Sunday, November 23, 2008

No news is good news

Martin Morgan only took over as chief executive of Daily Mail and General Trust at the beginning of October, but as a near 20-year veteran of the group he knows precisely what shareholders want to hear as recession and structural change tear into the newspaper market.

The full-year figures tell a familiar story: advertising revenues have slumped, print costs are rising and readers are migrating to the internet.

But while newspaper readership is down, DMGT has performed better than the competition thanks to earlier investment in marketing and in editorial. Retail advertising - a key element of the Daily Mail model - has also held up better than expected. The biggest risk is still that a long and deep recession in the UK could simply vaporise advertisers. The counter-argument is that leading retailers will have to continue their promotions in print in order to attract customers.

The message Mr Morgan wants to get across, however, is that we should be thinking of DMGT as a business-to-business company rather than a newspaper publisher.

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