In March 2022, Schibsted’s sports platform added a new sport for the first time in many years – Formula 1. Behind the decision was a true product strategy to engage younger users, create long-term growth and do something unique.

In Schibsted Sports Platform, we build three products: VG live, Aftonbladet Målservice, and the Sports APIs. VG live and Målservice together serve around 1.5 million unique weekly users across Norway and Sweden with live sports results, videos and statistics. With over 35 million weekly page views, these services generate more than NOK 45 million for VG and Aftonbladet each year.

Our Sports APIs serve as a one-stop-shop for sports data in Schibsted.

But for years, our main offering has stayed the same: football, handball and ice hockey. To expand our audience and do something truly new, we wanted to extend that offering. The result was our new Formula 1 service, launched in March 2022.

Our F1 service enables both new and seasoned fans of the sport access to:

• Live predictions of who will win the races and world championship.
• Live position of the cars on a race map (usually 30 seconds before you see it on TV).
• Video clips of overtakes, pitstops and other key incidents from the race.
• Journalistic coverage on what’s going on, both on and off the racetrack.

When we launched our service, F1 was the world’s fastest growing sport (199% fanbase growth from 2020 to 2021).

However, the project started out with three fundamental questions:

• How can we engage younger users?
• Where can we invest our efforts to show long-term growth potential within our markets?
• What can we do that others have not yet perfected?

These questions led us into a very open product discovery process, including multiple sports. But in the end, F1 stood out as a golden opportunity for us. Here’s why:

F1 engages younger users

According to research by the motorsport network, 63% of F1 fans are 34 years or younger. Much thanks to the Netflix show Drive to Survive, F1’s fanbase is close to that of e-sports in terms of demographics.

We see long-term growth potential in our markets

The main hype around F1 has not been driven by a Swedish or Norwegian rising star. Hypes based on an individual do not necessarily guarantee the popularity of that sport beyond the success of the national star. F1 has become popular as a sport, although there are key individuals boosting that popularity as well. The F1 articles in VG and Aftonbladet also showed a growing volume of unique readers per article.

Despite the sudden hype, F1 is an old sport, with a significant and loyal fan base in our markets, especially in Sweden, a country that has fostered a total of ten F1 drivers throughout history. The combination of it being a proven sport, with a clear format, with a fresh new hype connected to it, gave us faith that it was worth the investment.

Great potential to do something that others have not perfected

If you want to make a new live football service in 2022, you are in for a tough fight. E-sport is efficiently captured by Twitch and YouTube, golf has the PGA Tour app. Tennis is available in multiple services. Because of the limited interest in F1 until recently, there are few live sports services that cover it. Looking through our Schibsted lens, this was a wide-open blue ocean in front of us.

The end-product and results

So far, F1 is generating 600,000 monthly user sessions, and we have established ourselves as a go-to destination for the sport. After 15 Grand Prixes in 2022, we’ve reached about 150,000 unique users and 400,000 page views on average, per Grand Prix. Although we are very happy with these numbers, and they exceeded our targets by about 15%, we still believe that the real potential of F1 lies ahead of us. There are users who are still discovering that we have launched a new sport, even though there are no Norwegian or Swedish drivers participating (yet!).

Schibsted Nordic Marketplaces is starting a journey to meet the need for more specialised services. At the heart of the change is the ambition to be a force for positive change – for both society and the planet. Christian Printzell Halvorsen is leading this journey, knowing that the greatest risk is not daring to change.

I joined Schibsted in 2007, mostly because of the people. I loved the engagement and energy you get when you bring together journalists, engineers, product and salespeople.

I was also inspired by the bold decisions that Schibsted’s management dared to take. After all, our history is one of bold moves, often in difficult times. Just think about it: We set up FINN in 2000 to compete against our own newspapers. We bought Blocket a few years later and rolled it out across the globe, to 36 countries, knowing most would fail, but betting that some, like Le Bon Coin in France, would become incredible successes. Sometimes, you must dare to fail in order to succeed.

