Many of the online news services carried a headline recently, “Newspaper Local Web Sites Most Trusted Source for News.” The story behind the headline cited research recently completed for the Newspaper Association of America (NAA) by Comscore. Even though any self-promoting research must be viewed with skepticism, the Comscore results may well be valid. The problem is, it doesn’t matter. Unless the local papers can monetize their draw for news, they will still be shoved aside by other sites that can. Local newspaper sites that still depend on run-of-site static display for most of their online ad dollars will not see the increases in advertising that others who use search, targeted rich text, video and online direct will enjoy.
A long time ago (only 15 years, really … it just seems like longer now) newspaper research found another satisfying trend. The numbers seemed to show that when a person turned 35 or so, bought a home, and started to make a better than average salary, he or she somehow morphed into a newspaper reader. It may seem laughable now, but it was an accepted industry fact back then. A few years later, research from Clark, Martine & Bartolomeo proved that this “fact” was absolutely wrong. The “Born to Read?” research showed that if readers were analyzed by year of birth instead of age, a very different picture emerged. Instead of some miraculous transformation, a generational change was occurring. Baby boomers read newspapers less than their parents, boomer’s kids read less yet, and so on. We now know their research was right. We see it every time newspaper circulation is measured.
Newspapers got on the Web early, but they weren’t very smart about monetizing their online presence. Instead, they offered many services (including news) for free. The theory was that these services would point users to the “core product,” i.e. the printed newspaper. Sadly, people who are used to getting something for free resist paying for it. Attempts to get money for online news have not been well-received. In the meantime, newspaper share of local online ad revenue has dropped by half during the last four years. So now newspapers have a conundrum: a trusted source of news that is hard to monetize. Rather than researching what they know and patting themselves on the back, they should be researching what they don’t know and figuring out what to do next.
This revelation should come as no surprise to online managers. They’ve been telling us all along that print and broadcast reps “just don’t get it.” It’s not meant to impugn their intelligence; it’s just that those reps have their hands full trying to maintain existing customers. Online managers tell us regularly that they can drive revenues faster with a sales staff whom they can actually fire for not meeting sales goals. Our vice president of sales training, Bill Caudill, tells us that, after a training session, 30% of the reps “get it” and actually go out and sell online advertising. After three months, he says, half of them forget it.
Craigslist, Google, Monster, Autotrader… for local media the list of outside competition is growing longer every minute. In old westerns, the scene would be akin to Indians popping up over the horizon, arrows ablaze, pouring down on the covered wagons of the cowboys.
In the scheme of things, it’s still a drop in the bucket. The total is less than 3% of all locally spent online advertising. If we estimated it for individual local markets (we usually don’t do that until an advertising segment reaches $1 billion), it would equate to a few hundred thousand dollars or less in most markets.