Simon Fox, the chief executive of Trinity Mirror, said part of the rationale for the £184m deal to acquire Northern & Shell’s titles, including the Daily Express, Daily Star and OK!, is the "opportunity" to get efficiency and scale from having a bigger ad sales team.
"I don’t think it should surprise anybody that the industry has been trying to reduce the number of individual sales teams," Fox told Campaign. "The agencies want that. They want an efficient way to buy."
The enlarged group should have ad sales approaching £380m, based on its most recent published figures for 2016, making it roughly the same size as DMG Media, owner of the Daily Mail and Metro, in advertising terms.
Fox said "nothing will happen overnight" to the two ad sales teams as the long-awaited deal is not due to complete until the end of February, subject to the approval of Trinity Mirror shareholders.
He explained: "Bringing the two organisations together gives us the opportunity to bring a single [ad] sales team to the market. I think that’s what the market wants. That’s clearly the direction of travel. The timing will be determined [later]."
Joint ad sales plan reemerges
Fox said that the head of the enlarged ad sales team is "not decided" and "it wouldn’t be fair" to identify individuals or discuss potential job losses.
He added that he is "very open" to the idea of reviving talks with other publishers about joint ad sales, after the Northern & Shell’s deal completes.
Trinity Mirror began talking in earnest a year ago with Northern & Shell and decided at the time to pull out of industry-wide discussions with News UK, Guardian Media Group, Telegraph Media Group and DMGT about pooling ad sales in a potential joint venture, called variously Project Juno, Rio and Arena.
Fox hinted he could return to the table. "I’ve always said the [news] industry does need to collaborate more," he said, noting "we are very small in the grand scheme of things" – without mentioning tech giants such as Google and Facebook by name.
"If we can come together as an industry we should," he added. "I’m very open."
Merging sports journalism teams 'makes sense'
Trinity Mirror has told investors that it hopes to find £20m a year in synergies from the Northern & Shell deal across commercial and editorial.
Vijay Vaghela, the finance director of Trinity Mirror, hinted the savings could be greater when asked on an investors’ call as he said he was "very, very confident" of achieving that target.
Fox said on the call: "There will be certain editorial teams that we will pool – for example, sports. It makes sense to bring our national sports teams from across all our titles together in one single the group. That content is then available for all titles.
"What that means is instead of the Express and the Mirror covering the same football game, we can use our resource much more efficiently and that will allow us to have broader, deeper coverage."
He maintained that content would be improved by "content-sharing across the Trinity Mirror group" by giving the Daily Express and Daily Star access to other internal resources such as Trinity Mirror Wire, which has content from its regional and local titles.
Deal will 'reduce dependence on advertising'
Fox does not expect any competition or media plurality concerns to block the deal.
Desmond has committed that his Health Lottery will spend £30m on advertising with Trinity Mirror over the next five years as part of the deal, according to Vaghela.
Total turnover from the Northern & Shell titles was £190m in 2016, including £30m for magazines OK!, New and Star. The titles had about £60m of ad sales, of which £12.6m was digital, in 2016. Trinity Mirror had about £320m in ad sales for the same period.
Trinity Mirror said the acquistion will reduce its dependence on advertising. The Northern & Shell titles got 61.2% of revenue from circulation compared to 43.6% for Trinity Mirror in 2016.