Winds of change blow more briskly through B2B media

Posted on April 18, 2013

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A couple of interesting announcements this week underscore the rapid pace of change that is sweeping throughB2B media – and the increasing urgency behind publishers’ transition to digital-driven, multi-platform business models.

On Wednesday, American Business Media announced plans to merge with the Software & Information Industry Association (SIIA), forming what the companies called a “comprehensive, global business information and media industry association.” ABM frankly acknowledged that it can no longer continue as a standalone association, putting pressure on its members to approve the merger (a two-thirds majority is required).

The ABM announcement came a day after technology publisher UBM Tech announcedsignificant changes to its business stemming from “a strategic shift in the company’s focus toward a unique business model.” That business model no longer includes print: All remaining print publications will end production as of July 1. Information Week and EE Times will continue online, while smaller brands Test and Measurement World and Advanced Trading are being killed altogether.

The shuttering of print operations seemed inevitable; print accounted for just 6% of revenues at UBM Tech, and parent company UBM has been aggressively downsizing, reorganizing and closing print titles since 2008.

But the two announcements, taken together, should deliver a virtual head slap to any B2B publisher that still believes in ad-supported print properties as a path to sustainable growth.

“There are still huge opportunities for B2B publishers, but many need an attitude adjustment to deal with the new realities, which today are being driven by the four pillars of technology: cloud, data, social and mobile,” said Colin Crawford, a media consultant and former executive with B2B tech publisher IDG. “B2B publishers need to focus on the content, services and information that are valuable to their readers and deliver them in the most appropriate medium in the most compelling and engaging manner.”

Game-changing opportunities?

ABM CEO and President Clark Pettit echoed a similar sentiment regarding the SIIA merger, saying the combined association will be able to help publishers “fundamentally rethink” business models by exploring new ways to integrate ad networks, publishing workflows and other digital platforms using emerging technologies such as cloud solutions.

“Bringing [the ABM and SIIA] communities together gives us a chance to build lab-like environments that combine publishing, technology, marketing services and business information to create the business models of the future that will drive the growth of B2B,” he said. “There are some game-changing opportunities created through this merger, and we are hoping to leverage those quickly.”

On its microsite, ABM said the goal of the SIIA merger “is to create a defining association that brings together all constituents of the B2B universe, including marketing and advertising, business information and paid content, events, digital and data.” That sounds a lot like what the B2B media company of the future needs to be.

One challenge that ABM and trade publishers share is the need to serve marketers across multiple platforms with multiple products. “Marketers need synthesis — smart solutions that merge technologies, capabilities and formats,” the ABM stated on amicrosite dedicated to the merger. “That takes companies on the service side capable of (1) thinking multilaterally across information, media and technology, and (2) creating products and services that improve customers’ workflow.”

Better customer insights

UBM Tech has adopted such a multi-channel marketing approach, which it calls “Curvonomics.” A consolidated customer database lies at the core of the strategy. In an interview last year, CMO Scott Vaughan said achieving a more complete view of its audience across platforms had led to 5% growth of average revenue per user. (Vaughan left as part of this week’s restructuring.)

In its press release announcing the changes, UBM Tech said it would continue to invest “significantly” in growth areas such as data analytics capabilities, adding that its Customer Insights Team “will utilize these tools to build a better understanding of the needs of our communities, allowing us to foster deeper relationships with our customers by providing them with the right products and services at the right time.”

Developing a better understanding of customer behaviors is a critical piece of any modern publisher’s strategy – but one that many B2B publishers continue to miss. “A digital media brand has to be able to identify potential buyers for sellers,” Scout Analytics’ Matt Shanahan wrote in a recent post.  “The better definition of a potential buyer is an audience member who exhibits buying intentions (i.e., behaviors).  With that definition, the only way to detect potential buyers is to make use of a behavioral database to analyze and understand behaviors within the buying funnel.”

Higher-margin products

UBM Tech’s closing of its print brands, as well as four underperforming events, will allow the company to focus on more profitable products such as events. Folio reported last month that UBM’s events business generated $664 million in revenues last year, an increase of 11.7% from 2011, with “margins north of 30 percent.”

Managing the pace of the transition away from ad-supported print products can be difficult. Publishers such as IDG have attempted to avoid the sting of “big bang” restructurings by adopting a philosophy that IDG CEO Bob Carrigan calls “managing print for profit and digital for growth.”

“We are constantly trying to map our direct costs to where we think the revenue is going to be and we are pretty religious about that,” Carrigan said in a March interviewwith the Media Briefing.

Crawford, the former IDG executive, said, “By moving early, aggressively and decisively to digital strategies and managing print for profit, IDG managed to retain its core print publications as its competitors UBM and Ziff-Davis have been forced to exit the market.”

Print products can play a role in a B2B publisher’s multi-platform, multi-product strategy. But any publisher that still thinks “print first” in any aspect of its business:skills, culture, structure or process – is in trouble. Most of us by now understand the need to diversify products and services while leveraging technology to increase efficiencies and achieve scale. But many are still unprepared for the pace of this shift – and the implications of moving too slowly.

Rob O’Regan

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