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Financialindependence
1. Online News
Financial Independence
Have the Business Models Come of Age?
Presented by John Granatino
5th International Symposium on Online Journalism
University of Texas, April 16, 2004
2. Agenda
• A bit about Belo
• Original registration goals
• Advertiser case study
• The results
3. A Bit About Belo
Belo Interactive is the
Internet subsidiary of
Belo – the nation’s 9th
largest media company
with more than 150
years of building loyal
audiences.
Belo Interactive is the
Internet subsidiary of
Belo – the nation’s 9th
largest media company
with more than 150
years of building loyal
audiences.
4. A Bit About Belo
Local market dominance
• BI attracts on average 5.5 million visitors generating over 110
million page views a month. 1
• DallasNews.com and projo.com are the most visited local news
and information web sites for their markets. 2
• The following Belo Interactive Web sites are the most visited
local television-affiliated sites in their markets: 3
- azfamily.com, Phoenix - KGW.com, Portland
- KING5.com, Seattle - KHOU.com, Houston
- KVUE.com, Austin - KMOV.com, St. Louis
1. BI Web Logs, 2003 2. Nielsen//NetRatings Q2 2003 Custom Report 3. The Media Audit – Phoenix 4/03; Seattle 6/03;
Austin 5/02; Portland 6/03; Houston 8/03; St. Louis, 7/03
5. A Bit About Belo
Recognition from our peers
• 2004
Murrow Awards: KGW.com, WFAA.com, KTVB.com, KMOV.com, WVEC.com,
WWL-TV.com
AP Regional Awards: Dallas, Norfolk, Portland
• 2003
Sigma Delta Chi: KGW.com
Online News Association: DallasNews.com
EPpy award: DallasNews.com
Murrow Awards: KGW.com and KREM.com
AP Regional Awards: DallasNews.com, KGW.com, Projo.com
• 2002
Murrow Awards: KREM.com, WFAA.com, KVUE.com, NBC6.com, WWL-TV.com
NAA Digital Edge Award: Projo.com
AP Regional Awards: DallasNews.com, WFAA.com, KGW.com, KVUE.com
6. Registration Goals
1. Identify and value customer segments
2. Increase audience loyalty and value
3. Migrate audiences
4. Increase advertising impact
7. Registration Goals
October 2000: Planning
May 2001: Launch
August 2001: 1st
email sale
February 2003: Audience
management system
May 2003: Offer targeted online
advertising based on declared or
behavioral data profiles
September 2003: Launched
broad suite of Precision
Advertising Solutions
October 2000: Planning
May 2001: Launch
August 2001: 1st
email sale
February 2003: Audience
management system
May 2003: Offer targeted online
advertising based on declared or
behavioral data profiles
September 2003: Launched
broad suite of Precision
Advertising Solutions
8. Goal 1: Identify & Value Customers
Who are your heaviest users in recency, frequencyWho are your heaviest users in recency, frequency
and amount, and what do you know about them?and amount, and what do you know about them?
Represent 5% of total usersRepresent 5% of total users
Consume 51% of page viewsConsume 51% of page views
Tend to be higher income and slightlyTend to be higher income and slightly
younger than print readersyounger than print readers
Do not subscribe to the newspaper (94%)Do not subscribe to the newspaper (94%)
9. Goal 1: Identify & Value Customers
Interests/HobbiesInterests/Hobbies DemographicsDemographics
Male 53%
Female 47%
$0-$19,999 11%
$20,000-$34,999 12%
$35,000-$49,999 15%
$50,000-$74,999 21%
$75,000-$99,999 17%
$100,000+ 24%
13-17 Years Old 2%
18-24 Years Old 10%
25-34 Years Old 25%
35-44 Years Old 26%
45-54 Years Old 26%
55-64 Years Old 11%
BI’s customer profileBI’s customer profile
6.3 million registrations
1.9 Million targeted email subscribers
6.3 million registrations
1.9 Million targeted email subscribers
Automotive 14%
Books/Literature 23%
Computers/Technology 22%
Cooking 24%
Electronics 13%
Entertainment/Movies 35%
Finance/Stock Market 13%
Gaming Internet/Computer 12%
Golf 13%
Health & Fitness 24%
Home Improvement 22%
Music 30%
Outdoor Activities 22%
Shopping 18%
Sports 31%
Travel 28%
62%
77%
11. Goal 2: Grow Audience Value
Full audience management
• Technology enables “behavioral” tracking on our websites
• Integrates registration data to enable demographic or interest
category targeting
• Ad server designed to predict, deliver, report on audience
segments
REGISTER
AUDIENCE
DEFINE
AUDIENCE
GROUPS
DELIVER
TARGETED
ADVERTISING
Ad Serving
System
MEASURE
BEHAVIOR
Audience
Management
System
12. Goal 2: Grow Audience Value
Online ads can be served based on:
Content Section
News
Sports
Weather
Business
Entertainment
Traditional
site targeting
Traditional
site targeting
Demographics
Gender
Income
Age
Lifestyle/Interest
Entertainment
Shopping
Travel
Purchase Intent
Real Estate
Employment
Automotive
Financial
New
targeting
options
New
targeting
options
13. Goal 3: Migrate Audiences
Dallas Morning News
circulation
(785,000)
DallasNews.com
registered users
(1,825,000)
Reach opportunity
from online
Reach opportunity
for BI
Frequency from
duplicated audience
(As of Jan, 2004)(As of Jan, 2004)
14. Goal 4: Increase Advertising Impact
Unleash the Internet’s power to deliver “one to one” orUnleash the Internet’s power to deliver “one to one” or
addressable marketing.addressable marketing.
