31. August 2017 ǀ Munich Ismaning

How VRM digitized its business

VRM, a media company in Mainz, has turned everything upside down. We spoke to VRM’s sales manager, Matthias Lindner, about the changes.

The media industry was the first to experience digitization. Restrictions were reduced, the advertising business collapsed, and free online offers emerged. Is this a good time to work for a publishing company?

Sure, there are editors-in-chief who are dissatisfied with the industry and badmouth it. I grew up in a publishing house myself and used to work as a freelance journalist. And yet I am convinced that there is no better time to work for a publishing house.

You’re kidding…

Not at all. After all, digitization was the trigger for many exciting projects. We have changed a lot in the past few years, introduced paid content, bought the publishing company Echo, introduced a new umbrella brand (VRM) for the media company, relaunched a few daily newspapers, and, with e-commerce, entered new business segments.

What do you consider the triggers for these developments?

On the one hand, our customers are using media differently than a few years ago. In addition to our web offer, various online services, such as our e-paper, the news app and social media channels complement our print products. On the other hand, digitization has also affected our in-house structures. Technology changes organizations and processes – such as through new sales channels or marketing automation.

What do you sell today?

Print media are still our main sales driver. Our challenge is that the growth of our digital offer does not make up for the loss of subscriptions to our print products. That is why diversification is very important for us. In the meantime, not only have we evolved from a traditional newspaper company into a multi-media company, we have also developed e-commerce. For instance, we are in the travel business and have a web shop. Readers can book tickets with us, find jobs in the region, and buy books, calendars, and decorative items from LED tea lights to a tablet computer with an installment plan. Plus, we are also involved in a startup network because it is important to us to always be a part of new developments.

That doesn’t have much to do with the traditional publishing business.How does it all fit together?

Our goal is to become the #1 information and service provider. We focus on the trust our readers place in us and offer high-quality journalism as well as additional services to people here in the region.

Is growth only expected in online business?

Future readers will choose a mix of online and print media. It is important is that content available online also have a price, which is why our readers have been paying for that since late 2013. Each month, they receive five articles for free, another ten for registering, and then a day pass or subscription model is available. Meanwhile, our new members, who opt for bundle offers with a significant digital portion, or even all-digital, account for a good 20% of our digital sales.

An important digitization trend is that customers demand a service that is as individual as possible.How does a publishing house deal with that?

Many readers expect to receive customized suggestions based on their click history and personal interests, like with Amazon. Our news stream can be individually compiled in the app and our readers receive article recommendations on our webpages. The scatter gun advertising approach of sending flyers to homes no longer works. Today’s adults no long want two-year notice periods; they would rather be able to change their offers from month to month. To make this possible, it is necessary to utilize social media, e-mailings and marketing automation, as well as use as many sales channels as possible. Today, we have 25-30 advertising channels and 50 advertising campaigns per year. It’s impossible to compare this to when a personal letter and a call center were the only sales channels.

How would you define modern marketing?

Firstly, I would like to take the 80,000 customers and target the ones I would like to address – segment target groups. Secondly, it helps tremendously to use smart systems to automate processes. If a customer goes on vacation, he can now choose whether he wants to stop receiving his newspaper for that period of time, have a neighbor receive it, or read the e-paper while on vacation. Then he automatically receives a reminder to register two days before his vacation and while on vacation, he receives a message inviting him to participate in a contest for the most beautiful vacation photo. It would be great if he would like to continue to receive the e-paper after his vacation. The idea is to build chains of events that proceed automatically – thanks to marketing automation. The goal of these activities is to provide a complete customer lifecycle; i.e. to know all the points of contact with the customer. This is the only way to create an optimal shopping experience for the customer.

That sounds more like the goal for a department store rather than a media company to me!

We have already completed part of the transformation. Look at banks that are encountering these challenges for the first time. Can you imagine what they will look like in ten years?

Autor: Andreas Schmitz ǀ 31. August 2017 ǀ München Ismaning

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Andreas Schmitz

About the Author

Andreas Schmitz

Journalist Corporate Media in Munich, many years of experience with publishing houses and agencies. Focus on storytelling and content marketing in the field of corporate media. Special affinity with technical and scientific subjects. Member of the founding editorial department of the management magazine CIO, former chief editor of the corporate portal SAP.info, development of various electronic magazines and online media