As a follow-up to my last blog post, “Don’t assume “greatest generation” will support print at all costs,” I had planned to write about Gen X and how that generation more than any other has contributed to the creative disruption of the newspaper industry (and perhaps all media).
I’ll save that topic for later, though, as this time of year my thoughts are on a different audience: an audience that still remains fiercely loyal to the printed newspaper in the absence of any alternative.
I’ll bet your local newspaper, like mine, was chock-full of retail inserts this past Thanksgiving (if you live in the United States) and that your Sunday newspaper will be huge for the next couple of weeks.
My local newspaper had more than 50 inserts in the Thanksgiving edition this year. While that’s down from the year before, it still represents some of the biggest preprint numbers that paper has ever seen in a single edition.
In recent years, single-copy sales have remained steady on Thanksgiving Day, despite significant declines on just about every other day of the year. Consumers who value coupons and use store circulars to comparison-shop continue to be one of the most loyal print readership audiences left.
In a 2012 Ideas Magazine article, “2017: What media shifts in the next five years mean for newspapers,” Shawn Riegsecker, founder and CEO of Centro Marketing, predicted that by 2017: “National dailies still breathe, but weekly newspapers thrive. For printed metro and national dailies, an implosion of advertising preprints in 2014 or so will devastate their revenues.”
Riegsecker said newspapers would lose 30% of the preprint revenue the first year, and the decline would continue in subsequent years. If that prediction were to come true, Thanksgiving 2013 could be the last of the big pre-print newspapers.
So far, though, I haven’t really seen anything that will cause the collapse of printed inserts in the next 12 months. But I do believe advertisers are looking for alternatives that better enable them to target customers. I also believe they will abandon printed circulars if there ever is a viable alternative.
Newspapers absolutely must be at the forefront of this innovation or plan to lose this revenue for good.
As someone who has managed both advertising and circulation for newspapers, I know firsthand the importance of pre-prints as a connection between advertiser and consumer.
The fact that advertisers would welcome a different means of reaching customers hit home a couple of years ago when I was sitting in the offices of a local grocer, trying to keep him from making a drastic cut to his distribution.
The reasons for the cuts were primarily financial (he was forced to cut back on his overall marketing budget), and we ended up in a discussion about the effectiveness of pre-print advertising.
The grocery executive felt he had no choice but to continue to do free-standing inserts, but made it clear he would gladly consider a less costly alternative to pre-prints. He rightly pointed out he was delivering inserts to entire zip codes in which only a handful of people would shop at his store.
Newspapers have taken steps in recent years to shore up pre-print revenue through various free products, both requested and total market, and some of these products have actually been pretty good. They often include relevant and appealing content, and they ensure advertisers are getting the zip code penetration they are looking for.
Sunday opt-in products, in particular, have been successful at driving revenue on the pre-print advertising side. These products are very effective in maintaining short-term printed revenue, but newspapers need to figure out a long-term solution to what will ultimately be a declining revenue stream.
Many will remember I-circular, the product created by the AP a few years ago. I-circular developers attempted to create a digital experience that would also offer some of the nostalgia and feel of the printed circular.
The product was kind of cool and proved to be relatively successful in many markets. It didn’t really translate the pre-print experience, but was a good example of a product that could be an effective tool in developing a retail audience.
In fact, I-Circular was purchased by Wanderful Media (a newspaper consortium), and incorporated into FindandSave.com. Findandsave.com provides a fun and relevant shopping experience that would appeal to the most die-hard shopper.
Now, with the integration of I-circular, it also provides an effective way for consumers to peruse current print circulars using their mobile device. The Web site is geo-specific to the market the user is in and has PDF circulars from most major retailers.
Newspapers need to develop ideas like these to continue to attract a growing mobile audience. This is especially true at the local level.
Newspaper companies often have very little control over how national retailers will spend in their markets, as these decisions are centrally made and based on internal marketing data. Newspapers can, however, influence local advertising spending and providing alternatives for local pre-print advertisers should be a top priority.
The formula for developing this audience is very similar to how newspapers are developing other audiences:
- Niche content delivered across multiple platforms.
- Community engagement through local events, sponsorships, etc.
- Building the best local consumer databases to enable advertisers to better target customers.
- Developing local marketplaces via their Web sites, where retailers can connect with consumers.
Of course, none of this is new. These are all common themes in the Satisfying Audiences blog. Unfortunately, many if not most newspapers continue to cling to the traditional pre-print revenue model and are not thinking forward to the day when audiences will no longer require circulars to learn about deals.
While I think it is unlikely that pre-prints will collapse next year, I do think retail customers will continue to move away from printed media, and that most consumers are not so loyal to printed pre-prints that they won’t embrace a new way of finding great deals.
For newspapers to continue to be relevant in this arena (both to advertisers and consumers), they need to innovate ways to reach this specific audience in a meaningful way.
The exciting part is this is truly an “open water” problem, meaning the opportunity for innovation and new revenue is endless.