HOW DIGITISATION TRANSFORMS A REGIONAL PUBLISHER

O c t o b e r 1 2 t h , 2 0 1 7 i n B e r l i n

SCHWÄBISCHE ZEITUNG | largest daily in BW (IVW II/17: 165.373 sold copies)

2

22 Editions ca. 8.500 km², ¼ of the area of Baden-Württemberg North - South 170 km East - West 115 km Appr. 1,3 Mio. people living in the area

CEO: Dr. Kurt Sabathil appr. 900 Employees

Central Services Finance/Controlling Human Resources

Information Technology

Print

Logistic

Digital

TV / Radio

Services

22 Dailies 165.373 copies/day (IVW II/17)

Postal Services appr. 100.000 letters/day

schwäbische.de

Regio TV Stuttgart

Dialog Plus Callcenter

Weekly for non subscription household 213.000 copies on Saturday

Merkuria Logistic

maerkte.schwäbische.de

60% Regio TV Ulm

Networx Crossmedia Agency

14 Weeklies 544.000 copies

Merkuria Distribution 5.300 Part-Time Employees

südfinder.de

Regio TV Bodensee

bitzilla Digital Agency

60 Community Papers 147.000 copies/week

50% Agency Frey Leaflet Distribution

startbahnsüd.de

Radio Neckaralb Live Reutlingen/Tübingen

CONTUR Corporate Publishing

10 Magazines 288.000 copies

50% Schneider Directmarketing Leaflet Distribution

bodensee.de

44% Radio 7

Schwäbisch Media Academy Human Resource

development/consulting

33% Nordkurier 71.007 copies/day (IVW II/17)

Weeklies 230.590 copies

Investments/Cooperations - kimeta - fupa.net

25%

Radio Seefunk 50% Printeries

Ulm, Weingarten 3,3 Mio. copies/week

ORGANIZATION CHART

THE DIGITAL REVOLUTION

LINEAR DECREASE OF DATA STORAGE COSTS

12.10.2017 5

EXPONENTIAL GROWTH OF DATA TRANSFER RATES

12.10.2017 6

EXPONENTIAL GROWTH IN COMPUTER POWER

7

ORGANIZATION / ADMINISTRATION D I G I T I S A T I O N I M P A C T

COMPLETE DIGITAL WORKFLOW TROUGHOUT THE COMPANY

9

- Print Production

- Page Make-up

- Radio

- TV

- Online

- Circulation

- Sales

ERP

HR (Cloud)

Finance

Online-Shops

Products

Clients

Suppliers

Employees

TV Production

Production

- Print Planning

Radio Product.

DCX

Online CMS

DMS Archive

DMS Workflow Archives

Order

Invoice

Printers proof

Confirmation

Invoice

ePaper

Order

Digital

Newspaper

Free paper

Leaflets

Magazins

Digital

Mobile

Portals

TV

Radio

Reminder

Salary

Travel Expens.

Vacation

COST AND PROCESS EFFICIENCY

12.10.2017 10

Investment in IT: simple and flexible (to deal with new market requirements)

Standardization and Automation of the work-flow

Lean Management and Continuous Improvement Processes

Self-learning systems and Artificial Intelligence

BUILDUP EDITORIAL AND DIGITAL STAFF

12.10.2017 11

Full Time Employees2016 2008 Variation

Editors Main Edition 32 30 2Editors Local 117 101 16Editors Online 8 0 8Video Journalists 4 0 4Crossmedia Trainees 24 16 8 Sum Editors/Trainees 185 147 38Media Designers 6 0 6Digital Business Unit 29 4 25CDO/Data Analysts /AI (´17) 3 0 3

72

STAFF STRUCTURE | AGE

12.10.2017 12

23,63%

28,65%20,00%

20,23%

6,32% 1,17%

under 20

20-29

30-39

40-49

50-59

over 60

Average age (without temporary personnel): 39,97 years

25 % of our employees < 29 years 50 % of our employees < 38 years

EDITORIAL D I G I T I S A T I O N I M P A C T

06.10.2017 14

New digital products

NEW DIGITAL STORYTELLING

12.10.2017 15

„Our farmers“ editorial serial: Texts, pictures, audios, videos and 360 degree tours Nominated for the prestigious Ernst-Schneider-Preis

NEW DIGITAL SERVICES

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Interactive data-based maps – automatic updated e.g. Storm warnings, Location of the emergency doctors

Area covers emergency doctors Current weather risk

EDITORIAL-DASHBOARD | CHARTBEAT

17

Number of current users

Articles on the decline

Engagement time per user

Where are the users coming from?

Engagement time on the article Articles

on the rise

How does the site perform compared

to a week ago?

DIGITAL SUBSCRIPTION (PAID CONTENT)

12.20.2017 18

digital subscriptions total

media combi additional to print (4,90 € p.m.)

digital premium (22,99 € p.m.)

Digital live (6,99 € p.m.)

