Category Archives: Innovation

Sanoma’s digital transformation gains momentum

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Sanoma House in Helsinki

Sanoma House in Helsinki

Last week Sanoma announced the FY2013 results. To be frank they were mixed, with online and mobile sales growing but print media in decline. The vocabulary turned classical: annus horribilis, Utopia, and per angusta ad augusta, could be heard in English, Finnish and Dutch conversations during the week. As is often the case with mixed signals, the good news has been somewhat drowned out by the more negative headlines throughout the year.  Yet Learning had a good 2013. And after a slow start to the year the overall digital platform has gained momentum and performed particularly strongly in the final quarter.

I always find it tricky blogging about financial results given that Sanoma is a listed company. But now that we have announced the results, I’d like to call out a handful of highlights on digital in Finland, The Netherlands, Learning and early stage innovation at Sanoma in 2013, drawing on the published materials.

As a reminder, the core strategy of Sanoma rests on three pillars: i) connecting consumers with content and brands, anywhere, anytime; ii) delivering powerful marketing opportunities to advertisers through our reach and consumer insight; and iii) providing personalized digital learning solutions to pupils and teachers.  Digital is clearly an integral part of that strategy.

Finland

Our share of the online media market grew by 5%-points to almost 40%.  Our online advertising revenues grew by 18% over the previous year and digital consumer sales grew by almost 30%. Digital subscriptions at Sanoma’s single biggest brand, the newspaper Helsingin Sanomat, grew by almost 40% to 160,000 (on a total of about 355,000). Furthermore, digital sales at our second biggest brand Ilta-Sanomat grew by about 40%, whereby digital revenue gains now appear to be exceeding print losses; this terrific performance also secured a lead for Ilta-Sanomat over Iltalehti in terms of visitors. We also saw early success at magazines with the Donald Duck library reaching 12,000 subscribers.

Our market-leading position in recruitment got even stronger and we regained leadership in terms of visitors in real estate.  Finally, we made a great start with e-commerce service MSO.fi with more than 120 retailers already on board.

We have seen strong growth in usage via mobile devices and of online video and this is where we have registered our fastest growth.  By the end of 2013, over 50% of all pageviews on our Finnish network came from mobile devices, with mobile visitors growing by over 100% and pageviews by close to 150%.  Correspondingly, mobile advertising sales grew by around 180%.  Online video advertising sales grew by over 30% and the weekly reach of video platform ruutu.fi by 25%.

The Netherlands

comScore ranks Sanoma #4 of the big 5 in The Netherlands with 8.1 M unique visitors (MUV) in December 2013  – behind Google, Microsoft and Facebook (12.7, 10.7 and 9.9 MUV, respectively), but ahead of eBay (6.6 MUV). Other Dutch media groups are also represented in the top 20, but lack the reach of Sanoma. The state-subsidised NPO, and privately run TMG, De Persgroep and RTL Groep, registered a reach of 6.2, 5.3, 4.7 and 4.4 MUV respectively in December.

NU.nl, the leading news site by visitors and strongest media brand in The Netherlands and a cornerstone of Sanoma’s digital network, further strengthened this position in 2013 delighting readers with more than 10.000.000.000 pageviews, almost exactly 50 per inhabitant per month! Pageviews have more than doubled in the last three years and in the meantime more than 75% of views are made from mobile devices.  NU-apps have been downloaded more than 5 M times so far.

In common with Finland, video also grew strongly (about 40%) totalling 152 M at video platform zie.nl.

Lindanieuws.nl – an extension of the highly successful magazine brand Linda. – came with a new version that resulted in a tripling of the number of visitors to 1.2 M and a doubling of advertising sales.

Digital sales via automated trading increased by almost 25% – a serious money-maker for our digital network.  Our performance-based business had a solid year. In particular, sales at the recently acquired FashionChick doubled, partly driven by international expansion. The introduction of curated search at directory Startpagina.nl has been a runaway success and one of the most rapidly growing digital product innovations we have made in recent years. Net sales of e-commerce service SBC grew by 25%, with sales of home deco performing particularly well with a growth of nearly 50%, And soft launches of new brands leef.nl (health) and yixx.nl (jewellery) and of the international launch of price comparison site kieskeurig.nl in France and Poland have helped to ensure a healthy pipeline of new business lines that we expect will support the growth of the performance-based assets in the coming years.

Learning

At Learning, there are also good data to evidence our progress to a more digital future. Much of this relates to bringing content to life by making it more functional through digital. For example, in The Netherlands, more than 1,000,000 pupils in primary education work with Malmberg’s software, reaching 60% of all schools.  In a single week in November, more than 1,000,000 exercises were made on homework platform Bingel.be in Belgium. And in Finland, teachers and pupils logged into Sanoma Pro’s new learning environment 1,900,000 times, with 768,000 hours of active use. In the meantime 800 e-books have been published in Sanoma’s five Learning countries on the BookShelf platform provided by Young Digital Planet.

