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‘Rip it up and start again’: Fairfax unveils new commercial strategy, moves away from Facebook

Fairfax Media is moving away from dependence on Facebook and avoiding “cheap inventory, sold by the kilogram”, as it unveils its new commercial strategy for its metro publications.

The publisher’s new strategy is built on improving integration capabilities, technology and design, and helping people understand premium publishers.

Fairfax Media’s metro newspapers are set to undergo some major product changes online

It comes a day after Fairfax’s annual results revealed a 5.3% decline in total revenue to $1.732b, a 9% decline in Australian Metro Media’s revenue ($522.2m) and an overall increased net profit of $142.6m,. 

Matt Rowley, chief revenue officer of Australian Metro Publishing, told Mumbrella the new strategy was driven from “big changes in digital”.

Rowley said it was disappointing to see the focus in digital marketing has been around performance in recent years.

“The other bit, and I think it’s really starting to change – and there’s been some fantastic data which has just come out about this in Deloitte’s latest media report –  which is that probably up until the end of last year, everyone just figured that everything within social was just positive,” he said.

“It was going to be this great force for positive social change and then clearly we hit the US elections.

‘Cheap inventory’ one of the challenges which led Fairfax to its new strategy, said Rowley

“What became clear was having an algorithm doesn’t make you a publisher, it doesn’t give you that bond with people that builds that trust and that’s really important,” he said.

He added “cheap inventory, sold by the kilogram” which was often of “questionable quality”, and people “looking to re-create the internet within Facebook” were also major challenges which led to a reassessment of Fairfax’s strategy.

“We’ve then gone about saying ‘How does Fairfax then find a future, or continue the strong brands and the traditions that we’ve got in that sort of digital market landscape?’”

New capabilities

Rowley, who began his role in April this year, said it was essential the company had new capabilities in order to capitalise on brand opportunities and solve challenges.

To help expand the publisher’s capabilities, Fairfax built a commercial innovation team, which is made up of developers, project management, and commercial content.

One of the team: Fairfax’s commercial content director, Kate Cox

“We are also doubling down on our strategic capability as well,” Rowley added.

“We are recruiting for new roles – category specialist directors – who work across our key verticals, things like travel, finance, auto, retail, to work directly with senior clients.

“We are also recruiting new strategy roles which go into the agency sales teams, so we can give more value to our agency partners.”

Stripping back the product and starting again

Rowley said with the “legacy” online systems Fairfax had in place, it was never going to be competitive.

The company, which will relaunch The Brisbane Times website later this month, has simplified its product – reducing its ad offering from 38 formats to four.

Brisbane Times’ current design

“That’s a massive step change for us. The whole thing, going back to scratch, was about saying ‘We want to create a product and have the editorial within there that is a viable option for you to go to first thing in the morning instead of Facebook,'” he said.

“We started building that from a product perspective, and then from a commercial perspective we said ‘Look we want to make sure then that whatever we want to do on the commercial side – ads, media, all the rest of it, it – doesn’t detract from that.”

It’s a step away from others in the industry, who according to Rowley, think about “pop-ups, take overs, things that distract and go underneath”.

“This is more about drawing people further in, and what we’ve done there is we’ve reduced the number of different ad formats we have from 38 down to four,” he said.

Rowley added testing indicated time spent on ads was now upwards for 20 seconds, and viewability rates were between 80% and 90%.

“We think that’s a massive leap forward and over the last few weeks, we’ve been showing both partners and agencies, and absolutely everybody has come back and said ‘Wow that’s a big leap.’”

On the production process to get to this point, Rowley said: “There’s so many sort of noodles that are criss-crossed in different directions, and we’ve got upwards of 300 different systems that connect, to put out the papers and the websites that have been built – we have these websites running for 20 years.

“Going back and starting from scratch is great because it enables so many things in terms of user experience, data and measurement. But then what you need to be able to do is re-connect some of those bits of spaghetti.”

He said the website design – which has more white space and minimal ads, allows the content to “breathe”, which will encourage engagement.

Brisbane Times’ new design with less ads, topic tags, talking points, a comment thread, and high-speed news

Rather than thinking about creativity in advertising based on shape, Rowley said it was about how to “inject it into space”.

“The staple of digital advertising and digital display advertising right now is the homepage desktop takeover.

“If you think about it, that’s a total anachronism for the internet now, because you are talking about desktop – which is maybe half of your traffic and you are talking about homepage.”

He hopes marketers will wake up from their “slumber” and move away from cheap inventory, or ads which appear in unsafe places.

“Just like they are waking up in so many different ways around media, as marketers I think we will as well and go ‘Wow that was a crazy 10 years’”.

However, he said it was the responsibility of a company like Fairfax to have the products that clients could work with now, rather than legacy websites built for five to 10 years ago.

While other publishers have built on their current platforms, Rowley said starting from scratch was a “cleaner way”.

“The exciting thing we are doing here, I don’t know any other publisher that’s done it who said ‘Rip it up start again,'” he explained.

“It makes it possible for us to work in that paradigm and compete, starting again now, with the technology now.

“By building it for now, we have the chance to compete – to evolve what we’ve had for the last 15 years doesn’t work.”

Re-establishing people’s understanding of premium publishers

Going back to basics has been key for Fairfax, in order for it to re-establish people’s understanding of premium publishers.

“What that looks like is when people look at the digital media landscape at the moment, they kind of look at it and go and wow there’s this thing that’s dominated by Google and Facebook, and that’s the way it is, and you just draw a straight line and you say ‘Well that means publishers jump off a cliff’.

“But actually, I think that’s the same sort of thinking that people thought when they looked at Blackberry or Nokia.”

“What we are seeing now is change, and we are seeing a turning point as far as how people think about media, and I think people, not just consumers, but also marketers, will start to wake out of that.”

Fairfax will be moving away from Facebook as a platform for news

Rowley said it was important to understand Facebook and other social platforms’ role, which was not to work as publishers.

“I really do think that whole fake news thing was a massive wake up for people, because what it said was, ‘We need to remember what Facebook and other social platforms are really there for.’”

The company will market its new products as they launch, avoiding Facebook as a platform for content distribution.

“They [social media platforms] are great at doing certain things, but clearly not so good at doing others, and as far as creating content and brands that you know you can trust and understand and go back to, and as far as building brands from a marketing perspective, we also know they don’t do that.

“The whole world got sucked into this idea of thinking that you were going to rebuild the internet inside Facebook, that it was going to be there for everything.”

Internal sentiment

While the changes mark a significant milestone for Fairfax, it comes after a major metro media restructure earlier this year, which saw the axing of 125 editorial jobs, to generate $30m in annual savings.

Rowley said the remaining staff were happy with the new commercial strategy.

“Loving it. And part of that for example is, they love what the product says about the brands and how it represents the brands and the quality that it shows and the engagement it gives, and the space that it gives the content.”

Fairfax made $30m in cuts earlier this year

Mumbrella understands the company will also have its own CMS, and will provide more efficiencies for editorial.

Asked why Fairfax decided to make a bold change, Rowley said it came down to the company’s mission.

It’s probably because we are so clear on what our mission is as a company and because of that, and because we have the strength to be able to do it…you put that together with our conviction as far as what we are here to do, we came to an inescapable conclusion that if we kept going the way things were, we weren’t going to be able to keep that mission going.

“You have to put the hats off to the board to ask the hard questions and say ‘What do you need to do to make it happen?’

“It took a lot of people to make self sacrifices to make that happen and to say ‘Hey this is about the greater good of the company and how do we do it for the future rather than what my empire looks like right now?’”

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