Today, we know that this fearlessness paid off. In 2019, we spun off our international marketplaces, creating the company Adevinta – which in 2020, bought eBay Classifieds, concluding the transformation from a newspaper company to the world’s largest online classifieds operator.

Now we’re taking a similarly bold step for our Nordic marketplaces, setting up for the next decade while daring to challenge our success formula for the last 20+ years. We are setting the verticals free and using the combined strength of our Nordic organisations in a whole new way – all to provide our users with the best possible service in each category.

Users are demanding more

Things were relatively easy for us in the “classifieds days”, when marketplaces were all about ads and an ad was an ad regardless of what you were selling.

Now users and customers are demanding more and more sophisticated solutions. This gives rise to the specialists, the companies that create beautiful user experiences by investing deeply into solving a very specific problem and then scale the solution across countries.

Marketplaces are also changing and moving towards so-called “next-generation models” which solve more of the users’ needs, like payments, shipping, insurance and financing. As we move in this direction, Schibsted’s marketplaces must also become specialists. The way you sell a t-shirt is very different from the way you sell a house, and obviously this requires very different solutions. But the way you sell a t-shirt is not that different country-to-country.

We must set our verticals free

In essence, our different categories or what we call verticals, i.e., Mobility, Real Estate, Jobs and Recommerce, are becoming more important dimensions. So, we asked ourselves: If we worked together across the Nordics, what could we achieve within each vertical that any one country alone couldn’t? What if we dedicated four times the resources to each initiative instead of duplicating our effort four times across countries?

The conclusion is clear. We must set our verticals free and let each of them evolve more freely on their own terms to reach their full potential. By taking a Nordic perspective, we can think bigger and be bolder in how we solve users’ and customers’ problems.

We also want to be a force for positive change in society and for our planet. We call it our burning ambition. It defines our purpose and what we want to achieve in the long-term. It is our joint mission for all our marketplaces, built on Schibsted’s common strategic platform: Schibsted Future State.

We will make the sustainable alternative the obvious choice.

Because every action we take today impacts whether our children and grandchildren will have the opportunity to live in a sustainable world.

By doing so, we will increase our positive impact on society and the planet by more than ten times before 2035. We mean “sustainable” in the broader sense of the word. We will obviously contribute to the green transition by driving towards circular consumption, but we also strive to create equal opportunities and a more diverse society.

Empowering smart choices

Imagine a world where it’s so easy to make the right choice that you don’t even think about it. A world where it’s second nature for users and customers to make sustainable choices. We truly believe that we can make a difference by empowering people to make smart choices for themselves and future generations.

By offering people services that help them improve their lives and create financial opportunities, while being good for society, so that they will be able to take future-proof actions.
Because every action we take today impacts whether our children and grandchildren will have the opportunity to live in a sustainable world.

Having been in this business for a long time, I sometimes joke and say I have dedicated my life to ads for t-shirts and used cars, but we are so much more than that. As a salesperson working in one of our marketplaces, you may think you’re simply selling advertising solutions. As an engineer, you may think your job is to write code. And if you work in customer service, you may think your purpose is to solve problems. But whatever your role in Schibsted Nordic Marketplaces is, you are part of our shared mission to make the sustainable alternative the obvious choice.

We need to operate differently

Knowing what we can achieve is one thing. Actually doing it is something else. We have realised that we have to operate very differently to achieve this new, great ambition. To set our verticals free to evolve more independently, we must think differently around both technology and organisation.

For the last 20+ years, our success formula has been local brands with local organisations and local technology platforms, where the solutions for the different verticals have been highly intertwined.

To let each vertical develop independently, we would have to break the dependencies between them. A person working in real estate shouldn’t have to rely on or coordinate with someone in mobility. And that means the technology solutions for each vertical must be separate.

A cross-Nordic view

At the same time, if how you sell a t-shirt is similar across countries, we should be able to use that same technology solution across countries. And similarly for mobility, real estate and jobs. That, however, requires us to have a cross-Nordic view within each vertical to decide which common solutions and business models to deploy.

Finally, while we want as much vertical independence as possible, we share certain assets across verticals, like the valuable and loved FINN, Blocket, Tori, Oikotie, DBA and Bilbasen brands. We also need to create strong areas of expertise to attract, develop and retain talent in sales, tech and marketing, for example.

