Month: October 2019

“We didn’t say we were taking it in-house and then spend the next six months figuring out who we’d work with,” said Palau on stage at Digiday’s Media Buying Summit this week in Key Biscayne, Florida. “No, we had everything in place. We had done all the groundwork. We realized we could pull it off because we had everything in place.” 

That said, the company didn’t simply stop working with its media agency, Mediacom, and start running programmatic all on its own. Bayer contracted MightyHive to help with the transition with a plan to end that contract after the second year. Within that contract, an “attrition model,” where MightyHive would take people off the Bayer business as Bayer built up its staff, was outlined.  

As previously reported by Digiday, running programmatic in-house saved Bayer between $10 million and $11 million in costs in the first six weeks of doing so. Palau declined to share if the company has since saved more on costs or how much it is currently spending on programmatic. 

Being in-house has changed the way the company allocates its brands’ media budgets. Overall, the company’s digital spend is up 40% from a year ago, which had the company spending roughly 40% of its dollars digitally and 60% on television. Next year, Bayer’s digital spend will be higher than its TV spend. While Mediacom still runs TV buying for Bayer, the company is in the process of bringing all of its TV media data in-house as part of a push for its internal media strategists to have a more active role in holistic channel planning.  

In-housing has also given Bayer the ability to quickly handle problems that might come up with a buy. For example, Bayer has halted some buys when CPMs increased without a clear reason for why that increase was happening. That’s something that would have taken the company much longer to do when those buys were placed by its agency, as the agency would have to realize it, figure out what’s going on, let Bayer know and then do something about it. 

Palau has made sure that Bayer’s in-house team doesn’t sit in a separate wing of the company away from the brand teams. “We are not a cute little group on a separate floor with Nerf guns — we do have Nerf guns — with a special name that no one knows about,” said Palau. “If we’re not embedded in the [full brand] team[s] there are two things that happen. First, we’re not going to be good at our jobs because we’re not going to fully understand the consumer, and that’s a big problem. Second, the brands will see us as this separate group and that makes us no different than the agency.” 

Currently, the company is piloting an organizational model with two brands where those brands now have a dedicated media person, search person and a programmatic person. “I’m placing a bet that that programmatic person will be much better at their job and much more effective for the brand if they understand the customer,” said Palau. “If you look at an in-house model where you separate yourself from the brand, you make broad decisions because you don’t understand it, you don’t understand profit, the P&L, why Walmart moves your stuff around the store all the time. Being in the brand creates an education between both [sides].” 

In-housing programmatic is also having an impact on creative as the company’s in-house team is more integrated with its creative agencies than it has been in the past. Bayer will give its creative agencies a look at the types of people its brands are going after and ask for creative built against those audiences. 

Overall, Bayer is still in the process of figuring out how to handle a growing in-house team. The company now has a dedicated HR person focused on hiring talent for the in-house programmatic team. Palau declined to share how big the team will get but said, “It will be as big as it needs to be.”

“This isn’t a trend, isn’t a fad, this is a pivotal shift in our industry,” said Palau. “This is something that more and more brands are taking on.”

The post ‘We realized we could pull it off’: 2 years in, Bayer is on track to take all digital media buying in-house by 2020 appeared first on Digiday.

Business Insider has made plenty of hay out of the story. An advanced Google search of Business Insider’s domain reveals that in the past six weeks, BI has published no less than 250 articles on WeWork, including everything from a deeply reported look at the founders’ connection to a New York-based Kabbalah organization to profiles of co-founder Rebekah Paltrow Neumann to Rep. Alexandria Ocasio-Cortez’s opinion of the company. A Business Insider spokesperson “can’t confirm” how many WeWork stories BI has published in that time.

A BI WeWork story with the headline “Sex, tequila, and a tiger: Employees inside Adam Neumann’s WeWork talk about the nonstop party to attain a $100 billion dream and the messy reality that tanked it,” drove the second-highest number of BI Prime subscriptions in the history of that program, according to a source at BI. It was enough to warrant a Rock Star award for the reporters from editor in chief Alyson Shontell.

On Fortune’s website, the average amount of time readers are spending with WeWork stories is nearly twice as long as average, a spokesperson said. Bloomberg, which has covered WeWork as a real estate, finance, tech, credit and wealth story, put the company on the cover of Bloomberg Businessweek in May and has been running segments on radio and television about the company.

