Yet, as the mediafutures tracking project shows, many publishers responded by simply doubling down on their own internal strategies.
Sticking to the action plan
With so many things on everyone’s ‘to do’ list, prioritising and sequencing have become critically important. Respondents were asked whether they had a “clear and detailed action plan in place for the immediate future?”
The majority (67%) are well into a programme. Yet these are split between...
- Those who have communicated the plan through the organisation in order to obtain company-wide buy-in (43%) and...
- Those who still need to sell the plan internally (24%).
By contrast, there is a significant 33% who look vulnerable, as they are still at various stages of “getting their act together”.
Encouragingly, no one is feeling completely overwhelmed by what to do next and the scale of the task ahead, as was the case back in 2023.
Every company looks to be sorting out what they need to do to grow; and to do this whilst maintaining delivery standards, consistency and brand values.
Another factor that runs through the whole survey is the different challenge faced by transforming legacy companies as opposed to greenfield start-ups. Start-ups lack established brands and content inventory; corporate knowledge and experience; and do not always have the profit-focus that is usually baked into legacy operations. Yet they come with little ‘corporate baggage’ and with a can-do and fast-implementation mindset.
Nevertheless, the thought-processes and disciplines are identical across all companies when it comes to putting the strategy into action.
Ready to change direction
Sitting at the centre of the key metrics which are measured by mediafuturesPULSE (turnover, profitability, headcount and confidence), there is a very practical question as to how to balance these factors in response to changing market conditions. What is clear is that the accelerating rate of change is forcing rapid adjustments to the business plans and models of most companies.
Balancing investing against cost-cutting
Respondents were asked to look very strategically at their business and to assess how much they were taking out of their operation in terms of cutting costs as opposed to investing (where ‘investing’ covers marketing, research, tech stacks, journalism and content creation, staff headcount, staff training, etc). The aim was to get a general sense as to where in the transformation journey individual companies are. And why?
‘Investors’ form a significant group (27%). They tend to be well-progressed on their journey, have been through the pain of right-sizing and are now looking more positively about actioning their clearly defined plans. Yet they also know that this may hit their bottom-line profits in the short-to-medium term, as their investments outweigh the costs taken out of the business, which are ideally the result of smart efficiency and productivity gains, rather than damaging squeezing. They have the highest levels of confidence in their future.
‘Balancers’ are the largest group (51%), up from 42% in 2023. They are carefully and cautiously trying to fund their investments through costs being taken out of the business.
‘Cutters’ are the smallest, but still significant group (22%). They fall into three broad segments:
- Efficient and productive operations, often highly automated, who are finding the benefits of working smarter and faster, increasingly with AI tools.
- Those who are making significant cuts now to fund the major investments that they want to make in the future.
- Those who are simply trying to stay afloat and who often have cash-flow and longer-term financing issues.
Altering the balance
The three cohorts outlined above are not stable states. Respondents were asked to look out into the future to take a view as to whether they are likely to change their current approach over the coming year.
The largest group (59%) said that they were ‘steady state’ and would hold to their current strategy. This figure is strongly up from 2023 when it stood at 46%. A growing number are sticking to the plan.
Yet the remaining 41% are ‘flippers’:
- Positive flippers (22%) are ready to move into their investment stage, but this number is well down on the previous year’s 33%.
- Negative flippers (19%) are prepared to make further and deeper cuts than to date.
The verbatim quotes below provide more background and colour to the bare figures...
- “We have a plan and a clear set of priorities. Our challenge is to get the timing right. We need to remain cash positive. So, knowing when to press the investment button is a month-by-month decision at the moment.”
- “Our investment phase ended nearly two years ago. Then came cost-cutting and right-sizing. Now, all profits are being re-invested for growth.”
- “We are investing in new areas (building digital capability) as we move resource out of declining areas (physical production). We remain committed to investing in quality content that people can trust.”
- “If we don’t find new revenue streams with digital, then we will have to look at cost-saving to offset the print trend.”
- “Investment is a continual process both in terms of tech stacks and product development.”
- “Investment to grow remains the opportunity, but the market is still too volatile to have confidence that it will all pay off.”
- “We’ve allowed ourselves to get just a tiny bit fat. Long overdue action about to be taken!”
- “I prefer to think in terms of increasing efficiency and productivity, rather than cutting costs.”
- “Working out where to make the right investments currently takes up most of my time.”
- “Staff, print / mailing and travel are our major variable costs. We have become obsessively forensic about all of these.”
The market feels very volatile at the moment, with many companies living from month-to-month, ready to respond to changing conditions, whether those are external or internal factors; and whether they are positive or negative. Agility driven by confidence in perplexing times.
This article was first published in InPublishing magazine. If you would like to be added to the free mailing list to receive the magazine, please register here.
