Category Archives: Newspapers

Goodbye Pennysaver: Is There Life Left in Shopper Publications?

Is there life left in local, broadsheet “shopper” publications that highlight home and trade businesses and things for sale? Not according to OpenGate, a $3 Billion LBO firm that abruptly laid off workers for Pennysaver USA, the industry’s largest company, which it purchased in 2013 from Harte Hanks for $22.5 Million. At that time, the company had annual revenues of nearly $200 million and had 800 employees in California.

Other shoppers remain in business, such as American Classifieds (Thrifty Nickel) and many locally or regionally-owned Pennysavers. The name “Pennysaver” goes back to the 18th Century, and is not exclusive.

Our guess is that OpenGate didn’t see a clear path to profitability and decided to simply pull the plug (apparently, without paying final wages.) Core advertisers and consumers have many alternative options on Craigslist and other sources, and OpenGate didn’t seem to have a plan that would have upgraded Pennysaver to a hyperlocal, searchable and mobile-oriented model. That’s where things need to go.

We look across the aisle, for instance, to Cox Target Media’s Valpak, a coupons and advertising business. It has thrived on a hyperlocal publishing strategy, and has developed a robust digital strategy. Valpak has just announced a great Apple Watch app. But PennySaver wasn’t going there.

Theoretically, we still find Shoppers an appealing alternative sales channel. They are generally 100 percent commission, and many products could theoretically be added to their bundle (Google, et al). WebVisible, at one time, teamed up with American Classifieds to pursue such a model. PennySaver, itself, teamed up with Antengo, a mobile classifieds service. But that was discontinued when OpenGate came on board.

UT San Diego Sale: Online Isn’t Adding Value to Traditional Media Sale Prices

Today’s announcement that UT San Diego and its eight regional publications will be acquired by Tribune Publishing’s Los Angeles Times for a slightly better-than-fire sale price of $85 million (plus $100 million in pension liabilities) points to several things.

1. The price is probably a flat fee for the brand and expectations of selling regional advertising throughout southern California.
2. Individual components such as subscriber counts include a certain number of online subscribers. But there aren’t many online-only subs in this case.
3. UT San Diego’s various online and mobile services really aren’t factored in.

The U-T reported Sunday circulation of 271,564 for 1Q, 2015. On other days, circulation ranged between 169,484-222,479. The LA Times reported Sunday circulation of 965,598 and average weekday circulation of 650,718 for the six months that ended Sept. 30.

The LA Times will be able to save some costs with the acquisition by cutting circulation, printing, sales and perhaps, content costs. It will also more effectively sell regional accounts to large advertisers, specifically retailers, auto makers and auto dealers and medical. But in the end, online (or mobile) won’t be much of a factor.

That’s a shame. Back in 2002-2004, a former colleague of mine developed a general hypothesis that if a traditional media property could show recurring value in online properties, it would be able to boost its sale price by X percent – probably 20 percent or more. It was a major reason to double down on digital growth. But this clearly hasn’t happened.

I was chatting about this with BIA/Kelsey Chief Economist Mark Fratrik. He notes that online revenues accounted for 16.4 percent of newspaper revenue in 2014, and will be 17.9 percent in 2015. The forecast is for online revenues to grow slightly to 22.9 percent by 2019. This reflects some additional online revenue, but as he points out, it also reflects BIA/Kelsey’s expectations that print revenues will decline.

It is true that online could add value to traditional value property in some cases, says Fratrik. But San Diego is full of online competition from TV station sites, alternative sites and news start-ups.

The Times of San Diego, for instance, now reaches 150,000 unique users a month. Publisher Chris Jennewein – a former leader of UT San Diego’s digital operations – notes that 26 percent of his readers are aged 25-34 and seventy-five percent are under 55. “Our readers probably didn’t read either of the two newspapers to begin with,” he told me this morning via email.

For me, it is a sad situation. I lived in San Diego for 11 years, and occasionally did consulting projects for the newspaper. UT San Diego always had innovative online projects going on, and several strong leaders at the digital helm. It got deeply involved in email marketing services, online directories, Spanish language media, hyperlocal editions, premium iPad editions, video services, mobile headlines, entertainment publications, prepaid deals and loyalty services. But in the end, none of it seemed to matter very much.

The 2014 LMA Innovation Mission: What Tech Leaders Can Teach Traditional Media

When a traditional media executive visits Google, Facebook and other tech leaders, there is always a lot of oohing and ahhing and a bit of envy.

