CFO World

Fairfax calls in Google for adtech, digital audience efforts

ASX-listed media company looks to Google for support to build programmatic advertising, digital and data sophistication

Fairfax has struck a deal with Google to bolster its programmatic advertising and digital audience efforts across flagship media titles including The Sydney Morning Herald, The Age, the Australian Financial Review and Canberra Times.

Under the partnership, Fairfax said it will leverage Google’s global technical expertise in adtech to sell and market programmatic advertising across its major city mastheads as well as lifestyle properties. It will also work with Google to optimise publishing technology, digital innovation, drive subscriptions growth and improve the way Fairfax teams use data.

Kicking off in 2018, the first focus will be on premium ad products, top-tier client relationships and creating new commercial solutions. The brands coverage are The SMH, The Age, the AFR, WAtoday, Canberra Times and Brisbane Times.

Fairfax CEO, Greg Hywood, said the partnership comes off the back of rebuilding the ASX-listed media company’s publishing technology from the ground up.

“We are ensuring our company, our media and our shareholders benefit from commercial opportunities available to us,” he said. “We expect upside performance from this partnership will allow us to make new investment in our journalism.”

Google managing director A/NZ, Jason Pellegrino, added the joint effort with Fairfax would help demonstrate the power of programmatic sales.

Fairfax managing director of Australian Metro Publisher, Chris Janz, said the deeper partnership would provide advertisers with new ways to work with Fairfax.

“Google’s sales channels and marketing-leading programmatic technology will empower and enable advertisers to access Fairfax brands and reach our valuable audiences,” he said. “We are bringing the very best that Fairfax has to offer together with the smarts and capability of Google.”

Fairfax’s ongoing commitment to editorial has certainly been questioned this year, after the group slashed 125 editorial jobs, or more than one quarter of its newsroom, in May as part of efforts to cut $30 million in operating costs.

The deal with Google also comes as traditional media players fight to retain advertising dollars against the rise of next-generation, walled garden players such as Facebook.

In its FY17 financials, Fairfax reported full-year group revenue of $1.73 billion, down 5 per cent year-on-year, and a 4 per cent drop in underlying EBITDA of $271 million. In total, the group reported a net profit of $83.9 million, compared to a $773 million lost in FY2016.

The shining star on its books, Domain Group, spun out as its own ASX-listed entity on 16 November 2017 after shareholders and the courts voted in favour of a separation of the company from its Fairfax parent. Fairfax remains the largest shareholder in Domain.

Programmatic advertising, meanwhile, is on the up and up, despite concerns around the digital advertising supply chain as a whole. According to a recent AOL report, 22 per cent of Australian advertisers plan to increase spending on programmatic buying by more than 50 per cent in the FY18 year.

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