MailOnline publisher Martin Clarke told us how he is conquering America by spending millions on luxury party yachts in Cannes
Although its "sidebar of shame" (the gossipy column on the right-hand side of its web page that focuses on semi-nude celebrities) is well-known in the US, few people outside the media industry realise just how massive the Mail has become in America, and how big its ambitions are. The Mail's collection of US offices and correspondents are now bigger than many entire US news organisations. Globally, with 815 staffers, it rivals the New York Times in size (which has over 1,300 editorial staff but is shrinking). Nearly 250 Mail journalists work in America right now, up from zero five years ago.
That has shifted the global gravity of Mail considerably - toward New York and away from London, the HQ.
And the Mail is still growing, fuelled by its increasing online revenue which is replacing its dinosaur print-product. Revenues for the last six months of 2016, for the Mail's parent company, were £950 million, down 1%. Profit before tax was £129m, down 11%. But the online section of that is increasing. MailOnline is where the future is for the paper that devotes more editorial resources to bikini analysis than the Washington Post did to Watergate.
At the Cannes Lions in the South of France this week, the Mail "won" the ad festival by parking a massive luxury party yacht on the dock next to the festival centre. In front of that, the Mail erected a three-storey multi-level stage with a free bar and DJ. Admen and media execs lined up to get in. Next door, the News UK yacht - handsomely branded with the Wall Street Journal's logo - looked small and quiet by comparison.
Multiple sources told Business Insider that the Mail's rented party-yacht bill was at least $1 million, and some estimates put it as high as $8 million, for the week. The cost of the boat is just the start of it: There was also the branding, the stage, the DJs, the staff, the food, the PR people, the celebrities, the plane tickets. Among the Mail's star guests for the week were Martha Stewart, WPP CEO Martin Sorrell, Piers Morgan, and Instagram star The Fat Jew.
In addition to its main yacht, the "Idol," the Mail also rented a smaller (but nonetheless sizeable) secondary yacht, "Miss Candy," on which Business Insider spotted publisher Martin Clarke engrossed in his laptop. Last year, the Mail had only one boat and no stage. So the dockside extravaganza this year is a symbol of the scale of its thinking (or its excess, depending on how you feel about the Mail).
"What we invest we expect to make back," a source on the Mail boat told us.
Business Insider was invited onto the Mail yacht for lunch with publisher Martin Clarke this week. When asked about the Mail's yacht bill, he told us the company spends "less than you think. We consider it a good investment." It's one of the easiest ways to get the attention of American advertisers, Clarke says.
Here is a lightly edited version of our conversation:
Jim Edwards: How many staff do you have in total now?
Martin Clarke: 220 in total in New York. Globally 815, it goes up every month. Slightly under 400 are journalists. I'll be honest I don't keep track of how many journalists we have in offices. Broadly speaking I'd say 60 or 70 in Australia, this doesn't count freelances. One-hundred-and-twenty in the US. The remainder in London. LA is about 40 people isn't it?
Q: How many did you have in America five years ago?
Clarke: There were none in America five years ago.
Q: Would you ever go all digital?
Clarke: That's not my call. I wouldn't have thought so for a very long time. The Daily Mail still makes a heap of money, so why would we do that? And I think they'll continue to make money for many a year.
Q: Do you ever think about it?
Clarke: Not personally no, I'll be honest. And I don't think anyone in the business except in a drunken late night conversation thinks about it either.
Q: The Independent did it.
Clarke: I think the Independent is an entirely different kettle of fish from the Daily Mail. It's arguable whether the Independent should have lasted as long as it did economically. we're not a rich man's plaything, we're a profitable business. We're not a charity, or subsidised by a fund, or a licence fee, we're a profitable business. And the Daily Mail and the Mail on Sunday are still very profitable businesses in their own right. So there's no serious thought or conversation about that at all.
Q: Total revenue is down at DMGT, the parent company, even though digital revenue is up. Do you need to make cuts?
Clarke: Why would I make cuts to a growing business? one of our KPIs that I have to stick to is the number of people I hire. And in the past if I haven't hired enough people I get told off. It's a growing business it's still an expanding business. Despite growing so fast it's still a very lean business. We do not have a lot of people sitting around doing nothing. We haven't hired so fast that we've made too many mistakes. We've hired at a nice organic rate. So that we have a very efficient staff, a very talented staff, they work really, really, really hard. There's certainly no question of us cutting. Every business can be much more efficient. And get more bang for its buck.
