1

FCR Media: Managing the Transformation to a

DMA Across Europe

Paul Wood

Chief Marketing Officer

FCR Media Group

ALSMA Conference, Shanghai

October 29th, 2013

2FCR Media Group has experienced

significant growth in 2012-13

FCR Media is a group of leading online, mobile and print media companies, currently operating in Ireland,

Sweden, the Czech Republic and Slovakia, Finland, Romania, Russia*, Lithuania, Estonia and Latvia.

Group target is to become the leading Digital Media Agency for SOHO market in mid sized European countries.

Key facts

• FCR Media operates in 10 countries

• Group revenues in 2013 (pro forma) 75,0 m EUR

• 90% of revenues are generated in non-Baltic

countries

• FCR Media has positive EBITDA and cash flow, with

cash position higher than debt and net debt

negative

• The Group is controlled by a leading Baltic private

equity fund

• FCR Media has 1300 employees

• Over 30,000 Google AdWords Customers

• Over 20,000 website customers

• Over 2,000 Mobile Optimized website customers

• We only have print products in 4 of our 10 countries

and only one with White Pages

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Operations and Business Model Adjustment

• Most leading Yellow Pages companies face similar challenges

• New Products not yet driving significant improvement

- New products acquired, licensed and developed – often at

significant cost

- So far not delivering “quantum leap” results (price

comparisons, coupons etc)

• Continued product development / acquisition requires CAPEX

• Significant investment needed to replace print centric production

systems

• Working Capital depleted as margins erode, print revenues

decline and customers migrate to lower margin products

4

Proprietary Products are important but…

• We must be flexible

• We cannot compete head-to-head for direct traffic to

our sites

• We cannot afford to be “bleeding edge” developers

• We must recognize that the barriers to entry online

are significantly lower

5This has guided a change in our business

philosophy…

“We put our advertisers’ message where

people are searching”

6

Group Product Mix 2013

• Arrow size indicates importance• Shading indicates relative revenue

7

• Arrow size indicates importance• Shading indicates relative revenue

Group Product Mix 2015

8Strategy: Digital Media Agency

• Standardized website/ contact page creation

• Customized website creation

• Creation of mobile sites, web-to-mobile

conversion, creation of apps

• SEA (PPC, Google AdWords)

• SEO

• Social media profile creation and administration

(Facebook, Google+, Twitter)

• Online display advertising (banners)

• Analytics (web, lead, SEA campaign analytics)

• Video creation, 360° photos

Digital Media Agency will offer

integrated media solutions for

digital campaigns, helping

businesses to be present across

all digital media channels.

FCR Media will position itself as

a one-stop shop for SMEs

emphasizing real value to the

customer.

Components

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Strategy: ClearSite website at the Core

The ClearSite Platform serves as a central repository of business

information and detailed content about that business. It is at the heart of

all value added products and services we plan to offer in the future.

• Business information on the ClearSite platform can be pushed across multiple

products / social networks either proprietary or 3rd party

• The basis of the ClearSite is a templated website approach to structuring data.

• This data can then be repurposed on a variety of products and services (stand-

alone websites with SEO service, mobile websites, Facebook, Twitter, Google+,

Google Places, Nokia, proprietary IYP products, mobile apps etc)

• SEA / SEM campaigns can also be directed to the ClearSite pages to further

enhance the value proposition

• Feeding the data gathered around these products and services into a customer

accessed “Business Centre” will help prove the value of our products / services

and position FCR Media as a Digital Media Agency

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SMEs are the same all over…

• Small & Medium sized businesses (<5 employees) are the majority of our customers

• Our current customers like us but we have common problems:

- Perception: “It’s Those Print Guys again”

- Need: “I already have a website…”

- Price: “My Friend (Nephew / Son etc) can do a website for me…”

There are the same objections we hear in all countries

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How do we overcome these objections?

• Perception: Reposition the Online Sales Story

- We are fundamentally changing our sales story to reflect the DMA.

- We will talk about Websites and driving traffic not just about ranking

on IYP (see Branding)

• Perception: Educate the Sales Force

- All of our sales teams are being trained to a “Basic Internet”

proficiency (Basic SEO factors, Title Tags, Google AdWords, Facebook

ads etc) but we will not make them “Internet Experts”

• Perception: Re-Branding our online

- We will separate out Online Brands from our Print Brands where it is

needed

- The speed of separating the brands will be dependent on the print

revenues / usage in the market but the sooner the better

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How do we overcome these objections?

• Need: Optimization and Traffic are Key

- “If you build it, they will come” is not a good internet

strategy

- We have the expertise to optimize your site and drive

traffic through SEO, Google AdWords and by linking /

“embedding” your site into our IYP

• Price: After they build it, will they support it?