In conclusion, we have decided to move to a matrix organisation with cross-Nordic verticals as the driving force, supported by functions. Similarly, we are moving towards a technology platform where we separate the solutions for each vertical, but where we use the same solution across countries.

Being aware of and learning from our history has made one thing extremely clear. Our people are our most important competitive advantage.

This is a fundamental change from how we have successfully operated for more than 20 years. It’s a massive change project with inherent risks both technically and with regards to people and market positions. A natural question to ask is: “are the risks too high?” We have taken the opposite view. Staying the same while the world around us is changing is perhaps even riskier.
Most importantly, a successful transformation will set us up for the next decade, enabling us to deliver better solutions to consumers and professional customers – and to society.

Our people the most important advantage

Being aware of and learning from our history has made one thing extremely clear. Our people are our most important competitive advantage – well over 1,000 people across the Nordics with exceptional knowledge about marketplaces and deep insight into our markets. To succeed we must create an even more attractive future for them, one where they can succeed and have more
impact than today. If we are able to engage our people in finding the best solutions, the other risks will be manageable. That’s why we have put people at the front and centre of the transformation.

We have just started this journey, so the outcome is not guaranteed. But we do think our approach is reinforcing everything that we are proud of today – our people and cultures, our brands, our financial results, and more than ever, our impact on society.

The car is perhaps the category within Schibsted Marketplaces that is changing the most, and it’s happening fast. The Schibsted moblity team takes us through the major trends behind the change.

After talking about the electrification of the global car fleet for more than a decade, we are finally seeing it happen. And the Nordic markets are leading the way. In Norway alone, 65% of all new cars sold in 2021 were electric (compared to 17% in Europe) and the other Nordic countries are rapidly catching up.

New consumer needs and behaviours have prompted car manufacturers to digitalise their user journeys, thus side-lining the professional car dealers to a greater extent with an “agency model”. In the future, the purchase process will be digital, taking place online and offering frictionless services and subscriptions to consumers. The Nordics are among the top five countries in Europe in terms of willingness to buy cars online.

This shift is causing several ripple effects, including these five impactful, underlying trends:

1. Car dealerships consolidate

Future consumers expect and demand a digital relationship to the car industry, both in relation to car buying as well as access to mobility. For the professional car dealers, this is a golden opportunity to move online and harvest the results of a transactional buying process – including reduced costs and increased revenue per sale. To remain relevant, dealers will need to invest heavily in new technology. The industry’s landscape is changing dramatically, and the winners are the players who offer the best holistic digital buying experiences, as well as new services for alternative car ownership models.

2. Car e-commerce reaches new heights

The digital maturity and expectations from both consumers and professional customers are increasing at an accelerated rate. And cars are no exemption. The market for digital car buying is expected to grow to NOK 9 billion in 2026, as the online share of used car sales increases. While both internal combustion engine cars and electric vehicles (EV) transactions will migrate online going forward, EVs are especially well positioned for digital car buying, as these models are not tied to the same legacy business models.

3. Consumers strive to eliminate pain-points

Car sales have begun to shift from consumer-to-consumer to consumer-to-dealer (or C2B in business lingo) at an increasing rate, as a growing number of consumers are willing to pay for convenience and want to eliminate the pain points of selling directly to another consumer. According to Schibsted Nordic Marketplaces projections, around 15% of the overall car flow from consumer-to-consumer sales is expected to convert to C2B sales by 2026.

4. The rise of new ownership models

Today we see the rise of new ownership models. The growing sustainability considerations among consumers, coupled with the global production halt of new cars, has pushed even more people to consider “access” versus “ownership” when it comes to their mobility needs. The leasing market is expected to grow in the coming years and key players are quickly moving to consolidate. And the same goes for car subscriptions. Already today, between 18% and 30% of Nordic car customers have considered, to some extent, accessing a car through a subscription model.

