Fairfax CEO accuses REA of 'price gouging', signals new strategy

Fairfax CEO accuses REA of 'price gouging', signals new strategy
SHARE
THIS



Fairfax will look to events, providing marketing services to SMEs and content marketing to boost flagging revenues as it revealed earnings from continuing business were down 23% for the year.

In a presentation to investors this morning CEO Greg Hywood accused rivals REA Group of “price gouging” and insisted “this media company won’t blink”, but admitted “leading the change means a good deal more than cost cutting”.

The group today showed a $16m loss for the last financial year.

The company also revealed its first digital subscription number, with 68,000 people signed up for paywalls for the Sydney Morning Herald and The Age, a number that is “ahead of expectation”.

He said they had expected 105,000 people to pick up a digital subscription in the full year, and were running at a “73% conversion rate” from those offered a month for a dollar to full membership, and stressed the paywall has “had a minimal impact on advertising revenues”.

Figures show Metro media advertising revenues dropped 21% in FY13 to $633.6m, with the financial review Group down $66.5m, an 8% dip.

Hywood said the circulation clean out still has a way to go, but they have “broken the back” of it, getting down to a core business and looking at a strategy of “lower circulation and higher cover prices, saying they would look at more increases in pricing this year.

Insisting they were not "casting into the wilderness to find something new" he said they would leverage the core business with growth strategies, ioncluding providing more marketing services for SMEs through its sales division.

Talking of building out a new content marketing unit Hywood pointed to the changes to the marketing mix, and the brand’s heritage in content creation, but insisted it would be a “distinct” department, and would have “rules of engagement” for interacting with editorial and sales teams.

Turning to events, which made the company $25m this year, with things like the City2Surf and ocean swims, he said: “We’re only setting out to be a small player in a large market. We see the opportunity to build a business that’s several times larger than currently.”

Looking at the improving position of Domain which made $44m, he said: “Despite continued claims of market dominance the only thing REA Group is moving away from is agents, with more and more becoming increasingly angry with price gouging.”

Please login with linkedin to comment

Latest News

“Simply Disingenuous!” Coles Challenged Over Its Decision To Phase Out Its Printed Catalogue
  • Marketing

“Simply Disingenuous!” Coles Challenged Over Its Decision To Phase Out Its Printed Catalogue

The Real Media Collective (TRMC), the Australian industry association representing the interests of companies in the paper, print, publishing/media and related distribution sectors across Australia, has challenged Coles Supermarkets for using the environment as a reason in its announcement today outlining its plans to cease sending catalogues to Australian homes from September. In the announcement, […]

Major Stars Including Kerri-Anne Kennerley & Tim Bailey To Go As 10 Announces Major Restructure
  • Media

Major Stars Including Kerri-Anne Kennerley & Tim Bailey To Go As 10 Announces Major Restructure

Network 10 is set to undergo a massive restructure, leaving a number of high-profile journalists out of a job, including Kerri-Anne Kennerley, Natarsha Belling and Tim Bailey, B&T understands. As first reported on The Sydney Morning Herald, the restructure was announced to staff on Tuesday. As part of the restructuring, the presentation of the weekday […]

by B&T Magazine

B&T Magazine
The Alcohol & Drug Foundation Team With Dee Madigan’s Campaign Edge To Tackle CV-19 Drinking
  • Campaigns

The Alcohol & Drug Foundation Team With Dee Madigan’s Campaign Edge To Tackle CV-19 Drinking

Alcohol & Drug Foundation (ADF) has launched a new national health campaign with Campaign Edge aiming to tackle COVID-19 drinking. Funded by the Australian Government, Break the Habit reveals that it takes only around 66 days to form a habit – roughly the same amount of time many Australians spent in lockdown. It’s a fact most Aussies are […]

How To Get Out Of A Cashflow Crisis
  • Opinion

How To Get Out Of A Cashflow Crisis

Paul Roach (pictured below) is a business strategist and coach who has worked with hundreds of SMEs across many industries to supercharge their cashflow. Roach is also author of the book Smarter Business Stronger Cashflow. In this guest post, Roach gives his top tips when the cash taps start to be turned off… Cashflow is like […]

One Daydream Expands Into Alcohol Category
  • Marketing

One Daydream Expands Into Alcohol Category

Sydney and Melbourne based PR, Talent & Digital agency One Daydream has extended its client portfolio to include alcohol. The category expansion comes as One Daydream joins the agency roster of Pernod Ricard, working on a project basis to manage strategic PR and digital campaigns. The global drinks group boasts one of the most comprehensive and prestigious […]

Modern interior with furniture and creative business sketch on wall. Success and solution concept. 3D Rendering
  • Media

Commtract Appoints New Business Development GM

Commtract today expanded its marketing, advertising and digital offering in response to a growing number of CEOs outsourcing to ‘gig-workers’ amid COVID-19. According to new research, 40 per cent of Australian CEOs are planning on outsourcing to freelancers in the contingent workforce. Commtract, which launched in 2016,  has more than 4,000 communications experts on its platform, and has already placed over 800 roles. […]