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News Plus 21 Sep 2021 - 6 min read

News Corp boss Michael Miller says ‘we probably had too many products’; ex-Nine digital exec Pippa Leary hired to clean-up for ‘fewer, bigger, better’

By Paul McIntyre - Executive Editor

News Corp Executive Chairman Michael Miller: “The market is very strong. If you asked me that question three weeks ago, I would have been a bit more hesitant."

News Corp’s Executive Chairman Michael Miller is super bullish on the advertising market and the broader consumer economy in coming months although admits three weeks ago it was a different story. And he's expecting big things from his new recruit, Pippa Leary, charged with cutting, consolidating and creating a better News Corp product portfolio for blue chips and small and medium businesses. 

We've probably had too many products so part of Pippa’s remit is to review the margins and the use ... the digital space moves pretty quickly. What was in vogue two years ago has evolved.

Michael Miller, Executive Chairman, News Corp

What you need to know:

  • News Corp boss Michael Miller wants a revamped and consolidated product portfolio.
  • Nine's former digital commercial director Pippa Leary has been hired to overhaul News Corp's products for "fewer, bigger, better".
  • Per Miller: "We've probably had too many products so part of Pippa’s remit is to review the margins and the use."
  • E-commerce and affiliate marketing are growth areas – News Corp's leads and comparison sites in wagering "are leading the world" and learnings from those sectors are being transferred to travel, lifestyle, sport and retail.
  • The advertising market has flipped in recent weeks – from early signs of a pause on budgets, Miller says "the market has quickly turned again". 

 

Cut, consolidate, create 

Michael Miller has been in talks for months with his new hire and one-time foe, Nine’s former digital commercial director, Pippa Leary, who's charged with overhauling News Corp's product line-up. She now reports directly to Miller as Managing Director, Client Product. 

Leary was part of the team at Nine which outpaced News Corp and other major Australian media operations in building out a digital business today considered market leading. She has also been an agitator for Australian media companies to collaborate closely and create scale to counter Google and Facebook with cross-industry initiatives which were usually scuppered by fierce historical media rivalry – News Corp was regularly one of them. 

Leary has been CEO for two years of the listed content services firm Swift Media, backed by the Smorgan family, but the two execs have been in discussions for several months about a role to cut, consolidate and create new products in News Corp’s often complex offering. Miller admits blue chip brands and SMBs have found it difficult to transact with News Corp although it has been improving.

"We have over the past few years made I think a lot of refinements to our client portfolio," Miller told Mi3. "We've simplified our product and breadth of portfolio for clients and I think addressed the perception that we’ve got great assets but [were] not always easy to transact with.

"We have great commercial product teams in the food space ... in the travel space, in the sport area and in the business space. These are just some examples of bringing those product teams together to ensure that our commercial products follow similar disciplines, similar metrics, that are resourced appropriately. It also means we can be more agile in bringing them together for particular clients who need to them to use our specific networks to reach audiences with whatever message and [in] manner they need."

E-commerce, affilliate marketing, leads generation in high growth

Still, News continues to move aggressively to reduce its reliance on the traditional advertising market via masthead subscriptions – and now e-commerce and affiliate marketing programs – using its media assets and commercial content units to generate income by nudging audiences to buy client products and services, from which it receives a commission. 

Miller cited The New York Times' success with Wirecutter, a product review site which publishes detailed product guides to consumer products with an affiliate marketing model in which referral commission generates hundreds of millions in annual revenues. The site is so popular with consumers it now charges a subscription. 

News Corp Australia, Miller says, leads the world in affiliate marketing for the wagering sector with sites like punters.com.au and racenet.com.au now serving as a model across other sectors including lifestyle, food and travel.  

Like most media companies, News Corp has been trying to expand its presence with small and medium sized business, the hitherto untouchable strongholds of Google and Facebook.      

