2009: The Year Ahead - A time to be brave

With the economic downturn casting a long shadow as 2008 draws to a close, Media Week asked leaders from each sector of media for their advice on how to prosper in the tough climes of 2009.

When even Google is starting to make people redundant, you know there are tough times ahead for the media industry.

We face the most challenging market any of us have known, which means all broadcasters will do as we are doing at Five and start forensically analysing their schedules to extract every last bit of value.

There are also external pressures, both legislative and regulatory, that will determine the health of the television industry in the longer term. Next year will be the year public service broadcasting as we know it will either be safeguarded or screwed. And the industry must determine how it harnesses broadband now that Kangaroo is little more than roadkill in the eyes of the Competition Commission.

Perhaps the iPlayer will be the saviour of us all. Expect broadband to move out of the PC in the study and resolutely onto the TV in the living room. But don't write TV off just yet. Ironically, people will want their telly to entertain them more than ever in these straitened times.

Ashley Tabor
Chief executive Global Group

We are living in unprecedented times, but now that the radio sector is largely in private hands it is better placed to handle the economic uncertainty. We have the freedom to do the right things for our businesses under private ownership, which is very different to some of the short-term decisions that sometimes have to made in the glare of public ownership.

Next year will be a defining time for DAB - as long as we can get the structure and the framework correct. There needs to be a road map and I expect significant decisions to be made very early next year. Two main stumbling blocks remain - how we ensure robust DAB signal on the move and how to get it into cars.

Copyright will be another issue, as the correct balance has yet to be struck between how much we pay the record companies in exchange for how much publicity we give their material. We must also continue to keep the BBC in check and ensure it is honest to its charter and remit.

Stevie Spring
Chief executive Future

Future bucked the trend in 2008. We were up on ads, up on circulation, up more in the second half of the year than the first, and we're pacing ahead for the first quarter of next year.

For 2009, we're hoping for the best and planning for less than the best. Credit crunch, recession and the unknowable effect of the internet on consumer behaviour and trading make us cautious: we're conserving cash, building in flexibility and managing our cost base.

Until banks start lending again to unstressed firms at unstressed rates, the lifeblood of so much of our industry - mergers and acquisitions, research and development and risk capital - is being cut off at source.

So, I'm looking forward to 2009 with the benefit of having taken our medicine early (we restructured two years ago), with the benefit of a loyal customer base in robust host sectors (gaming, music, film and cycling), with nearly half our circulation volume paid in advance (47% on subscription), and with more than 20% of our ad revenue from fast-growing digital products. We may just turn out to be the tallest dwarf in the media sector.

Stephen Allan
Worldwide chairman and chief executive MediaCom

The ink is by no means dry on 2008, as UK plc waits to see the outcome of Christmas spending. For many companies, this last period will determine whether it is a good, average or wipe-out year.

Inevitably, there will be some very relieved corporate buyers, who narrowly (but now thankfully) missed out on acquisitions. Equally, there will be some sellers feeling the opposite - just think of Yahoo.

With total ad revenues falling in 2009, all categories of media will share the pain, with regional newspapers suffering the most and the internet the least.

But even paid search will begin to level off from its prolific growth, although the internet is likely to finally overtake TV to become the largest shareholder of ad revenue. However, television will offer better value than ever and we should also watch out for progress in web TV.

In 2009, uncertainty will make sensible business planning even harder and rising unemployment will weigh down on consumer confidence and spending. Batten down the hatches for a bumpy ride.

Mark Howe
Country sales director Google UK

It's impossible to look forward to 2009 without considering the ramifications of the downturn - the first we have experienced in a truly digital economy.

Marketing budgets are being squeezed as businesses try to manage costs carefully and face increasing pressure to prove their value to the bottom line. Focusing marketing activities very tightly on products and services that yield the greatest profit margins and responding faster to changing consumer behaviour will be paramount.

In terms of advancing the search market in 2009, we'll continue to research and demonstrate its value as a branding opportunity. We know search is a great direct response tool, but research suggests there's also a significant uplift in purchase consideration when brands appear in natural and paid-for search listings.

Online video will also be central to our 2009 strategy and we're pleased with the progress YouTube has made so far - the ad proposition on the site is really coming together.
Google will also continue to innovate in core search, progressing with universal search - integrating images, videos and other rich content with text-based results - while tools such as machine translation, search on mobile and increasing personalisation of results are also areas we are very passionate about.