Define specific audiences – beDefine specific audiences – be likelike traditional mediatraditional media
Increase results – Relevance, efficiency, performanceIncrease results – Relevance, efficiency, performance
Develop unique solutions – beDevelop unique solutions – be differentdifferent than traditionalthan traditional
mediamedia
15. Goal 4: Increase Advertising Impact
We are able to deliver targeted
messages directly to
advertisers’ most valuable
customers, no matter where
those customers travel
throughout our sites.
16. Goal 4: Increase Advertising Impact
Traditional placement: reach large groups with similar profiles
17. Goal 4: Increase Advertising Impact
Client’s message will
only reach most
valued customer
segment, no matter
where customer
travels on our site
Client’s message will
only reach most
valued customer
segment, no matter
where customer
travels on our site
Precision placement
hits the exact target every time
18. Goal 4: Increase Advertising
Impact
Targeted Segments:
Visitors to the automotive section of
DallasNews.com in the past 30 days
Measurable Results:
»Response rate of 7.7%
»Credit applications doubled
»Mitsubishi automobile
searches increased by 17% on
site
»Campaign generated 44% of
calls at a time when eight
promotions were running in
other media
Targeted Segments:
Visitors to the automotive section of
DallasNews.com in the past 30 days
Measurable Results:
»Response rate of 7.7%
»Credit applications doubled
»Mitsubishi automobile
searches increased by 17% on
site
»Campaign generated 44% of
calls at a time when eight
promotions were running in
other media
Targeted Campaign Yields
Dramatic Results for Auto Dealer
19. Results: A Competitive Advantage
Untargeted audiences:
Commodity impressions
Lower performance
Low consumer
relevance
Unknown audience
reach
Targeted audiences:
Powerful delivery
combinations
Efficiency
Superior performance
Audience relevance
Reach and frequency
20. Results: More Efficiency for Advertisers
• Email revenue more than doubled in 2003
Since 2002, we have delivered more than 1,500 email campaigns
We now have over 700 email clients
• Average CPM for a targeted campaign is more than double an
untargeted CPM
We have delivered more than 150 targeted campaigns
We now have over 50 targeted clients and 20 were new clients to
Belo Interactive
• I can pay for a larger news staff
Belo spends its money disproportionately on journalists, so success
in targeting leads to success in content
21. Results: More Money for the Web Site
Targeted Revenue as % of Total
0%
4%
8%
12%
16%
20%
24%
2002 2003 2004 Expectation
DallasNews.com targeting revenue grew 143% from the first
quarter of 2003 to the last quarter
22. Online News
Financial Independence
Have the Business Models Come of Age?
Presented by John Granatino
5th International Symposium on Online Journalism
University of Texas, April 16, 2004
Hinweis der Redaktion
Bait: The online news industry has had quite a run, starting from being a $0 billion business a decade ago to a $X billion business in 2004. Sure, there was that bubble a few years back, but even without it, online news operations are growing, the content is becoming more sophisticated and audience numbers are through the roof. What could go wrong?
Pitfall: The value trendline of the audiences we develop is declining. If we continue to deliver unknown, untargeted audiences to advertisers we will find ourselves relegated to a commodity impression buy where only volume counts. For companies like Belo, a commodity buy based on volume is not a fight we can win vs. yahoo, aol and other national portals.
Solution: Belo Interactive’s registration initiative is one component of a plan to capitalize on the power of one to one marketing made possibly by the internet. At the same time, it creates opportunities for us to glean greater value for the audiences we build with our web sites.
This morning, I’ll share with you Belo Interactive’s targeting options developed from registration. By the end of the presentation, I hope you will have a sense of how we are using the data we collect to serve our visitors and our advertisers and that you will gain ideas for your own registration strategies.
About Belo
Growing markets
Clusters in NW, SW, TX
Enduring local brands
Operate as high quality local information provider
Broadcast station news casts grow lead in’s – despite network affiliation
Results BI is number 1 or 2 in all broadcast markets
Newspapers like TDMN are some of the best in the nation with superior circulation GROWTH
Quality = Belo culture. We extend this to online results… (next slide)
Although we take greatest pride from the continued loyalty of our customers to our sites, there is no question but that there is a special honor in being recognized by your peers for meritorious performance. Belo is a journalistically-driven media company, which I don’t mind telling you is refreshing in this day and age. In the last month, two of our local TV stations have won Peabody awards, the highest pinnacle in the broadcast news world, and the Dallas Morning News won a Pulitzer prize for photography and the Providence Journal was finalist in another Pulitzer category. At Belo Interactive, we have won 13 Edward R. Murrow awards in the last three years, as well as the prestigious Sigma Delta Chi award from the Society of Professional Journalists, won by our Web site in Portland, Oregon. Why do I go on about this in a presentation about changing online business models? For one simple reason: If we did not enjoy the financial successes we have, I would not be able to hire the number of experienced journalists that work at our sites.
