Digital First Media, which oversees the Denver-based MediaNews as well as the New York-based Journal Register Company, has inked a deal with Nimble Commerce to power an ecommerce initiative across the company’s 150 plus local sites. The deal will replace the media group’s largely fragmented ecommerce efforts — many of which pre-date the creation of DFM in October — with a single platform capable of launching daily deal and flash sales campaigns seamlessly across its media properties.
For the San Francisco-based Nimble Commerce, the agreement is a big win. The company is engaged in fairly intense competition with Boston-based Group Commerce over the growing white-label commerce space and the deal with Digital First ranks in the “top five” in terms of aggregate reach, according to founder and CEO Prashant Nedungadi.
The partnership is an indication of the continued demand by publishers for commerce-related products even in the wake of the ongoing consolidation of the pure-play daily deals space.
“For us it goes into how media publishers are doing not just daily deals, but how they are monetizing their audience outside of doing display ads,” Nedungadi told Street Fight in an interview. “What’s happened through the daily deal business is that these legacy businesses have been able to rebuild the engagement through their customers.”
With the quiet support of owner Alden Global Capital, a hedge fund that also held a majority stake in Media news group, the Journal Register created digital First Media in September to transition the two companies’ legacy print businesses into “multi-platform media companies” capable of leveraging scale effectively.
“A big part of Digital First’s strategy is to make sure that everyone of our properties gets into a single platform,” Arturo Duran, chief digital officer for Digital First Media told Street Fight in an interview. “The newspaper companies were very funny in that they would always want to have a different side, telling you that the reader in San Francisco is different from the reader in New York or Denver. With digital, in the end there is one end user and one excellence in navigation and architecture.
“Groupon is worth $15 Billion and the New York Times is worth $1.2 Billion. … It’s a matter of being where [the market] is.” — Arturo Duran
A big driver for a nationally scaled local play like Digital First or Patch, which Nimble Commerce counts as a client on its website, is the ability to sell locally for a national audience. Duran points to the growing contingent of small ecommerce business run from secondary markets as a major opportunity for Digital First’s new commerce platform, a segment that a more fragmented media/commerce model couldn’t touch.
The integration of a commerce offering is a big step for Digital First as it pushes to build a digital media model that stands independently, both in actuality and in strategy, from its print counterpart. “As traditional media people, we placed advertising and delivered audience — that was our job. Things have changed,” says Duran. “[With a commerce platform], were able to partner with advertisers in a local way and make sure that merchants have the right return on investment and that we are able to get a piece of that action.”
Today’s rollout brings daily deal and flash sales capabilities to Digital First’s entire line up of local media properties. Though Nedungadi says that 75% of the transactions processed through the platform are generated via email, both Nedungadi and Arturo are focused on developing deeper integrations of commerce widgets into content pages, something more akin to the way in which advertising is distributed.
“The big challenge for digital content is monetization, and the big issue for monetization is relevancy,” says Nedungadi about placing widgets displaying daily deals and flash sales around content. “Commerce is not something like a step child sitting on the side; its actually becoming part of the experience.”
Whether media people like it or not, traditional digital advertising (e.g. banner advertising) is taking a far smaller chunk of the local marketing spend than it once did. A host of more interactive, value-driven, marketing products led by the daily deal are carving out niches where advertising once won dollars simply by default. For local media companies to survive, they cannot be content with eating the same portion of shrinking slice.
“Listen, Groupon is worth $15 Billion and the New York Times is worth $1.2 Billion,” says Duran about the decision to launch a commerce initiative. “It’s a matter of being where [the market] is.”
Steven Jacobs is an associate editor at Street Fight.