Matt Sanders, GM, Publisher Solutions, DDM | October 1, 2014
Are you exploring, launching or accelerating your digital business? That’s a question we’ve been asking ourselves constantly over the past four years, alongside hundreds of news media organizations.
At industry conferences, strategy days with news executives at our offices, transformation workshops delivered with API/Poynter, and DDM BootCamps with traditional and digital media teams, we’ve had occasion to listen, observe and engage with thoughtful, earnest leaders and operators of news organizations of every size and shape. In the past two years alone, I’ve traveled more than 300,000 miles – learning from and working with news media leaders from 23 states and 17 countries – which has yielded added perspective and perhaps a little expertise. We have also learned a great deal from our more than 300 news media partners across the U.S. who publish our syndicated content, license our technology, or use our native advertising services.
What is abundantly clear is that each has faced wrenching challenges, with some being unique to their market, but many more are common and have similar solutions. By combining our on-ground observations with our own transformation over the past four years, we’ve developed a unique vantage point. That is, companies are pursuing a range of digital strategies at different paces, with different priorities. In some cases we leave exhilarated by what we see, in other cases disheartened.
From our point of view, a news company’s digital transformation can be benchmarked in phases ranging from Exploration, to Launch, to Acceleration (See below). A company’s movement from Phase 1 where they are exploring new models to a Phase 3 organization experiencing accelerating digital audience and revenue growth depends upon its ability to embrace, organize and drive innovation in two directions: content and monetization.
How can I benchmark my company?
It turns out that there are a number of fundamental strategic directions and operational steps a company must take to shift from a Phase 1 company to a Phase 3 company. We use a detailed, online benchmarking tool internally and with our BootCamp training participants, but an abbreviated checklist should provide readers some helpful intuition.
In order to make the shift to a Phase 3 company, along the X-axis of content innovation, a company must be making aggressive progress toward:
In order to make progress up the Y-axis, companies need to align their digital business models alongside their successful content innovations, including:
While this is a somewhat simple concept, we’ve observed that movement is messy. In fact, we’ve observed ourselves move along each phase, not in a straight line, but rather in a staggered fashion, wrestling regularly with multiple priorities, scarce resources, internal conflicts and chicken-and-egg paradoxes. Similarly, we’ve seen friends across the industry face digital challenges and opportunities in courageous and fascinating ways. The following case study will hopefully illustrate one company’s progress toward Phase 3.
Case study: El Diario de Hoy and America Interactiva
In a recent DDM Digital Transformation BootCamp in San Salvador, El Salvador we worked with more than 40 leaders from El Diario de Hoy and their digital arm, America Interactiva.
First, El Diario de Hoy is the largest circulation newspaper in the country and its print revenue remains quite vibrant, like many of its Latin American counterparts. Yet, they’ve had the foresight to create a separate digital organization called America Interactiva and have plans to make it even more autonomous. [Note: If you’ve read anything about DDM regarding dual transformation, you’ll recognize our wholehearted support for this step in organizational design!] From our perspective, this organizational choice alone pushes them well beyond Phase 1 into Phase 2, freeing them up to launch new content and monetization initiatives. Accordingly, the actual name of their news site, ElSalvador.com is distinct from their print publication, El Diario de Hoy.
Second, as evidence of their progress, they have already launched several new digital-only services like PagaPoco.com (a Groupon competitor locally), created their own online classifieds service called ClasiWow! and provided a specialized online offering for female readers called Mujeres (Women). They also serve up more than 40% of their traffic on Elsalvador.com to mobile users – with more than a third coming from the Salvadorans living in the US. One anecdote worth mentioning is a conversation I had with my driver from the airport. I asked him how he gets his news, and he replied, “I read both newspapers but I love it that ElSalvador.com delivers me the news I need right here on my (Samsung Galaxy) phone in an email that takes me to their site! Their mobile site is very easy to use.” Yep, solidly Phase 2.
As a solid Launch Phase company, America Interactiva has many of the fundamentals in place with some core offerings, and we expect them to approach Phase 3 and see their business accelerate dramatically in the next 18 months. They intend to use our Benchmarking tool to mark their progress and direct priorities over time. We are eager to see it.
Encouragement and caution
While we recognize the complexities and difficulties of creating and sustaining a successful digital business, we’ve seen what it takes, internally and externally. But one observation is paramount – those that put the proverbial cart before the horse tend to get kicked in the teeth. That is, some try to go to launch or acceleration phase without the right fundamental organization to power it. We’ve seen that fail over and over again under the weight of the traditional organization or “square-peg” resources trying to lead digital initiatives. If you find your digital ideas well conceived, or that you’re following industry “best-practices” but for some reason your results seemed more frayed or flailing, chances are you are at odds internally and can’t provide it the fuel and fanaticism necessary to succeed.
To get Phase 1 right, leadership must explore and establish the right digital team before proceeding on with vigor toward Phases 2 and 3. Don’t yield to either fear or enthusiasm without first laying the foundation for launch and acceleration. Progress is much clearer to mark, measure and manage thereafter.
See you in Phase 3!