In addition to transforming its core business, Sanoma Learning is working on providing learning services to the home market with a new online tutoring proposition for mathematics: StudySteps. This has been soft launched in Belgium and The Netherlands, tested in Poland and Russia, and the first results are promising, with 110,000 exercises made in the test period.

Furthermore, Sanoma Learning is exploring the possibilities to build a position in emerging markets and has amongst others made an agreement with the People’s Education Press to provide digital services to support the provision of e-learning in China. It’s early days, but there is clear demand for Sanoma’s high quality Learning capabilities abroad.

Innovation

SanomaVentures had an exciting year, receiving over 400 requests from external startups, which ultimately resulted in 9 investments, bringing the total to 15 to date.  In aggregate the business/financial performance of this portfolio has been promising and these ventures currently employ over 161 people. We expect to make a similar number of new investments this year.

Building on the success of the series of in-house innovation accelerators, we have now launched an Innovation Lab to foster the ventures that are borne out of the accelerators and as a test ground for new ideas from the core business.  We currently have a full pipeline of concepts, prototypes and early stage ventures and have set ourselves the goal to have established five ventures in the next 3-5 years that have an annual revenue potential of € 10 M+. In 2013 we ran four accelerators (Content, Commerce, Talent and NU-lab), two of which were open to external participation. Through these accelerators we trained about 500 Sanoma employees on the lean development methodology and created 15 functional prototypes, about half of which have been given seed funding for further customer validation.

Finally, we have significantly increased our investments and human resourcing on data science including hiring a team of 20 data scientists last year to boost our analytics and insights capabilities across Sanoma. We are currently working on developing the common “big data” enablers, as well as specific cases on consumer sales, online advertising and new business models. We expect to make a quantum leap in our insights capabilities in the coming years.

Good progress on the journey

Overall, reflecting on the three pillars of Sanoma’s strategy i) connecting consumers with content and brands, anywhere, anytime, and ii) delivering powerful marketing opportunities to advertisers through our reach and consumer insight and iii) providing personalized digital learning solutions to pupils and teachers, I believe the highlights above show that digital has made a big contribution in 2013 to progressing this strategy. Respect to the teams who have made this happen and thanks for your hard work!

Flipping 2.0

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flipping 2.0I’m curious about how we can ‘personalize’ learning: how can we help each individual learner to best develop their talents?

‘Flipped learning’ has caught my attention as one potential route, characterized by a more student-centric classroom, higher-level thinking as a goal, and good use of face-to-face interaction between students and teachers.

For this reason I recently read Flipping 2.0: Practical Strategies for Flipping Your Class, compiled by Jason Bretzmann, with authors contributing to sections on 1) Flipping in the core content areas, 2) Can anybody flip? and 3) Just for teachers.

I would like to recommend this book to teachers interested in flipping their classrooms and to other creators of educational resources looking to support personalized learning. I thought it was surprisingly accessible and there were three things I particularly appreciated about it:

1. Expert

All of the contributors have in-depth and first-hand experience of transitioning to a flipped classroom and describe that transformation clearly.  I thought the cases were helpful and real-world descriptions of the benefits and pitfalls. This is not a book of idealized concepts written by hands-off consultants but a very credible “how-to” handbook.

2. Practical

I especially liked the practical nature of the book. Amongst others, it’s a great resource for working out which technical resources might work best for teachers and students. There’s a lot of useful practical advice on creating learning materials, engaging students and dealing with challenges connected with flipped learning such as access to technology.  Where there’s a will, there’s a way.

3. Passion for teaching and learning

I love it when people are passionate about what they do. The contributors to this work share a passion for teaching and learning and that oozes through the pages. You feel throughout the book that they are striving to be great teachers and are constantly looking for ways to excel and improve in that role. Respect!

By the end of the book I personally wanted to create my own lessons and I’m not even a teacher! Apart from thinking how we could support the flipped classroom at Sanoma Learning, it also made me wonder if I could use some of these learnings in my own job. Somehow a ‘flipped board meeting’ doesn’t sound quite right :-), yet we do say that we want to spend less time going through powerpoint slides and more time on discussing and improving the strategies. Worth an experiment …

Sanoma Startup Challenge: the Future of Learning

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We recently announced the launch of a startup challenge, focusing on the future of learning. The goal of the challenge is to identify Europe’s most promising startups in K-12 education and to work with them in finding ways to help them to grow.