“It’s definitely driving a lot of traffic, but I don’t look at that as the main reason we’re investing in WeWork as a story,” said Tom Giles, an executive editor at Bloomberg. “This is one of those cases where we’re investing a lot of resources in it because it’s an important story and it really is resonating with our readers, both on the terminal and online.”

The pace of that coverage has accelerated as things have gone from bad to worse for WeWork. Bloomberg has had eight reporters spread across four bureaus covering everything from layoffs inside the company to co-founder Adam Neumann’s real estate side investments. “As the outlook’s worsened for them, we’ve ramped up coverage,” Giles said.

“It’s a story that does mix really hard financials with this charismatic guy that makes strange decisions,” said Paul Plumeri, vp of global brand marketing for The Wall Street Journal, which has been using its WeWork reporting to power content marketing efforts for much of this year. “America and other parts of the world obsess over these CEOs who are unpredictable.”

On some level, every publisher that’s moved into consumer revenue finds something that resonates with their subscribers. This past July, for example, New York Media got a similar shot in the arm thanks to its coverage of Jeffrey Epstein. Seven of the top 10 most-read stories among New York’s digital subscribers were Epstein stories, and over 50% percent of New York’s new subscribers that month had read at least one piece about Epstein, said Jason Sylva, New York Media’s gm of subscription and consumer revenue.

“Stories that perfectly demonstrate what your brand does well — for us, scandal, power, scams — reinforce your value to consumers and hence drive subscriptions,” Sylva said.

Most of the major moments in the WeWork saga have come and gone. “A lot of big news is already behind us,” Giles said. “But this is going to remain a big story.”

The post Sex drugs and (failed) IPO: WeWork mania has been good for business publishers appeared first on Digiday.

And at Bloomberg, Stephen Colvin, global head of advertising, marketing and live events, said that its events division has seen revenue growth over the past three years, with an 84% increase in revenue in 2018 alone. The company now has over 80 events globally, a figure that doubled from 2017 to 2018 and has since increased to over 80 in 2019 with the launch of several international events.

Reuters, which previously didn’t have an events business, bought into it earlier this month through the acquisition of FC Business Intelligence, a business-to-business publisher and conference provider in the pharmaceutical, energy, travel, science and technology spaces. Its events portfolio now has upwards of 70 events per year.

With falling print revenues and tough competition for digital ad dollars, publishers see events as an opportunity to grow revenues from their custom businesses, both by selling more bespoke events and by building out their tentpole franchises with new activations and underwriters.

“Much of [event] growth has been in the custom space,” said Forbes CRO Mark Howard. “Several years ago, print was the lead, and then digital grew our footprint around the world and was a bigger business opportunity for us. But being able to take on live events has taken our relationship with the brands even further in the last couple of years.”

Howard said that events have been a big strategic initiative for Forbes over the past several years, with 2011 being the year that the brand first started to really think about it as a key component of its growth strategy. But over the past year, Forbes has pushed to grow its custom events businesses. Now, the brand hosts around 100 events globally, up over 50% from last year and the majority of those events, roughly 70%, are custom created for advertising partners who are looking to reach Forbes’ audience, Howard said.

Though The Wall Street Journal’s customer subscriptions business is its biggest revenue line “by some miles,” Watford said that its live and custom content divisions are also growing off the back of subscriptions. The majority of its 200 events are newsroom-led, but increasingly the brand is creating more custom integrations for its partners, as well as branching out into bespoke standalone events. 

But Watford said that a big effort behind its event growth is that they are a known and measurable impact on member retention. “If you have been to a WSJ event you are more likely to remain a member,” she said.

For Reuters, branching into events provides an opportunity to start cross-selling its existing sponsors into events, as well as hit the more than 900 FCBI customers that don’t currently advertise on Reuters’ other platforms.

“One of the main reasons we were so attracted to FCBI was their expertise in pharmaceutical, travel and marketing,” said Michael Friedenberg, president of Reuters. “I can’t share the specific new areas we’d jump into, but what we like are highly regulated industries, which we have deep, deep expertise in reporting on those areas.” 

The terms of the sale weren’t disclosed, but Kate Spellman, CMO of Questex, a business-to-business publisher and events business in the beauty and wellness, travel, hospitality, pharmaceutical and technology industries, said she thinks this is a good investment for Reuters. 

