Why we’re closing Mumbrella Asia

We’ve made a reluctant call.

We’re closing Mumbrella Asia.

It was a tough decision because people’s careers and livelihoods are involved. And the failure does not belong to those people.

It was a tough decision because we’ve just run a successful event. In November, Mumbrella360 had a programme we’d have been proud of in any market in the world.

It was a tough decision because we’ve amassed a decent audience. We just delivered our 10 millionth page view. And we’ve now got more than 25,000 subscribers to the daily email.

And it was a tough decision because many of our commercial supporters became friends, and it feels like we’re letting them down after they backed us.

But as a business decision, it wasn’t tough. Indeed, it was probably a call we should have made earlier.

In the six-and-a-half years we’ve run Mumbrella Asia, we’ve never had a profitable year. Traffic has grown and revenues have grown, but we’ve never come close to breaking even.

This year, despite the (relative) commercial success of this month’s Mumbrella360 Asia we’re on course to lose another six-figure sum on our Singapore operation.

So we’ll be publishing for just a few more days.

One thing about this makes me proud: failure has always been in Mumbrella’s DNA. It’s how we have learned enough to create our successes.

There have been times where we’ve failed with a particular project and I’ve been left asking myself whether it was our strategy that was wrong, or how we executed.

This time we know.

The team did their job really well. The issue was the strategy we set for them.

Over the years, we got the strategy wrong in a couple of ways. One was around business model, and another around our – as the business jargon goes – addressable market. The two things are intertwined.

When we launched Mumbrella Asia in April 2013, it was our second market after Australia.

It seemed like an attractive proposition. Not only would we be the only Australian marketing trade press publication with a foothold in Asia, but the Australian news operation would give us a benefit over our local rivals who didn’t have anyone on the ground back in Oz.

We launched on April 22, 2013, with an initial crew of two – an editor in Hong Kong and salesman in Singapore.

Our first editor of Mumbrella Asia was Robin Hicks, who’d previously been our Melbourne editor and had also worked on local Asian trade media publications earlier in his career.

After a few months, we made the reluctant (on Robin’s part) decision to move him to Singapore too, as more of the APAC bosses were based there, although HK was admittedly a more fun place to be.

Robin was always passionate about the industry and the personification of a mission-driven journalist – who sees their job as serving readers by aiming to tell it like it is, rather than prioritising cosy relationships or short-term commercial considerations.

In his launch article, Robin compared his ambitions with that of Mumbrella Australia:

“What has made Mumbrella work is that it has a point of view. The stories we love to cover have a point of contention – a starting point for debate. Our best pieces touch on the issues that matter and get people talking. And this is what we want to achieve in Asia.

“Now, I’ve been told that the Mumbrella approach won’t work in this part of the world. That we’re too controversial (WPP boss Martin Sorrell has called us ‘aggressive’). That, unlike in Australia, readers will be less willing to jump in and join the discussion. But from what I gather from the people I’ve met since I’ve been back, I’m fairly confident the doubters will be proved wrong.”

It turns out that Robin was both right and wrong.

We quickly built a following and keen commenters. And at any given time, a number of company bosses would not be talking to us because of something we’d written. However, unlike Australia – where a disgruntled boss would pick up the phone and give us a blast before we all moved on – in Asia, it would sometimes be months before we realised a relationship was on ice.

When our then publisher (and now general manager) Dean Carroll came on board shortly before Robin left, he discovered there were many relationships that would benefit from a reset.

Meanwhile, our next editor, Eleanor Dickinson, was almost as driven as Robin, and just as likely to test the boundaries.

It was a relatively brief stint. While Dean, whose role included editorial oversight, was on holiday, Eleanor’s boundary-testing included writing about a sensitive Singaporean political issue. A few weeks later, her employment pass was not renewed by the government, and we found ourselves with a few days to get her out of the country.

Which brings us on to Mumbrella Asia’s third editor, Ravi Balakrishnan, who was a veteran of the Indian marketing trade press before joining us last year. Ravi had been editor of Brand Equity in India – the marketing magazine of The Economic Times, India’s most-read daily financial newspaper.

Our little team began to come together quite nicely as we found our niche within the community. Ravi’s gravitas and Dean’s diplomatic skills mended a lot of fences. And the personable Wilfred Wong spearheaded our sales effort. We won Trade Media of the Year and News Media of the Year at the Asia Pacific Publishing Awards.

However, we were also discovering a couple of things about our strategy.

First, we might call ourselves Mumbrella Asia, but events were such a key part of our business model that really we were Mumbrella Singapore.

Our mature business model in Australia enjoys three major sources of revenue. We have healthy advertising on our website and our daily email newsletter; we do well for sponsorship of our conferences; and we generate good revenues from event ticket sales.

For Mumbrella Asia, we were never able to kickstart that advertising stream. The market norm wasn’t there. In Australia, five years before, we’d been successful in persuading traditional print advertisers within the trade press that it was worth investing in digital advertising to talk to our audience. But with Mumbrella Asia we never pulled off that trick.

I’ve always opposed us taking programmatic advertising. I’m convinced it doesn’t work for B2B publishers. Their audience is too concentrated and too niche for it to be valued properly by algorithms.

A few months ago, as something of a last throw of the dice, I argued that we should give programmatic a try. Surely our 2.5m page impressions a year had to be worth something?

