Net Results

For some time, business-to-business publishers have been taking stock of their brands and positioning themselves as content providers on the Internet. This process is set to gather speed as publishers roll out their brand franchising online and develop into new areas.

The Periodical Publishers Association (PPA) has prepared for this by setting up its interactive wing, PPA Interactive, last year. Julian Treasure, chairman of PPA Interactive and of contract publisher TPD, says: “We are taking a lead in trying to help publishers make the most of the Web.

“In terms of business to business, we have seen some of the big publishers make a very impressive start. Publishers come from a position of strength, with established brands and well-defined relationships with their readers, and they can leverage that strength by building powerful online presences.”

Charles Newman, senior partner of e-publishing consultants MMP, says developments in the US represent major threats to business-to-business publishers in the UK.

“The biggest threat is to smaller publishers, who may be very strong in their field but haven’t got the infrastructure or the deep pockets to cope with the US onslaught. Specialist business-to-business publishers in the UK do not have the resources to respond.

“The large organisations which do respond have to restructure significantly to put together anything effective. VerticalNet, which creates business-to-business communities on the Internet, is the biggest example of the threat, having recently announced a European joint venture with BT. Even the largest specialist business-to-business publisher will struggle to meet that commitment.”

However, Newman sees chinks in the armour of such massive players as VerticalNet. “The strengths of the existing business-to-business publishers are the weaknesses of their online counterparts. The digital publishers are weak on content, and have high marketing costs. Business-to-business publishers, meanwhile, have deep roots in the sector and an already established marketing platform.”

The development of magazine brands on the Internet is probably the biggest area of growth for publishers at the moment, claims PPA chief executive Ian Locks.

He says: “All of the major and most of the minor players are developing various interactive products. The challenge is to do it before someone else takes away your market. Business publishers are ideally placed to hold on to their markets. They have long histories with strong brands, and excellent contacts in the niche markets.”

EMAP Business Communications claims it was the first business-to-business company in the UK to develop an integrated client-oriented approach.

EMAP Business Communications chief executive Derek Carter says: “We see our markets through the eyes of our customers, and market focus and brand extensions are second nature to us. Our growth into an e-commerce environment is a logical development of our existing strategy. Our digital strategy, which is clearly defined, has seen us make significant launches.”

Examples of EMAP’s online products include Produxion.com, a joint venture with Channel 5 and e-commerce solutions provider Netdecisions, which builds on the market position provided by Broadcast magazine and is designed to facilitate the commissioning of TV productions. In the medical sector, Nursingtimes.net and HSJ.co.uk, the Health Service Journal Website, offer a broad range of recruitment, clinical and training information.

Reed Business Information (RBI) chief executive Keith Jones points out that business-to-business publishers in the UK have been successfully producing content-driven services using the Internet for at least three years.

“At RBI, we have been building on the brands, content, market platforms and customer relationships we have developed as hard copy publishers,” says Jones.

Among the RBI titles that have established presences in the dot-com arena are Air Transport Intelligence, Estates Gazette, New Scientist and ComputerWeekly. The latest challenge, says Jones, is to create totally new services, not just offshoots of printed products.

“These services must exploit the potential of electronic media. They should build on existing strengths of brand, content and customer but add new dimensions in concept, scale and functionality.”

New demands

Claire Butcher, media director of business-to-business consultancy Primary Contact, says online publishers are responding to the new demands of the medium, and many are rethinking their original Internet launches.

“During the early days of Internet publishing, many people put up Websites which reflected the content of their publications. Now they’ve realised Websites need to provide a service for their readers which the publications don’t – for example, providing archives of important data and information on suppliers. They need to be working tools. Readers don’t want a repeat of news stories they’ve already read in the printed version.”

It does not seem long since the first wave of Internet technology, when some media analysts thought that established distributors of information would be seriously threatened by newcomers using increasingly user-friendly and powerful software. However, the widely predicted process of disintermediation has not occurred, says PPA Interactive’s Treasure.

“You still need professional content engines and editors who understand the target audience and anticipate the needs of the reader base. It’s a question of moving that expertise into the interactive medium and understanding its values. That’s a lot easier for a publisher to do than it is for somebody who only understands the technology.”

Treasure expects publishers to take full advantage of the revenue-generating possibilities exclusive to the online medium.

“You can become part of the commercial lifeblood of the industry you’re in and take a cut of the transactions you facilitate. That is a huge new revenue stream for publishers; we’ve seen that in the consumer area already, with magazines such as Q, which used to be just a magazine and is now an online music retailer. There is no reason why business-to-business magazines can’t do the same thing.

“Business to business is forecast to be the largest user of e-commerce in the next five years and the magazines that contribute to that growth should be able to take a royalty on making people’s lives easier.”

An issue facing business-to-business publishers is how to balance free content with that which is available only to subscribers. The PPA’s Locks is unequivocal on this point. “I subscribe to the view that there is no such thing as a free lunch. There’s either not much of a lunch or it’s not free.”

Primary Contact’s Butcher says online publications which launched as subscription titles are under pressure to revert to free content.

“The Economist started out offering a paid subscription service. It’s questionable, however, whether it is going to be able to keep that going forever, with other publications such as the FT being offered free. The Economist is already showing signs of climbing down by offering its print subscribers free access to their online product.”

Building subscriber base

RBI’s Jones says if publishers are to keep their loyal subscribers and reel in more through their new brand profiles, they cannot afford to be passive in the new electronic markets.

“Publishers have the potential to create trading platforms in the markets they serve. The rapid advances in mobile communications will give business-to-business publishers the opportunity to occupy either a much greater part of their customers’ lives.”

Treasure asserts that no publisher can afford to be complacent. “The development of brand franchising on the Internet must be done quickly, but it is never a matter of merely slinging printed magazines onto the Web. An online presence needs to aim for community building and enhanced interaction with readers. Features such as ‘who’s who’ facilities and bulletin boards make a site live and breathe on a daily basis.

“Ideally, your site should be the first thing people log into, while your online magazine should offer a real time and business critical service which is indispensable to readers.”