Bonnier is facing declining sales of traditional print media due to changes in consumer culture and the rise of digital media. To address this, the R&D department is considering alternatives to increase readership and sales, including creating a social media microblogging app or using cross-promotion to entice print purchases. They recommend developing the microblogging app, called Project Blog+, which allows users to tailor content to their interests across a variety of topics. Implementation would start with building infrastructure, then testing and rolling out the app over several years. Risks include lack of writer or consumer buy-in, and insufficient growth.

1. BONNIER: DIGITALIZING
THE MEDIA BUSINESS
Conlon Cash, Brooke
McCarter, Sundeep Shamanur, and
Cole Welch

2. OUTLINE
Issue Identification
Situation Analysis
Internal
External
Alternatives
Recommended Strategy
Implementation
Risks and Contingencies

3. Issue
ISSUE IDENTIFICATION
How can Bonnier achieve an uptake in readers
to offset the declining sales of traditional
media?
“[R&D’s] task is to identify opportunities to develop and
initiate new projects in a fast-changing media world.”
Would introducing an innovative product solve
this issue?
Goal: Increase Sales

4. Analysis
CONSUMER CULTURE
Traditional Digital
???
Media Media

5. Analysis
INTERNAL ANALYSIS
Strengths
• Innovation
• Large variety of magazines
Weaknesses
• Decline in traditional magazine sales
• Decrease in profit from 2009 – 2010
• Digital applications only brought in 2% of revenues in 2011

6. Analysis
EXTERNAL ANALYSIS
Opportunties
• Android and other markets
• Digital media culture
• Technological advances
Threats
• Volatile consumer culture

7. Innovation
Analysis
KEY
SUCCESS
FACTORS
Digital
Diversity
Platform

8. FIVE Substitutes
Analysis
FORCES High
MODEL
Suppliers Competition Buyers
Low High High
New
Entrants
Medium

9. ALTERNATIVE 1: SOCIAL MEDIA
SERVICE
Create a micro blogging app that allows users to keep
Alternatives
up to date on topics that they are interested in that
are exclusive to that app.
Pro • Keeps up with the trend in “pro-sumer” culture
• Matches company culture of innovation
Con • High risk

10. ALTERNATIVE 2: CROSS PROMOTION
Entice consumers to purchase print magazines by
Alternatives
offering exclusive interactive content online or using
the app only if the consumer purchases it.
Pro • Increase in traditional sales
• Increases awareness of online
Con • Hard to know if consumers will purchase magazine given the
decline in sales

11. QUALITATIVE ALTERNATIVE ANALYSIS
CROSS
BLOG APP
PROMOTION
Alternatives
New Product Brand Awareness Adds Value for
Additional
Customer
Adresses Consumer Revenue Sources
Preferences Increases Tradtional
Subscription
Dynamic

12. QUANTITATIVE ALTERNATIVE ANALYSIS
Weight Alt 1 Alt 2
Alternatives Feasibility 25% 3 5
Innovation 25% 5 2
Timeliness 15% 3 4
Risk 15% 3 4
Digital Integration 20% 5 3
Total 100% 3.9 3.35
Scale of 1-5; 1 = Worst; 5 = Best

13. RECOMMENDED STRATEGY
It is recommended that the R&D
Department to develop the microblogging
Recommendation app that targets digitally conscious
consumers and allows these consumers to
tailor the content to their preferences.

14. PROJECT BLOG+
Addesses Consumer Culture
Microblogging
Social Media
Digital Integration
Implementation
Supplies Information
Variety

15. PERSONAL PROFESSIONAL
Twitter Project Blog+ Full Website
Articles
Project Blog+ is a mix between personal information
Implementation and a long, professional format.

16. PROPOSED PRICING STRUCTURE
Free Version Paid Version
App Price: App Price:
Free $7.99/month
Revenue Generation: $84.99/year
Advertising
Implementation

17. FREE VERSION
Sports
PAID VERSION
Movies
News Home Improvement
Health Movies
Music Music
Video Games
Politics
Health & Fitness
Cars
Implementation
Fashion
Gadgets
Etc.

18. IMPLEMENTATION
Short Term (0-6 Months)
• Build infrasctructure to deliver the content
• Network with potential writers
Medium Term (6-12 Months)
• Test market in Sweden
• Review the data
Implementation
Long Term (12+ Months)
• Full roll out on Apple and Android markets

19. OUTCOME
Issue: How can Bonnier achieve an uptake in
readers to offset the declining sales of
traditional media?
Adresses Key Sucess Factors:
Implementation
Innovative
Digital
Variety

20. FINANCIAL INCONSISTENCIES
The parent company’s profit is not currently
tied to the success of the R&D department
Why?
− Digital apps and digital subscriptions only make up a total
of 3% of revenues
− The Parent Company brings in the majority of its inco,e
Implementation from investment in subsidiaries
What else is going on?
Subscriptions declined from 2009 to 2010, having
a substantial impact of on parent company profit

21. PROFIT TRENDS
1600
1400
1200
1000
800
600 Profit (loss) for Group
400 Profit (loss) for Parent
200
Implementation
0
-200 2009 2010 2011 2012 2013 2014
-400
-600

22. RISKS & CONTINGENCIES
Risks:
Writers don’t agree to the idea
Suffcient growth is not obtained
The idea never leaves the development stage
Poor expectation of consumer culture shift
Contingencies:
Infrastructure for Blog+ can be licensed in the same
manner as Mag+
Risks and Shift resources to cross promotional strategy
Contingencies

23. WHEN TO EXIT?
Tests:
Fit
Performance
Competitive Advantage
Risks and
Contingencies

24. QUESTION
AND ANSWER
SESSION

25. QUOTE
“The world of passive consumers was turning
into a new world of connected “pro-sumers”
where users actively tailored content and created
their own content.”

26. QUOTE
“Imagine this: the best minds in the industry
have spent 15 years in addressing this issue, and
they haven’t come up with anything. You will
not know more in February than you know
now, so you might as well start doing
something.”
- Jonas Bonnier

27. QUOTE
“Their task is to identify opportunities to develop
and initiate new projects in a fast-changing
media world.”
-Describing the RD department