Sanoma: business growth through new revenue models

Interview with Rob Kolkman, CEO at Sanoma Media Netherlands since 1 January 2019. Before joining Sanoma, Rob Kolkman held senior management positions at Reed Business Information (RBI), part of RELX Group.

Sanoma has a solid position when it comes to reaching a sizeable part of the Dutch population through its cross-media brands, and news platform NU.nl. Although existing revenue models are still viable, Sanoma is constantly looking for sustainable revenue models to increase monetization and reach further growth. New revenue models include e-commerce activities, paid online content, and data propositions. To complement its business and support its growth strategy, Sanoma actively pursues acquisitions and partnerships.

Sanoma’s NU.nl has been a successful fully ad-based and paywall-free news platform for the past twenty years. NU.nl saw a record number of 8.3 million unique visitors in July 2019 and together with Sanoma’s other brands such as women’s magazine Libelle, Sanoma reaches about eighty percent of the Dutch population each month. Kolkman: “The growing number of unique visitors and pageviews of NU.nl still guarantee a high degree of profitability and our revenue model around advertising, programmatic in particular, still leaves room for growth in the coming years. With the uncertainty in the complex advertising ecosystem, direct monetization models in which users pay for content are increasingly becoming an option.”

Target specific audiences on NU.nl

Fifty thousand visitors of NU.nl play a Formula 1 game, for which they log in by sharing some personal data. “Our Formula 1 game is an example of how we can target specific audiences within the immense reach of NU.nl. A login model brings in relevant data and makes our advertising proposition more interesting. Although I see NU.nl as a ‘free’ platform, we are looking for ways to stimulate conversion. The challenge is to convert specific target groups on NU.nl into a purchaser of content or products for both ourselves as well for our partners. This is still in an experimental phase, but it’s not rocket science: either the user has to pay or the advertiser.”

Curated news and news alerts

While newspapers have been cutting back on their editorial staff in the past ten years, NU.nl has expanded significantly in this respect. Kolkman: “Our editorial staff decides which news stories will be published on NU.nl. Besides the news items we think everyone should read, NU.nl improves user experience by filtering news items that match the profiles of individual users. If your smartphone settings allow it, NU.nl news items change depending on your location. Yet, our editorial staff is very aware of issues around filter bubbles, so we keep offering our readers content that surprises them and broadens their view.”

“Our news alerts to which people can subscribe, make sure people can really focus on their fields of interest, which improves user experience. The big challenge is to find out what makes people decide to log into NU.nl in order to see specific content or what they would be willing to pay for content. Sixty-five percent of our users visit NU.nl through our app, which opens up possibilities for further personalization and accompanying revenue models.”

Videos and podcasts

NU.nl increasingly publishes videos and podcasts, but finding suitable revenue models for these is also a challenge. “Do you add commercials or use a sponsored-by model?”, Kolkman asks himself. “Making videos is expensive and requires new capabilities, which is why they are often produced in partnerships. We make videos of sports events in-house, since these attract a substantial audience, but videos for niche audiences would not be profitable. To get round this, you could for instance make a video for a magazine like AutoWeek and make sure it is suitable for a broader public on NU.nl. Our editorial teams are constantly experimenting with this. Creativity and a passion for media characterize our organization.”

Sanoma’s brands reinforce each other

Each month Sanoma reaches eighty percent of the Dutch population in the age group of thirteen and older. Not only with NU.nl but also with a long-established magazine title like Libelle, which has a reach of four million people, over two million in print and another 2 million online. Sanoma’s portfolio now consists of about thirty titles within a number of clusters, such as women’s magazines (e.g. Libelle and Margriet), kids (e.g. Donald Duck and Tina), parenting (e.g. Ouders van Nu), living (e.g. vtwonen) and automotive (e.g. AutoWeek). 

Kolkman: “We keep looking for possibilities to let our brands strengthen each other. Ouders van Nu reaches eighty to ninety percent of all young parents in the Netherlands. This is a specific target group and we are looking for ways to link this magazine to other (cross-media) brands for example. Another example is the content from AutoWeek we publish on NU.nl. AutoWeek offers specialized content for true car enthusiasts and we are now learning how to make this content suitable for a broader public.”

