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Kommersant CEO on diversifying media portfolio in Russia

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Kommersant CEO on diversifying media portfolio in Russia

Article ID:

13667

To hear Damian Kudriavstev describe Kommersant Publishing House’s journey from a print-centric publisher to a prominent multimedia provider in Russia, he makes it all sound so logical, almost simple. But as any publisher knows, the work on such a transformation is never done and never easy.

Damian Kudriavstev

Since October of 2006, when he took over as CEO, Kudriavstev has accelerated and diversified Kommersant’s activities, starting with going full-colour with its flagship business daily newspaper, launching new magazines, websites and an FM radio station, and in September it will hit the airwaves with a new TV news channel.

Interestingly, Kudriavstev says all these moves were not necessarily about finding a new audience – if that happens, great – but more about satisfying the needs of his loyal audience and readership and extending the Kommersant brand.

Kudriavstev will join an international panel of speakers at the 63rd World Newspaper Congress in Vienna (12-15 October) to share his company’s strategy in a session dedicated to Repositioning.

WAN-IFRA: Under your direction, Kommersant has diversified its activities into a number of areas, particularly online, TV, radio, etc. How did you pave this path to become a multimedia operation?

Kudriavtsev: My background is more in Internet as I was part of one of the first ISPs (Internet Service Provider) in Russia. And I remember when we first started that company and people wanted to connect, the first question they asked was: “Why should I connect with you, do you offer good content – in Russian?” That was funny. So from that response, we decided to establish a true content company to go with our sister ISP. I mean back then people wanted to know that something was there if they were willing to pay for this connection. And even today, Russians are not really willing to pay for content, so it was very unpredictable back in 1996.

Enters Kommersant… they had a very strong position in traditional content, in print. The company had a good reputation, especially in the mid-’90s, as being very influential with its content. But by the mid-2000s, it was starting to be considered a bit old-fashioned. And this is why the shareholders put me in the position to drive some innovation on that front.

So we started to change the content on the traditional platforms, not on digital at the outset. We moved the newspaper from purely black and white to more colour, which also changed and improved our relationship with advertisers.

A second step was to change our line of magazines because we had titles covering finance, politics, the Kommersant newspaper, but our audience doesn’t have only interests for business and politics, they also like style and travel and the like. So we added some travel, shopping and glamour magazines for the same audience. Not to extend the audience necessarily, but to cover their other interests. They believed in Kommersant when it just covered politics and business, and now they believe in it for these other topics.

After that, we had a strategy meeting where I announced this new idea: that we will cover all of our audience’s interests and needs. We will not focus primarily on new audiences but covering the needs of our audience. For example, politics in the newspaper, economics in magazines, glamour and life in another magazine.

But – and here is a third step – when they are in a car driving … in Moscow, we have terrible traffic. They, of course, are not reading our publications during this time, but we don’t want them to forget about us, so we said, ‘let’s do radio.’ By doing this, we are offering continuous publishing as radio is online all the time. And if we can do this well, then we can surely do an online news site. We had a website that featured articles from the newspaper, but we thought if we had a website where we could do news all the time, then we can convert our newspaper site to a continuous news site. So we created one… that was a fourth step.

And after this we started to realise that we produce so much content that is already multimedia, with audio, video, blogs, internet, which is interactive, we then said, ‘why not create a TV channel?’ We know we have the contacts, a lot of known people, topics to cover, a lot of visual talent and we have people who have many connections to newsmakers, so we just add news packages and move them to TV. That’s a simplified explanation, but we will launch a news channel in September that will target the same audience we have been attracting for the last 20 years.

WAN-IFRA: But what were some of the issues you faced, or challenges others might face in trying to launch, for example, a radio station if you are newspaper publisher?

Kudriavtsev: First of all, there is the issue of brand. Our brand was rooted in print for sure, but we want to, of course, extend our brand in all things we do. In radio, obviously, you cannot read articles, but the same emotion and intonation that is associated with those stories has to come across in the different media, but of course in different ways. And if you fail, people will leave you. The same goes in print. There was this great economics website in Russia that launched a newspaper, but people were disappointed in the newspaper and they ended up not visiting the website anymore. When we launched our radio station, we had to find the right people for that medium. When we hire people to work at the newspaper, we try to instill into them the Kommersant agenda, who we are, and it was equally important to do the same for radio.

Secondly, people who advertise on radio are much different from those who might advertise in print, using different agencies, ones we have never worked with in the past. So we had to educate, if you will, these companies about Kommersant. Most advertisers know that Kommersant is the most important newspaper in the country, but people in radio don’t care about that. ‘If you want my advertsing, show me that you know how radio works!’

And the final thing is another monetary metric system… we know how to calculate and distribute newspapers, but in radio we need ratings and ratings is a completely different thing. With all that said, I think we have handled all these problems pretty well. We are already one year on radio and I think we are doing well, but not well enough. We are not earning much money yet, but we are already at break-even. So we are optimistic about the future there.

WAN-IFRA: How are the editorial teams organised? One for each medium? Integrated? And the same for advertising?

Kudriavtsev: We have a separate division called Synergy, whose main task is to run between all the separate editorial teams to work on cross projects. I am not talking about cross promotion, I am talking about cross projects. So they use some staff from different divisions to produce some content for specific projects but they actually pay them additional money. Journalists must work for different divisions, but they are paid for that separate work.

As for advertising, we sell for each medium but we have close links between them.

WAN-IFRA: How has your digital background helped in this diversification strategy?

Kudriavtsev: I admit it has been a bit of a challenge for me because you print something that cannot be corrected, so tomorrow it is already done. But it was also a big challenge for our editorial team, for example, to write articles not just for tomorrow but on a continuous basis as I was pushing them hard to do so. But we didn’t try to do this overnight, we did this over time. And I think today we have a mutual understanding of what we need to do.

WAN-IFRA: Today media companies face increasing pressure to enter new markets, some that require entry quite quickly. How does market research fit into this environment?

Kudriavtsev: It’s very important, but it’s not decisively important. Nobody who did market research in 2006 would have told Mark Zuckerberg to do facebook because MySpace and Friendster were already thriving on the market. Of course you need to do market research, but you need to have a belief and a vision, and to be in harmony with your own people and shareholders. Then you can launch. Typically in Russia, marketing is always one step behind. If you would have asked the people here in 1989 if they liked the Soviet Union, 75 percent would have said yes. In the ‘90s, it no longer existed. Before the free market came, it would have made no sense to do marketing about Roquefort cheese because nobody tried it. But if you truly believe that people will try it, there is a good chance it will be on the shelves. That means that marketing needs not only a vision, but also education, explanation and a huge advertising effort. … at least in this country.

Author

Dean Roper's picture

Dean Roper

Date

2011-08-08 16:54

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