- A website is a “living thing” and can’t just be made and

forgotten

13

A Word about Sales Training…

• We do not need our sales reps to be “Internet

Experts” any more than we need them to be

Photoshop pros for print ads

• We need a high level training and a sales support

“cheat sheet” or glossary of terms for SEO and for

AdWords

The majority of our customers are not sophisticated

in online advertising and we need our reps to be

conversant of the key topics but the expertise will

remain in the back of the house.

14Three countries with different market

conditions…

Sweden

• Highly competitive

market

• Well Known Brand

• Low print usage

• High online and

mobile penetration

• More than 40,000

customers with

ARPA of approx.

1,000 Eur.

Ireland

• No direct

competitors

• Strong Brand

• High Print Usage &

Revenues

• High penetration

of mobile and

Broadband

• More than 16,000

customers with

ARPA of approx.

1,250 Eur

Estonia

• Limited In-Direct

competitors

• Strong Brand

• Minimal Print

Usage & Revenue

• DA service more

robust

• Highly

“Connected”

Society

• More than 23,000

customers with

ARPA of Approx.

250 Eur.

15We must adjust the speed of transition to

DMA based on market conditions...

• Moderate Risk to

fast transition

• Customers

invested in Print

and online ranking

• 2% of customers

with websites

• Introduced

ClearSite Bundles

mid-2013 (Print,

Online & Mobile)

• Significant Risk to

fast transition

• High value

customers invested

in Print & online

ranking

• 15% of customers

with ClearSites

• ClearSite bundles

introduced mid-

2012 (Print, Online

& Mobile)

Estonia

• Limited Risk to fast

transition

• Customers

invested in DA and

online ranking

• Limited customers

with websites

• Bundles to be

introduced in 2013

– focused on DA

service and online

Sweden Ireland

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Speed of Transition

• In Sweden, Estonia, Latvia, Lithuania, Finland, Czech Republic and

Slovkia we will move extremely quickly to the DMA model as there is

either little or no print revenue at risk

- Sweden: we will continue to sell Print and Online bundles

especially since the market leader has discontinued it’s print

products

- The local companies will decide how much “Old Fashioned

Baggage” is attached to the brand to determine their branding

strategy

• In Ireland we will move more cautiously due to the continue usage of

the print product and significant print revenues especially in the Key

Account Channel

- We will start to reposition the online sales story to be a “website

story” with IYP as another traffic driver to provide some separation

between the print brand and the online brand

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Lessons from Sweden…

• To drive the adoption of the DMA strategy it is critical

that the ClearSite bundles be the primary focus of our

sales call

• The DMA strategy also calls for multiple sales calls

during the year for up-sell opportunities so a clear

path must be developed

• Google AdWords are a vital part of the bundle to prove

immediate value of the ClearSite Bundle

• The old “print-focused” brand Lokaldelen must change

18The ClearSite Bundle

ClearSearch.se

ClearSearch.se

Mobile

Print Books

Internet

Search

Reporting

ClearSite

ClearSite Mobile

ClearSite

19The transformation to DMA starts

with the foundation platform…

It all starts with the ClearSite Bundle

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Mobile Optimized Sites

SEO

Facebook Advertising

Digital Packages

Google AdWords / Renewals

Foundation Platform

Providing Digital Up-Sell

Opportunities…

21

ClearSenseSearch

Lokaldelen clearsearch.se clearseach i mobilen ClearSite AdWords Facebook

Brand

Products

i mobillen

Rebranding is a key strategy…

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The Power of the ClearSite Bundle…

• AdWordsTM

• ClearSite & ClearSearch.se

• Google Places

• Google +

• HomePage & SEO

Google

Places

Google

Places

Google

AdWords TM

ClearSite(ClearSeach)

SEO(Customer

Homepage

)

Google

AdWords TM

23We are the fastest growing Google

AdWords reseller in Europe…

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95

169 172

223 214109

49

31 21

3937

3924

3421

1615

11

9

7

4

65

5

8

5

2

24

3

3

1

2

3

1

1

2

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Google AdWords - 1000 Google AdWords - Erbjudande 1 (Värde 1500 kr, betala 1000 kr)

Google AdWords - Erbjudande 2 (Värde 3000 kr, betala 2000 kr) Google AdWords 3000

Google AdWords 4500 Google AdWords 6000

Google AdWords 12000 Google AdWords 24000

Google AdWords 48000

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We have doubled the number of

ClearSite customers in 5 weeks…

2013_38 2013_39 2013_40 2013_41 2013_42 2013_43

Basic MySite 1 Page MySite 1 Page MySite Erbj 2 1 sidig MS+ (tillval) 1 sidig MS+, år 2 (tillval)

3 Page MySite 3 Page MySite+ 5 page MySite+ 5 sidig MS+ (tillval) 5 sidig MS+, år 2 (tillval)

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The Template is working…

• Sweden is proving that the transition can work

• Estonia and countries with limited print exposure and low website sales will move rapidly to this model

• Ireland, with a high print revenue and usage and 3,000 ClearSite customers, will move more methodically to the model

• Strength of the Brand will influence how quickly we move to an online branding versus a print branding

Thank You