Libelle attracts younger generations

The development of Libelle’s readership in this digital age is very promising. The print version of Libelle focuses more on traditional readers of print content, while a substantial part of the online readers belong to younger age groups. Kolkman: “A joint interest in the same subjects is what draws different age groups to Libelle. We try to tailor our content accordingly. For instance, the mother of the famous Dutch vlogger Enzo Knol started a weekly vlog on Libelle TV. The monetisation models for the print version are of course subscription fees and advertising, but for online it is only advertising. Online Libelle readers are already a specific target group, but further personalisation is key when looking for new revenue models in the online domain.”

Tijdschrift.nl: all-you-can-eat model

Sanoma is experimenting to see if people are willing to pay for online magazine content, for instance by linking NU.nl and Tijdschrift.nl. Tijdschrift.nl is an app that contains seventy-five magazines for a relatively low monthly subscription fee. Subscribers can search these magazines for articles within their area of interest or download a complete magazine. Kolkman: “The number of subscriptions to Tijdschrift.nl is growing fast, which is partly a result of the fact that people are growing more and more accustomed to paying for online content. Some suggest that there is a limit to the number of online subscriptions, but I’m not sure if there is such a strict upper limit.”

Subscribers to Tijdschrift.nl pay less if they already have a print subscription. Kolkman: “This model works and offers added value to our readers. Tijdschrift.nl is an all-you-can-eat model, but I think such models may become more specific in the future. I’m thinking of consumers who make their own selection of magazines and pay a monthly subscription fee.”

Biggest online research panel

Sanoma acquired a majority share in Panel Inzicht, which is one of the biggest online research panels in the Netherlands. Through insights of consumer panels, brands can improve the connection with consumers. Kolkman: “This supplements the data insights Sanoma already gains through its cross-media brands. With the substantial audience reach we have, we can perform online quantitative research for advertisers. We are for instance looking at ways to connect Panel Inzicht to Libelle and NU.nl for relevant market research. Readers voluntarily decide if they fill in a survey, so privacy is less of an issue here. The audience we reach on Libelle.nl and NU.nl linked to Panel Inzicht will create a potential for growth acceleration.”

Cashback platform Scoupy 

Another of Sanoma’s new revenue models is action-marketing, or so called cashback, platform Scoupy. Scoupy generates useful consumer insights by bringing together consumers, manufacturers and retailers on a platform where consumers can for instance try new products free of charge or get product discounts. Kolkman: “This is a good example of finding an alternative way of reaching consumers, building a relationship with them and generating new data. This data supplements the consumer data provided by supermarkets. Scoupy, Panel Inzicht and NU.nl have a wealth of data at their disposal and Sanoma as a whole offers the necessary cross section of the Dutch population.”

Interact with people through media content

Instead of owning and retaining all consumer data, Kolkman believes in Sanoma’s role as an enabler that shares data with clients or partners in order for these brands to be able to build their databases. “We have to trust in our position in the market. Through our media content, we interact with people and are part of their daily routine. Consumers come to us for inspiration, information, and to be part of a community. They don’t visit company websites of different brands on a daily basis, but they do go to NU.nl every day to read the latest news or to Libelle.nl to be inspired and entertained.”

Partnerships in e-commerce

“It is our mission to make online visits to Sanoma’s brands relevant for consumers,” says Kolkman. “E-commerce is a way to attain this relevance. For instance, we have an e-commerce shop linked to vtwonen for which Fonq does the handling and distribution. So we looked for a partner with the right expertise in the market and set up a sustainable model that fits in with the expectations of our readers, both online and in print. People visit the vtwonen site at certain moments in their lives, for instance when they’ve just bought a house or have plans to renovate.” 

Another revenue model for Sanoma is the travel market. Kolkman: “For many years, we have been organizing package holidays for our readers. This has always been very successful, but now we are looking for partners in the travel market, who can use our audience reach as an extra sales channel with promising conversion rates. I see possibilities for such partnerships in the market.”

Online betting industry

The betting industry is a potential growth market and liberalization of this market in the Netherlands as of 1 January 2021 will open up new opportunities for Sanoma, according to Kolkman. “A lot of online gambling that was previously illegal in the Netherlands, such as online casinos, will become legal. Sanoma does not intend to apply for a license, but we are doing research to see what our role can be in this new market, within the boundaries of our company’s purpose and values. We will determine our position and for instance look into possibilities for partnerships in this market. We are proactive, since we can’t afford to just wait and do nothing.”

Follow us
Hide