“Iceberg Report” strikes a nerve, newspaper executives react

A day after releasing "No Iceberg: Separating Truth from Fiction About Newspapers In This Recession," the reactions are pouring in. Among the feedback from INMA members on the various internet forums:

Bernard Asselin of The Gazette in Montreal said now is the time to "focus on the core values of our products," and that newspapers should "stop the non-value-added activities, make people accountable and responsible, start the client-supplier concept internally, implement the internet profit centre concept."

Michael John Gill of Fairfax Australia said he worries that "we do not see much discussion of what the internet has done to the 'news' part of the equation. Fundamentally, primary sources are now – largely – available to all. So the distinguishing 'news' values have to be defined against today's reality."

Mike Donatello of USA Today said "the mess we find ourselves is largely of our own making" and "fueled by our myopic obsession with the quarterly care and feeding ...[more]

The upside to “bankruptcy” for U.S. newspapers

The first time I took a European to a baseball game was the first time I was asked: “Wouldn’t it be more efficient to run directly to third base?”

I’m having similar luck recently explaining U.S. bankruptcy rules. In many countries worldwide, bankruptcy means liquidation. In the United States, there are degrees of bankruptcy. One such bankruptcy protection is Chapter 11, which allows a company to restructure its debts and operations in the hope of avoiding liquidation.

What U.S. publishers Tribune Company, Philadelphia Media Holdings, the Star Tribune, and Journal-Register Company are doing is restructuring debt. Their operations are hardly “normal” in this recession, but they are scalable and manageable. It is the debt that is onerous and threatening.

The CEO of a major U.S. newspaper told me recently he expected “every major U.S. newspaper company” to go through Chapter 11 bankruptcy protection in the next 12 months.

Another CEO likened what newspapers are going through to what airlines went ...[more]

Collaboration needed for self-service newspaper tools

Why can’t newspapers come up with self-service solutions for advertisers and readers similar to the banking and information technology industries?

A U.S. publisher told me recently that newspapers have been looking at self-service solutions for readers and advertisers since 2000, but nothing tangible has come of it. He pointed out that there are tools available, and his newspaper has put a lot of energy into “making a weak tool work.”

This is a classic situation of leadership needed at the national level to bring publishers together to come up with industry-wide standards – or, better yet, an industry-wide tool.

Real estate advertising on upswing in Southern California, possible early indicator

I’m hearing that classified advertising at the major Southern California newspapers took a slight upswing in January and February – especially real estate. Not huge upswings, but publishers are beginning to believe they’ve reached bottom.

What might this portend?

Similar upturns in real estate advertising – and maybe the broader classified sector – by early 2010 in other U.S. markets.

Real estate advertising began collapsing in Southern California in mid-2006, a precursor to the sub-prime mortgage crisis that hit other U.S. newspapers in mid-2007.

The good news for California newspapers in this downturn: Despite the roller-coaster ride, newspapers maintained their market share.

No iceberg, no falling sky: some newspapers are better positioned than others to weather today’s recession

I’ve spent a lot of time in recent weeks on the phone with INMA members worldwide trying to measure the precise depth and colour of this global recession.

Take away regional ...[more]

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Re-imagining newspaper publishing on weak days versus strong days

Posted at 08:22 AM - 21 February 2009

Adam Smith would be proud of what’s happening in today’s newspaper industry. The Scottish political economist would likely see the hidden hand of the market at work, and the newspaper industry’s response to remake itself and find efficiencies where necessary.

While the Detroit Media Partnership is cutting back from seven-day print publishing to three-day print publishing to focus on profitable days of the week, others are finding new ways to imagine the value propositions of low-demand and high-demand days of the week.

An INMA member recently suggested to me that one such idea suggested that weak days such as Monday, Tuesday, or Saturday (in the United States) be transformed into “deep dives” on “passion subjects.” Perhaps the front page and front section should be about sports during football seasons on Monday.

Other INMA members who disagree with what the Detroit Media Partnership is doing say they prefer to keep their brand alive seven days a week, but ...[more]

The strategic brake and accelerator for quality newspapers

Quality newspapers aimed at up-market readers are feeling both the brake and the accelerator during this economic downturn.

As advertising dries up, the pressure to adjust editorial staffing levels intensifies. A Belgian publisher told me recently that it’s important not to compromise on the quality of content, but that it’s a legitimate discussion to talk about the quantity of content.

He also said there are value themes that quality newspapers must address: the value of proximity, economic/political news, and sports. Maybe it’s best quality newspapers focus on these high-value areas in terms of strategic development – and de-prioritise everything else.

In contrast, down-market popular newspapers that have a low reliance on advertising (25%-35%) and a low investment in editorial quality are better weathering the economic storm.

If the newspaper industry focused on one classified sector, it should be real estate

In visiting recently with the senior strategist at one of the United States’ leading newspaper companies, a theme emerged about classified advertising in today’s recession:

Employment advertising has migrated to the internet and likely will only come back to newspapers as a fraction of what it once was.

Automotive advertising is down about what you would expect it to be in a recession, but this is expected to return to newspapers.