“It’s a smart direction,” said Spellman. “What they bought was the content and the thought leadership and the database behind the brands. If they stay focused on that, then they have the business know-how to make it work.”

According to Colvin, Bloomberg Live has seen a 34% revenue compound annual growth rate over the past five years, which he attributes to the company investing into the global expansion of events, including bringing the Bloomberg Equality Summit to London and Mumbai this year. And all of the brand’s events — both marquee and bespoke — are invite-only, including those that are ticketed, as a way to curate an audience that advertisers and partners want to meet, which has brought in over 50 sponsors so far this year.  

However, with this growing push to take a piece of the B2B event market, it calls into question how big the bubble can get before bursting.

For B2B publishers, like Spellman, it makes sense that business publications are intrigued by these events models. “The dollars right now, B2B is a good place to be,” she said. “But the challenge we have in the B2B space right now is that there is so much out there and clearing the clutter to get to the ‘how to’ is the real effort.” 

She notes though that with an oversaturation of business-to-business conferences and events, there are only so many places for industry leaders to spend their money for professional development, and therefore, only the companies rooted in data and research will have the highest returns on their investment.

“People are focusing on quantity versus quality and that bridge is going to collapse soon. That’s what’s going to drive a lot of consolidation in the market,” she said. 

Max Willens contributed reporting. 

The post Business publishers are seeing events as a top growth area appeared first on Digiday.

“We were able to get a whole second life out of this stuff,” said Michael Koenigs, executive producer at Localish.

Now Localish is expanding beyond specials. It plans to produce around 10 half-hour shows a week, said Koenigs. Those shows will air across ABC’s local TV stations in major markets, such as New York, Los Angeles and Chicago, which also carry Localish’s short-form videos. There are also plans to distribute the long-form shows elsewhere, but Koenigs declined to discuss specifics.

Localish already distributes its programming fairly widely. Its videos air as segments on ABC’s local TV stations, are published to ABC’s and the local stations’ digital properties and are distributed out of home in airports and taxis.

That broad distribution helps Disney’s ad sales team to pitch Localish to local and national advertisers. To date, the ad sales team has primarily pitched Localish as an opportunity for branded content, such as custom-produced episodes of existing Localish series and brand or product integrations into specific segments, said Adam Monaco, svp of local at Disney Advertising Sales.

As Localish expands into more long-form shows, that will create more opportunities to incorporate advertisers into the shows. It will also open up opportunities for ABC’s sales team to revisit Localish’s previous branded content deals if a short-form video featuring a marketer is up for inclusion in the longer format. Whether the marketer would be asked to pay an additional fee for the new distribution will be considered on a case-by-case basis, Monaco said.

Advertisers will likely be interested in the additional distribution — especially if Localish’s programming were to make it onto Disney+’s ad-free streaming service — but their willingness to pay extra for it would be a question of the cost, said Noah Mallin, U.S. head of content and experience at Wavemaker. That said, Disney has spent the past couple years pulling together its distribution across its TV networks and digital properties, from its long-held entities like ABC to newer acquisitions like National Geographic, to make it easier for advertisers to take advantage of the “far-flung Disney empire,” Mallin said. “When you stitch it all together, it almost looks more like a platform than it does a media partner. I think that’s very much been their strategy.”

In stretching into long-form programming, Localish has not only been able to take advantage of the videos it produced for Facebook but also the analytics it received from those videos. For its first TV special, Localish took a video that, at the time, had received 5 million to 6 million views on Facebook and slotted it as the opening segment “to keep viewers watching until the ad break. So we were able to create a stronger show because we had this digital, second-by-second [viewership] data,” said Koenigs.

But at the same time as Localish has been able to take videos that have worked on Facebook in expanding into long-form programming, it has also had to do away with aspects of those videos that may have worked on Facebook but are not suited to the longer format. “A lot of our Facebook videos actually feel long when put on TV,” Koenigs said.

For example, Localish’s Facebook videos feature what Koenigs called a “super top,” in which a video starts with a 30- to 60-second summary of the story before transitioning to the actual story. The super top helps to grab people’s attentions on Facebook, but “you don’t get the liberty of saying things twice on TV, so we had to chop off the super top,” he said. Additionally, Localish also looks at the Facebook videos’ second-by-second viewership to see where the audience may have dropped off and inform what edits should be made.