5. Content is king (or queen)

Cars are extraordinarily complex consumer goods and when viewed in combination with the electrification boom, that complexity is multiplied. Range anxiety, charging speed, home and away charging are a few of the new concepts to which consumers are adapting, and as a result, the use of online information during the purchase process is increasing.

Today, over 90% of Nordic car buyers go online in connection with a car purchase, according to Schibsted’s 2022 Nordic Car Buyer Study. A huge trend, or perhaps better phrased as an opportunity, that spans all the mentioned trends above, is the doubling down on mobility content – content that guides, engages and inspires as we all navigate this historic market disruption.

As Schibsted Nordic Marketplaces transitions towards the next generation marketplaces, a separate unit will find, nail and scale tomorrow’s winning marketplace models that create a more sustainable future. The Accelerator will make sure that Schibsted has the ability to innovate fast and challenge itself.

Schibsted has developed world leading marketplaces and is the largest online classifieds group in the Nordics. Now, as we are facing our largest transition in 20 years: going from a horizontal operating model, with strong brands embracing many categories, towards a new, vertical, specialized operating model, it’s time to make change possible.

Evolving user needs

This transition is fuelled by evolving user needs, leading to disruption which creates great opportunities. New business models and new user segments will emerge, enabled by new technologies that will deliver frictionless experiences.

This urges us to find, nail and accelerate initiatives to build relevant new positions that deliver upon these users’ needs. We need to act, both on short term opportunities by sustai­ning innovation in current verticals, as well as on the longer term with potentially disruptive innovation. Successful companies invariably face the “innovator’s dilemma”: navigating between catering to customers’ current needs, while adopting new innovations and technologies to fulfill their future needs.

The Schibsted Accelerator is our response to this dilemma. Its sole purpose is to find, nail and scale tomorrow’s winning business models which help create a more sustainable future. It will separate and accelerate key initiatives to build a relevant, systematic pipeline of promising ideas and proven cases that are in need of scaling competences to increase speed.

There are great examples of more specialized, niche marketplaces around the globe. They address the needs of a smaller user segment, typically by increasing convenience. Target users are often “non-consumers” today, either because they lack the financial means or skills to buy the traditional product. Gross margin per unit, certainly at start, will be significantly lower compared to a traditional model.

Small things can get big

Established incumbents, like Schibsted, have difficulties as to why they would tap into this. After all, they deliver good value to current users, the new segment is rather small and margins in the new model are not even close to current operating models.

However, as history has shown, small things can get big. Netflix started as a DVD-by-mail rental service. Blockbuster, at the time the video distribution market leader, could have responded to the new competition, but why would they? Netflix was only serving a small user segment that Blockbuster didn’t serve anyway, and there was no big money in this niche. The hesitance to respond is logical as Blockbuster had a different profit formula compared to the newcomers.

Airbnb and Uber are similar examples, closer to our own focus areas. Needless to say, Airbnb exceeded USD 2 billion revenue and 700 million EBITDA in Q2 2022.

Enable scale

The Schibsted Accelerator will make sure we deliver upon the next growth curve and enable proven cases to scale fast. Experimenting with new ideas, building up a pipeline and fast scaling of proven cases requires a different way of allocating resources than we do in our core business. It also requires a different governance structure, with other processes and an independent profit formula. The unit will make sure to support the verticals in the best way possible and deliver upon our common ambition.

Research shows that setting up an accelerator increases our chances of success; the survival rate of companies nurtured in a business incubator is 87% versus 44% for unassisted enterprises, so odds are in our favour.

Five cases with great potential

We will start by adapting five cases that are already part of our market­places’ brands today. They all have a potential to grow big and will benefit from being part of the accelerating hub.

Qasa (a modern way to rent and let out houses), Plick (preloved fashion), Nettbil and  Autovex (C2B car auction), Honk (car subscription platform) and Nybrukt (refurbished electronics platform) will get the attention and help with all kind of different competences available in the Accelerator like marketing, finance, UX, tech, GTM, insights and strategy. On top of that, the governance model is set up for fast decision making whilst benefiting from being part of Schibsted.

Besides those cases a dedicated team is on a continuous hunt for building up a pipeline of new exciting ideas. Recently a discovery project within AI enabled reverse recruitment started and next experiments are planned on an AI travel recommendation tool.

