Business To Business Publishing: The Business World - Publishers are having to adapt to industry developments at every level in order to survive. Tim Woolgar investigates

A wind of change is blowing through the publishing industry. Faced with the internet and the potential for growth through digital media, business to business publishing, in particular, is in a state of flux.

A wind of change is blowing through the publishing industry. Faced

with the internet and the potential for growth through digital media,

business to business publishing, in particular, is in a state of

flux.



The boundaries are being redrawn daily, it seems. The battle is no

longer solely about ownership of information: it is now just as much

about how information is presented and managed.



While magazine publishing could once have been looked on as an

established, even traditional, business, this is no longer the case.

Those who seek to exploit new media successfully are realising the need

to encompass new ways of thinking about and delivering their services -

and incorporating that with the more established areas of their

business.



Annette Smart, marketing director of the conference, exhibitions and

publishing company, the Business Connection, says: ’The motivation for

the publishing companies is probably a combination of fear and

opportunity. For large, ’traditional’ corporations with established

market dominance, fear is likely to be the main driver. For the small

and medium-sized publishers, particularly in successful niches, and the

more innovative players, then the opportunity side of things is likely

to be more prominent.’



Whatever the motivation for change, the industry is evolving, and while

some companies’ strategies are becoming clear, manifesting themselves in

new product, new alliances, mergers and acquisitions, others are finding

their way in more discreet and cautious ways.



Among the latter group is Reed Elsevier, shortly to announce the results

of a six-month review of corporate strategy undertaken by its new chief

executive, Crispin Davies. During his days as a brand manager of Procter

& Gamble, Davies was responsible for introducing Pampers to the UK, and

his career since at UDV and the media group, Aegis, has been marked by

successful customer-focused strategies. Reed is jealously guarding the

contents of the review before publication, but it seems likely that it

will call for a renewed focus on marketing-led ideas.



Other companies are adapting to the new environment more openly and

aggressively. Recent developments have seen a process of acquisition and

rationalisation by the major corporations, aimed at developing

synergistic opportunities between business to business titles and trade

exhibitions.



’People like Reed Elsevier and Miller Freeman have been buying up

exhibitions and new titles over the past five years,’ the KPMG

publishing consultant, John Williamson, says. ’They are now trying to

develop the relationships between magazines and exhibitions, looking at

what’s profitable and worth developing, meanwhile disposing of what

doesn’t fit with their strategies.’



Haymarket (the publisher of Campaign), for example, has stepped up its

interests in exhibition organising via a series of joint ventures with

Miller Freeman - including the consumer electronics show, Live, which

ties in with its ownership of What Hi-fi? magazine.



The advantages of owning both exhibitions and magazine titles in the

same market segment are obvious. Both activities require a database of

customers, and there are numerous crossovers in terms of market profile,

advertising and communication with customers. Williamson says: ’The big

players are attempting to own complete markets. There are significant

advantages to having the top two or three business titles in one stable

alongside the trade shows and exhibitions business for the same

market.’



Some publishing companies believe that this approach is likely to be too

capital intensive to work for them. VNU Corporate Computing’s process of

acquisition and market positioning over the past 12 months has seen it

concentrate firmly on the publishing sector. It has eschewed

opportunities to get more involved in exhibitions or other tempting

areas such as broadcasting.



Tony Evans, the group marketing manager of VNU, representing the group’s

business titles, says: ’We realise there’s money to be made from

exhibitions and conferences but the start-up costs are very high and the

competition is fierce.’



He takes a determinedly realistic view of VNU’s corporate strategy based

on well-defined objectives and streamlined activity, backed up by

experience.



’Companies like Emap, which have been doing that kind of thing for

years, are going to be better at it. We see our involvement in

exhibitions much more on the level of partnership with the people who

know the business and who are already succeeding at it,’ Evans says.



’We’ve also looked at opportunities in digital television and

web-casting but the question is: how do you make any money out of that?

We are coming to terms with the internet and the opportunities there,

and this is a different medium again. Just because something falls

within the same bracket in terms of ’supply of information’ doesn’t mean

we should be doing it. To succeed, you have to be bloody good at what

you do - we are publishers not broadcasters, or exhibition

organisers.’



Some indication of the group’s future direction may be derived from its

acquisition of Nielsen Media Research in the US. This move fostered

speculation last year that VNU would eventually compete for the UK TV

audience research contract run by BARB - although so far this theory has

remained as speculation.



