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06/21/2018

GateHouse CEO: Serving small business can replace lost ad dollars

By Ken Doctor, Nieman Lab

GateHouse Media claims to serve 219,000 small- and medium-sized businesses in its hundreds of markets. Like most of its newspaper chain peers, GateHouse expanded its ad selling to “marketing services” more than a half decade ago. Unlike those peers, the company now aims to move profoundly beyond selling ads.

 

Mike Reed, CEO of GateHouse parent New Media Investment Group, lays out the strategy in our interview below. (Here’s my full, much longer interview with Reed.)

He makes the case that America’s burgeoning base of 29 million smaller businesses — those with 20 or fewer employees — want a one-stop shop for help with everything from financing to IT to human resources. The company’s UpCurve division leads this new charge.

For the first quarter, UpCurve generated $19.4 million in revenue, an increase of 36 percent compared to the first quarter of 2017. Yet it’s a small revenue — and profit — contributor so far, accounting for less than six percent of revenue.

Mike Reed’s hope: Small businesses “want to deal with a local business partner. So why can’t we be their business partner?”

Ken Doctor: Let’s talk about both ThriveHive and UpCurve.
 
Mike Reed: Our B2B business, which was selling advertising, has had to evolve. For us, the evolution is to selling services to the small businesses. So that’s UpCurve.

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