Sanoma touches the lives of millions of people in the Netherlands, Finland, Belgium, Poland and Sweden every day.
From the newspaper reader who accesses the world through our investigative reporting, to the young woman inspired by the world of beauty and styling at her fingertips through sites like FashionChick; from the advertiser who is able to reach an audience of targeted individuals with similar interests, to the little boy who masters arithmetic through one of our learning products.
One of the reasons I’m very excited to be part of Sanoma is this impact we have on the lives of our consumers and business customers. Consumers trust us and are loyal to our strong local brands, through which they acquire knowledge, are entertained and connect with others in like-minded communities. Our business customers benefit from our local expertise and our relationships with our consumers, which creates a wealth of opportunities for them. In order to deliver on this, a total focus on the customer is to be at the very heart of our company.
Our misson is to engage people with content that inspires, informs, entertains and educates – when, where and how they want it.
In media, we need to understand that the demands of our consumers will continue to change, fundamentally impacting previously solid business models. New business models will arise that are more complex and require different skills. Still the principles remain the same in that we provide quality information and entertainment for our consumers and that advertisers are interested in interacting and doing business with the audiences that we reach in this way.
New media formats enable increasing personalisation of both content and advertising, which creates an ever-improving cycle. As we learn more about consumers’ preferences, we learn to serve them with more relevant content. This requires us to become more agile, data-driven and even more focused on the demands of the consumers – we are going from ‘sending’ to ‘fulfilling the pull of the market demand’.
"New media formats enable increasing personalisation of both content and advertising, which creates an ever-improving cycle"
In Learning, our focus is to enable teachers to maximise each pupil's learning capabilities developing the talents of every child. Sanoma is on top of the game to meet the changing demands of pupils and teachers. We are a market leader in developing cross-media learning solutions that utilises each medium to the fullest extent. We assist the teachers not only in providing more engaging learning materials, but also in ways to reduce their administrative and preparatory work in order to be able to spend more of their time directly interacting with pupils.
The future is cross-media
People often ask me how digitalisation affects our business. They might also say that media and learning companies should embrace ‘digital’ to remain relevant for their audiences.
At Sanoma we are increasingly seeing proof that this strategy works. Whether it’s in home deco in the Netherlands where an SBS TV programme drives sales to a web shop and consumers want to relax with our inspirational magazine vtwonen, or whether it’s in news, where our different assets drive traffic across platforms.
To boost our ability to offer consumers and advertisers a true cross-media offering, we have made adjustments to our organisation in 2015. Sanoma Digital was re-integrated into the businesses to capture synergies, and its online assets are now part of the country-specific media portfolios. This way we can offer advertisers and consumers a full cross-media mix and develop the digital business more quickly and in line with our local strategy.
"To boost our ability to offer consumers and advertisers a true cross-media offering we made adjustments to our organisation in 2015"
At the same time we’ve kept the strength of Sanoma Digital: a shared ‘Big Data’ and digital expertise team remains at the Group level to leverage insights and technologies quickly for the benefit of both Sanoma Media in Finland and the Netherlands/Belgium.
The year at Sanoma Media Finland
Sanoma Media Finland (SMF) had a tough 2015. The Finnish economy suffered from a continued economic downturn, and the media industry was heavily influenced by the prolonged decline in advertising markets and ongoing changes in consumer behaviour.
Pia Kalsta was appointed as CEO of Sanoma Media Finland in February 2015 to lead the turnaround of SMF. In the third quarter of the year SMF initiated a company-wide reorganisation to innovate processes and ways of working as one of the turning points on the way towards profitability and a future-proof media business. Unfortunately, we had to let 200 employees go during the process. This is always difficult and has definitely tested the flexibility of the company, but at the same time it made SMF more efficient and agile. As a result, we see new energy, a strong resolution and new opportunities as well.
On a general business level, online and mobile sales continued their steady rise – with non-print media sales already amounting to 38% of all Sanoma Media Finland sales. In total, our advertising sales also grew year-on-year in the fourth quarter. This was a formidable achievement, given the difficult advertising and business climate. As a result of the team’s hard work, both in saving costs as well as in developing our business, Sanoma Media Finland’s profitability level improved in the second half of the year, while there is still significant room for further improvement.
