We have written before about how niche media businesses are bucking the downward trends. It seems to be an approach that is working for consumer as well as
B2B businesses. More evidence of this comes with the recent publication of Centaur’s latest interim report, which confirms that its Travel & Meetings portfolio reported revenues of £5.7m (2016: £5.0m), up 14 percent year on year, led by its Business Travel iQ business information brand.
Also mining the travel sector, Skift has been one of the biggest success stories in the business information sector over the past few years – its success stands in contrast to other media startups which rely on VC funding. In fact, its founder Rafat Ali has spoken many times about why going ‘narrow and deep‘ in high-value niches is the biggest opportunities for media companies.
So why does this sector seem to be returning dividends for publishers?
Well, travel is one of those rare verticals that seems to thrive no matter what. For one thing, the travel and holiday industry seems to be resilient – despite all the gloomy news about the 31 percent increase in the cost of holidays post-Brexit, the latest Travel Trends Report from ABTA notes that more British people are taking holidays than at any time since 2011. Additionally, as has been pointed out by Skift, the falling cost of haulage and desire for experiential holidays means that there is more diversity in the industry than ever before, from the types of travellers to the sorts of destinations. Small wonder, then, that media companies with a focus on providing travel information are proving equally resilient.
So is the travel information sector that rarity which will keep on giving? Yes, and no.
Reports this month about the collapsing value of the pound suggest that overseas travel will be severely hit next year: like construction, the UK travel industry may experience a Brexit lag. Nonetheless, the types of information businesses that are thriving within the sector are just as important to their clients during good times and bad. In good information businesses, renewal rates of plus 90% are standard; in bad times that may be affected by companies going bust, but new business is likely to be supplemented by other clients seeking insight. Businesses like Skift and Business Travel iQ are unlikely to suffer much if there is a downturn in the sector.
But is the travel sector unique? No.
PwC’s media forecasts demonstrate that B2B revenue is set to increase further, with the ‘business information segment [being] the growth engine of the overall B2B market worldwide’. Successful examples exist in healthcare, commercial property, finance, infrastructure, and commodities, among many others.
In addition, the rise of the gig economy means that media companies are willing to try new things to reach those potential new audiences: an “at will” hiring approach makes the cost of experimenting with new products much more bearable. Back in the travel sector, Airbnb’s Pineapple failed, but it is practically certain to try again, and has a bigger opportunity with the huge amounts of consumer data it controls to launch new B2B services around that.
In short, the B2B sector can continue to prosper through a balanced approach to product development: make sure you understand your customers (or potential customers), and understand what they need from you: but be emboldened to experiment.
Martin Tripp Associates is a London-based executive search consultancy. While we are best-known for our work in the TMT (technology, media, and telecoms) space, we have also worked with some of the world’s biggest brands on challenging senior positions. Feel free to contact us to discuss any of the issues raised in this blog.