Real estate advertising is the one classified sector the newspaper industry should focus its energy because, mid-recession, it’s unclear the degree to which this will come back to newspapers.

The rationale behind focusing industry efforts on real estate is a long-understood but rarely discussed reality: real estate advertisers hate newspapers. They’re not sure that newspaper advertising move homes, but agents feel pressure to advertise so they can show clients that they’re doing something.

The strategist tells me that what’s needed is a ...[more]

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Mexico’s OEM and its local/national network of editorial and advertising

Posted at 07:11 AM - 19 February 2009

One of the more interesting discoveries I’ve made while traveling the world of newspapers is how media companies, long before the internet, set up national content and advertising networks based on intense coordination.

In recent years, I have seen how Dainik Bhaskar in India’s Hindi Belt generates more than 100 editions – each with hyper-local content, but also similar content that is slightly translated for each edition as there are different dialects every few kilometers.

 

Today, I met with Organización Editorial Mexicana (OEM) in Mexico City. OEM is a multi-media company that includes 67 dailies in 25 state capitals throughout Mexico. I can’t attest to revenue, but they own the most daily newspapers of any company in Latin America.

 

And OEM may be one of our industry’s best kept secrets.

 

Since the mid-1970s, OEM has assembled newspapers through launches and acquisitions, and today these are linked ...[more]

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Swiss view of U.S. newspapers: you’re over-reacting

Posted at 03:02 PM - 10 February 2009

What is happening to the U.S. newspaper industry is either the leading edge of what will happen to other national newspaper industries or a typical American over-reaction.

 

Mind you, the Americans aren’t alone in contemplating the total collapse of the newspaper business model with foreboding overtones that no traditional revenue will ever return. The British are forthrightly in that boat, and the Canadians are reluctantly putting their optimism on the shelf in this downturn.

 

Not surprisingly, American newspaper executives asked to speculate on the shifting of entire advertising categories away from print newspapers assume that what happens in the United States will eventually happen elsewhere.

 

The view from Europe – equally unsurprising – is that the degree of gloom from the States is a typical American over-reaction.

 

Said a Swiss newspaper publisher: “My view of what’s happening in the U.S. is that newspapers have milked advertisers and readers until that model no longer works. The minute ...[more]

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What if you increased an advertiser's spend 500% and got crucified for it?

Posted at 12:56 PM - 03 February 2009

A sales executive with a typically silo’d American newspaper shared the following story recently that illustrates the cultural challenge for newspapers that want to become multi-media companies.

The newspaper salesman pitched a small company on making an investment in print advertising. The company’s manager shared that, in fact, he invests with the newspaper’s web site.

Yet the company wanted to grow, the newspaper executive heard the man’s story, and went back to him with a proposal. Why don't you increase your marketing budget 500% with the newspaper – mostly online, but also a small print component which is what he was pitching the man on? The salesman was trying to meet the needs of the company while generating incremental revenue for the newspaper -- even though there would be little in the form of print advertising. 

The newspaper salesman went back to his management with the good news … only to be pummeled by the web site’s manager for unauthorised ...[more]

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Dreams from 1981: imagine a future with newspapers online

Posted at 07:37 AM - 01 February 2009

This TV broadcast from 1981 is making the rounds in the blogosphere. It's a Steve Newman broadcast on KRON San Francisco about this crazy idea of early home computers being able to process the morning newspaper online. Well, as we all know, that will never happen.

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Suppliers and the workarounds for old processes

Posted at 07:31 AM - 01 February 2009

Talk to most suppliers to the newspaper industry, and they will admit that they are usually thrown into a single bucket: “vendor.”

Look, they have an agenda. They have sales goals. They have a reason for meeting with you, and it’s not to exchange recipes. Yet they also have amazing institutional knowledge – often across a broad landscape. They often don’t even realise that they are, in fact, consultants selling services and information. That’s just not precisely what they were hired to do. 

This fact was brought home to me in recent weeks with a series of dinners, phone calls, and conference conversations with suppliers to the newspaper industry.

 

The special insight from recent weeks goes like this: Despite all of the personnel cutbacks, does anyone realise that the editorial, circulation, and advertising processes that were in place in 1969 are still in place in 2009?

 

Suppliers have suites of “newsmedia” solutions that will get newspapers ...[more]

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Who referees audience development discussions at your company?

Posted at 06:56 AM - 01 February 2009

I participated in a panel discussion recently at the INMA Audience Summit in Scottsdale. The topic was audience development across platforms. 

As newspapers evolve to newsmedia companies, there is a rising expectation from the advertising community to understand the value of each medium’s audiences to their marketing communications. 

The notions of “total audience,” “unduplicated audience,” even “duplicated audience” are not new. In the past five years, newspapers from North America to Europe to Asia have tried some spin on this concept with varying success.

 

The challenge is that not all audiences are created equally. A reader of a print newspaper enthralled for 45 minutes is not the same as a hyper-kinetic web viewer who pops in for 20 seconds and leaves. Yet in our embryonic efforts to deliver “total audience,” one is equal to the other.

 

In Scottsdale during the question-and-answer session, I noticed something unusual about the conversation.

 

One executive talked passionately about the value of ...[more]

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