Online News Financial Independence Have the Business Models Come of Age?

1
Online NewsFinancial IndependenceHave the
Business Models Come of Age?
Presented by John Granatino5th International
Symposium on Online JournalismUniversity 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 nations 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

8
Goal 1 Identify Value Customers
Who are your heaviest users in recency, frequency
and amount, and what do you know about them?

• Represent 5 of total users

• Consume 51 of page views

• Tend to be higher income and slightly younger
  than print readers

• Do not subscribe to the newspaper (94)

9
Goal 1 Identify Value Customers

• BIs customer profile

Interests/Hobbies
Demographics
6.3 million registrations 1.9 Million targeted
email subscribers
10
Goal 2 Grow Audience Value
New visitor/Trial
Retention/Growth
Loyal customer
11
Goal 2 Grow Audience Value

REGISTER AUDIENCE
DEFINE AUDIENCE GROUPS
DELIVER TARGETED ADVERTISING
Audience Management System
Ad Serving System
MEASURE BEHAVIOR

• 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

12
Goal 2 Grow Audience Value
Online ads can be served based on

• Content Section
• News
• Sports
• Weather
• Business
• Entertainment

Traditional site targeting
13
Goal 3 Migrate Audiences
DallasNews.comregistered users (1,825,000)
(As of Jan, 2004)
Dallas Morning News circulation (785,000)
Reach opportunity from online
Reach opportunityfor BI
Frequency from duplicated audience
14
Goal 4 Increase Advertising Impact

• Unleash the Internets power to deliver one to
  one or addressable marketing.
• Define specific audiences be like
  traditional media
• Increase results Relevance, efficiency,
  performance
• Develop unique solutions be different than
  traditional media

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
Precision placementhits the exact target every
time
Clients message will only reach most valued
customer segment, no matter where customer
travels on our site
18
Goal 4 Increase Advertising Impact
Targeted Campaign Yields Dramatic Results for
Auto Dealer

• 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

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
DallasNews.com targeting revenue grew 143 from
the first quarter of 2003 to the last quarter
22
Online NewsFinancial IndependenceHave the
Business Models Come of Age?
Presented by John Granatino5th International
Symposium on Online JournalismUniversity of
Texas, April 16, 2004