“We've probably had too many products so part of Pippa’s remit is to review the margins and the use,” said Miller. “The digital space moves pretty quickly. What was in vogue two years ago has evolved and so there's a degree of evolution in terms of the rationalisation of products, but also investment in new product. Fewer, bigger, better. That's what I really want her to focus on.”

Consultants role 'overblown'

Despite the strategic overhaul, Miller downplayed the posse of big consulting groups which have been trawling over the local business for several years in News Corp’s bid to modernise – PwC, Accenture and McKinsey have all had lucrative contracts tramping through the local arm. 

“Others make more of the advisers than what they are,” Miller said.

“Every company has advisers in but it can be very specific on a piece of technology. You hear Accenture’s in the business – it’s a great technology advisor, but it's a particular piece of work. It's not structural, organisational or about strategic change. I feel that others have made it more than what it really is.”

PwC’s role, said Miller, has been to examine how News Corp can “better economise globally” although he didn’t reference McKinsey’s work, the old stomping ground of Siobhan McKenna, News Corp’s CEO, Broadcasting and a long-time confidant of Lachlan Murdoch. None of the consulting work, Miller insisted, was a precursor to the strategic plans for Leary’s remit around shaking up its product line-up. 

Miller said Leary’s arrival rounds out a new-look News Corp exec team that includes former Suncorp CMO Mark Reinke (Managing Director, Consumer), former WPP AUNZ CEO Mike Connaghan (Managing Director, Commercial Content) and Lou Barrett (Managing Director, National Sales). “If you pick those four up as examples, it’s a very different News Corp in that we’ve brought new skills and leadership into the business,” he said.

Leary told Mi3 it was too early to flag early changes but they would come. "It would be remiss of me to speak for News Corp [just yet] but from what I can see from the outside, News' revenues and in particular, the jump in subscribers, have created a situation where News is less reliant on cyclical advertising revenue and now has counter cyclical revenue streams," she said. "They've really diversified their revenue stream. And they're thinking outside of just traditional media into e-commerce and a whole range other areas."

Collaboration, attention

Leary noted that during her two years out of big media rivalries, more collaboration has transpired – and will need to continue.

"I think you've seen that shift occur over the last couple of years where everyone in the Australian market, where the big media players were pitted against each other, now see a real shift where it's more like we may compete in some areas but actually, there's all these other areas that we need to work together on."

Leary suggested there is also now less hostility between Big Media and Big Tech.

"Everyone recognised that there needs to be somewhat of a truce going forward. In saying that I still think there are some fundamental differences between what I would call professionally generated content and social media or user generated content. And I think that's fine as long as we all recognise that. The work [on the advertising attention economy] that someone like Karen Nelson-Field at Amplified Intelligence has been doing is excellent. That can be taken further and further. It's one of the things I'm really looking forward to doing," added Leary.

Cliff edge averted  

On the broader economy and advertising market, concern has been rising among media companies about a potential slowing in spend as lockdowns and supply chain bottlenecks crimped earlier optimism. But in recent weeks, Miller says the sentiment has shifted gears again.  

“The market is very strong,” he said. “If you asked me that question three weeks ago, I would have been a bit more hesitant. The indications given by the Victorian and New South Wales governments in the past fortnight means companies are seeing the re-emergence of the opportunity to take share and not lose share. They know habits will have changed due to lockdowns and they don't want to miss out on capitalising on those new habits. Call it freedom day, call it retail day but people are looking forward to getting out there and spending in stores. Part of this get back to normal will be a degree of retail therapy. 

“We’re hearing if from restaurants – they will be packed. They’ve got solid bookings towards Christmas. Last year, the fashion space was the other one that suffered with no Spring Racing and lockdowns over Christmas. But people are going to be updating wardrobes and fashion retailers are optimistic for the opportunity the lead up to summer provides," added Miller.

“So we’ve definitely had a busy week and it’s the same for the weeks ahead. I think you’ll find that with other media as well. The market has quickly turned again.”

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