Bailey has big job on her hands

Nearly three years since she took charge of MGN's three flagship titles - the Daily Mirror, Sunday Mirror and The People - Trinity Mirror's chief executive Sly Bailey has adopted a more "hands-on" approach. Sheelagh Doyle reports.

The surprise defection of Mirror Group Newspapers' ad boss Dominic Carter to News International has put the issues of the group's management structure and strategy back in the spotlight.

Carter was the third MGN ad director in two years. He has had just nine months in the job and is leaving to take up a role of trading director for Times Newspapers, reporting to director of advertising Ian Clark. As director of advertising at MGN, Carter reported directly to Trinity Mirror chief executive Sly Bailey.

Carter's resignation follows the departure of managing director Ellis Watson, announced in May. Watson has so far not been replaced. Bailey has added to her considerable burden by taking on his role in the interim.

However, Carter is currently due to work six months' notice.

Since arriving from IPC in 2003, Bailey has generally pleased the City. She has increased profits through judicious cost-cutting, combined with strong performance at the group's regional paper and online businesses.

Yet, the three national titles - the Daily Mirror, Sunday Mirror and The People - continue to be a challenge. There have been changes in editorial strategy, and damage to the Daily Mirror's image caused by the Piers Morgan Iraqi prisoners' photo fiasco.

Entertainment focus

Since Morgan's departure, the Daily Mirror's circulation, despite ditching its "serious news agenda" and reverting back to its red-top "entertainment" focus under new editor Richard Wallace, has continued to slide.

The Daily Mirror's average ABC sales for May to October were down 3.75% year on year, the Sunday Mirror was down 4.3%, while The People slumped 8.4%.

Furthermore, the papers are under-performing a generally declining market. By comparison, The Sun was only down 1.9% and the News of the World fell 2.2%. This leaves the Mirror titles lagging even further behind their rivals - The Sun leads the Daily Mirror by more than 1.5 million copies a day.

Adrian Pike, press director at Starcom, believes the Daily Mirror has lost some of its personality since Morgan's exit. "It has become a lot more editorially stable and not as controversial, but I wouldn't say it has carved its own identity."

Paul Thomas, press director and managing partner at MindShare, agrees. "I don't think they have managed to create a brand identity that stands out from where it was previously."

Nick Fullagar, a member of Trinity Mirror's executive committee and director of corporate communications, refutes these claims and argues that the changes have made the paper more focused for its target market.

He also claims that the ABCs present a cloudy picture. "ABCs don't tell you about bulks and discounted marketing spend. Unlike the rest of the titles in our sector, we operate at full cover price."

However, Trinity Mirror has indicated that a priority for growth is through investment in its online businesses.

It is paying £50.9m for online recruitment firm Hotgroup. It has also been linked with residential property websites.

Fullagar insists that Trinity Mirror remains fully committed to its national papers, and says Bailey is currently overseeing them "because it gives her a chance to re-evaluate the strengths and weaknesses, and gives her a better feel for the person she needs".

Pointing out that there had been recent significant investment in new presses and sections for the nationals, he adds: "Newspapers are core to our business, but we see digital as a key pillar, as a strategy for growth. You can't ignore digital. It has to be in the mix."

Decent numbers

Despite the management changes on the commercial side and long-term copy sales decline, press buyers still have faith in the papers. Starcom's Pike says: "Everyone wants MGN to do well. While it is struggling, it still has decent numbers in circulation. It is not a dead duck yet."

Perhaps in acceptance that there is little growth to be had in national newspapers, MGN has been flirting with consumer magazine launches. Earlier this year, it had advanced plans for a TV listings magazine, but these were scuppered when a price war broke out in the sector.

Magazine insiders say there is also an advanced dummy for a real-life magazine, called Reality. But here again, News International has overtaken MGN.

The former has announced it will launch a similar title, Love It, in February, followed, in March, by a home interest title, Inside Out.

Advertisers would dearly love to see a rejuvenated MGN, which would both help in getting mass coverage and provide negotiating muscle to use against NI.

They will be hoping that Bailey's hands-on assessment leads to improvement in the papers' fortunes.

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