We’re encouraging applications from European startups that have a live product and growing customer base, but are still smaller than € 2 M in annual revenues and have been established within the last five years.

The application round is now open and will close on 1 March. Five finalists will be invited (expenses paid) to Amsterdam on 23-25 April to work with executives and experts from Sanoma Learning and SanomaVentures and to pitch their startup to The Next Web Conference audience and jury. The final winner will be announced immediately after the pitches and will receive a cash prize of € 25.000. We will also explore the options with the finalists for closer collaboration with Sanoma in supporting their growth ambitions.

Education is at the dawn of a new era, partly enabled by technology. As interim CEO of Sanoma Digital and CEO Designate of Sanoma Learning I am excited about working together with high potential startups in the edtech space and hope that we can build some successful and long-lasting relationships through this initiative!

For more information on the learning startup challenge, including the application procedure, click here.

Good luck to all applicants and I hope to see you in Amsterdam in April!

Abundance

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Last month I saw Peter Diamandis speak in Amsterdam and was inspired by his vision and approach to creating a world where we live in abundance rather than scarcity. Together with Steven Kotler he has earlier articulated this case in the excellent book ‘Abundance: The Future is Better Than You Think’.

The Abundance Pyramid
Diamandis and Kotler describe abundance by means of a pyramid, structured with three tiers of ‘goods’ (inspired by Maslow’s ‘hierarchy of needs’). The base of the pyramid concerns the essential needs of water, food and shelter: these resources enable life itself. The middle tier in the pyramid includes energy, education and ICT: they contribute directly to improved living standards and can also catalyze further growth. The top tier of the pyramid is reserved for freedom and health: they support the well-being of the individuals and enable them to reach their full potential and make the maximum impact for a better world. The authors describe the goal of abundance as a sustainable world in which every person on the planet has the opportunity to access the goods in the three tiers.

Progress through technology
The authors make the case that expontential advances in technology will allow us within twenty-five years to create abundance on these three tiers for a world of nine billion people. How about that for a Big Hairy Audacious Goal: global abundance within twenty-five years! They believe that these advances will be supported by three driving forces. Firstly, the rise of DIY innovation, enabling individuals and small organisations to tackle problems previously only addressable by governments, thereby massively opening up the talent pool working on solutions. Secondly, the rise of the technophilanthopist, whereby very wealthy individuals commit a major part of their wealth and talent to helping the world’s less fortunate. Thirdly, what they term ‘the rising billion‘ – the world’s poorest (in fact, closer to four billion today) who have made rapid progress in improving there positions in recent years, largely supported by mobile technology, and will soon be able to pull themselves out of poverty.

Concrete cases
Diamandis describes for each of the goals in the abundance pyramid, the technologies that could contribute to a more abundant world and in which way. He makes a convincing case!

Accelerating the pace of change
They conclude the book by suggesting that the best way for businesses and governments to achieve abundance goals is to use open incentive prizes – they believe that such competitions are the most effective method to motivate the smartest people in the world to develop new solutions. They puts forward some powerful cases to demonstrate the point.

Inspiring work
I was inspired by the optimism of this book and the concreteness of the supporting arguments. The failings of our world are well covered in the media (rightly so) and we are in any case biologically programmed to be on high alert to them. It was good to see the other side of the coin and I experienced this as a well-founded articulation of a positive scenario. I respect that a lot. Arguably there are parts of the book that go too far, and some of the downsides of the journey to abundance could be ugly. Nevertheless, I would like to recommend this book to readers looking for inspiration about a positive future for our planet.

Sanoma can make a difference through education
About a week before seeing Diamandis, I joined a group of innovation leaders for lunch with the former PM of The Netherlands, Jan-Peter Balkenende, to discuss innovation and sustainability. He emphasized the importance of the business of sustainability: how can we create new business opportunities (with a profit incentive) by helping to build a more sustainable world? He referred also to Abundance in this context.

In the case of Sanoma, I believe we can best support sustainable abundance through our Learning business. As described above, education is part of the middle tier of the abundance pyramid, contributing directly to improved living standards and catalyzing new growth. Through our strong positions in developed economies, I believe we can further progress personal and societal development by personalising the process of learning, to help individuals to realise the full potential of their unique talents. Maybe an even more audacious goal would be to bring access to high quality online education to the rising (four) billion people in developing economies. I don’t yet know the extent to which Sanoma is ready, willing and able to play a role in this. Even if we could fulfil but a part of that task, it would surely be a worthwhile (and profitable) contribution to a more abundant future! Wouldn’t that be a terrific mission to work on?!

