Newspaper Transition & Web Revenue

Strategy 2009

Mel Taylor MediaOnline Revenue Strategy for Local Mediawww.MelTaylorMedia.com 267-625-5313

A Pop Web Group Company.

MelTaylor2000@gmail.com12/3/08

This report is a ‘best practices’ summary of observations, experiences and facts that were collected over the past 18 months.

We believe it’s a realistic roadmap for local Newspaper media to follow, in 2009.

It’s primarily focused on business, sales structure, and web revenue models. It touches lightly on content.

Much of the information contained within, applies to local Television & Radio Broadcasters as well.

Contact us if you are interested in the Radio or Television version of this report.

Newspaper Transition & Web Revenue Strategy 2009

Mel Taylor Media background

• newspaper

• television

• radio

• internet

• sales management

• content, production

• talent, reporter

• sales training

Mel Taylor Media recent client list

challenge for newspapers

stabilize & grow print business

simultaneously

grow share of web dollars

current economy will accelerate this challenge, and force a quicker solution

• news as commodity

• ad networks, falling cpm’s, glut of inventory

• specialty sites

• aggregators

• those successfully leveraging automation & outsourcing.

• competitors not dependent on rising hard costs

• outdated worker agreements. ex: uaw

• internal conflicts & bottlenecks

• economy accelerating advertisers move to web

forces killing current business

model

core business

• not newspapers• not journalism

it’s advertising

core business local assets

• news/info gathering & dissemination

• sales force & support staff

• relationships & brand trust

• printing press & distribution

notice the omission of ‘newspaper ‘or ‘website’ ?

first step

questions we asklocal media managers

your advertisers are moving online.

are you offering web to all of them?

what % of your traditional clients

use online advertising ?

do your reps know?

questions we asklocal media managers

what % of your traditional clients

want to use online advertising,but don’t know how ?

questions we asklocal media managers

BIG question we ask

what % of your traditional clients are regularly offered web?

typical answer: not sure, but probably well less than 25%

newspapers capture large shareof local online revenue,

yet they still leave a lot of money on the table

that’s alot of upside for newspapers to gain…and for pure-plays/competitors to go after

how pure-plays are gaining LOCAL share

HUGE issuetraditional reps & managers fear cannibalization afraid to offer web

trading dollars for dimes

protect the way it’s always been

potential loss of job

HUGE issueovercoming fear of cannibalization

• if newspaper doesn’t offer web to clients…

someone else will.

• clients will buy web, either from newspaper,

or it’s competitors: TV & pure-plays.

how newspapers are fixing that issue

• overhaul compensation

• update job descriptions

• consistent web training for ALLespecially top & mid-management *

* how can top & middle-managers “manage”…what they don’t fully understand ?

overhaul sales repcompensation

• compensation must become primarily, commission based.

• bonus & penalty when selling web. no longer ok for sales rep to hit print number, and miss web number. In this case, rep loses print bonus.

• threat of sales staffers quitting greatly reduced in this environment, due to lack of available jobs. radio reps are strong candidates as replacement hires; they’re used to cold calling, direct sales & creative cross-platform packaging.

how newspapers are fixing that issue

culture transition via job

description modification

• no longer a newspaper company

• now a local news & info company

• aggregate, distribute & sell… multi-platform

how newspapers are fixing that issue

management transition

> legacy managers, no matter how successful they’ve been, may not be best suited to build the web business

> creation of ‘vp advertising’ or ‘chief revenue officer’ understands and is responsible for all revenue opportunities.

how newspapers are fixing that issue

management transition> consistent training for top & middle managers how can they manage what they don’t fully understand?

newspapersales structure 2009

hybrid approach for near term

• web specialists target new biz, categories, web-only buyers

• web specialists assist & train traditional reps

• mandatory web sales for print reps (bonus & penalties)

• convert all reps to ‘super-sellers’ over time

goal: integration• all reps become super sellers

• 1 point of contact for client

• able to offer many solutions

• reps sell total reach of platforms

newspapersales structure 2009

right-sizing

who to let go ? • those that debate change.. purge internal poison

• valued in past, but less valuable for future

• editorial without solid connection to revenue

• web staff without solid connection to revenue

mandatory re-think

all content/editorial staff

must now think revenue too

newspapers getting smarter about:

• less reliance on middlemen: ad networks

• not all traffic is valuable. bigger not always better

• developing content networks; syndication

• specialty sites, separate url’s

• inventory dilution & falling cpm’s via limiting supply

• aggregator strategy: do what you do best, point to the rest.

• reverse publishing opportunities

• online & print working side by side

newspapers targeting new revenue categories

• broadcast & cable dollars online info-mercials, video micro-sites, video in banner, pre-roll, etc

• seo/sem offerings

• behavioral, geo targeting

• yahoo partnership

• go direct to brands w/custom, cross-platform ideas

• syndication of content

• creation of premium, vertical ad networks

• self-serve ad platforms for smaller clients

newspapers targeting broadcast & cable’s weaknesses

• reliance on transactional, agency business

• high cost of news gathering video & production

• small newsrooms

• limited publishing & layout experience

• small online sales & editorial staff

• little or no sales staff training

• over-air content not translating to web

newspaper tactics togrow local, online revenue

share

• online only sellers & multi-platform super sellers

• consistent training of traditional sales force

• specialized web training of top & mid management

• change job description & commission structures

• target print, broadcast, & interactive budgets

• creation of local ad networks

sales

how newspapers can ownlocal, online news/info space

• low cost of video news gathering & production

• leverage new tech: video cell phones, wireless, etc.

