I read an article this morning about the woes of newspaper revenues – pretty much the same old thing you see from anyone covering this media space in a one-dimensional fashion. The twist to this article though was that it stated that revenue declines in July of this year, were felt in both the print and online mediums at newspapers. I will side with the article and say that up until now, online verticals at any publishing house usually saw monthly increases and July represents the greatest online revenue slowdown we have seen to date.

• NYTCO – total revenue down 16.2% in July, online revenue up only 0.9%
• Media General – total revenue down 13.8% in July, online revenue up by only 5.3%
• Gannett – total revenue down 16.7%, online revenue up by only 3%

The article then went on to use more written prose to beat the issue of the dismal state of newspapers and their publishers. The reason for the perils in revenue and the slowdown in online is very clear however, and to understand it, you have to understand the traditional publisher mindset. The mindset of gouging print rates, ownership of content, and so on. It seemed that for a while newspaper Web sites were answering the need of failing print revenues, but as this article stated, this is no longer a publishers reality. Even given these dismal reports, new-age publishing pundits, me included, strongly feel that the negative revenue trends can be reversed, if only a few key changes are made at newspaper groups.

What publishers must do:

Get comfortable selling online as a standalone – bundling media, especially print media for a publisher, aids in covering inventory and gaining revenues. However, a forced bundle is not always what your Web savvy advertiser is looking for. With the understanding of new forms of advertising that pure-play online giants can offer, and effectively might I add, advertisers are looking for guided free will with spending their money, not a forced bundled purchase.

Think of your Web site as a standalone product – many publishers view their newspaper sites as an extension of their print product. In some ways this may be true: ads laced with a call to action that directs a consumer online, for example. However, when looking at keeping current and active in the minds of advertisers and the general consumer population, looking at the new and innovative ways your Web site can enable you to interact is key.

Be creative online – the world of online is far different from the static print regiment publishers are accustom to. An online marketplace allows you flexibility, agility, new media inclusion, dynamic platforms, speed to market and all for a low investment if compared to print. Guaranteed, if a publisher used the capabilities an online platform offers, they would find themselves remaining current and in the advertising game a lot longer.

Listen to your readers and targeted consumers – just because we’ve been publishing the product for over 50 years, doesn’t mean that we know best. The most effective way to produce a successful marketplace is to make it one that includes your readers and better yet includes the behaviors of the online consumer.

Flexible pricing - consider moving to pay for performance pricing for your advertisers online. The benefits of this is twofold – advertisers feel that you have partnered with them to ensure their dollars are working in conjunction with the leads and exposure you provide and it keeps your marketing and digital teams focused on the goal of building a thriving marketplace. They should never feel comfortable or content. Reinventing ourselves in this ever-changing e-enabled world is an imperative.

These are just a few of the things that publishers need to consider and or implement to stay current. The risk of not making a change to mind-set is obvious, continued revenue and marketplace declines. As we have said many times on this blog, a newspaper brings with it a lot of advertiser benefits, trust and brand recognition just to mention a few and all that we are suggesting here is that publishers build on these benefits, and do it quickly.

written by Beverly Crandon

A new Online Publishers Association (OPA) report, covering consumer trust levels in local media shows that not only do consumers trust local media sites, but they are more likely to take action after viewing advertisements on these mediums. Newspaper Web sites rank first, with 46% of consumers taking action - making a purchase, going to a store, conducting research, as opposed to only 37% of consumers acting after viewing a local ad on a national portal.

Additional findings in the OPA report:

• Local magazine, newspaper and TV sites attract significant percentages (48%, 40% and 39%, respectively) of consumers who had spent more than $500 online in the previous 12 months.
• 37% of portal visitors and 34% of the overall online population spend this amount in a year.

To get a PDF of the report, click here - OPA Local Online .

written by Beverly Crandon

Real estate site Zillow has just launched a new product called Showcase Ads, a self-service ad platform that lets advertisers create targeted ad campaigns.

With Showcase Ads, advertisers can buy anywhere from 25 to 100 per cent of the available views on searches, for homes within a specific ZIP code or region. Moreover, to measure performance, advertisers are given both the number of expected impressions for their ad and real-time updates on ad performance. Showcase Ads run for 30 days and are paid per ZIP code targeted.

