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How
 VG
 see 
their 
business 
modell 
in 
the 
future,
 and
 how
 and
 where
 they
 expect 
to
 earn
 money? - Rune Danielsen
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How
 VG
 see 
their 
business 
modell 
in 
the 
future,
 and
 how
 and
 where
 they
 expect 
to
 earn
 money? - Rune Danielsen

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How
 VG
 see 
their 
business 
modell 
in 
the 
future,
 and
 how
 and
 where
 they
 expect 
to
 earn
 money? - Rune Danielsen How
 VG
 see 
their 
business 
modell 
in 
the 
future,
 and
 how
 and
 where
 they
 expect 
to
 earn
 money? - Rune Danielsen Presentation Transcript

  • How
VG
see
their
business
modell
in
the
future,
 and
how
and
where
they
expect
to
earn
money?
 Rune
Danielsen
 Commercial
Director
at
VG

  • VG is a Media House A content provider across platforms
  • Biggest VG is the Nr. 1 newspaper in Norway, and we are nr. 1 online. We’re much bigger than our competitors
  • VG
‐
Readership

 30,1% Kilde: Forbruker & Media.
  • Newspaper
and
online
 51% •  I
2007
VG
had
 1.191.000
print
 33,2% readers,
and
 30,1% 1.316.000
online
 readers.
 •  VGs
Total

daily
 readership
(off
 and/or
online)
is
 2.015.000
persons.

 Kilde: Forbruker & Media. Daglig antall tusen lesere
  • Total
Daily
Reach
 •  NRK
cover
75%
of
total
populaBon
 every
day.
(TV,
Radio,
Online)
 Fom 2.Q 2008 inneholder NRK også yr.no. •  TV
2
reach
60%

 •  VG
reach
52%
of
poulaBon
on
a
 daily
basis
 Fom 1.Q 2008 inneholder VG også Nettby. •  Dagbladet
at
32%

 •  AOenposten
reach
29%
 Prosent Fom 1.Q 2008 inneholder TV 2 Gruppen ikke Kanal24, Kilde: Forbruker & Media. 2Q 2008. www.tns-gallup.no/medier Nettavisen og Side2.no.
  • Daily
reach
in
age
group
12
–
19
years
 Fom 1.Q 2008 inneholder TV 2 Gruppen ikke Kanal24, Nettavisen og Side2.no Fom 1.Q 2008 inneholder VG også Nettby. Fom 2.Q 2008 inneholder NRK også yr.no. % Kilde: Forbruker & Media. 2Q 2008. www.tns-gallup.no/medier
  • Daily
reach
in
age
group
20
–
39
years
 Fom 1.Q 2008 inneholder TV 2 Gruppen ikke Kanal24, Nettavisen og Side2.no Fom 1.Q 2008 inneholder VG også Nettby. Fom 2.Q 2008 inneholder NRK også yr.no. % Kilde: Forbruker & Media. 2Q 2008. www.tns-gallup.no/medier
  • 1994 - CIRCULATION: 386 137 Advertising revenue: Readership: 1 381 000 239 MILL NOK Profit: 218.5 MILL
  • 2002 - CIRCULATION : 390 510 Advertising revenue : Readership : 1 571 000 370 MILL NOK Profit: 270.3 MILL
  • 2007 - CIRCULATION : 309 610 Advertising revenue : Readership : 2 015 000 672 MILL NOK Profit: 365 MILL
  • Our Vision
  • Our Goal – Strong growth the next five years
  • So
–

 What’s
the
problem
?

  • Problem
number
one
‐
Age


  • VG
Buyers
 Heavy
Buyers
 Medium
Buyers
 disappears
 Heavy
buyers
is
 geWng
older

