animations for use inside the club.
KMCreate has also helped a local football club rebrand its catering operations, redesigning the look and feel of its menus and related imaging. It designs and produces logos, collateral, and awards for other customers, and it recently won a contract to provide video services for a local council.
In its second year, KMCreate is projected to bring in more than £200,000 of work, “and substantially more than that in potential for growth,” says Neil Webster, commercial director of KM Media Group.
KM Media Group owns a regional newspaper and radio stations. When it began examining its market to gauge the potential for offering advertising, design, production, and Web development services in 2014, it found the potential customer base ran the gamut — with the greatest potential in the middle of the market, Webster says.
“Looking at the market, the opportunity was to be a bridge, somewhere between people using full-service advertising agencies locally, and people who traditionally used us to make up an ad — the people who have a slightly bigger need,” Webster says. “We segmented our business.”
While this middle ground is highly competitive in the Kent region, Webster believes the newspaper’s brand gives KMCreate a competitive advantage. “There’s a myriad of companies offering these services,” he says. “Most people in most marketplaces trust their local newspaper, plus a business like ours deals with literally thousands of customers every year.”
In its first year, KMCreate drew a mix of existing clients and businesses that had never worked with the media organisation. That has required, in some cases, extending skills such as logo design for in-house advertising to broader branding campaigns for organisations like the nightclub and catering service.
To do so, KMCreate leverages its parent company’s core competencies in creative services, account management, and advertising; it also contracts with freelancers as needed to fill skillsets.
“Like other media companies, we have a whole matrix of skills,” Webster says. “The vast majority of media operators will find that the talent is there. The big discipline has been making sure we’re not pitching for things we cannot do.”
KMCreate built business through promotions in its newspaper and radio stations. A brand partnership manager also actively markets its services in the community and identifies businesses to pitch.
It was also important, Webster adds, not to compete with local advertising agencies that bring considerable amounts of revenue into the core business.
“We’re very careful not to encroach in the space of local advertising agencies, because they are our larger customers,” Webster says. “We know most of the customers in our marketplace — the ad agencies and the clients they represent — so we’d [consider whether our actions are] affecting the marketplace.”
KMCreate is a division of KM Media. Company executives opted not to create a stand-alone entity, but rather staff KMCreate by leveraging creative resources from its operations department and sales resources from the commercial department.
“We’re trying to make our business less departmental and structured, and making sure we’ve got the right resources on the team,” Webster says. “We’re working to make sure we’re maximising the opportunity and the value-add.”
That mentality also drove how KM Media executives considered the potential opportunities and drawbacks of the venture. Executives reasoned that offering an extended suite of advertising services would — at a minimum — prompt existing customers to spend more of their traditional advertising dollars with the organisation, according to Webster.
“We took the view that if this developed as a worst case, it would still be a business development tool for our [core] business,” Webster says. “In fact, what happened very quickly was that the opportunity has arisen so it is a growing part of what we’re doing.”
And even with its stand-alone success, KMCreate is still considered a contributor to core operations.
“It’s involved in lots of aspects of what we’re doing,” Webster says. “It’s raised the overall creative standards of our advertising, and it’s an important part of big client pitches about how we can develop not just straight-up advertising, but design and collaterals, and being able to rely on an organisation like ours.”
This is one of 14 case studies featured in INMA’s strategic report “Revenue Diversification Beyond Traditional Print and Digital,” released in December 2015.