Making the Transition

The story is becoming familiar. The Institute of Practitioners in Advertising’s Bellwether Report, for the first quarter of 2006 was, once again, pessimistic about the prospects for advertising in the traditional media. The report saw ‘no sign of a rebound’ in the depressed advertising market, with traditional media budgets cut for the sixth consecutive period, and marketing spend growth predicted to hit a four year low in 2006.

Continuing a now well-established theme, the report confirmed that the internet, and direct marketing channels, continue to win out over traditional players. Internet advertising was the only media to have more funds allocated to it, with the Bellwether Report noting 1 in 4 marketing departments reporting an upwards revision in projected spend on the internet, the strongest gain in two years. WWP group chief executive, Sir Martin Sorrell, said that the report confirmed his experience. ‘New media and new technologies are growing as clients experiment with different approaches and question the value of traditional media.’

Advertising expenditure on the internet is certainly doing well, now running at about £1.4bn annually and growing at a rate of about 65% (2005 on 2004). About half of this expenditure is on ‘paid for search’ on the web, where bespoke advertising is served in real time, depending on how a search is being conducted, and spend in this area grew by some 80% in 2005. In 2005, the internet took a swingeing 22% of the nation’s classified recruitment market. Given that spend in the UK’s national press is running at about £1.8bn, it is clear that the internet is catching up fast, and will almost certainly match, or even overtake, advertisement spend in national newspapers in 2006.

Digital’s onward march

Digital managements are confidently expanding their influence over the traditional media … such as newspapers. Omid Kordestani, for example, Google’s global head of sales, speaks of Google becoming a one-stop-shop, selling his online advertisers packages that ‘straddle on and offline media’. He describes how Google’s buying power enables their negotiation of attractive deals on display advertising and how ‘it will not be long’ before Google owns traditional media to maximise margins. The traditional media is also appointing digital management to key positions. Hugo Drayton, for example, moved from Hollinger Digital to managing director of the Daily Telegraph before moving back to new media. Stephen Miron, the former chief of Associated Newspapers' New Ventures interactive operations, moved to the post of managing director of the Mail on Sunday newspaper. Kevin Beatty, the former chief of Associated Newspapers' new media operations was appointed to managing director of the Northcliffe Newspapers Group.

For all the efforts of newspapers to promote themselves as multimedia brands, there seems to have been fewer in the newspaper world to have made a career transition in the other direction, from newspapers into digital media.

This is, apparently, not for want of trying. Guy Phillipson, chief executive of the Internet Advertising Bureau, says that he receives calls every week from people in traditional media sectors seeking advice on how to move into online. Someone who has, very successfully, made the leap from newspapers, however, is Andy Jonesco, now senior vice president of Audience at AOL (UK), but previously a career newspaperman. AOL (UK), a company ultimately controlled by Time Warner but with investment from Google, is one of the UK’s leading online interactive services providers, with more than 2.3 million members. AOL members, on average, spend more than one hour a day online, with access to more than 20 channels of content, covering traditional subject areas such news, entertainment, finance, motors, less traditional topics like parenting, and email and the internet. Says Jonesco, ‘we have created a walled garden where, on average, AOL members spend more time than any other web property.’

Jonesco joined AOL (UK) in May 2002, from Express Newspapers, where he was managing director. Initially, his responsibility was for AOL’s advertising sales function, as vice president in charge of their 50-strong Interactive Marketing team. In September 2005 however, Jonesco was promoted to senior vice president - Audience. In this new role, Jonesco formally integrates his Interactive Marketing team with the Online Customer Experience group, which is responsible for delivering content to members on the AOL service. Such a notion (of integrating editorial with advertising) redefines the concept of ‘content’, and would be strongly resisted in a conventional newspaper environment, where editorial independence has been the fiercely maintained tradition. But, said Jonesco of the move, ‘I wanted to ensure that we retained and enhanced our reputation for delivering quality content to the AOL audience, as well as striking the balance with what our advertising partners wanted to see, which is high performing, innovative advertising campaigns. By combining the talents and experience of these two teams into the Audience business we could continue to set the standard in this highly competitive market.’