  • Problem
number
2
‐
circulaXon
numbers
 ”De Streife?”
  • The
Crucial
QuesXon
for
the
 Newspaper
 • HOW
TO
SUSTAIN
PROFIT
IN
A
 SHRINKING
MARKET?
 FRONT END: PRODUCT INNOVATION BACK END : IMPROVED PRODUCTION EFFICIENCY
  • The
Pillars
for
Newspaper
Sale
 PRICE
 PROMOTION
 PLACE
 PRODUCT
 The classical 4 Ps of P. Kotler
  • The
Pillars
for
Newspaper
Sale
 PRICE
 PROMOTION
 PLACE
 PRODUCT
 Estimated increased profit: 48 MILL 14
  • New
IniXaXves
to
sell
more
at
 
higher
price
to
core
readers
 PRICE
 PROMOTION
 PLACE
 PRODUCT
 Specific themes, occasions or season
  • PRICE
 PRODUCT
 THE
PRICE
EQUATION
 1990: 6.60 7.00 1997: 9.00 8.00 2007: 14.30 10.00 Source: McKinsey internal report VG
  • Consumption of Coca Cola
  • Reach new target Groups (Women) Problem – Other segments grow more
  • Reach the healty segment
  • Increase in revenue and profit An activ product- and price policy enabled Coca Cola to grow revenue despite the fact that ”The Real Thing”, their main product decrease
  • VGs sale at Statoil PRICE
 Effect of Price and Innovation for VG PRODUCT
 +28% *Revenue per Month
  • PROMOTION
 MarkeXng
and
Trade
 •  VGs
Branding
has
been
amongst
the
most
succesful
 adverXsing
in
Norway
for
the
last
20
years
and
from
our
Sales
 Modelling
we
see
that
it
sXll
is
profitable
 •  Our
Pay
off
is
”The
day
will
not
be
the
same”
(witout
VG).
This
 is
sXll
relevant
for
our
total
offer
as
a
Media
House
and
for
VG
 online,
but
it
is
a
big
quesXon
wether
this
sXll
is
the
case
for
 the
newspaper.
 •  More
and
more
people
experience
that
the
day
is
good
 enough
witout
buying
the
newspaper
 •  I
will
not
go
deeper
into
this
now,
but
we’re
adapXng
the
 markeXng
concept
to
make
it
more
relevant
for
the
 newspaper
and
we’re
also
trying
to
develop
a
becer
 markeXng
concept
for
retail
adverXsing
as
well
as
for
our
 addiXonal
products

  • PLACE
 Space
Management


 •  VG
is
one
of
the
top
10
FMCG
products
in
 Norway
 •  Our
problem
is
that
it’s
a
single
product,
and
 it’s
based
on
commision
sale
–
so
there’s
not
 many
incenXves
for
the
retailers
to
give
our
 product
acenXon
 •  And
Retailers
”only”
care
about
growth

  • PLACE
 Space
Management


 •  We
have
the
best
place
in
the
shop
–
at
the
cash
 desk,
and
we
need
to
defend
that
place...

 •  But
we
also
need
to
expose
our
products
at
several
 places
within
the
shop.

 •  This
is
in
parXcular
the
case
for
our
addiXonal
 products.

 •  To
achieve
this
we
have
to
adapt
our
retail
busines
 model
from
the
exisXng
flat
commission
model,
 towards
a
model
that’s
more
growt
/
volume
 oriented.

  • PLACE
 Space
Management


 •  I
don’t
know
about
any
other
adverXser
that
puts
 more
money
into
ads
for
the
product
without
 exposing
it
in
the
shop
(we
hide
our
addiXonal
 products
within
the
newspaper)
 •  We
can
let
some
of
our
new
products
be
availible
 more
than
one
day,
and
we
can
give
them
their
own
 exposure
‐
next
to
the
newspaper
 •  We
consider
changing
the
business
model
by
giving
 the
buyers
an
opXon
with
differensiated
prices

 •  A
stronger
focus
on
Space
will
force
us
to
change
our
 business
model
towards
retailers.

  • PLACE
 New
Sales
Channels
 •  VGs
problem
is
not
the
prize
of
the
product.
It’s
 peoples
Xme
 •  We
need
to
look
for
new
situaXons
were
people
have
 an
extra
minute,
and
we
need
to
be
able
to
put
the
 product
in
front
of
them,
there
and
then
 •  At
the
moment
we
have
appr.
12.000
places
were
we
 sell
the
product
 •  In
the
summer
and
on
sundays
we
increase
this
to
 15.000
(door
sale,
boat
sale,
etc).

