Investing in the future: how much newspaper stock would you buy today?


Investing in the future
Investing in the future

At the recent INMA mobile and integrated advertising sales seminars in Chicago, a lot of brilliant ideas and success stories were discussed and as usually occurs at conferences like these; networking and pre- and post-event meetings and idea exchanging were abundant. While there and in other exchanges in recent weeks, I’ve had discussions with a handful of newspapers of varying sizes and the one thing that seems to constantly come up is resources.

If you can’t get approval for new resources for new programs like these, you can’t get very far. We’ve cut back most of our organizations in recent years, asking fewer people to do more. And with each coming year (or week it seems) a new development arises that newspapers just have to get into and usually we’re asked to do it with existing resources. Of course, there’s only so much that one person can do or that one department can take on (successfully). The more we take on, the less likely we are to hit home runs with all the new projects and the more likely we are to merely bunt and attempt to advance the runner.

Taking the baseball analogy one step further, let’s look at how many of today’s MLB teams field winning dynasties: they buy the best players they can get their hands on, surround them with good coaches and quality facilities and keep the fans fat and happy with US$15 hot dogs and US$10 Bud Lights.

My point is that we’re at a point in the digital development of media consumption where we are in need of fronting our efforts with a bold investment. If we truly hope to put our companies' best foot forward in the digital realm with dozens of new programs and play in the larger digital arena where we’re competing with the likes of Google, Yahoo and any other Web operation out there that our local businesses are seeking new customers from, we’re going to need to invest in the future of our businesses. If we want to compete with the Yankees, we need to hire some free agents, remodel our ballpark and improve the quality of the meat in our hot dogs.

I’m not saying there should be no plan for how to justify addition of new resources. Spending without expectation of return is not smart. What I am saying is that we know where we’ll be if we don’t invest more in digital — same place we’re at now, or worse. Beefing up your digital teams and digital infrastructure should be looked at in the same way that buying a new printing press was a few years ago — a necessary investment in the future sustainability of our business. It’s time we boldly staff-up and mirror the aggressive nature that new competitors like oft-mentioned Reach Local are showing with massive growth in all our markets through smart program development and constant staffing increase.

If we truly see a sustainable future for our newsmedia organizations, shouldn’t we be investing heavily in the areas we see most potential in? And I don’t mean one more developer or one more dedicated salesperson. Let’s jump in with both feet and convince management to help us create a fleet of digital warriors to properly battle the growing competition. These are difficult conversations to have and, yes, the math needs to be done to prove at least the potential return-on-investment within the first year of rapid digital staff expansion. Challenges of how to best structure your digital efforts are always debatable. But I guarantee you the conversation gets easier once those early successes come through the door and a few light bulbs begin to go off from within the long-time traditional staffers. It’s infectious, and that’s the kind of excitement that will drive renewed faith in our industry.

Looking back on a wise investment is always more comfortable than considering a new one. But all these companies who are backing growing digital operations with huge capital investment are not doing so because they have years of proven ROI, they’re doing so because they see the payoff down the road and feel the heat to have skin in the game in the long run. The newspaper groups that seem to be having the most success are the ones who are embracing this investment. More of us need to act as boldly and invest like any quality advisor would suggest in down times — buy up market share while the market is down so you’ll be in a good place as it comes back up.

At Stephens Media, we are having these difficult conversations, and we’re doing the math to justify the expansion. In the meantime, we’re launching dozens of new digital programs with existing staff (which has certainly grown already in recent months) and encountering a lot of learning hurdles along the way, some of which we clear and some of which trip us up. One thing we know for sure is we’re not standing still, and we’re looking closely at our digital investments with an eye towards their future worth and importance to our mission.

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