WAN-IFRA just released a report—Digital Transformation at Aller Media Finland—that looks into the successful transformation of a legacy print publisher into a diversified business group.
The publisher, Aller Media Finland, is a part of the Aller Media Group that was founded in 1873. Through most of its existence, Aller Media Finland has been a publisher of weekly and monthly magazines.
Since the beginning of the decade, the company saw a steady decline in revenue from subscriptions and newsstand sales. This was due to consumers moving to digital media outlets and social media platforms.
This prompted the publisher to pivot to digital, and explore new business opportunities. It deployed a two-pronged strategy: reactive (short-term turnaround) and proactive (invest for future growth).
“Act before circumstances force us to do so”
The reactive strategy included discontinuing unprofitable print products and moving onto digital publishing platforms. The company also sold all of its monthly magazines even though they were profitable at the time.
Aller Media’s Director of Media Business Elina Schüller says, “We wanted to act before we were forced to make other drastic changes. All of those magazines were still profitable, but we saw that they didn’t have a long future, and within the next couple of years some of them wouldn’t be profitable anymore.”
At Aller, we prefer to act before circumstances force us to do so. So we sold them and got a reasonable price, instead of waiting two or three years and getting much less.Elina Schüller, Director of Media Business, Aller Media Finland
The sales were also undertaken to raise funds that could be invested in the publisher’s digital transformation.
The digital transformation of Aller Media began with converting content created for print products and distributing them electronically. The content was enhanced with multimedia and interactive features, and shared on social media.
The next step involved replacing the print-centric systems for generating, processing and distributing content. This was done by creating a centralized design team called the Design Desk.
It comprises all the art directors and graphic designers in the company, who had earlier been assigned to individual print products. The move reduced duplication of effort and ensured availability of designer resources for all products, since the team could allocate tasks according to their level of priority.
The biggest change was the implementation of a Content Management System (CMS). The new platform enabled employees to use a single interface for creating and publishing content, independent of the platform on which it was to be distributed.
Aller Media continues to own and print two weekly magazines: Seiska, an entertainment magazine and Katso, a TV program guide. According to the report, together they have 1.6M readers.
The diagram below illustrates Aller Media Finland’s transformation in brief. It does not necessarily reflect the sequence in which the various measures were taken.
“We needed to look five years down the road”
Aller’s proactive strategy was aimed at ensuring long-term growth by expanding into completely new areas. It allowed the company to move beyond its core business and enter new markets.
We needed to look five years down the road, to see where we were going and prepare for that.Elina Schüller, Director of Media Business, Aller Media Finland
The publisher took its first step in this direction with the acquisition of Suomi24 in 2010. It is Finland’s largest online community and offers dating, discussion forums, chat and email.
Suomi24 has nearly 2M registered users (Finland’s total population is 5.5M). It has more than 3M visitors each month, posting 6M messages annually – 16,500 posts every day. The data collected contains invaluable insights into the online behavior of a substantial percentage of Finland’s populace.
The acquisition helped Aller gain a leading position in data-driven advertising and create new businesses. Using smarter data, the company has:
- found a way to serve its readers better with more personalized content,
- created more value for advertisers, and
- developed new offerings outside its core business.
The data enables more effective marketing, since messages can be communicated at the right time and via the right channel. Those data skills are one reason our weeklies [magazines] are doing extremely well – we have an excellent understanding of our readers’ behavior.Pauli Aalto-Setälä, CEO, Aller Media Finland
In 2017, the publisher spun its data operations off into a newly formed subsidiary called Data Refinery. The division aims to attract corporate customers, both in Finland and abroad, who want to commercialize their data for sales, and develop their existing business with data.
First we commercialized our own data with good results, and now we are providing this service to others.Laura Avonius, VP, Innovation & Internationalisation at Data Refinery
The company has been learning from data and developing tools for better analysis. Its media sales team’s offerings have evolved from print-only to online ads such as banners and other display ads as well as programmatic, rich media, pre-targeting, re-targeting and customized solutions.
Aller Media Finland has also created another service unit, Aller Ideas, to serve other businesses with their content strategies. The publisher leverages its journalistic expertise and data to provide relevant solutions.
One of Aller Ideas’ primary goals is to become the leading social media services provider to businesses. To achieve that, Aller acquired Finnish marketing communications agency Dingle, which specializes in social media services for companies.
Aalto-Setälä said at the time, “We have already differentiated ourselves by owning Finland’s biggest online community, Suomi24, in addition to our magazine brands. Through this acquisition, we will expand our expertise to all other aspects of social media, and we will help companies better serve their customers online.”
“Turned the revenue graph into a ‘hockey stick’ form”
Anton Jolkovski, Managing Editor at WAN-IFRA comments, Aller Media Finland “has undergone a remarkable transformation in about seven years’ time.” Today 40% of its revenues come from digital operations.
According to the report, Aller Media is the leading publisher of magazines and newspapers in the Nordic region, with a total weekly circulation of 2.7M issues. In 2017-18 the group revenue was 4.542B Danish krone (about 608M euros at today’s exchange rate).
We haven’t stared at the statistics, because we know the numbers don’t mean money. But we have turned the revenue graph into a ‘hockey stick’ form, and it has continued to rise for many months rather than peaking and then declining.Elina Schüller, Director of Media Business Aller Media Finland
Aalto-Setälä commented, “We have transformed ourselves from a magazine company to a diversified business group with a data agency and marketing companies, but we are still in the media business with our weekly magazines. So we are quite different than we were seven years ago when we started this transformation.”
He added, “In five to 10 years, I strongly believe we will have even more digital platforms. The overall trend is toward platforms and technology, and we are building more meeting points where people can connect and be informed and entertained. I believe in a platform-based scenario for the future of our company.”
Download the full report from WAN-INFRA:
Digital Transformation at Aller Media Finland