Didier Quillot

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Digital Media 2.0

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Didier Quillot

  1. 1. Global Digital Magazine Media 2.0. Conference Digital Strategies for Magazines Didier Quillot - Lagardère Active Media Hanover – 15/03/2007
  2. 2. Agenda <ul><ul><ul><li>Opening remarks : A time of convergence </li></ul></ul></ul><ul><ul><ul><li>I. In this rocky period of transition, magazines are not doomed to decline </li></ul></ul></ul><ul><ul><ul><li>II. Lagardère Active Media Digital Strategy Keys and Implementation </li></ul></ul></ul><ul><ul><ul><li>III. A quiet revolution </li></ul></ul></ul><ul><ul><ul><li>p.3 to 6 </li></ul></ul></ul><ul><ul><ul><li>p.7 to 15 </li></ul></ul></ul><ul><ul><ul><li>p.16 to 27 </li></ul></ul></ul><ul><ul><ul><li>p.28 to 44 </li></ul></ul></ul>
  3. 3. A time of convergence
  4. 4. <ul><li>1922: first BBC radio broadcast </li></ul><ul><li>1928: first BBC TV broadcast “Television Queen’s Messenger” </li></ul><ul><li>1995: first free daily newspaper launched in Stockholm by Metro </li></ul><ul><li>2006: US Online advertising growth : +24% </li></ul>A time of convergence (Source : Merrill Lynch, MediaPost) “ Print is dead” “ Radio is dead. And so is print, by the way” “ Paying print is dead” “ TV and radio are dead. And print is even deader” EVENT MEDIA “EXPERTS”
  5. 5. MASTERING THE STRATEGY FOR DIGITAL SUCCESS The website widens brand recognition and increases print circulation MASTERING THE STRATEGY FOR PRINT SUCCESS The magazine anchors web traffic and recognition Developing a virtuous print / web model MASTERING THE STRATEGY FOR CONTENT SUCCESS A time of convergence
  6. 6. A pessimist sees the difficulty in every opportunity; an optimist sees the opportunity in every difficulty. Sir Winston Churchill A time of convergence
  7. 7. <ul><li>I. In this rocky period of transition, magazines are not doomed to decline </li></ul>
  8. 8. <ul><li>The magazine industry has strong assets to succeed on the web : </li></ul><ul><li>Readers communities </li></ul><ul><li>Trusted brands </li></ul><ul><li>In-depth content </li></ul><ul><li>Specific segment expertise </li></ul><ul><li>Relationships with advertisers </li></ul>Magazine are not doomed to decline <ul><li>Internet is an opportunity to : </li></ul><ul><li>Leverage those assets </li></ul><ul><li>Broaden brands’ audiences </li></ul><ul><li>Generate additional revenues </li></ul>
  9. 9. A rocky environment <ul><li> Advertising growth has been slow or negative </li></ul><ul><li>French magazines’ net advertising revenue 2006 compared to 2005 : -1.0% </li></ul><ul><li>American magazines’ gross advertising revenue 2006 compared to 2005 : +0.1% </li></ul><ul><li> Rationalizating of portfolios is necessary </li></ul>(Source : IREP, Publishers Information Bureau) US editions closed in 2006 Publisher
  10. 10. Prejudice N°1 : &quot; Time spent on the Internet is subtracted from magazine reading” +4% -1% +28% +4% +1% +5% +5% 2000 484 min per day 2006 575min per day Total +4% 2000-2006 CAGR Germany : Time Spent Daily w. Media (> 14 y.old) Minutes per day (Source :ARD/ZDF - Studie Massenkommunikation – 01/2007 )
  11. 11. Prejudice N°1 : &quot; Time spent on the Internet is subtracted from magazine reading” <ul><li>AEPM French Magazine Audience Study – March 2007 </li></ul><ul><li>97,2% of the French read magazines every month </li></ul><ul><li>58,9% of the French read magazines every day </li></ul><ul><li>65% read at least one magazine published by Lagardère Active Media in 2006 </li></ul>
  12. 12. Prejudice N°2 : &quot; Online advertising budgets are subtracted from magazine advertising budgets” (Source :BIPE – Russia and China include B2B magazines)
  13. 13. Prejudice N°3 : &quot; The global magazine market is negatively impacted by the Internet &quot; Women Kids Cars Shelter Teens News Celebs Lads Parenting Sports Travel … Weekly Monthly Bimonthly … CATEGORY FREQUENCY THERE IS NO GLOBAL TRUTH ABOUT THE MAGAZINE MARKET THE SITUATION IS VERY DIFFERENT ACCORDING TO THE SEGMENTS AND FREQUENCY