Sly Bailey
Chief executive Trinity Mirror

This year saw us enter a period of profound economic downturn, which is having an inev-itable impact on consumer-facing media businesses.

We can't defy the gravity of ad markets, but we can manage our businesses so that we come out of the downturn stronger and more resilient. This means preserving cash, ensuring as much of our cost base as possible is variable, and continuing to invest in the multi-platform development demanded by our readers and advertisers.

We saw well-deserved success for commercial regional media firms through our campaign against the BBC's £68m local online plans.

In 2009, we must ensure the BBC does not find other areas of "scope-creep", which endanger the health and plurality of local media markets and the important role they play in democracy. Digital success is key to the future of journalism.

The regional newspaper industry is undergoing a process of fundamental transformation, driven by both cyclical and structural change. Newspaper groups may need to consolidate to survive, but this requires a change in regulation. I hope we will look back on 2009 as the year we redefined the future of the newspaper industry.

My motto for the year ahead? Survive, innovate and win.

Jean-Francois Decaux
Co-chief executive JCDecaux

Structurally, outdoor is in a strong position. Lifestyle changes, growing urbanisation and increased mobility mean we are one of the few media with a growing audience.

Globally, 60% of the population will live in cities. The number of air passengers continues to rise with state-of-the-art airports such as Heathrow Terminal 5 and Dubai, and cities are investing in new mass transit systems, such as Shanghai's metro.

In the UK, time spent out of home has risen by 53% since 1994 (source: TouchPoints2). Digital has increased flexibility to the point where a message congratulating Lewis Hamilton appeared 10 minutes after he won the F1 title. Outdoor also offers great value - the lowest media cost-per-thousands, whether you are in China, the US or UK.

Outdoor has consistently grown market share and ZenithOptimedia forecasts this will continue across the next three years.

So, what are the main challenges facing the outdoor industry in 2009? Outdoor has grown to be a 10% medium in the UK. That said, people now spend 16% of their time in the outdoor space and, as Martin Sorrell said about a similar dichotomy between share of audience and share of media spend with reference to the internet: "This is a disconnect we must correct." This is also outdoor's challenge.

Tom George
UK chief executive Mediaedge:cia

The past year has certainly been a whirlwind and nobody could have predicted the ferocity with which the economic crisis took hold.

This has accelerated some of the tougher decisions that have become necessary, particularly at media owners, as they seek to cut costs to put themselves in a more competitive position for 2009.

Next year, we will continue to see a very active pitch scene as advertisers seek to drive further value in tough times. The successful agencies will be those that not only deliver value, but also demonstrate effectiveness and real business return on advertising investment.

It's not unreasonable to expect further rationalisation on the media owner side, both in terms of structure - some regional newspapers are likely to disappear, for example - and how they organise sales. Next year, we are also likely to see single- digit growth online for the first time.
The optimist in me thinks there will be some signs of recovery in 2009.

Paul Hayes
Managing director News International Commercial

No one could have foreseen the dramatic turn of events this year and the significant impact this has had on the media market. Next year is equally unpredictable, but it's hard to believe there won't be casualties in the publishing sector.

During these tough times, there is plenty to play for in terms of market share and brand strengthening. Consistent investment in our products is the key to future prosperity.

We're already seeing the ben- efits of investing in our products supported by marketing activity focused on brand rather than promotion. The Sunday Times has just recorded an increase in circulation year on year - the only national Sunday newspaper to do so. Meanwhile, The Sun is enjoying record-breaking ad revenue as supermarkets battle it out - demonstrating that opportunities do exist in a downturn.

The important message for clients is to avoid a knee-jerk reaction, which proved detrimental to many clients in the past, losing them market share. The commercial landscape will look very different in 12 months. Those that are brave enough to invest will enjoy the fruits of those investments.

Elizabeth Fagan
Marketing and trading director Boots

Tough times will lead to dramatically different approaches. Accountability will become even more important, cementing the position of marketing at the decision-making table.

A greater focus on what customers truly need and want will lead to better products and services, at better prices. Businesses (and media owners) who understand their customers will flourish as their customers become more selective.

The combination of cheaper media, higher share of voice and more targeted approaches represent great opportunities for brands to build their businesses and emerge from the downturn even stronger.

Mediaweek
9th December