Journal Register’s goal: 50% of profit from digital by 2015

Coming out of Chapter 11 bankruptcy has been the easy part; instituting change is much harder, Adam Burnham, vice president of local sales at the Journal Register Company, told the Blinder Group and Suburban Newspapers of America’s Revenue Leadership Summit in Chicago today.

“We had to find out how to fix a broken strategy or a strategy that didn’t even exist,” he said.

The U.S. newspaper publisher filed for Chapter 11 bankruptcy in February 2009, and it was decided that much needed to be done to prepare for future change, and a goal of having 50 percent of all profits come from digital by 2015 was put in place.

Part of growing into the future was to get rid of legacy costs, but the larger, more important task was to become a business that was solely content and sales-driven. To do that, the company needed to become “digital first,” Burnham said.

“No good sales person out there today would want to be labeled a ‘print rep,’” he said. “We were not monetizing a huge digital audience. We had to put together digital products and initiatives.”

Previously, of 600 sales people, 18 were focused on selling digital. Today, all 600 people sell both.

“We restructured staff to have an online sales manager [in each location], who became our champion at the local level,” he explained. “The long-term solution is to have 600 online sales managers.”

To help sales staffs, digital products were bundled together. Three price points, US$399, $599 and $799 were introduced, and sales representatives could talk to customers about bundles and what each bundle did for geographic targeting, behavioural targeting, and search engine optimisation.

From January through May 2010, the average total digital advertising sold made up 7.6 percent. Of that, 44 percent was direct and 56 percent was indirect. The total was up 5 percent from the previous year.

The “digital-first” strategy was rolled out in June 2010, and digital percentages started rising immediately. By March 2011, the average total digital advertising sold was 15 percent, with 64 percent coming from direct and 36 percent from indirect sales. The gain from the previous year was 86 percent.

“We viewed digital as a new business start-up. We look month-over-month and quarter-over-quarter,” Burnham said. “Goals are not based on prior years, but on targets, which are based on our company having 50 percent of profit coming from digital by 2015.”

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