  14. 14. Ad sales growth of US Women Magazines ( source : Publishers Information Bureau) Prejudice N°3 : &quot; The global magazine market is negatively impacted by the Internet ” +23% +20% +11% +19% +5% +51% +2% +21% Ad Pages March 07 / March 06 Publication Publisher
  15. 15. Internet : a strategic move for magazines <ul><li>Potential upside </li></ul><ul><li>Significant savings on production & distribution </li></ul><ul><li>Potential new paying services (commercial referrals, users databases, classified ads, paying archive, etc. For instance DailyCandy.com) </li></ul><ul><li>New digital opportunities to strengthen brands and re-publish magazine contents </li></ul><ul><li>New communities with a new loyalty </li></ul><ul><li>Internet giants look for premium content </li></ul><ul><li>Assured downside </li></ul><ul><li>Some magazine content is available free of charge on the Internet (for instance Der Spiegel, Le Nouvel Observateur etc.) </li></ul><ul><li>Internet takes away ad revenue from magazines </li></ul><ul><li>Ease of entry for new competitors, while some pure plays have already established authoritative brand loyalty (Allociné, Aufeminin etc.) </li></ul><ul><li>Internet giants want to take ad revenue (Yahoo!, MSN, Google etc.) </li></ul>
  16. 16. <ul><li>II. Lagardère Active Media Digital Strategy – Keys and Implementation </li></ul>
  17. 17. Hachette Filipacchi Medias : a global leading magazine publisher More than 250 magazines Magazine revenue International France <ul><li>2006 revenue : 1 848 M € </li></ul><ul><li>Publisher in 41 countries </li></ul>
  18. 18. Lagardère Active Medias : a multiplatform content producer More than 250 magazines Movie / TV production Radios TV Channels New Media Movie / TV distribution Multi-media ad sales house
  19. 19. Lagardère Active Media growth strategy <ul><li>Rationalise our Portfolio </li></ul><ul><li>Shift from operating to licensing magazines in some countries </li></ul><ul><li>Exit from some underperforming segments </li></ul><ul><li>Address issues of scale </li></ul><ul><li>Develop web capacity </li></ul><ul><li>Benefit from the merger of our advertising sales houses </li></ul>Strong management commitment to achieve Lagardère Active Media’s transformation
  20. 20. First priority : WHAT? Monitoring the business by categories
  21. 21. Second priority : WHERE? LAM Magazine portfolio (as % of 2005 revenue) Global growth for global brands Take advantage of fast growing countries (China, Russia)
  22. 22. <ul><li>Improve overall productivity and reduce purchasing costs by implementing pre-press automated copy flow management </li></ul><ul><li>Improve coordinated paper and printing negotiation and review specifications at international level </li></ul><ul><li>Improve distribution practices and develop collaboration with distributors in the US and Russia </li></ul><ul><li>Invest in core business titles and segments (for instance Elle and Tele 7 Jours in France) </li></ul>Third priority: HOW? Improving print publishing efficiency
  23. 23. <ul><li>Websites </li></ul>Developing a virtuous ecosystem with group assets and partners Magazines TV Radio Production Mobile Events Web distribution
  24. 24. 4 levers to develop our websites in all key segments / themes by 2010 <ul><li>Organic growth (launch or relaunch of content websites) </li></ul><ul><li>Digital acquisitions ( november 2006) </li></ul><ul><li>Digital alliances ( + ) </li></ul><ul><li>Dedicated organisational structure (250-strong staff by the end of 2007) </li></ul>Our multiplatform strategy implies that print and web editorial teams collaborate closely
  25. 25. <ul><li>Segment expertise (women, auto, celebrities, news, kids etc.) </li></ul><ul><li>International brands </li></ul><ul><li>Current advertising market trends </li></ul><ul><li>Ad attractiveness of brands and contents </li></ul>A strategy built on Lagardère Active Media assets
  26. 26. Merger of own advertising sales houses
  27. 27. Cross-media campaigns Audience aggregation based on Lagardère Active Media portfolio and integrated sales house
  28. 28. <ul><li>III. A Quiet Revolution </li></ul>