You can’t help but notice the great perks, such as free dry cleaning and gourmet food. Add to that their relative transparency; open seating that bust out the cubicles; first name relationships with the executive team; grand vision statements that go beyond profit; the distribution of company equity; and their trust in employees.

But these tech perks have been around now for years (and copied.) What are the real revelations that traditional media company executives can gain from a tour of tech leaders, circa 2014? That’s the question posed by The Local Media Association’s Fifth “Innovation Mission,” a six day, multi-city adventure that included on site briefings at tech and media leaders such as Google, eBay, LinkedIn, The New York Times, Buzzfeed, CBS Local, Gatehouse Media, Automattic, RussMedia and others

BIA/Kelsey spoke on last year’s tour, and we have been eager to see the report from this year’s edition. Here’s the summary: The new wave is all about sharing media; the widespread use of mobile has given rise to omnichannel publishing; and the next wave of internal communications and news gathering is quickly moving from email to messaging.

The tour’s focus on shareable media especially caught our attention. BuzzFeed – which gets 23 million of its 57 million daily views from shared posts –goes so far as to say that share data has become “the most important metric.” The report says this about Buzzfeed: “As ideas surface, they ask themselves: ‘would you share this with your friends?’ For Buzzfeed, share data is seen as a stronger indicator of audience engagement than HuffPo-like “click bait” that fools you into checking out an article, but doesn’t ultimately engage you.

What drives sharing? For BuzzFeed, the biggest driver of shared media has been YouTube; but Pinterest is #2 – much more impactful than live media such as Twitter. Facebook is also a big driver, although its impact is not immediate: it takes several days to build.

Is Buzzfeed’s relentless focus on shared media an apples-to-apples “best practice” for traditional media companies? Probably not. After all, it says its real focus is grabbing people who are “bored in line, bored at work and bored at home.” (One of its biggest traffic drivers is Miley Cyrus.) Still, as mobile’s share of media usage gains, and “boredom breaks” pre-dominate, there are definite lessons in studying its model.

The LMA Innovation Mission Report can be purchased here.

Digital First ‘Complements’ Cars.com with Tracking, Other Services

What does a newspaper company do when it loses its affiliation with a major vertical brand? That was the question for The San Jose Mercury News and some of the other Digital First Media papers on New Years Day, when the company’s partnership with Cars.com ended.

The Digital First newspapers knew that most car dealers wouldn’t want to abandon an existing relationship with a partner like Cars.com, a major source of leads and online presence. The answer? Change the value proposition that local car dealers had with the newspaper. For instance, it could complement the Cars.com relationship by developing a service agency-like model. Specifically,it could track where the dealers’ leads came from, and provide actionable information about these active car shoppers.

To this end, Digital First signed up with Cupertino-based TapClassifieds, and its growing, 15 person TapClassifieds Auto division. As part of its program, TapClassifieds evaluates websites, landing pages, text emails and credit applications as they come in. It also clean ups a dealer’s inventory to make landing pages more aesthetic, and to track results.

Tracking dealer results from Craig’s List – a major channel for dealer visibility and source of leads — has proved especially important. The site switched to a premium classifieds model Dec. 3, killing a dealer’s ability to “spam” the site –along with a dealer’s rivals. Consequently, dealers needed to review their efforts on Craig’s List, and pursue alternatives.

Another major task for TapClassifieds: make sure that listings on sites like Craig’s List and eBay Motors are compliant with their regulations. They must remain compliant with the site’s terms of use or see their accounts shuttered without warning or recourse.

“It’s a far cry from the old days, when people would just want to see inventory,” said TapClassifieds COO Jeff Herr, a longtime digital newspaper vet who left MediaNews Group two years ago to join the startup. “There are many, many tasks that you need to do to support the dealer. We are a service bureau.” Pricing for the service runs $15 per month per car, adds Herr.

Digital First has been testing the model with Bay Area auto dealers, and it has now announced a strategic partnership to take the program across all of its markets. DFM properties in Philadelphia, Connecticut, Texas and New Mexico are already up and running.

For TapClassifieds, Herr says that autos are the tip of the iceberg. RV Dealers, real estate and vacation rentals will each launch soon. “Real estate is unplowed Earth,” he notes.

SF Chronicle’s Cooper: ‘The Fight’ to Save/Remake Daily Journalism

The politics of keeping newspaper sites relevant in the social era are intense on all sides.

San Francisco Chronicle Managing Editor Audrey Cooper is in the thick of it. Cooper, who has been at The Chronicle for six years, has been in the news recently over a “Food Fight.” Specifically, how is a foodie-town like San Francisco going to cover the restaurant/food and lifestyle scene?

