Our portfolio company NetMediaEurope didn’t always see things this clearly. In the throes of the post-Lehman media recession, which witnessed plummeting banner ad revenues for B2B media websites globally, NME seriously considered extending its tentacles into the B2C content sector.
The idea seemed attractive to the board at the time. With its pan-European footprint of titles like ITEspresso, Silicon, and The Inquirer, the company found itself exposed on multiple fronts: first, B2B technology ad budgets had been slashed by all large tech companies; but moreover, NME’s core markets of France, Germany, Spain, and Italy were all entering recession.
On digital content’s B2C side, things weren’t nearly as dire. Although CPMs were experiencing downward pressure, the diversity of audience and thus advertising base enabled quality consumer-facing websites like CommentCaMarche.com to remain sheltered from the downturn in corporate ad spending. The siren’s call of relative ad revenue stability on the consumer side was challenging to resist, especially when financial investors become alarmed at the impact on the bottom line short-term. Something had to be done !
But to the management team’s credit, they held their ground. Actually, they doubled-down. At the 2009 low point for B2B digital media, NME opened a UK presence. Even more crucially at the time, the company began brainstorming on how to diversify its revenue base while best leveraging its valuable audience of corporate IT decison-makers, such as expanding into lead generation. I won’t elaborate on the details because the story is still being written. But in hindsight it looks as though those difficult decisions at the nadir of the global financial crisis proved genius.
Charlie McCurdy, CEO of Apprise Media reinforced some of these choices in his excellent presentation at American Business Media’s Advanced Leadership Program on The Future of B2B Media. “Marketers are probably not buying banners or sponsorships for the media exposure, they want to drive leads to their websites. If white papers or Google AdSense deliver, they’ll do that instead.” In terms of b-to-b marketing share, ABM attendees forecast that live events would grow from 45.1% in 2011 to 48.4% in 2016; digital would grow from 12.8% in 2011 to 18.2% in 2016; and print would fall from 29.2% in 2011 to 11.7% in 2016.
In late 2010, NME witnessed a return of the banner ad budgets from corporates, but makes no secret of its appreciation of the importance of a diverse offer for this core client base, nor of the importance of scale. The company recently acquired the German subsidiary of CBS Interactive, and is on the hunt for additional acquisitions in Britain and France.
Nowadays it’s very fashionable in startup parlance to talk about strategic ‘pivots’. Indeed, the accelerating pace of innovation in technology often creates an environment where only those startups capable of redirecting their strategy on a dime can avoid obsolesence. But if there’s a moral to this story, it’s that there are no easy answers. Sometimes a ‘pivot’ is needed. Sometimes it’s better to scrap everything and restart with a blank sheet of paper. And yet sometimes, the old-fashioned wisdom of ‘sticking to your knitting’ prevails.