The year at Sanoma Media BeNe
The strongest proof that our cross-media strategy is working comes from the Netherlands and Belgium where the change process was implemented two years ago with the entry of Peter de Mönnink as CEO to the business. With our magazine portfolio rationalisation completed, 2015 was a year in which we’ were able to demonstrate the benefits of a cross-media approach for both consumers and advertisers. The increased co-operation with SBS Broadcasting, in which we hold a 66.67% majority stake, was key to this positive development.
"2015 was a year in which we were able to demonstrate the benefits of a cross-media approach for both consumer and advertiser"
In addition to stabilising like-for-like net sales, and even organic growth in the fourth quarter supported by strong online and mobile sales, there are impressive examples on a product level of what a cross-media approach can bring.
vtwonen is one of the five case studies we are showcasing in this edition of ‘Sanoma View’, It is one of the strongest home deco brands in the Netherlands. This originally print magazine has expanded with a number of extensions like to branded paint and cutlery, among others. A true cross-media breakthrough came when we introduced vtwonen TV programmes on SBS and transformed the vtwonen website into a home deco web shop. The pieces of the puzzle came together and the different vtwonen media channels started to reinforce each other. The original magazine title has become a true brand. Programme sponsors had trouble keeping up with rocketing demand as TV viewers went online to buy the products they saw showcased on TV. And that, in turn, led to an improvement of the magazine’s print circulation by as much as 30% year-on-year. And not stopping there, the vtwonen rebranded home deco and design fair drew a record attendance last autumn.
My final example is SBS Broadcasting. The company managed to grow its market share in the relevant target audience from 20 to 21.2%; an excellent performance given the general decrease in free-to-air television viewing. SBS’s main channel, SBS6, was the fastest growing TV channel in 2015. But even more promising than the very important ratings improvement is the fact that we see our media assets coming together. We acquired both the free-to-air as well as the online rights to air Champions League football in 2015. On television, this boosted SBS6’s ratings. And online, it drove traffic to our news site NU.nl. As in other cross-media examples, all formats support each other: live TV coverage happens on the main channel and viewers can get extra insights from statistics, interviews, and summaries online, logging in with their Sanoma Accounts. The number of Sanoma Account subscribers who signed up through NU.nl alone grew from zero to 200,000 in just a few months. People use their accounts to log onto all digital Sanoma properties to access additional content and tailored advertising. It proves that a cross-media approach works.
The year at Sanoma Learning
Sanoma Learning is a leader in digital/multichannel learning, combining the best of print and digital to maximise the learning impact. Half of our net sales contains a digital component. Our efforts to develop cross-country hybrid and digital learning solutions are really paying off. In 2015 Sanoma Learning saw a mixed picture. We made good progress on the digital transformation in our Western European markets, showing increases in digital sales and usage in each market. In Poland Nowa Era was impacted by changes in the regulatory environment. However, the team was successful in implementing counteractive measures to tackle these challenges and was able to gain share and grow its revenue. Restructuring our international unit YDP in Poland negatively impacted sales and the profitability of Learning.
We’ve also developed Sanoma Learning's Impact Framework to measure the benefits our solutions bring to our customers. Through this Impact Framework, we learned that 95% of teachers reported that our materials help them in enabling pupils to achieve their learning goals. Eighty five percent of teachers reported that our methods help them with engaging pupils with learning. Teachers typically save about eight hours of working time each week by using a solution developed by Sanoma Learning. We’re proud of these outcomes, which once again demonstrate the value our offerings bring to our customers.
John Martin, our CEO Sanoma Learning, tells more about the developments at Learning in this video.
Moving into 2016
2015 was a challenging year, but as a result of some tough choices made and innovations in the way we work, Sanoma has begun 2016 more agile and focused.
We consist of three strong and relatively independent Strategic Business Units: Sanoma Media Finland, Sanoma Media BeNe and Sanoma Learning, that are organised in a way that ensures they are as close to the markets they serve as possible. This gives them all the room they need to focus on their customers, while still benefiting from certain Group-wide support functions such as Technology and Data & Analytics.