Clarke: Less than you think. There is an economy of scale, less than you think. We consider it a good investment. This week works for us.
Q: How does it work for you?
Clarke: It works in terms of our general profile. Particularly with the American market where obviously we didn't have a brand profile. We concentrated our first three years in America building our audience. We didn't do a particularly good job building our profile commercially. And we've spent the last year to 18 months trying to rectify that with events like this and putting ourselves front of mind with the advertising community. Also, we do some proper business. You meet a lot of people. You discuss lines and ideas in principal and also you can take things further, so it works for us on a macro sales level and also on a micro sales level, on a field level. And also it's not often I get a chance to get all my people together. The UK team, the Australia team and the American senior team, in once place. So it's good for them to spend time together and keep them all on the same page. It's difficult running a global business in different geographies across the world, and keeping everyone culturally assimilated and on message and focused on the same priorities. So there is some benefit to that as well, so this works for us or we wouldn't have come back and done it again.
Q: Is the Mail affected by adblockers?
Clarke: We don't find adblockers a particular issue at the moment. The problem on desktop is not growing at all. And to be honest it's not particularly bothersome. And the number of adblockers on mobile is almost nothing. So we're watching it, we're not complacent about it obviously it's a concern but we're not freaked out over it by any manner or means. We're constantly refreshing the suite of ad products, you have to to keep the market interested, display, native video, mobile ...
Q: What about programmatic?
Q: Are your 650 daily videos generated by journalists or software?
Clarke: We do everything the old-fashioned way with journalists, yeah? We're quite wedded to that concept.
Q: Tell us about the Mail's strategy with Snapchat.
Clarke: Snapchat is fantastic. What do you want to know? Snapchat is phenomenal, excellent. They're a really great company to work with. Evan [Spiegal the founder] is a really, really, nice, smart guy. They're really easy to deal with. Very flat company. You don't have to deal with a whole bunch of people. I only really deal with three people and Evan is one of them. So I can get good feedback from them. They're transparent, they work fast, they're very pragmatic and sensible. It's not all pie in the sky, it's a really well-engaged audience we've got. In the last couple of weeks they've done a new release on the app which puts the Discover app in front of more people ... which has quadrupled [views] on some days from the days before they did that. ... our bit of the Snapchat app, not every day, has at least tripled and on some days is up to 400% higher. That was in a week, that was from this new release they did. It's phenomenally successful. Advertisers can present a full-length video or a native offering, or even click through to their own web site from it, so it's much more versatile for advertisers. They've got third party tracking now in America, we were effectively sold out this month on Snapchat, which is good.
Q: What's going in with Truffle Pig [the joint venture ad agency between the Mail, WPP and Snapchat]?
Clarke: It's actually going really well. We don't run it, they have their own management team, I'm on the board ... we have a quarterly board meeting at which they pick our brains from a point of view, we cooperate with contacts and introductions. And their business plan which so far they have stuck to, is doing really, really well. It's a good business that we're very happy to be part of.
Q: Is there tension on whether MailOnline should favour Leave or Remain in the EU Brexit referendum? Everyone expects Paul Dacre, the editor of the Daily Mail newspaper, to favour Leave.
Clarke: We deliberately do not strike really aggressive political poses and there's a very good reason for that. Any newspaper, even a big newspaper like the Daily Mail or the Sun is filling a niche. It may be a big niche but it's a niche. I'm not going to label those niches for the sake of political correctness but we can't afford even in a big niche, we have to have a mass audience and attract as many people as possible, so we don't ram the politics down people's throats. We do things straight. Obviously our columnists - Katie Hopkins is very, very pro Brexit. Piers Morgan, who can't say what he thinks because of his GMTV gig, is maybe less so ... it's pretty straight down the line with a light Brexit twist. My gut instinct, looking at the comments on the web site and what stories the readers click most enthusiastically on about the referendum ... the stories that they click on most enthusiastically are definitely the stories that would be seen as pro-Brexit.