Fortunately, we are not starting from scratch with finding, nailing and scaling new business models, rather the opposite.

Best practices & learnings from previous learnings are taken into account and we anchored the strategy for Accelerator. Our own learnings together with learnings from other accelerators are guiding principles, let me share a couple of those principles.

Win-win opportunities

Partnerships are key; Entering into new business areas requires different competences and people. Partnership, especially with start-ups with experience in the specific area, will create win-win opportunities.

Try-and-learn culture; A success ratio of 10 to 20% is not strange for start-ups. Therefore it is important to learn from failure, share and embed best practices and stop initiatives in time when KPI’s are not met, without blaming the people working on it and actively inform stakeholders on chances of success.

Current assets to experiment, new assets to scale; With great brands and technology and a fantastic user base, we can very quickly experiment with hypotheses by creating first versions of ideas and learn fast whether they have potential. However, when the MVP is proven, the MVP should most often be thrown out and built up separately to facilitate for scale. This increases speed, and decreases dependencies on core technology and brands.

Strong co-operation with the core

Success requires efforts from the whole organisation; With a small highly-autonomous, cross-functional team (which is the way to go for creating MVP’s) you can achieve a lot. Nevertheless, without strong cooperation with the core, success rates will rapidly drop. Alignment of ambition and strategy, the ability to get help from experts, access to users and customers and using the brands are our competitive advantage compared to others.

Start small but enable scaling; Ideas are often great on paper and can engage users and customers when asked for interest in a survey. Securing the first paying customers is a different story. Getting an MVP out in the market as soon as possible provides a quick indication of the size of the opportunity.

These are only part of the principles that we embedded within our strategy going forward. The most important differentiator to succeed, however, will be the people. Building upon Schibsted’s tradition of great entrepreneurial mindset, we will be a fearless force for change.

A separate hub is one important thing. But there are more aspects to consider for large companies with the ambition to be innovative. Sven Størmer Thaulow shares a set of rules.

Innovation has been one of the most used buzz words for decades. In any group of people discussing the topic there will always be different opinions on the definition. In Schibsted, we have established a common vocabulary around innovation based on the curriculum of Harvard and Professor Clayton Chris­tensen. Christensen defines sustaining innovation and disruptive innovation in the following way: Sustaining innovation occurs when a company creates better-performing products to sell for higher profits to its best customers. Typically, sustaining innovation is a strategy used by companies already successful in their industries.

Disruptive innovation is the second type of innovation and the force behind disruption. It occurs when a company with fewer resources moves upmarket and challenges an incumbent business.

A fight against the cash flow

In a large company, establishing new sustaining innovation (i.e. a new product towards the same customers) is not easy. It’s even more difficult to execute well on disruptive innovation. And God forbid – if you are disruptive against your own core business – then you are in for a real treat.

At the root of this problem is the nature of all innovation compared to the nature of a cash flow generating core business with healthy margins. Innovation means tons of experiments – of which 90% fail. Innovation often equals a long “hammock” of negative financials before hopefully some of the experiments start generating significant financial returns. Innovation = risk appetite + stamina/endurance + entrepreneurial mindset. In many large companies these are scarce resources.

The ability to succeed with inno­vation in such an environment is dependent on advanced corporate organisational engineering and hard, cool headed top management. And based on my own experiences in both operating and acting as the custodian of innovation units in large companies, I have concluded on a set of rules that can give some guidance on how to make it work. These rules are of course not an exhaustive list and many have done the same. In Schibsted, we try to learn and continually improve our efforts to stay a highly innovative company.

1. Set expectations right and avoid overly complex projects

Large companies are used to large projects and programmes. When innovating, that is not the way to do it. Fire off many small experiments with clear hypotheses about what problem you are solving and for whom. And towards your corporate stakeholders – be crystal clear that nine out of ten experiments will fail. At least!

2. Get the right ­people with the right attitude

Recruit externally primarily and hire only the right people. It’s better to grow slow and well versus fast and mediocre. Be careful with too many staff coming from the core business. Why? They bring with them the corporate way of working and rarely have the risk appetite you need. On the other hand, to not lose touch with the mothership, you do need a few from the core business in the team.