“The pieces end up being much tighter on television than they are on Facebook,” said Koenigs.

The post How ABC’s Localish is using Facebook to incubate TV shows appeared first on Digiday.

What are you pleased with from these latest numbers?
I look at it as very strong progress. I’m well aware of the way some of the numbers are reported, but the fact we have an operating profit of £8.1 million ($10.36 million) implies a much stronger underlying base. For a business in the process of complete transformation from advertising to subscription-led, it requires restructuring and some other work. The point is we remain profitable while transforming the business. That makes us unique. By definition, transforming means you have to run close to the line. I’m comfortable with that and confident we’ll drive more profit in 2019 and 2020. If you have revenue down 2.6% and profit down double-digits it’s because there are costs involved. We’re focused on hiring journalists and investing in subscription capabilities and technology. It is an investment.

You also went public with your average revenue-per-user figure of £200 ($256).
The purpose of every news organization is to have a sustainable business model for quality journalism. Subscriptions and ARPU are two parts of the same outcome. Being high on volume, but low on ARPU is irrelevant. If you take 400,000 subscribers on £200 ($256) ARPU, project that forward for 1 million subscribers, that defines sustainability. I will never play the volume game in subscriptions. It’s about volume and ARPU. If others were prepared to disclose their ARPU figures, I’d be prepared to have our numbers audited. It’s unhealthy to have industry-defining subscriptions in different ways.

Can you share your retention rate?
You can probably work it out. We are in line with the industry average. How you drive up engagement is the question that sits behind consumer-led subscription businesses. Our subscription run-rate doubled between 2018 and 2019. I’ll be even bolder in my assertions: We’ll acquire another 100,000 in net new subscribers next year, that’s after churn.

Where will you acquire those from?
We have two different pools I look at. We have a base of 5 million registrants. Subscriptions are less about anonymous viewers, but we do still need them [anonymous viewers] to keep in the funnel to serve registrants and subscribers. The second pool is, we have 750,000 people who paid for our journalism in the last 12 months. They paid for our journalism but are not registered, whether they buy the newspaper or access on a day pass, there are other mechanics in paying and these people are warm to the Telegraph. The size of those two combined is what makes me confident.

Auditing publishers’ subscription numbers are one thing, how do you respond to claims that The Telegraph’s registered users are not verified?
Firstly, there should be auditing where there is a financial transaction in place — registrants don’t pay, but auditing for ARPU and financial transactions.

Secondly, we don’t verify on point of sign up. We do send out a welcome email, and if it’s a fake address, it’s compressed; we know it’s not valid so it doesn’t count. If it does get through, we still have a tight definition for registrations: You have to have been logged in on-site in the last 12 months. With fakes, there’s a little bit of noise, but it will come out the other end.

We’ve been on the path of registration for over two years. I’ve always said in the future anonymous readers will be much less valuable, almost worthless, than verified and identified users. We’re seeing that from Apple’s ITP [Intelligent Tracking Protection] update, everyone needs first-party identifiable data. I’ve got 5 million, and that’s going to grow.

We’ve only been subscription-first for a year and have doubled the run rate. We have a good understanding of what drives retention and acquisition, but there’s still more to do.

How good is Brexit for the subscription business?
There’s a lot of interest in politics. And that can only be good for society as a whole, and that should outlast Brexit. It is a big driver, but we also find subscriptions come from what we call love, life and loss, so family, parenting and lifestyle. And the Oxbridge project this month has been a big subscriptions-driver. You can’t be reliant on a singular agenda because there will be quieter news days. Boris Johnson’s column [before he became prime minister] used to be very popular; there is a great affinity with him and our readers. It’s all about repeat engagement in the digital sense. Print retention has been stronger than we’re seen for multiple years.

How do you prioritize the subscription business without letting go of the ads business?
All our businesses in a subscriptions-led business have to evolve. One of the benefits of registration strategy is for a large group of readers, 5 million, we have a lot of identifiable insights. The partnerships business continues to be strong. In digital, there’s more money moving into the open marketplace. We’re comfortable with our market position. My future growth ambitions are on the subscription side, and I will always prioritize subscriptions over the casual reader, physically and digitally. On the ads side of the business, we try to sell the benefits of subscriptions and registration as part of the strategy, and that is landing very well.

The post How The Telegraph plans to go from 400k to 500k subscribers next year appeared first on Digiday.