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European papers understand added-value

Monday, March 1st, 2010

Advertising Age takes a look at how European newspapers are charging for content online. “The consensus … is that a hybrid model is the best option for most businesses as publications seek to develop potentially lucrative relationships with paying customers without losing the volume that comes from offering free content.”

The top example: “Le Figaro’s approach, 14 months in the making, keeps the main newspaper content free but offers two other options at $10 and $20 a month. Premium users get access to in-depth information, special offers, twice-daily newsletters, roundtable discussions with journalists, the opportunity to see their own content on the home page of the site and a concierge service that can arrange everything from theater tickets to shirt cleaning.”

Premiums are key, the report says. “In 52 countries around the world, 71 percent told Nielsen that online content would have to be better than what is available free before they would pay for it, and 79 percent would not use a site that charges them if they can find the same information at no cost.”

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Lots of numbers, most of them bad

Friday, February 26th, 2010

Medill Reports presents a roundup of advertising spending for newspapers and magazines from 2009, including a couple of graphs and, as anyone who’s paying attention could tell you, it’s not a pleasant sight.

On the deep end, according to Nielsen figures, local Sunday newspaper supplements show a 45 percent drop in ad revenue. Business-to-business magazines show a 33 percent plunge, and local magazines sank 24 percent. (Sunday supplements and local magazines. This is why we have time to write this blog.)

The bright spots were a 32.2 percent jump for Spanish-language cable television and a 15 percent gain for cable television. FSI coupons were up 12 percent.

In a trend that extends to 2006 at least, overall U.S. advertising spending was down 9 percent for the year last year. In 2008, U.S. ad spending fell 2.6 percent.

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Writing on newspaper industry’s wall is clear

Tuesday, February 23rd, 2010

A new count by Media Daily News says the newspaper industry has lost 105,000 jobs in the last decade, as the “rise of the Internet began lowering the curtain on the golden age of print.”

“Based on records kept by the U.S. Census Bureau and Department of Labor and tallies by various industry watchers, total employment in the newspaper publishing business has declined from 414,000 in 2001 to 309,000 at the end of 2009, a 25.4 percent drop over the course of eight years,” the report says.

Job cuts in newsrooms accelerated last year as “publishers finally decided they had cut other business functions to the bone, and reluctantly began cutting costs in the newsroom.”

The obvious conclusion: “if 2010-2011 doesn’t bring a big rebound in newspapers’ fortunes, coming years may see the quality and quantity of journalism suffer noticeably.”

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Miami Herald puts tip jar back under the counter

Monday, February 22nd, 2010

The Miami Herald announced over the weekend it was ending a program begun in December in which it asked readers to donate to the newspaper.

“After evaluating two months of response, we’ve decided to end the program,” Elissa Vanaver, a company vice president and assistant to the publisher, said in the newspaper’s report. She would not say how much money the effort had raised.

Shortly after initiating the program, in which credit card forms linked at the bottom of articles on MiamiHerald.com and ElNuevoHerald.com enabled donations,  Executive Editor Anders Gyllenhaal said it had “elicited an encouraging steam of gifts, ranging from $2 to $55.”

Vanaver said when the program was launched in December and again this past weekend that The Herald has no plans to charge for content online. The newspaper does charge $2.99 for mobile applications that deliver sports content, its report said.

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Newspaper pre-prints the next victim of online?

Thursday, February 18th, 2010

Two surveys suggest that newspapers’ pre-print inserts could go the way of classified advertising as online coupons grow in popularity, says Media Daily News.

Coupons.com –  which allows consumers to find coupons they want and print them out at home, download them to mobile devices, or transfer them to stores’ loyalty card accounts — says its digital coupon business grew 170 percent in 2009 compared to 2008, in terms of the volume of savings.

Meanwhile, a white paper released by the Newspaper Association of America and Kannon Consulting says newspaper inserts are in trouble, with big retailers like Sears demanding double-digit rate cuts and the CMO of J.C. Penney’s expressing concern that prepaid inserts don’t reach as many younger consumers. Media Daily News quotes from an analysis of the months-old proprietary white paper by the Poynter Institute’s Rick Edmonds.

The report, says Edmonds,  “warned that inserts, which account for half of retail advertising, are ‘under siege.’ The industry, notoriously pokey in providing return-on-investment metrics or in facilitating ease of placement, needs to tone up its act in a hurry, the report suggests.”

A Scarborough Research report last August said about 7 percent of U.S. households get their coupons from Web sites and about 8 percent get them via text messages or e-mail. In December, a report said spending on newspaper inserts was up 11.2 percent for the year.

In November, The News & Observer’s VP for Display Advertising cited a focus on selling pre-prints as one factor in the decision to discontinue publication of the company’s bi-monthly lifestyle magazine.

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Down is the new “up”

Thursday, February 18th, 2010

A couple of “less bad is good” stories today:

Monthly magazines’ latest quarterly decline in ad pages, at 5.7 percent, is “not the same as a gain but a much smaller loss than the double-digit plunges that have been seen since the third quarter of 2008,” Advertising Age says. Ad pages fell in 94 monthlies this quarter and grew in 59, according to the Media Industry Newsletter.