When we started registering customers in 2001, we had some very specific goals in mind
Establish baseline by identifying customer segments.
Increase participation and Efficiency with audience acquisition – we focused acquisition efforts on high value audience segments
We wanted to migrate our audiences, from newspaper, television station to us… from us to them
Finally, and most significantly for our business model, we wanted to change the way advertising is bought and sold online, more efficient, more effective
Registration story
October 2000, began planning to take advantage of Internet “one to one” marketing capabilities
Belo Interactive is recognized nationally as a leader in delivering effective targeting capabilities online and through email.
In fact, Belo Interactive is one of the first interactive media companies to…
Register Web site visitors
Deliver targeted emails to its registered users
Offer targeted online advertising
Registrants provide demographic and lifestyle information
- Geography- Income
- Age- Lifestyle/Interests
- Gender- Media Usage
Over 6 million registered users
Nearly 1.8 million subscribers to permission email service
Establishing a value of a customer or segment is similar to what we do with newspaper circulation… There are some geographies where home delivery is simply not a reasonable value for the paper – either because of cost or advertisers demand…
Similarly, some online customers are simply not valuable enough for us – as a network of local news and information Web sites -- to pursue. We can’t know that, however, until we know something about our customers and their habits.
What we found out was shocking on some level. Our most valuable customers – in terms of the recency and frequency of their visits – comprise a group of about 5% of visitors, and the consumer more than 50% of page views.
Audiences come to us for a wide variety of needs, from local news, sports, entertainment, (etc).
Unlike niche sites, Gives us strong local audience with wide range of targeting capabilities.
In our local markets, we are significantly deeper than national sites, truly reach audiences
Dayparts are emerging online and the daytime, at work audience is our specialty… reach audience when no other media can
HH income 50k plus – reflective of the internet population, high quality disposable income
Prime buying demo of 25-54… 77% of our registered user
Now that we have identified our audience segments, next we wanted to grow the value of those segments. This meant walking them down the experience chain from being a newly acquired visitor to a satisfied and loyal customer. We have several methods for doing that. The first of course is the quality and immediacy of our news report (the more that people see that we have the latest information, the more likely they are to come back again and again). Other methods include easy of customer experience and, especially, promotion of our Web sites by our affiliated television stations and newspapers.
This is the one “technology” slide
Take registration data PLUS measure site behavior
Feed into audience management system…
Significant investment in ad serving to ensure appropriate delivery of messages
Importance of managing/delivering audience profile – Registration/ behavior not mutually exclusive, but powerful in combination.
This allows us to supply targeted solutions based behavioral data from user patterns on our web site, declared data regarding demographics or interest and combinations of both declared and behavioral…
Starting with our online/website distribution….
Target advertisments to these declared and behavioral segments – right now…
Continue to adjust our targeting segments based on advertiser demand…
Having identified the audience and having taken steps to advance our customers from trial to loyalty, we can now be much more sophisticated about migrating the audience. This Venn chart is intended to represent the overall audience that is interested in news and information about Dallas. The yellow segment is newspaper readership and the blue segment is online viewership. The green area in the middle represents duplicated audience that is consuming both media. For the Web site, the newspaper readership represents an opportunity to grow reach. For the newspaper, the online site represents an opportunity for *it* to grow reach. And the green segment represents an opportunity to provide frequency to advertisers who are seeking that.
Having measured our audience, having improved its value and having enhanced our reach and frequency through partnership with our affiliated newspapers and television stations, we were ready to increase the impact of our advertisers’ sales messages. In some ways, we wanted to be similar to traditional media… especially be defining specific audiences. But we also wanted to increase the results our advertisers could expect, through the efficiency and performance that an addressable digital medium could offer. Where the real gain for us would come, however, was in developing unique solutions for our advertisers, solutions that print or broadcast could never offer, owing to the restrictions of their media.
Precision Placement is an established mode of buy online…
Comcast places ad in sports and is branded to any individuals who visit sports page
In this case, sports will skew male, but has wide variety of individuals… 30% female
Not an effective at targeting specific demos of audience,
Use placement for the powerful context of the information and advertiser affiliation with brands…
Inverting the Traditional Placement model….
Identify a target audience and deliver ads where ever they go on site… Not specific to content, specific to audience
Demographically, behaviorally or combinations of both
(Use example target Females, interested in travel)… expand slightly
Highlight targeting results…
Point, reaching individuals at the right time in the purchasing cycle delivers results
Note:
7.7% response of unique individuals reached (call, click) Universe (55,000)
Prior to registration:
We used to be….
Since registration:
We are becoming…
If I were competing with myself, I feel better about my competitive advantages today than the ones we had a few years ago.
Is registration/targeting another hot idea destined to fall short on its promise of opportunity
Or
Will it deliver significant financial impact