REGISTERED USERS | AFTER INSTALLING METERED PAYWALL IN MAY 2014

12.10.2017 19

CIRCULATION DEVELOPEMENT IN PAST 12 YEARS

12.10.2017 20

-24,4% -17,4%

-10,6%

DEUTSCHLAND BADEN-WÜRTTEMBERG SCHWÄBISCHE ZEITUNG

SOLD COPIES IVW II/2017 VS. II/2005

G E R M A N Y

Source: BDZV-Umsatzerhebung

MARKETING D I G I T I S A T I O N I M P A C T

SOCIAL MEDIA FOLLOWER SCHWÄBISCH MEDIA

12.10.2017 22

= 393.486 Follower

f

t

w

s

Facebook 350.794

Twitter 19.813 Whatsapp 18.818

Sonstige 4.061

12.10.2017 23

12.10.2017 24

06.10.2017 25

SALES D I G I T I S A T I O N I M P A C T

CROSSMEDIA RE-ORGANISATION SALES DEPARTMENT

12.10.2017 28

Products

Print Digital TV Magazines Events Newspapers schwäbische.de Regio TV Lifestyle Career Fair

Free papers Epaper/ App Business Real Estate Fair

Community Papers Social Media YouTube.de Health Business Talks

Key Accounts

Events

Travel

Auto

Real Estate

Jobs

Special products

Business

Health

Development of customer fit products Cooperation

Crossmedia Agency NETWORX

Corporate Publishing Agency CONTUR

Crossmedia marketing Real Estate Real Estate

Newspaper Real Estate

Free Paper Real Estate Online

Real Estate Non subscription households

Real Estate Magazine

Real Estate Fair

Real Estate Local TV

SALES-DASHBOARD (CRM-TOOL)

12.10.2017 30

Overview Sales projects

Reminders

Data quality of the customers Sales forecast

current year

Sales per month actual vs.last year

Sales in pipeline Next activities planned/overdue

Soon ending contracts

DIGITAL CLASSIFIED

12.10.2017 31

DIGITAL AGENCY

12.10.2017 32

VIDEO PORTAL FOR TRAINEES

12.10.2017 33

ONLINE-ONLY MAGAZINE | WWW.KATSCHING.DE

12.10.2017 34

DIGITAL EVENT BOOKING PORTAL

12.10.2017 35

AD-REVENUES REGIONAL NEWSPAPERS 2016 VS. 2006

12.10.2017 36

Source: BDZV-Umsatzerhebung

-40,7%

-29,4%

GERMANY SCHWÄBISCHE ZEITUNG

FROM BIG DATA TO SMART DATA

WHAT IST BIG DATA?

12.10.2017 38

Customer / User

BIG DATA ACTIVITIES

12.10.2017 39

IT INFRASTRUCTURE – SOFTWARE ARCHITECTURE

12.10.2017 40

analytical frontend

machine learning libraries & in memory-computing

data sources

etc.

datawarehouse

data storage

all tools are open-source-software!

IT INFRASTRUCTURE – DATA LAKE ARCHITECTURE

12.10.2017 41

Staging-Layer 1:1-image of raw data

Transformation-Layer structuring, feature engineering, data quality

Safety-Layer privacy and data protection issues:

main-datamodel, i. e. de-pseudonymisation (SM_ID…), personal data (names, …), opt-in-management

Integration-Layer integration, archive- and event-tables,

pseudonymisation (SM_ID)

Export-Layer results (tables, scores, …)

PREDICTIVE ANALYSTICS – CHURN MODEL

12.10.2017 42

preparation & exploration data acquisition and integration correlations, cross-tabs feature engineering

modeling & prediction historical information for each

subscription more than 60 features classification algorithm

results & actions proactive customer retention

campaign

Client-ID churn probability

8234567 0,768

8234568 0,135

8234569 0,890

8234570 0,451

… …

subscription duration

complaints complaints

age age age age

≤ 4 years > 4 years

> 2 ≤ 2 ≤ 3 > 3

PREDICTIVE ANALYTICS – EFFICIENT RESOURCE PLANNING FOR SALES AGENTS

06.10.2017 43 06.10.2017

identification of KPIs data acquisition and integration distribution, statistics, … feature engineering

modeling & prediction historical information for each

customer anomaly detection for each

parameter conversion in traffic light score

results & actions warning mechanism for sales

agents more efficient use of resources

client-ID sales performance

4216714

4216714

4216714

… … fre-

quency

volume (mm)

market share

…

12.10.2017

ARTIFICIAL INTELLIGENCE (AI)

Writing Bots (Sports, Financials a.o.)

Chatting Bots (Call Center, Social Media Channels)

Learning Patterns and Predictive Analysis

Automated Personalisation of Content out of database: User should always get his personal, intelligent content where ever he is

12.10.2017

Project: Development of an algorithm to automatically send personally relevant local news and services to individuals based on the profile of their user behaviour

Google grants >100.000 $ for the project

Prototype to be developed by June 2018

End of project in April 2019

12.10.2017 45

NEW BUSINESS FIELDS D I V E R S I F I C A T I O N

PORTFOLIO SCHWÄBISCH MEDIA

12.10.2017 47

Stars

Cash Cows Dogs

?

Market- Growth

Relative Market Share (Profitability)

Schwäbische Zeitung

Free papers Radio7 Community Papers

Nordkurier

Leaflet distribution Mail services

Regio TV

Digital-Subscriptions kimeta

Radio Neckaralb

Magazines

lakeconstance.de CONTUR

südjobs.de

startbahnsüd.de

Digital market place

cinema

Events

HR-Services

Agency services

GROWTH OUTSIDE NEWSPAPER

12.10.2017 48

Newspaper revenues are stable, growth with other activities (Index 2005 = 100)

2005 2016

Other Revenues

Newspaper Ad Revenues

Newspaper CirculationRev.

Reve

nues

43%

44%

13%

100. 31%

26%

43%

125.

DIGITISATION HELPS US TO KEEP FLYING!