Total revenue for Lee Enterprises fell just 9.2 percent in January compared with a year ago — the first single-digit percentage decline since 2008, and the fifth consecutive month in which the year-over-year revenue comparison moderated, according to Editor & Publisher.

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Continued rough sledding ahead for newspapers

Monday, February 15th, 2010

A look at fourth-quarter 2009 financial results from five of the 10 publicly owned U.S. newspaper companies that have reported so far shows that “it’s clear the industry as a whole is still in deep trouble, with no strong indication that better days are ahead,” says a Nieman Journalism Lab report.

The report says that in Q4 2009 the industry “saw its 14th consecutive advertising revenue decline; the last nine of those quarters were double-digit declines.” And nothing indicates that January, typically a bad month for revenue, is looking any better.

The report examines the five publishers individually: Gannett, New York Times Co., Lee Enterprises, Media General and McClatchy Co.

At McClatchy, it finds strong online revenue growth comparatively, but scoffs at CEO Gary Pruitt’s claim that expectations of revenue declines in the low- to mid-teens percentage range in January indicate a recovery. “In other words, McClatchy expects the Q4 decline of 20.5 percent to be followed in Q1 2010 by a decline of somewhat less than 15 percent, and considers that to be an ‘improving advertising trend.’”

In another problem area, “Besides nearly $2 billion in long-term debt, McClatchy also disclosed that at year-end, its pension plans were underfunded by $494 million in the ‘qualified’ plan (their standard defined benefit plan, which is frozen), and another $100 million in the non-qualified supplemental executive-level plan. This accumulation of future obligations makes McClatchy one of the most-leveraged publishers out there.”

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McClatchy sticking to top-down approach

Thursday, February 11th, 2010

McClatchy Company is looking to the leadership that steered the newspaper publisher nearly into bankruptcy to figure out the way forward as part of a task force to “strengthen newsrooms, modernize how we work, make the most of resources and consider how we can work together more effectively,” a memo distributed Wednesday says.

The task force of 10 editors and publishers is to review newsroom strategies over the next several months, beginning with “deep interviews with all McClatchy editors over the next two weeks.” The team’s work is to be completed in time for 2011 planning.

The task force will be chaired by Anders Gyllenhaal, executive editor of The Miami Herald (formerly of The News & Observer in Raleigh); and include Rick Thames, executive editor of The Charlotte Observer; Melanie Sill, executive editor of The Sacramento Bee (also a former N&O executive editor);  Stan Tiner, executive editor of the Sun Herald in Biloxi, Mississippi; Pat Dougherty, executive editor of the Anchorage Daily News; Mark Zieman, publisher of The Kansas City Star; Mi-Ai Parrish, publisher of The Idaho Statesman; Eric Johnston, publisher of The Modesto Bee; Brian Kirlik, vice president for affiliate services at McClatchy Interactive (based in Raleigh); and Washington bureau chief John Walcott.

McClatchyNext is a blog that calls itself “a shared discussion for McClatchy journalists and others to talk about the way ahead for journalism, news companies and people who care about them” started by former VP for News Howard Weaver.

Here’s a piece of a discussion about top-down vs. bottom-up management styles from McClatchyNext:

“McClatchy is looking for a new way to do business and all the answers are already here, in house, waiting to be utilized to their fullest.  By tweaking management styles to a bottom-up approach and looking to the people in the field, doing the work, we will find the answers we need to be an even better company and be leaders in the newspaper industry of tomorrow.”

“People in the field, doing the work” — like publishers and editors.

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McClatchy’s Pruitt: online ad model working

Wednesday, February 10th, 2010

McClatchy CEO Gary Pruitt said Tuesday that deriving online revenue from advertising is working just fine and there’s no reason to move toward paywalls, according to Editor & Publisher’s account of the speech.

Pruitt gave the keynote address at the Borrell Associates Local Online Advertising Conference in New York City.

Pruitt is also OK with aggregators like Google and Yahoo, because they send plenty of traffic — 20 percent, he said — to McClatchy newspapers’ sites.

“In fact, McClatchy credits its success in building online revenue to its alignments with several different Internet players including Yahoo, Cars.com and CareerBuilder,” E&P says. “Pruitt told the Borrell conference that online revenue in 2009 accounted for 16 percent of total revenue — up from 11 percent in 2008.”

“We are very comfortable with free content supported by advertising,” Pruitt said. “We don’t view it as fatally flawed. That said, if we could make ad revenue with paid products we would.”


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Newspapers get small share of political ads

Monday, February 8th, 2010

Newspapers can expect to see less than 8 percent of the $4.2 billion to be spent on political advertising in 2010, a new report from Borrell Associates says. That share comes out to $329 million.

Most will go to broadcast TV with 61 percent, or $2.6 billion, Editor & Publisher’s reading of the report says, followed by cable TV at a very distant second with a 9.1 percent share. Only 1 percent, or $45 million, of political dollars is expected to be spent on Internet ads — 73 percent more than in 2008.

“Last year was relatively quiet on the political front, yet spending outpaced 2000 levels,” E&P says. “The recent Supreme Court ruling that allows corporations to now spend on politics caused Borrell analysts to bump up its forecast 10 percent.”

The Fitz & Jen blog charts the numbers for each medium.

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