 •  We
constantly
need
to
be
looking
for
new
places
to
 sell
/
distribute
the
newspaper

  • Revenues
from
2007
to
2012
 •  If
we
manage
to
work
well
with
all
of
the
4
Ps,
we
believe
it’s
 possible
to
keep
circulaXon
appr.
on
a
2008
level
unXl
2012
 •  That
will
give
us
a
golden
opportunity
to
grow
adverXsing
 revenue
on
print
alone
with
25%
from
2008
‐
2012
 •  Best
case
‐
Total
revenue
will
be
appr.
2.200
mill

 •  If
not,
we
sXll
have
to
grow
revenue,
but
it
has
to
be
in
a
mix
 between
product
prize
and
adverXsing
growth,
due
to
more
 and
more
paper
to
heavy
users
 •  It
will
be
allmost
impossible
to
reach
our
target
for
the
Media
 House,
if
newspaper
circulaXon
”collapse”.
So
the
issue
 regarding
circulaXon
is
our
number
one
priority

  • Newspaper
Busines
Models
 International Newsmedia Marketing Association, R. Picard
  • VGs
future
Busines
Model
 (on
longer
term)
 VG International Newsmedia Marketing Association, R. Picard
  • THE
CRUCIAL
QUESTION
FOR

 VG
ONLINE
 • HOW
TO
KEEP
THE
POSITION
AND
 SECURE
CONTINUED
GROWTH?
 NEW PORTFOLIO INITIATIVES
  • IN
POLE
POSITION
–
WEEKLY
USER
 SESSIONS

  • THE
VERY
BEST
WEBSITES
DO
ONE
 THING
REALLY,
REALLY
WELL

  • NEWS Prefered place to be updated for Norwegians 15 - 29 Source: SOON-project by Synovate jan 07
  • VGs
product
porBfolio
 Høy 
within
the
BCG
matrix
 Sesam Nettby VG TV VG Nett VG Mobil Vektklubb Markedsvekst Møteplassen Dine Penger VG Helg VG 7 VG papiravis Matbilag Bilbilag Lav Høy Lav Markedsandel Size of circel indikates revenue
  • AN
AMBITION
TO
BREED
A
LEADING
 NICHE
PRODUCT
YEARLY
 2005 2006 2007 A NEW PRODUCT IDEA 2008 OPERATED IN SEPARATE COMPANY WILL BE LAUNCHED IN NOVEMBER
  • Nettby – Social Network Service The fastest growing ”city” in Norway More than 750.000 members since launch last year 70% coverage of all Norwegian teenagers
  • VG Vertical Cross Media content Cross Media Sale
  • VG
‐
Cross
Media
Sale
 Cross
Media
Team
Established

 Strenghten
focus
on
”VG
idéas”

  Started
1.
januar
2008
 
  Two
customers
(Orkla
og
Landbruket)
 
 VGTV
+
VG
print
  Common
team,
one
from
online
and
one
from
print
 
 Tailormade
ad
concepts
uXlizing
  Number
of
contacts
increased
from
 
 all
VG
plaqorms

 


25
to
130
persons!
  X‐media
sucsesscases
executed
 
  125
%
over
budget
aper
six
months
 
 Sale
compared
to
last
year
for
the
 two
customers
 =

9,6
mill
(+
67
%)



 New
cartoon
 +
new
ad
space
 Neaby
+
VG
print

  • We also provide Multi-Media respons administrasjon Order by mobil tlf. Order online Order with SMS Partner in logistics export of customer information
  • Summary
 •  We
aim
to
maintain
revenue
from
circulaXon
in
the
periode
 2008
–
2012,
and
to
grow
adverXsing
revenue
from
print
due
 to
growth
in
product
volume
 •  Price
and
InnovaXon
is
our
soluXon
 •  We
will
not
change
our
business
model
totally
,
but
we
will
 adapt
it
and
it
will
be
much
more
adverXsing
dependent
 •  Online
innovaXons
will
be
launched
every
year
and
they
will
 be
totally
adverXsing
driven
 •  We
integrate
some
editorial
departments
across
plaqorms
 and
we
integrate
adverXsing
sales
towards
the
biggest
 adverXsers

  • THE
9X
THEORY
 •  The
average
person
will
underweight
the
 prospecXve
benefits
of
a
replacement
by
 about
a
factor
of
three

 •  and
overweight
by
the
same
factor
everything
 they're
being
asked
to
give
up
 John T. Gourville (John
is
a
Havard
professor
in
MarkeXng
with
a
special
focus
on
 price
and
product
innovaXon,
and
we
strongly
belive
in
his
 message)

  • INMA
36th
European
Conference
 Next:
 Horst
Pirker