Newspaper roots

But, before this appointment, Jonesco was a highly liked and regarded career newspaper man. For 10 years, he worked at Telegraph Newspapers where, ultimately as advertising director, he was responsible for all display advertising revenues. Says Paul Hayes of Jonesco, (Hayes worked for Jonesco before becoming the Telegraph’s enterprise director and eventually managing director of Times Newspapers) ‘Andy is one of the most progressive and passionate people I have worked with. More than most, he understands that a relentless examination of one's team and one's own performance produces ever improving results.’

After leaving the Telegraph in 1996, Jonesco went to Express Newspapers, initially as advertisement director. He was quickly promoted to managing director (where he famously, but unproductively, sought the return of the damages the company had paid Lord Archer, after revelations that Archer had asked a friend to lie under oath in a 1987 libel trial with the Daily Star). ‘This has not come as a shock to us’, said Jonesco at the time. ‘We had hoped that Lord Archer would take the honourable course and make amends, as so many people believe he should.’

How difficult was this transition to the new media? ‘It’s a different world’, says Jonesco. ‘In newspapers, when Diana died for example, everyone knew their duty. The night editor recalled the editor, and years and years of doing the same thing every day kicked in – everyone knew the rules and everyone knew what to do.’ In contrast, says Jonesco, the digital world is an ‘adolescent’ medium and ‘we haven’t fully worked out the advertising model yet. We don’t have the tradition and experience of 200 years of newspaper publishing. In this world, we do not own the medium as we did in newspapers - the consumer does.’

A new advertising model

‘We have to understand that the advertising model in not the traditional ‘interruptive’ one,’ says Jonesco. ‘Pop-ups are an example of the old interruptive way, and we have to get the balance right. We have a very rich medium, combining movement, sound and image which, used inappropriately, can be irritating. If I want to search, then I am in ‘search mode’ and I don’t want clutter or interruption. And, I don’t want the feeling that I am under surveillance and being watched ... ‘Big Brother’ – spooky. And, do I want pop-ups on email? Ouch. We are still learning about what sort of messaging is appropriate around our various modes. We have to complement the consumer experience, not interrupt it.’

Marketers, therefore, have to learn not to push information at consumers, but to enable consumers by making information available. Their job is to place their offer in the ‘consideration set’. In the ‘informationally assymetric’ world of the past, marketers were in control, but they are not now. In the past, the costs of accessing information were high for consumers, but now information is instantly accessible. And, the information they access includes that from their peers. ‘I bought this … it works well’ is a message that will de-risk a purchase and will be influential in the purchasing decision. The image of brands is, therefore, subject to significant modification by instant and friction-free peer communication.

Jonesco, therefore, believes that News Corporation’s acquisition of MySpace is a shrewd one (a website famous for facilitating the do-it-yourself promotion of the Arctic Monkeys). ‘There is a high value from social networking’, says Jonesco, ‘which allows you to communicate and to share information about yourself. You build the commercial stuff around it ... the model is about reach and engagement.’

Clearly, Jonesco has made a successful transition to the new media world. Guy Phillipson clearly believes he will not be the last. ‘Traditional media people understand how traditional media people think – and these are the people who may be thinking about investing in online for the first time,’ he says. ‘Companies, like this, don’t want to speak to people who are obsessed with their search engines.’ Jonesco concurs. ‘All the skills from the old media world are equally applicable in our world, and that’s why we’ve grown to the size that we have. In fact, I don’t think about online as a new medium any more. It’s just another medium. The requirements are the same. You have to understand your consumer and be able to communicate with your customers.’ Perhaps, therefore, we should not see Jonesco as someone who has changed sides, but an example of the new breed of media manager truly able to function across this new multi-platform world.