The advertising arm of Mail, Metro and i publisher DMG Media has set out proposals for a major restructure amid a “suppressed” market that has not recovered as well as expected following the Covid-19 pandemic.
Redundancies are expected in the shake-up at Mail Metro Media, but numbers have not yet been shared while a consultation process gets underway.
The proposal is that Mail Metro Media’s current operating model for commercial sales will become “more collaborative” across the board.
This will include combining all agency sales into a single team. More junior agency partner vacancies will be created.
The categories and planning teams will merge together so they can “better access clients, senior planners and strategists,” staff were told, while the sales executive team will be centralised.
A dedicated Metro team will be created across digital, print, classified and partnerships, while “operational efficiencies” will be made across direct sales, commercial editorial, and SME-focused functions.
In an email to staff announcing the proposal seen by Press Gazette, chief revenue officer Dominic Williams said: “It is not easy for me to write this, however, despite our collective effort and determination, DMG media has faced a suppressed advertising market that has not recovered as expected after the Covid-19 pandemic impacted both print and digital revenues.
“Therefore, we will need to restructure our cost base so that it better reflects the broader economic environment we are in today.
“While this is a difficult decision to be made, it will position DMG Media for success in a very challenging advertising market and ensure we can deliver on our future goals and ambitions as a more consolidated and streamlined business.”
Williams told staff that if the proposal goes ahead there will be a “reduction of headcount in our department”. Some newly defined roles will also be created.
As well as DMG Media’s brands, Mail Metro Media also sells advertising for The Telegraph’s print products.
Parent company DMGT was delisted from the London Stock Exchange in January last year after Lord Rothermere, whose great-grandfather founded the company, took the company private. He is now its chief executive and chairman.
The company is now preparing to face the same economic headwinds as other publishers, such as The Independent and Mirror and Express publisher Reach, who have also announced plans for redundancies with advertising revenues dipping and costs like energy increasing. [Update: a shake-up is also planned for Metro newspaper, with an as-yet unknown number of editorial redundancies and the departure of editor Ted Young.]
New data published by the Advertising Association and agency WARC on Thursday showed the projection for the ad market in 2023 amounts to a real terms decline of 3% once inflation is accounted for. After accounting for inflation, real terms growth was thought to have been flat in 2022 at -0.1%.
“Forecasts for the coming year show reduced growth expectations for almost all sectors of advertising in line with pressures felt by all parts of the economy,” the Advertising Association said.
James McDonald, director of data, intelligence and forecasting at WARC, said: “Despite an air of resilience in recent market results, a looming recession will put pressure on ad trade this year. We foresee ad market growth easing to 3.8%, equating to a real terms decline and the weakest rise in a decade if the pandemic-hit 2020 were excluded.
“The silver lining here is that our current modelling suggests that the slump will be short-lived, with advertising investment set to lift by 5% over the first nine months of 2024.”
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