Chapter One Introduction
1.1 Background
The digital marketing disruption has created important changes in the media, especially in newspapers and magazines. Nowadays, the boom of smartphones, is increasing the immediacy of obtaining the news and it is firmly changing the markets perspective.
According to a research by Knight Foundation, 89% of the users read news through their smartphones. Although the TV is still the number one media, the social networks are increasing day by day. Twitter, Web Pages, Instagram, Facebook, Snapchat, among others, are in the second place with the inevitable expectation of becoming number one in the future.
On this way, it has surged many medias considered digital native that have understood the fundamental principle of this new market, the continuous change. These new medias are already becoming rentable and valuable. One example is the Huffington Post, founded as a blog in 2005 and in 2011 was sold for 315 million dollars. One of its founders, also founded a similar portal, but directed to younger people. The portal is named Buzz Feed and today its value is 1 billion dollars. There are other successful examples and cases like Masgable, The Daily Beast, Topix, among others. In Spain, there are also similar sites like El Espa?ol, Libertad Digital or 20 Minutos. In Venezuela, La Patilla, Noticias 24, Run-runes, Caraota Digital o El Estímulo.
Along with new digital tools and ways of accessing news, a new concept was created in the United States, “news aggregators”, which are web sites that reproduce what others digital media reports, giving the respective credit. This is what The Huffington Post do, and others are also starting to operate with this business model such as BuzzFeed (US), La Patilla (Venezuela) or Noticias 24 (Venezuela). They collocate the most relevant information and redirect it to the principal source. Despite the un-doubtful success of The Huffington Post, it does not offer an exhaustive news portfolio of desired countries (e.g. Spain) but rather a broad view on global highlights.
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1.2 Current Status
During the last years, the industry of Media and Communication has evolved to new and different practices. The globalization has created that the change is a constant variable in this new era, digital era. Everything is changing in business of Media and Communication. 20 years ago, people had to buy newspapers or magazines in a shop with the main purpose of consuming news or opinions. The fastest way to consume was the TV, however the consumer must be slope of the specific TV news schedule. Nowadays, through smartphones and tablets the consumer can reach to news and any time and place.
1.2.1 Worldwide Digital News
Due to all the content that people can receive through World Wide Web and new forms of distribution, many different fake news about some successes like US president election, Catalunya Process, Venezuela’s 2017 strikes, among others, have reached out to the population. This has promoted a crisis of confidence in journalism where it is very difficult to differentiate verified facts from untruths.
According to Reuters Institute:
24% of respondents believes that social media is doing a good effort with the main purpose of showing a difference between the fact and fiction. The people in the world is feeling that is very difficult to trust in news and this is a big problem because nowadays everything can become viral very fast.
Trust is perceived globally different depending on the country. For example, in Finland, trust in media is perceived by 62% of people, but in south Korea and Greece just 23%.
In countries with a lot of political polarization like USA, Italy and Hungary, the distrust in media is more related to the political bias.
29% of respondents sometimes avoid news. One reason is because it can have a negative impact on their mood. The second reason is because they consider difficult to trust in the source.
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Chapter Two Literature Review
2.1 Literature Review (Media and Communication)
The following chapter will show the description and analysis of previews research related to news-aggregators in Spain’s, Digital News Consumption, market behavior among others. We will also go beyond of the previews research by discussing and analyzing the body of knowledge. It is indispensable to determine what is known and unknown related to digital news consumption and news-aggregators in Spain. It could happen that previews research will be replicated and this should be avoided.
2.1.1 Media and Communication Definitions
The industry of media and communication has many different definitions. The experts of this area could consider some concepts very easy to understand and typical. However, it is important to define and make clear some concepts related to media and communication specially in the digital area, where the business plan will be the main focus. It is relevant because of the continues change in this context. Base in mind that just few years ago, the following concepts did not exist: digital news, news-aggregators, web pages visits, views, search engines, trends, digital marketing, digital marketing operations, digital news consumer, digital natives, omnichannel among others. Beside this, we will offer the definition larger and traditional definitions for journalism, journalist and impress media.
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2.2 Models/ Concepts/ Frameworks and Their Applications
In the business opportunities chapter will be applied all the concepts and models with the main purpose of defining each regarding the business plan:
PESTEL analysis will be applied with the main purpose of considering all the external variables that are relevant to the business plan. The environment selected is Spain, and so all information will be oriented to understand this environment.
Porter’s Five Forces will be applied with the main purpose of understanding the industry behavior in which the business will develop its activities. In this case will be Media and communication, specified to health and safety.
SWOT Analysis will be applied with the main purpose of understanding even more the external factors a how should be develop the strategy of the company regarding strengths, threats, weakness and opportunities. For example, what strengths has El Nuevo País to approach the opportunities and to face the threats.
Canvas Business Model will be applied to understand the customer segment, in this case will be the online news consumers and the advertisers. It is important to approach all the 9 blocks with the main purpose of identifying the value proposal and how the company creates values.
The expansion model (LLL) will be applied to understand which will be the value creation source, how the news reproduction business model will be successful and how it will compete in the host market, Spain.
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Chapter Three The Opportunity ................................. 28
3.1 Business Opportunities ...................................... 28
3.1.1 Market Research ........................................ 29
3.1.2 The Market Gap ......................................... 32
Chapter Four The Company and Team ........................ 44
4.1 Legal Structure and Ownership ............................ 44
4.2 The Management Team .............................. 46
Chapter Five Marketing Plan ......................................... 52
5.1 Identification of Potential Consumers ............................ 52
5.2 Projection of Potential Sales Revenues................................ 55
Chapter Six Operating and Financial Plans
6.1 Conversion of Inputs into Outputs
Regarding the news consumers, the key operating process of the company that will convert the inputs into outputs are the following:
Visits Process: For our news consumers will be three main channels to visit our platform and read news: direct (the Web page and The App), Socials Networks (Facebook, Instagram, Twitter) and Instant messaging apps (Wechat, WhatsApp, Facebook messenger among others)
After the user or consumer get in the platform to read the news, the visit will be registered automatically in our web management software and or online visits counter.
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Chapter Seven Conclusion
After the research and analysis on the business plan “El NuevoPais.es” it is indispensable to summarize the key points with the main purpose of deciding the viability of the project.
It is known that Spain is facing a political situation due to the Rajoy impeachment and Pedro Sanchez arrival to the presidency. However, Spain is considered a safe country for investment, with a GDP of 3% annually. International and local StartUps have been successful in this territory. One proven successful case is El Confidential, a digital newspaper, which is consider a reference in the online news sector, due to its digital native origin. Additionally, Spanish population have shown a strong interest for this type of platform and they have a strong socio-cultural background of reading online news. On top of that, the market growth of online advertisement has been 14% up to 2018, and it is expected to continue growing in the next 10 years.
We have identified an existing market need and niche in which news consumers are still reluctant to trustful digital news. However, there are few existing credible and reliable online news sources (e.g. El Confidencial, Antena 3, El Periodico, GrupoZ, etc.). This project intends to use these existing stablished tools to offer an innovative service such as the “News-aggregator” and start filling in the market niche. The objective is to retrieve the news out of these sources by professionals in the field, filter them according to credibility and relevancy criteria to finally reproduce them in our platform. This will guaranty a low operational cost because the news will not be produced from scratch. Despite the possible adaptation of the news from our team of professionals, the articles will remain loyal to the original content and source, which will always be cited, mentioned and recognized.
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