In an interview with San Francisco Magazine, Cooper notes that the restaurant reviews are “the most clicked on things” in the paper. And “chefs are like our local celebrities. But does our section get to that narrative,” even as it publishes four pages of recipes?

The Chronicle site and its companion SF Gate site are the best read news sites in the Bay Area with 17 million users. But “the fight to save daily journalism is like a bar fight,” she says. “We need to get more aggressive about change. And print readers don’t traditionally like changes a lot. But the status quo is not enough.”

Cooper adds that “there are a lot of blogs and specialty publications starting to gnaw at the edges of what we do. That’s true of tech coverage, real estate, food. If we just sit back, then they’re just going to eat us alive.”

We’re conducting a fireside chat with Cooper at our Interactive Local Media conference Dec. 10-12 in San Francisco. Register here.

The Newspaper Consortium, Emphasizing ‘Scale,’ Re-ups for Five Years

The seven year old Newspaper Consortium with Yahoo is getting a new lease on life as “The Local Media Consortium,” and is re-signing members to a new five year group deal that will seek out digital opportunities with Yahoo and additional technology and content players as they arise.

Under terms of the new deal, members may opt in and out at will, rather than facing penalties for withdrawal. All local media members will now also be able to join and participate across the board. Previously, TV stations were not given access to certain features.

Roughly 85 percent of the original consortium membership has re-upped, including McClatchy, Hearst Corp., Morris Communications, Digital First Media, Lee Enterprises Inc., Berkshire Hathaway’s BH Media Group Inc. and A.H. Belo Corp. There are also new members such as Deseret Digital Media and Ballentine Media. More members will be announced at the end of October. Combined together, the consortium represents over 200 million unique users and garners 1.7 Billion monthly page views.

By signing up for new terms, the newspaper companies are sending a clear message that they are making money via the consortium’s display ads and other activities. They also see many advantages to banding together and exploring mutual opportunities in a way that might be more efficient than building entirely new consortiums for various projects.

Newspaper products that have been developed outside the consortium in recent year, for instance, include such projects as Wanderful Media, a national shopping play; and the Zillow newspaper-real estate consortium.

We talked this morning with McClatchy VP of interactive media and Consortium Chairman Chris Hendricks, along with new Consortium Executive Director Rusty Coats, a longtime newspaper vet most recently with E.W. Scripps and Media General. “It is a much different approach,” says Hendricks.“This is more of a ‘cult of the willing.’ We are looking to see how we can collectively work together on multiple fronts. We are looking at the world through the prism of scale, which is what really matters.”

Over the years, Hendricks notes that Yahoo has been able to provide a number of functions to the Consortium, including ad serving, content and search. It has also been able to extend its audience for display ads. But the Consortium now wants to investigate more wide ranging “plumbing” functions with a wide range of players, plus content and ad exchanges, he says.

Gannett Digital Marketing Solutions Rebrands as G/O Digital

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Gannett Digital Marketing, the umbrella division of Gannett that includes ShopLocal, BlinQ, PointRoll, DealChicken, Key Ring and Clipper Magazine, relaunched today as G/O Digital. The new unit – which is adding a massive hub in a Chicago skyscraper, and is specifically kept separate from Gannettt’s media properties — is lead by longtime ShopLocal head Vikram Sharma. It also adds ecommerce vet Mark Maranacci (Edo, Google, Yahoo) as ShopLocal President, where he will lead the sales marketing team interacting with national brands and retailers.

The rebranding was announced today at ShopLocal’s 8th Annual Retail Summit in Chicago. Gannett CEO Gracia Martore, at the event, said that the effort is part of “transforming Gannett into an innovative media and marketing powerhouse,” scaling local audiences “to a national level.”

Staples SVP of U.S. Stores Alison Corchoran spoke about the value of having all the Gannett services under one roof. The company views Gannett as a major marketing partner, along with companies such as Constant Contact, Google, Groupon, LinkedIn, Facebook, Cheetah Mail and Mcgarry Bowen.

Corcoran noted that Staples now has 1,500 stores, but it isn’t about the stores so much as being a “b2b marketer” both online and in the stores. With the rise of search, Direct Mail, email marketing, social media, ecommerce and loyalty services, she noted that the goal posts have dramatically changed.

While Staples continues to focus on “easy,” “the meaning of ‘easy’ has changed. Retailers have more dots to connect. Gannett’s new focus on integrated offerings have really helped the Staples team get over the dual dilemma of being “very data driven but risk averse,” she says.