Imagine
Imagine that you could be part of a movement that could create an abundant world within twenty-five years. What would you do? Sanoma Learning can help to provide access to high quality education and I am personally passionate about that goal. Care to join us on that journey? Or to create a new journey to abundance of your own? I’m interested to hear your thoughts on this.

Making it happen at the CommerceAccelerator bootcamp!

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Participants at the closing session. Blinded by the light ...

Participants at the closing session. Blinded by the light …

We’re working hard on transforming Sanoma for a more digital future. Boosting innovation is key and includes developing new digital business lines and learning new skills that we can use across the company. For this purpose we have created the Innovation Accelerators and the CommerceAccelerator is the third in the series so far.

We see three domains of opportunity for the future Sanoma. Firstly, we want to provide information and entertainment to consumers across multiple channels. Secondly we want to help advertisers with powerful marketing solutions based on our reach to consumers and insights into them.  And thirdly, we want to help to help pupils and teachers to achieve great learning outcomes using new learning solutions.

Winners go to bootcamp

Team leaders at the closing session

Team leaders at closing session

In Amsterdam last week we ran the bootcamp for the CommerceAccelerator – focusing on the advertising domain mentioned above. The top 5 ideas and their owners were selected in a live webinar to build prototypes of their concepts. This followed an inspiring program of ideation and training, of building and testing ideas, which started out with about 220 participants from across Sanoma and included about 70 university students.

Rich talent

Student team Weggle from Tampere

Student team Weggle from Tampere

We had an interesting and varied mix of talent amongst the team leaders, including people from business development, sales, product management, television and a student team from Tampere.  I like it a lot when we have such a diversity of experience and skills at the bootcamp: it makes for a rich and exciting experience!

Fast pace, strong delivery

I love the bootcamps. They are practical and fast paced. They’re very demanding but also a lot of fun. It’s great to have teams of talented and driven people working on building prototypes and testing them with real customers.  Making it happen!  I believe in learning by doing and this is a very concrete proof of that!

Leadership

Listening to CEO Harri-Pekka Kaukonen kicking off the pitch session (for the sake of good order, I am tweeting that picture in this photo, I am not checking my mail during the speech :))

Listening to CEO Harri-Pekka Kaukonen kicking off the pitch session. (For the sake of good order, I am tweeting that picture in this photo, I am not checking my mail during the speech!)

We were joined by Sanoma’s CEO Harri-Pekka Kaukonen, CHRO Jackie Cuthbert and the CEO of Sanoma Learning Jacques Eijkens. They are all strong supporters of the accelerators. We appreciated that they joined us; they are all super-busy driving the transformation of Sanoma, but it is brilliant that they make the time to support the accelerators.  A great show of leadership!

Five prototypes

Listening with intent to the pitches. Amongst others, Harri-Pekka Kaukonen on the front row, and Jackie Cuthbert on the back row.

Listening with intent to the pitches. Amongst others, Harri-Pekka Kaukonen on the front row, and Jackie Cuthbert on the back row.

At the end of the day on Thursday each of the teams demonstrated their prototypes. They included i) a contextual and sentimental targeting service; ii) a pre-targeting service; iii) a mobile advertising service iv) a gamified service to engage viewers during TV commercial breaks and v) a shopping service bridging the real and virtual worlds. Some of the testing with customers has been quite brilliant and helped to underpin the commercial promise of the ideas. Great validation!  (I would like to show the promo video’s here, but feel it’s a bit premature at this stage).

Top teams

I really like and respect the passion and enthusiasm of the teams and am proud of how they have performed and behaved! This counts for the idea owners and the talented professionals from MakerLab.  And also for Lassi Kurkijärvi (@lassi, Director at Sanoma) and Joris van Heukelom (@jorisheuk, Partner at Makerstreet) who once again showed inspiring leadership throughout the program.  Great job everyone!

Next steps

We have promised the teams that we will inform them how we would like to proceed by the end of next week. There are three alternatives: i) create a new venture ii) develop within the business or iii) not pursue the opportunity. I am confident we will pursue some of these concepts and will engage with the key stakeholders to ensure that we will be able to bring them to market quickly!

The world turns of course, and we are working on developing the next accelerator which will focus on 4G and video and we aim to start in Q1 next year.  With the launch of our Innovation Lab in January (as part of the new unit Sanoma Digital), which will be led by our mobile superhero Lassi Kurkijärvi, the Innovation Accelerators have become a core element of our transformation program. I see the establishment of the Innovation Lab as a great validation of the success of the accelerators we have run so far.

I’ve been happy about the high level of support that we have won from top management and young talent. What I would like to develop further in upcoming accelerators is to secure more engagement from middle managers. I believe this would help us in transforming the core business.  If anyone has good ideas about how to achieve this, please drop me a line!