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Grupo RBS: from traditional media company to e-commerce startup

How did Grupo RBS make the transition?

By Chaymae Samir |  Sep 26, 2019

After 60 years of traditional business processes in the media industry, Grupo RBS decided to introduce a process of digitalization and localization. We previously tackled how the group is fueling digital success with print profits and transforming the newsroom while optimizing digital subscriptions in the south of Brazil, even in remote areas.

If you missed Part One, Part Two, or Part Three, we recommend a read before consuming this final section.

A customer journey powered by an obsession with margins

“We are obsessed with margins,” Andiara Petterle, SVP of Product Development and Operations for RBS, says of the group’s pursuit of only those revenue streams that bring good profit margins.

“We don’t want to do events just because people are doing events,” Petterle said. “We don’t want to do marketing services if there is no margin in it.” Instead, RBS has been leading experiments of its own.

First, with its Zero Hora newspaper. When they first started on their transformation, and in an effort to get readers to shift from print to digital, especially in remote areas of the South, they introduced a breakthrough tablet subscription in 2015 for a Samsung device that allowed consumers to access a modern e-paper with two daily editions. However, the advertising campaign had to be interrupted right after the digital subscription was introduced due to product shortage.

In 2019, things are different. They’re instead fueled by data, a better knowledge of their ecosystem and the frustration that Facebook and Google haven’t been successful so far in engaging with relevant local content. 

‘’Today, we work with different bundles that are inclusive of our main product, television. This provides a cheaper acquisition rate than paid digital marketing. Google and FB ads don’t work for us, we use the regular media. What works for us is a combination of television with segmented campaigns and digital.’’ says Petterle.

For RBS, more usage equals more retention, the magic number being 20 pieces of content per month

All the presenters on the air, at the end of show, give a call to action to subscribe to the free trial offered by RBS’ digital products. The cross-promotion strategy generate a lot more return than any other marketing channel but the push is also internal: ‘’We created a retention squad based in the newsroom. They’re in charge of the KPIs to generate engagement and retention, which they do through push notifications and newsletters. We have a goal for our squads to reach daily for how many articles they read daily, monthly etc.’’ And this is what generates the retention according to Petterle: 

‘‘We have a magic number over here. If people read 20 articles per month, it’s the tipping point. If they read less, they will churn in a few months. If they read more than 20, they’ll stay. We have to make people engage with us and read at least 20 pieces of content, it could be an article, a video or a podcast.’’ 

By increasing usage, RBS reduces churn. And the newsroom was reshaped to be responsible for it since all the managers have their personal bonus related to it and the entire newsroom is engaged in this process.

Read further: How local news publishers are converting visitors to their site into subscribers at higher rates than national publishers

Becoming an e-commerce startup: the next steps

App users represent half of the churn measured on the website, which explains why RBS will be focusing on improving the app experience

All of RBS’ products are embedded in local journalism and with the purpose of helping the state. At the end of this year, the group will be launching their ‘super app’’, making it easier to their subscribers to access all their digital platforms under one roof.

‘’We have different apps for different purposes. This was all fine in 2017 but is now too much trouble for our users. We’ve invested a lot in researching and understanding how they use the products hour by hour during the day and what the value to really develop a product that’s much better in terms of user experience.’’ says Petterle.

Television remains the biggest chunk of revenue for RBS, but digital now represents 20%, with a 50% year-on-year growth. 

‘’Last month we’ve reached a subscription base that’s bigger than the print one. The base is bigger, the revenue is lower, but we see a moment in the future where digital is going to be the largest part in our business. Subscription is already 65% of our digital business, which is already bigger than advertising for us. This is important for the sustainability of the journalism itself. It’s going to be a different business, from what we had in the past and what we have now, but we see the journalism sustainable with digital subscription.’’ says Petterle.

News products are now bundled with cable company offerings, wine and grooming services are offered with their digital apps, university partnerships have become an engagement channel as well as a sales channel, and bundles, including a VIP lounge at the local airport, will be offered with their digital subscriptions.

Read further: How publishers are becoming strong ecommerce players

Over 60 years of history, RBS has been rethinking its sales channels, as well as its cultural and operational integration. This has resulted in new opportunities for the group, deeply embedded in building digital native companies, fully taking advantage of the enormous opportunity emerging-market digital consumers represent.