The Showcase Ad product builds on the company’s EZ Ads platform, which launched in April of 2007.

written by Beverly Crandon

For those of you looking for that niche that applies to your generalist newspaper or magazine verticals, a recent report from Scarborough Research may have all the answers.

According to Scarborough Research, Internet coupons are of increasing interest to consumers, but newspapers still lead the charge, with 53 percent of households getting their coupons from the Sunday newspaper.

So, if you haven’t stepped up your acquisition of online coupons from your local merchants, you may want to look into doing so.

written by Beverly Crandon

TNS Media is back at it again - Only this time the news is heavy hitting on the automotive vertical.

In a recent report from the research organization, studying Q1’ advertising expenditures, it explains that the overall the auto category spent 7.4% less dollars on all forms of advertising. The drop in ad spend was not confined to domestic brands, as for once the economy has caught up with foreign makes as well.

• The Non-Domestic Auto segment shrank 7.4% to $1,764.7 million and Domestic Auto plummeted 16.0% to $1,445.5 million.
• The declines were spread across all tiers - factory, dealer associations and local dealers - and were especially severe for light truck vehicles.

written by Beverly Crandon

AOL’s ADTECH has been selected by Gannett to be the publishers online ad serving provider. The contract deal includes the managing of all advertising on Gannett’s local newspaper sites, their broadcast sites, USAToday.com, along with the plethora of niche sites owned by Gannett.

“We selected ADTECH because their top tier technology will allow us to seamlessly execute and deliver for advertisers at both a local and national level,” said Chris Saridakis, Gannett senior vice president and chief digital officer.  “With the ADTECH platform, advertisers of all sizes will be able to easily reach our affluent, active online audience, whether it’s through broad national campaigns, audience segmentation, or locally targeted campaigns.  Gannett can now enable national and local advertisers to engage with any audience segment they could ever hope to reach.”

According to ADTECH, the deal has been in the works for the past 15 months and is expected to reach its full roll out in February, when USAToday.com is added to the list of sites being managed by ADTECH.

Gannetts properties will be serviced using Helios IQ, an ADTECH ad server platform.

ADTECH has already been established as a strong contender in Europe and they are hoping that this newly announced Gannett relationship will aid them in breaking ground in North America.

written by Beverly Crandon

The Interactive Advertising Bureau of Canada released its annual online advertising report and the numbers  show that 2007 was a banner year.

Online advertising revenues in Canada grew by 38% in 2007, to reach 1.2 billion and according to the IAB, this means that online ad revenues in Canada have more than quadrupled in only five years.  Of the growth in Canada, Paula Gignac (President of IAB Canada) said “The sky’s really the limit for Online, as new developments in targeting technology, creative (it’s great to have our first Video advertising revenue number), and integrated strategies are happening on an almost daily basis — all with the goal of helping marketers capitalize on online’s ever-growing and engaged audience. Online advertising is no longer below the line in any way — it’s now an essential component of any marketing mix.”

According to the IAB, the 2007 online ad revenue breakdown was as follows:

• Display - $432 M
• Video - $9 M
• Search - $478 M
• Classifieds/Directories - $305 M
• Email - $17 M

From a geographical perspective, approximately $260 million (21%) of the $1.2 billion, came from French Canadian Online properties.

The IAB breakdown of 2007 online ad revenues, by advertiser category was as follows:

• Automotive - 16%;
• Media + Entertainment (Music, Film, TV) - 8%;
• Financial - 11%;
• Leisure (Travel, Hotel, Hospitality) - 7%;
• Packaged Goods - 6%;
• Retail - 9%;
• Technology - 10%;
• Telecommunications - 7%; and,
• Other - 26%

You can download a summary of the report here: IAB Canada 2007 Online Ad Revenues

written by Beverly Crandon

Needing more qualitative data on what consumers are looking for online? Well MyBuys has released the results of their e-tailing survey, which queried 1,345 consumers about online shopping preferences and their propensity to buy. Many of the questions surrounded behavioural targeting and suggestive selling and the results, no doubt, were very interesting:

• 77% of consumers report that they have made additional purchases when they have encountered personalized product recommendations online.
• 75% of consumers are willing to provide some meaningful amount of personal information in exchange for a more personalized, relevant shopping experience.
• Personalization is only an upcoming initiative for 41% of merchants.
• More than a third of merchants say they simply lack the resources to make personalization a higher priority.

