“Our goal is to become the leading digital publisher. And it’s all based on a very simple strategy.”
- Mathias Döpfner, CEO of Axel Springer SE, draws on his creative starting point to steer Europe’s leading digital publisher confidently into the future
- “Don’t be afraid of self-cannibalisation: you’re going to be cannibalised anyway, so it’s much better to do it yourself!”
- Why should you build a work culture where people dare to do the things they’re “not supposed to do”?
It’s not hyperbole to say that, for millions of people, Mathias Döpfner has shaped their window on the world. As CEO of Axel Springer SE, he has grown a successful European media empire which has now set sights on the rest of the world.
Mathias has a unique creative perspective on the media landscape. Because whilst he now heads up Axel Springer, and is a board member of Vodafone, Time Warner, and Warner Music Group, he originally wanted to be a jazz bassist — and has a PhD in Musicology.
After he spoke at TOA Berlin 2016, he sat down for an exclusive chat with TOA founder Niko Woischnik. They cut to the chase and dug into the toughest question that modern publishing faces, namely: how does the media business make money and innovate in an unforgiving online world?
Watch the whole talk here, or read Mathias’ hard-earned perspective below:
Niko Woischnik, TOA: I have a question about your past. You studied musicology and theatrical arts. How important is interdisciplinary knowledge exchange for your company and your role as CEO of Axel Springer?
Mathias Döpfner, Axel Springer SE: You could say that studying musicology is a waste of time if you want to run a media company! But I’m really happy that I had that opportunity, and I think it’s helpful because media is a creative industry.
To speak the language of creative people and to learn the specifics of music and art can only help to run a very creative business like the media industry.
Having inspiration from very different areas is good. It’s like having a diverse team: if you have a team with a high diversity, you are usually more successful than if you have a team that is very homogeneous. The same is true with learning experiences: if you’re always [only] learning about business, it’s very narrow minded, and I think you will probably not be that successful.
NW: what technologies do you think will impact the media business and your company most in the next decade?
MD: Well, the whole publishing industry is completely disrupted and is in a fundamental transformation — with an open end. I personally tend to be optimistic. I think that the media business and journalism in the digital world is going to be better even than in the analogue world, both quality-wise and with regard to financial results.
But it is a very disruptive process and technology plays a crucial role. Analogue distribution is — let’s say — a “dying” model: it’s structurally declining.
Now, it’s all about digital distribution. It’s about mobile, it’s about interactivity; and it’s very, very interesting to see which role virtual reality is going to play.
I find it tremendously exciting and we are very glad to be able to be in the middle of that change.
NW: You’ve grown your digital share of revenue tremendously since you became CEO — a lot of it via acquisition. What is your mergers and acquisitions strategy moving forward? You bought Business Insider and made large investments in other platforms in the USA — what can we expect in the years to come?
MD: Our goal is to become the leading digital publisher. With roughly 200 million unique users, we are by far the biggest digital publisher in Europe — but now we want to go beyond Europe. And it’s is all based on a very simple strategy.
We basically do three things. We buy or launch content platforms, content products, or content brands. We launch or buy marketing companies — they always used to be an important part of a media company. That means advertising revenues.
And the third pillar is classified advertising revenues. Portals of real estate, cars, jobs: we called it “classified ads” in the old analogue world, and this digital classified business is now an important economic backbone of a digital media company.
Beyond Europe, the US market is a high priority, and we have made 13 investments in the United States over the last two years — ranging from very small investments in Mic, Now This, Ozy, Livingly, and Thrillist, to two really big ones: Business Insider and eMarketer.
NW: Moving away from the acquisition part of of this three-fold approach, what can companies that are ripe for disruption do to instigate more internal product innovation?
MD: The first important thing is you must not be afraid of self-cannibalisation: you are going to be cannibalised anyway, so it’s much better to do it yourself! It’s easier said than done.
I do not believe in central innovation. I think you should not have an innovation department — it doesn’t work in departments. Innovation and creativity takes place where you don’t expect it to take place: in a very deep, central manner.
So what you can do is to create a culture or a mindset — a spirit — where people dare to come up with ideas, and where people dare to do things that they’re not “supposed to do.” This kind of culture then leads to innovation.
NW: And what role do you think will Berlin — as a creative and emerging technology hub — play in the global technological landscape?
MD: Well, Berlin was — as a former mayor used to say — “poor but sexy.” And in a way, these two elements helped transform Berlin into one of the most exciting hubs in the world for tech companies and startups.
It was very cheap in Berlin at the beginning for artists to rent a studio or for founders to rent office space. And at the same time the quality of life was very exciting in Berlin — Berlin is a slightly decadent, hedonistic place with a great nightlife.
So the combination of sexiness and poorness transformed Berlin into an exciting place for innovation. Of course, with regard to invested capital, it’s incomparable to Silicon Valley.
But if you look to the big hubs — Tel Aviv, London, and the American hubs — then Berlin is one of the most creative ones; and with regard to invested capital is growing fast.
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This talk was edited for clarity and length.
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