Attitude is also important. When you disrupt your core business, many colleagues in the core will react negatively to what you set out to achieve due to collision of objectives. If this is not the case, then you’re not stepping hard enough on the gas. To succeed with disrupting the core business within the same company, you will have to ask for forgiveness, not permission, and not get bogged down in the corporate way of operating. If you do, you will move too slowly.

Only use the corporate services if you need them. You should have laser focus on creating products with a market fit, not on following processes designed for a huge company.

3. Mimic the start-up setup as much as possible

From the owner’s perspective, I call this the viking ship principle. It’s when you tell the team: “Here’s your ship. It’s stacked with food, a sail, some pocket change, swords and ores. Now you guys go sailing, and we hope you make it to Scotland.”

In other words, as an owner of an innovation project, try to minimise their dependencies on others, remove as much barbed wire as possible for them, set them up with the amount of resources they need, and give them the authority to manoeuvre. And this means, there’s no one to blame! In practice, it also means establishing these radical experiments, sooner rather than later, as separate legal entities.

Why is this so important? Well, in a corporation, the teams have “gazillions” of dependencies. It slows development down. It also pulverises authority versus responsibility. There is always someone to blame. That’s a recipe for disaster for an innovation project.

4. You need a special culture to be able to operate as an antibody inside a monster

When you want to run many experiments, you will most likely do it in an accelerator-like setup. The accelerator can quickly be perceived by the staff in the core business as the privileged few, the ones who get to do the fun stuff and the ones spending the cash but not earning anything. And if some experiments are about disrupting and hence cannibalising the core – it gets even more toxic.

This can become a vicious circle for both the core and the accelerators. It’s not fun to work in a place where you feel that you are not wanted or are even worked against. The management needs to constantly manage this balancing act. One way to do this is to build a resilient accelerator culture with its own rhythm, rituals and ways of operating. But also, a culture that doesn’t become so strong that the monster’s immune system fires off on all cylinders.

5. Use governance and organisational engineering

As previously stated, radical innovation = stamina. The problem at hand is “when the manger is empty the horses fight”. Core business is under a constant margin pressure and when times are tough it’s natural to hunt for costs that can be cut in areas that don’t impact revenue too much. Hence – removing long term experimentation capacity is an easy target.
Radical innovation activities as accelerators must be organised as companies on the side of the core business areas. They should also be as high up in the organisation as possible to avoid being a victim of core business margin demands and priorities.

6. Utilise your core business for scaling products

It’s often tempting to use the core business for scaling new products and services. The classic scenario is to cross sell or bundle a new product to the existing customer base of the core business. It might be smart but very often it’s done way too early. Make sure the product market fit is well-proven as a separate service before you start “plugging” it into the core machine. Nothing is worse than selling something too early to too many customers. You only have one shot and if you fail, churn is brutal.

What’s even more difficult is to use the core business to scale a disruptive and cannibalising service, but it is possible. Schibsted did it with FINN on classifieds back in the early days of the internet. If that’s your preferred way of boosting innovation, you must deploy a combination of heavy communication about why this is important towards the core business brute force, top down-style governance, along with heavy, asymmetric incentives for the core business.

7. Make sure to use the right KPIs at the right time

It’s obvious for people who have worked in a start-up that you use different metrics at an early stage of the company compared to at a later stage. For example, pirate metrics (AARRR) are well known when you work in the venture capital space. But in a core business of a corporation, there are often other metrics, like market share, gross adds, EBITDA, revenue growth, capex to sales, etc., that are dominant. Applying these types of metrics to early-stage radical experimentation is obviously highly dangerous.

8. Seriously consider employee ownership

When you establish innovation activities as separate legal entities, you should seriously consider setting aside 10% to 15% of shares for employees. Being a part of such endeavours is much higher risk than being an employee of a large company. It also takes extreme efforts to succeed with start-ups. Hence, it should be rewarded accordingly. It’s good for both employees and the owners that the employees have a significant stake in the upside.