  29. 29. Premiere : accompanying the readership move to digital A content-driven website Premium content (Reviews, Interviews, News) Rich Media Content (Trailers, Slideshows) Community content (forums, user comments) Exclusive box-office game (develops loyalty) Premiere.fr was launched in Februrary 2007
  30. 30. Premiere : accompanying the readership move to digital Showtimes anywhere in France Integration of Google Maps to find movie theaters Free showtimes by SMS A service-driven website Spiderman3 – UGC Les Halles – Mon Tue 11:20
  31. 31. Premiere : accompanying the readership move to digital Content synergies : website is feeded with L.A.M.’s databanks Movie reviews Movie Showtimes Celeb news Theatres & Restaurants TV Listings & reviews News TODAY TOMORROW
  32. 32. Premiere : accompanying the readership move to digital PREMIERE.FR TARGET : 1 MILLION UNIQUE USERS ON MOVIE CONTENTS AT THE END OF 2007
  33. 33. Premiere : accompanying the readership move to digital Digital transition for the Premiere brand in the US Print edition will end in April 07 The Premiere brand will continue to grow online… … and on mobile phones (Premiere mobile launched in november 06) 5,2M 1,3M Page Views November 06 October 06 Premiere.com
  34. 34. Caranddriver.com : maximizing brand audience and revenue 80% of Caranddriver.com users are new to the brand Online traffic growth benefits to the brand 1,5 M 1,1 M Unique Users 21M 16M Page Views December 06 January 06 Caranddriver.com
  35. 35. Caranddriver.com : maximizing brand audience and revenue In-market content (buying guide, vehicle reports, used car pricing, comparisons, dealer quotes) Rich media content (Slideshows, video road tests and interviews) Community content (forums, user-provided road tests) Video advertorials ( Virtual Test Drive ) For in-market users, deeper content than in print magazine
  36. 36. The US auto magazine ad market is depressive : 2006 vs 2005 auto ad pages : -13.8% Fast-growing revenue But LAM’s investment in Caranddriver.com allows online growth to exceed print erosion Caranddriver.com : maximizing brand audience and revenue +1,041M$ BRAND AD REVENUE EVOLUTION +2,972M$ Web ad revenue evolution -1,931M$ Print ad revenue evolution 2005-2006 AD REVENUE EVOLUTION
  37. 37. Caranddriver.com : maximizing brand audience and revenue TARGET : 2008 WEB AD REVENUES = 40% OF PRINT AD REVENUES
  38. 38. Creating value for a multimedia group strategy
  39. 39. Elle.fr : building a leading women’s portal Relaunch of the website Elle.fr will cover all the women subcategories : Fashion, Beauty, Diet, Food, Entertainment etc. Each category is built as a proper web site (ex : the food subcategory Elle à Table includes 11 700 pages) Elle à table, launched in october 2006, was the first element of the new portal Video recipes
  40. 40. Elle.fr : building a leading women’s portal Four ways to increase content and service In-house premium content (Recipes, Astrology) Group synergies ( Nanny Finder with Parents.fr and Infobebes.com, Evening Planner with T7J.fr and Premiere.fr) Partnerships with category experts (dating, ecommerce) Community contents (blogs, forums)
  41. 41. Elle.fr : building a leading women’s portal TARGET : 1 MILLION UNIQUE USERS AT THE END OF S1 2007
  42. 42. Creating value for a multimedia group strategy
  43. 43. Digital growth LAGARDERE ACTIVE MEDIAS FRENCH WEBSITES GROWTH 1,26 M 9,32 M February 07 + 26% 1,0 M Visits per week + 24% 7,49 M Page Views per week Growth October 06
  44. 44. Conclusion <ul><li>Magazines will still be there for years </li></ul><ul><ul><li>Target : save quality content </li></ul></ul><ul><ul><ul><li>Think added value content </li></ul></ul></ul><ul><ul><ul><li>Adapt content to segmented audiences </li></ul></ul></ul><ul><li>Digital usage will grow because of digital generation </li></ul><ul><li>Digital ad spending will follow </li></ul><ul><li>Need to reverse paradigm and to come to : </li></ul><ul><ul><li>Multiplatform content publishing </li></ul></ul><ul><ul><li>Management of segments / brands </li></ul></ul><ul><ul><li>Internal digital transformation : editors, publishers, salesforce, production </li></ul></ul><ul><li>A general and cultural (r)evolution </li></ul><ul><li>Timing is everything </li></ul>

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