Les Hinton, the CEO of Dow Jones & Co., the parent of The Wall Street Journal, Barron’s, Marketwatch.com and Dow Jones Newswires, sent the following e-mail to the company staff on the wake of its recent performance:
First-quarter results confirm the wisdom of investing in our products and services to provide more value to readers and customers and to drive growth.
In a fiscal quarter in which News Corp.’s earnings were very good, Dow Jones contributed a 9.5% increase in revenue in what is historically a weak three months for the company.
You know already many of the components of success. Ad revenue companywide was up 24% in the period from July through September. Circulation revenue for the entire company was 14% higher. The Wall Street Journal and its international editions were among the drivers. Barron’s showed continued strength. Our digital products paced the advance. Growing circulation and advertising revenue from iPads, e-readers and smartphones offer promise for the future.
Among enterprise products, we were able to increase customer retention even as we felt some declines in the quarter. That was expected given our investment in new and existing services as well as a sales cycle timed around long-term contracts. It’s the long term we’re focused on. We are investing now in our portfolio of Corporate and Financial Markets products – including Factiva, Newswires, Risk & Compliance, Investment Banker and Consultant – to facilitate long-term relationships and commitments and to drive growth.
The quarter included another big product expansion with WSJ Weekend in September. WSJ Weekend and Greater New York, another major expansion in calendar 2010, already have attracted more than 70 new advertisers to the Journal franchise. These are on top of the 88 new advertisers who have used our luxury magazine WSJ. since its launch to reach our affluent and influential readers. Based on that success we will be publishing WSJ. more frequently in 2011.
We are investing in our products and our audiences globally as well as locally. We added European and Asian editions to the Journal’s iPad app. We introduced Chinese and Japanese language WSJ iPhone apps to accelerate our efforts to pursue local audiences around the world. Some of our Local Media Group newspapers have begun charging for online access, and we’re pleased with the early results.
Internally, we haven’t relented in our quest to make our systems and processes the best in the business. MarketWatch journalists joined the Journal and Barron’s on the Methode publishing system. This put our three biggest consumer products on a common publishing system, allowing us to address our readers more precisely. Important projects under way from Finance to IT to HR are designed to make us a smarter, more nimble organization. We’re making customer service a priority and asking employees to contribute ideas to improve the customer experience. That initiative is called Customer 1st , and it recognizes that each of us is responsible for building loyalty reader by reader and client by client.
This economic environment makes it difficult to see too far ahead, so it’s impossible to predict the next year or even the next quarter. But we know what we’ve done, which is prove you can be a success in the newspaper business by selling trusted, authoritative and compelling content in print and on digital devices – and sometimes to the same readers.
Some with circulation half of ours prefer to dismiss our success with mistaken accusations about the Journal selling ads at a discount. The truth is our growing advertising revenue isn’t the result of discounting, and our competitors know that as well as we do. Advertisers are ready to pay a premium for space in the No. 1 newspaper in the U.S. Our product is ever more attractive to readers and advertisers both.
This was a good quarter. The economy remains unsteady, but let us hope this next quarter will be good too. Thank you for the performance you helped make possible and for the even better performance you are making possible now.