Even if we only pulled in a CPM of $10 (a fraction of our rate card) for two ad slots per page, that might contribute $50k per year.

In truth we’d left that experiment too late. The early stages saw it return CPMs in the cents rather than dollars, and in cash terms just a couple of hundred dollars per month.

Which left us with the other two parts of the business model – event sponsorship and ticket sales.

And that’s the point I was making about us being Mumbrella Singapore, not Mumbrella Asia. Events are, in the most part, attended by a local audience. When we launched, we told ourselves we were entering a bigger market than Australia. In truth, we were going into a smaller one.

But it still felt like a market worth being in. A lot of decisions affecting the whole region are made in Singapore.

Two years back, in late 2017, we ran Mumbrella360 for the first time in Singapore, at Marina Bay Sands.

It was a fraught, stressful and bumpy experience. It was a big event – four streams of content per day, plus masterclasses, plus the Mumbrella Awards, plus a networking afternoon.

Mumbrella360 saw strong lineup of local and international speakers

In the run up, most of the logistics were increasingly taken on by our Australia-based events team, as our single Singapore-based event manager gradually became overwhelmed by the scale of the event.

The event itself was something to be proud of.

Sponsors – particularly those who were familiar with Mumbrella360 in Australia – were generous in their support.

But we still lost a lot of money – again, in the six figures across that year.

Our biggest miss came in ticket sales.

We’d set a premium price. Our model has always been one of respecting the audience. We’ve always wanted to be an event organiser whose delegates expect to pay a premium to come away having learnt more and been sold to less.

But we were operating in a market where ticket prices are typically lower, and where sponsors therefore have higher expectations in how they can deliver sales messages to delegates.

In that first year of Mumbrella360, the quality of our program didn’t move the needle on ticket sales.

And yet, we’d promised our sponsors that Mumbrella360 would be well attended, and we needed to keep that promise. Letting down those who had gone out of their way to support us was not an option.

So as the event loomed, we gave away a lot of tickets to friends and contacts. It delivered a big, and senior audience to our sponsors, but it didn’t help our profit number.

Shortly afterwards, Mumbrella’s ownership changed, as we sold to Diversified Communications.

As 2017 turned to 2018, the rational thing to do seemed to be to close Mumbrella Asia.

Meanwhile, in April 2018 the first Mumbrella Asia Travel Marketing Summit took place.

Myself and our CEO/co-founder Martin Lane flew across for it, both thinking that this would be our final Mumbrella trip to Singapore.

It was a great event, and once again it had great sponsorship support. (And once again, we didn’t sell as many tickets as we’d have liked.)

At one point standing to one side of the room, I remember whispering to Martin something along the lines of “This is too good to let it die”.

Martin agreed. Once we were back in Sydney, we made a new recommendation. Reduce some of the risk by postponing the return of Mumbrella360 for one year, while we focused on growing our media sales and our audience.

Our new owners accepted our recommendations.

As a result, in 2018 we ran a good summit and a good Mumbrella Asia Awards. I was delighted that we were able to move to the live, presentation-based judging that helps ensure the quality of the Australian version of the awards. And at the end of the year, on that smaller risk model, we still lost money.

Which brought us into 2019, with much hanging on getting the media sales side of the business going, and the return of Mumbrella360 in November.

We decided to respond to the local market and reduce the ticket price.

It didn’t work. We didn’t sell many more tickets than the time before – and now they were at a lower price.

The sponsorship part of the equation did work though. Our sales team smashed that sponsorship budget.

But unfortunately, it wasn’t enough to close the gap on what we’d missed our advertising sales target by across the rest of the year.

Which brings us to where we are.

We’ve got a publishing product I’m really proud of. Traffic’s growing and so are email subscribers.

And we’ve delivered events that I’m convinced are world class.

But only the sponsorship part of the model is working.

And on a business model based around advertising, ticket sales and sponsorship, one-and-a-half out of three is not enough.

So it’s time to call it.

We gave Dean the news a couple of weeks ago. We asked him to come and work for us in Australia, but he’s had to decline for family reasons.

Meanwhile, we’re talking to Ravi about a potential role in Australia.

And as for Wilfred, if you’d like to hire an excellent, upbeat salesperson who’s just hit his sponsorship budget, then you know where to go.

We thought carefully about alternatives to closing.

Could we wind things back and keep things ticking over? We couldn’t figure out a way that wouldn’t also decrease revenue.

Or could we repurpose the Mumbrella Asia site to become editorial-only and more internationally focused, so we didn’t have to lose face by admitting we were shutting things down? That sleight-of-hand didn’t really feel like our style.

To be clear though, this is not the end of our international ambitions. We’re owned by a company which has a strong presence in the UK and US among others.

And what we’ve learned about the conditions for failure of our model in Singapore also helps us understand the conditions for success elsewhere.

We’ll leave Singapore knowing that we gave it our best shot.

To the many commercial partners who took a risk and supported us: Thank you – we never took it for granted.

To those who read Mumbrella, or commented: Thank you for your contributions.

And to all of our staff: Thank you. It was our strategy that was the failure. You succeeded on all the challenges we set you.

Tim Burrowes

Tim Burrowes is the founder and content director of Mumbrella. He’s written about media and marketing in Australia, Singapore, the Middle East and the UK.

source: http://www.mumbrella.asia