The last point above is further highlighted when profiling local merchants who do a notable amount of advertising online. Local merchants often times do not have the bandwidth or financial capital to appropriately roll out behavioural ads or suggestive selling, through recommendations formed from a consumers online shopping habits. However, media publishers have both the capital and the wherewithal to consult industry leaders and apply tried and tested applications that they can in turn broker to local merchants.

Considering some element of behavioural advertising on an ad publishing network not only provides another revenue stream, but it also enables a publisher to further connect buyers and sellers in a pointed way.

Publishers should take a page out of the rule books of many of the online shopping sites out there – ebags.com, amazon.com, apple.com and their iTunes store, all do a great job at recommending items “you may like” based on what you have recently browsed or purchased.

written by Beverly Crandon

Just last week there were a plethora of articles covering media advertising spend and it’s slower than projected growth. Articles spoke of advertiser trepidations and longer decision making processes. Articles also gave examples of major advertisers who were spending less; AT&T advertising Q1’ was down 14.6 per cent, Time Warner down 6.8 per cent, Walt Disney Co. down 7.9 per cent and Johnson & Johnson down 15.3 per cent. However, with all of the similar coverage out there, we chose not to blog about it here. It wasn’t until we saw an interesting comment from TNS Medias John Swallen, SVP Research of TNS Media Intelligence. “There are some things that are different about this slowdown,” he said, adding: “The advertising economy is a subset of the general economy. What’s different about this economic cycle is that it is consumer-led. The last big turndown that we had in 2001, post-9/11 and the dot-com bust wasn’t so much of a consumer-led slowdown. There were other economic factors. This one feels different. What we’re in right now is a period in which consumers are stressed and strained by rising food prices, rising fuel prices, a crunch on credit, and a feeling that things will get worse before they get better. Without a rise in consumer spending, that [disincentivizes] marketers from ramping up consumer ad spending.” Within the same article, Swallen indicated that advertisers conversion from traditional media to new has also affected the economic slowdown. With the Internet introducing clever and innovative ways to reach intended audiences, the dire necessity to utilize traditional forms of advertising (yes – both online and in print) have lessened. Advertisers are finding the unconventional ways of reaching an audience, and all for less of an investment.

Further on the note of advertiser spending, Swallen states that the trend of lessening newspaper advertising revenue will continue and that consumer magazines will follow closely behind in that trend. Note, to date, consumer mag’s have recorded single digit increases, but advertisers have now started to look for the same sense of flexibility they receive when advertising online. The rigid, long-term commitment contracts magazine publishers expect advertisers to succumb to, won’t last for long.

written by Beverly Crandon \\ tags: Advertising Revenue, John Swallen, TNS Media

Borrell & Associates released the results from their recent study called ‘What Local Media Sites Earn’ and for the first time ever in this six time report, newspaper online local ads topped more than $2 billion in revenue during 2007. Overall, newspapers held a 24.6% share of the total local online ad market. Many other forms of media, according to the Borrell report, paled in comparison to newspapers:

• Directories held a share of 7.8%
• Broadcast TV had a 6.9% share of the overall ad spend
• Local radio had a 0.8% share overall
• The majority share of local ad dollars (57.3%) were allotted to pure-play Web sites

“One company in our survey, with $400 million in total revenues, was generating $11 million in online ad sales on $3.8 million in expenses, for a profit margin of 65,%” says the report.

If there is one area of the Borrell report that should stand out for publishers looking to improve their online revenue and share, it is the profile of the top performing newspaper sites. According to Borrell and Associates, the top performing sites tend to have three things in common; they are less dependent on classified vertical categories; they have larger dedicated online sales forces; and they host multiple Web sites.

written by Beverly Crandon \\ tags: 2007, Borrell and Associates, local online ad dollars, Newspaper online revenue