The three CEOs on stage Monday for an alternative revenue models panel came from widely spread corners of the globe and offered markedly different approaches to how they run their media concerns.
None offered a magic ticket to how their 500 or so fellow publishers at INMA’s 2018 World Congress of News Media might seek out more money in today’s challenging media marketplace.
Sinead Boucher of Stuff New Zealand outlined how her brand has expanded beyond traditional news publishing in to everything from offering Internet service to providing health care and electricity.
Rajiv Verma at HT Media in India described broadening his company in digital information, radio stations, and education.
Jim Moroney of The Dallas Morning News in the United States implored audience members to recognise their customers as marketers rather than advertisers, and to recast their sales forces to tap into the larger marketing (versus advertising) budgets that most companies have.
But despite their differences, it turned out they have all faced the same battle against losing focus in their companies as they’ve expanded into new areas and adopted new strategies to remain successful. It was moderator Juan Señor’s question after their case-study presentations that brought that out.
“Sometimes one criticism of these diversification strategies is that you end up with a piñata strategy,” he said, as compared to early panel speakers’ insistence on maintaining a laser focus to avoid distraction. “Is there a danger you can slipslide?”
“Well I think there is a danger and we are well aware of it,” Boucher said. “The ventures we’ve chosen to go into have been chosen very precisely, and they are close to the core of our business. And they are things we can see that we can accelerate or amplify and grow quickly.
“So there are other things we’ve chosen not to go into. We had a couple of early things that were a bit more scatter gun and realised … would not work. So I think you just have to be very precise and targeted about what you’re going into and why, and what you want at the end of it.”
Challenged about being in areas such as health and electricity, she justified those a related to Stuff’s core competency of developing subscribers and engaging with them on a lifestyle level.
“In my view, it’s not either or,” Verma said in characterising the choice to expand. “A company has to try various things and some of them will work and, you know, some of them will not work. Failure is an essential part of experimentation and trying new things. That said, we were aware that these diversifications would create a problem for our business model. I knew this is something that is going to happen, but you somehow hope that there is time to develop.
“And that’s a brutal learning for us that, you know, time just vapourises, and all of a sudden you find yourself confronted with those realities. So if I could turn back the clock, I certainly wouldn’t do [some of the ventures]. But some of the actions that we took, it did lead to revenue increases, though they came at the loss of some focus, I agree with that."
Moroney framed it as a matter of management.
“If you have an organisational structure and a culture that runs a portfolio company, such that the companies run separately … I think you can run as many companies as you want," he said. “If you’re trying to bring an integrated focus to the core of a single company, then I think you have to be careful about having too many of these other things going on at one time.
“And we learned that a little bit the hard way. We have started and stopped many different things. Today we’re focused on reader revenue, as I said. We’re focused on where marketing spending is going, and that’s tied back to our original customer base."