• leverage large newsrooms

• reporters becoming MOJO’s : indie mobile journalists

• leverage publishing & layout experience

• 24/7 web-first newsroom

• local blogger network & aggregator strategy

editorial

notable newspaper initiatives

specialty sites

determine online content & revenue hole in market, and fill it with a separately branded web site. leverage power of legacy assets: content development, IT & design staff, marketing & sales staff, advertiser relationships, etc.

www.Metromix.com

www.LVBrideandGroom.com

www.ToastedRav.com

www.PHrequency.com

newspaperaction plan 2009 summary

• modify job description & comp plans

• regular training for all staff, especially top mgrs.

• automate & outsource

• syndicate & aggregate

• find profitable local holes, & fill

• consider revenue first, then content

• reverse publish

advertiser spend 2008where should we place more sales effort?

Overall Online

S.C. Johnson DOWN 10 % UP 111 %

Wells Fargo DOWN 10 % UP 157 %

Verizon UP 8 % UP 70 %

TNS Media Intelligence

Overall Online

Ford DOWN 2 % UP 65 %

GM DOWN 9% UP 79 %

Chrysler DOWN 8% UP 41%

TNS Media Intelligence

advertiser spend 2008where should we place more sales effort?

reverse value add

web advertising 101 seminarsfor local business

another tacticto drive web revenue

why a seminar ?local advertisers

want to buy web, but…

• confused• embarrassed by lack of knowledge• don’t totally trust sales rep• think Google is enough• think their own site is enough• never been offered web

• new web revenue on books

• increase online ad mix

• target advertisers still on web sidelines

• slow the migration to competition

• traditional rep sales training

benefits of seminarfor local media

• newspaper brings in ‘outside expert’

• expert provides objective info

• non-sales approach

• fun, easy to understand

how does it work ?

• expert makes the case for web advertising

• provides best practices & basic info

• branding vs. message awareness vs. search

• discuss creative, pricing, targeting

• local case studies

seminar topics that lead to business.

case studies

• & Cablevision• $146,000 new quarterly business• 26 new contracts

• e

• $ 144,000 new quarterly business• 41 new contracts

case studies

• $140,000 new quarterly business

• 26 new contracts

RESIDUAL EFFECT of training & seminar:

• web sales up 300%

• Jan: $30k per month …June: $109k per month

• Jan: 44 web clients….June: 67 web clients

WARNING

clients will buy web.from you….

or the competition

reaching customers

onlineSample slides from

seminarPresented by

Mel Taylor

Your customers

are spending more time

online

Ad spend: out of whack

the economy

while market is soft

•build demand for offerings

•lock long-term discount rates

•steal show while others vanish

Bill segment

Radio38 years

TV13 years

Internet 5 years

reaching critical mass50 million users

Phone74 years

Ignored Amazon.com

Ignored MP3’s and I-tunes

• search• branding• message

awareness

web marketing

• today’s yellow pages• reach those on a mission

search

is search enough?

would you only use yellow pages?

to advertise your business

How do you stand outon this page?

How do you stand out ?

branding• stand out from crowd• familiarity• stability• logo w/ slogan

•educational

•newspaper, broadcast,

outdoor

•passive consumer

•un-aware of offer> New location > Sale > New item

message awareness

click-through rate

what it does and

does not measure.

measures immediate response

not overall response

click-through rate

• brand lift• brand preference• brand recognition• visited site/store, later

OVERALL response

creative• kiss. 7 words or less• clear in graphics• single message• borrow from billboards

Unique User – visitor to site

Page Views – viewed web page.

learn these

EX: readership, viewership, listenership

EX: quarter hours, rating points

CPM – “Cost Per Thousand”

learn these

If CPM is $10

My AD seen 100,000 times

Total cost: $1,000.

http://tribads.chicagotribune.com/onlineadvertising/

http://essentials.baltimoresun.com/media_kit/design-dev/

rich media

http://www.tihr.com/mediakit/

what sites should i use?

• quality of content • advertiser friendly • number of ad units

what sites should i use?

www.wxtu.com

many radio stations still not taking web seriously

• dumping ground• cluttered• no content• no value, even if free• station looks bad

GOOD !• IAB.net compliant

• clean environment

• limited Ad units

• above fold

• good content

http://www.tmccreatives.com/

newspaper online

http://essentials.baltimoresun.com/micro_clients/lifebridge/

• online info-mercial

• ad-vertorial

• ez & cheap to produce

• your biz seen by more

• better search results

• never a wasted play

video micro-site on newspaper site

Source: NetRatings, September 2008

2 3 Million2 3 MillionTop Local Websites

Seminar 90 mins

• Client Check-in & Lunch / Networking

• Mel Taylor (50 mins)

• Web sales manager; local info ( 10 mins)

• Local manager offers discounted packages

• 15 minute break to close biz

• Pick door prize winners

Here’s overview of Seminar/Training program

• On site visit & training …. 5 weeks in advance

• Expert Web sales training; how to overcome common objections

• Overhaul of sales presentation & packages

• Set goals, get input from local staff

• Co-development of all materials, strategy

• Return day before event; training/prep

• Up to 3 sessions a day, over 2 days

• optional sessions: retail, agency, real estate, etc

• In the field calls, day after

call or email for more info. we specialize in building web revenue.

guaranteed.

Mel Taylor MediaOnline Revenue Strategy for Local Mediawww.MelTaylorMedia.com 267-625-5313

A Pop Web Group Company.

Mel@MelTaylorMedia.com12/3/08