’What we’re interested in is constantly looking at and researching new

markets for magazines and new ways of delivering content via the

internet.



We receive and conduct a lot of research into computing and, with the

development of our web contacts, this is an area that we could develop

further. I am interested in looking at ways of using that

information.



Whether we stick it into the magazines or find some other way of using

it, will be a decision we take over the next few months,’ Evans

says.



It’s not just the knock-on effects of the internet on the business to

business market that are requiring companies to change the way they

operate. Even within the short history of e-commerce and internet

communications, radical changes have occurred.



What hasn’t changed is the fact that business professionals need

information to do their jobs. It’s how they get that information and who

they get it from that’s galvanising the industry.



For news and views, industry developments and opinion, the trade press

has always been an obvious source. For longer term business

intelligence, managers turn to specialist reports from publishers, such

as Mintel, FT market reports, Frost & Sullivan and Key Note.



’From the content owners’ point of view, the key benefit from using

third-party distributors is market penetration. They use the trade

journals to provide a low-cost route to new markets. The strength of

business to business magazines has always been and remains their ability

to deliver communities of customers,’ Smart says.



The problem now - with so much available online - is information

overload.



Whereas before, brand managers would have been happy to reach large

volumes of consumers at low costs, now they’re looking for much better

targeting.



Likewise, they want access to relevant marketing information and

industry news without spending hours looking for it. If they can get

everything they want from one source, then so much the better.



The advent of new ways of delivering and targeting information means the

established system of trade journals has to change. With the internet,

it is now possible to reach customers at a fraction of the cost. And

while advertisers may be unlikely to turn away from trade journals

straight away, marketing budgets must now take account of web

development and promotion.



Smart says: ’What we’re seeing online is people providing for a mixture

of these two needs. The threat to trade journals that derive revenue

from subscription or advertising is that they will lose their audience

to increasingly specialised and sophisticated suppliers.’ Smart says

business to business publishers face a dilemma: ’In the main, the trade

journals don’t own this specialised content, which is potentially risky.

The jury is still out for many as to whether they will change direction

or focus more on their key competence - knowledge and delivery of the

customer’s needs.’



That, at least in part, is behind the thinking of Emap’s ’media neutral’

policy. The chief executive of Emap Business Communications, Derek

Carter, says: ’We look at our business through the eyes of the customer

and see what they are seeing - a content-rich organisation with a

variety of products.’



Emap’s business is divided into four main networks, comprising:

automotive, music, lifestyle and health. Each network supplies a range

of services and products in publishing, exhibitions, conferences and

other marketing services. Hovering above them all is the Emap Digital

umbrella with a brief to research and exploit new-media

opportunities.



Carter says: ’It’s about being a local player with global strengths. We

are able to bring the energy and responsiveness of a small company

together with the economies of scale and buying power of a large

corporation.’



According to Carter, Emap’s future plans are aimed towards developing

more content in each of its core networks. It will also broaden its

delivery systems to include more TV and radio options alongside a stream

of new websites.



Smart says she believes the contrasting strategies of Emap and VNU are

both compatible with the new publishing landscape: ’If content is king,

it will increasingly share the crown with customisation. It all comes

back to market targeting and segmentation. The publishers who can build

powerful communities of customers will survive.



’They can seek to meet all the information needs themselves, like Emap -

through buying individuals or companies with the expertise, or they can

preserve flexibility through partnerships and alliances like VNU.’



However, although large corporations have an advantage in the market,

they must change the way they think to survive. ’If a high-profile,

well-established publisher gets it right, they will power ahead of any

start-up. Well-respected trade bodies are also in a good position. But

at the end of the day, the real difference will be just how well the

needs of the community are understood and met. And that represents an

opportunity for the smaller, hungrier companies,’ Smart says.



The underlying problem is one of culture. Big conglomerates have a

long-standing and in-built culture that does not necessarily favour

innovation and quick decisions. Financial institutions have already

discovered this and have launched fresh, start-up companies such as Egg

and Smile in an attempt to have the best of both worlds.



Diversification is another area for publishers to consider in the long

term. With strong brands and established customers, there are endless

opportunities open to the innovative publisher. And with analysts

predicting even more rapidly changing markets over the next few years,

the future is increasingly unpredictable. The news that News

International - through its e-venture arm - is to start an e-bank and

the Time Warner AOL deal can both be seen to have far-reaching

ramifications.



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