This is kind of right, but it's like traveling back to the '20s and telling your grandfather that he should go into iPhone contracting if he wants to make money — good advice, totally wrong audience. If the people in charge at most newspapers actually had the first clue about the Web, the industry wouldn't be in so much trouble.
This isn't an article so much as an advertisement: "Lloyd W. Armbrust is CEO of OwnLocal, a company that helps newspapers fix their revenue problems."
His idea of "fixing revenue problems" is having newspapers pay his company a bunch of money so they convert money that probably would already have been spent on local advertising into money paid for web services. No mention of how much cannibalization was involved in the case studies.
Most of our newspapers see new customers, and an on-whole margin increase of 10% annually.
Think of it this way, a small print ad costs $100 for one-time placement. Most real newspaper customers are the ones who can afford $10k-$100k per year.
For that same $100 monthly, we can give that customer a website, SEO, and social-media management--basically opening up a newspaper's customer base to a much wider audience.
BTW, we only do a revenue share, so that bunch-of-money is coming directly from new customers.
Does it help newspapers improve their core business of serving the community and building credibility with readers? Or does it sacrifice decades of that work in the name of short-term monetization?
When a local newspaper becomes a service agency to the same businesses it covers, will it be able to report on them fairly? Do newspapers who use your service disclose that relationship when a story includes a reference to a business that is paying them to run their web site?
Working in the Industry for over 10 years I can give you numerous examples where newspapers will risk sacrificing revenue to cover the news. I've seen the largest customer at a newspaper (a bank) in the news for months because their president embezzled funds.
It's why advertising departments and newsrooms are separated at a newspaper.
The truth is that running someone's print campaign and running their website is no different...
The idea here doesn't seem to be helping newspapers succeed, but helping newspapers transform into entirely new businesses. It seems like a reasonable way to make money, I just don't think it has a lot of relevance to the troubles facing the newspaper industry.
There is a difference between "journalism" and "newspapers". In a sense, journalism (hard news, soft news, tech news, whatever) is this wide idea, and newspapers are just one implementation. In the past, scarcity of information combined with advertising helped support the business end (see also: TV, Facebook, everything, etc.). It worked so well, in fact, that it could overcome the ridiculous costs of actually making this physical thing to put the journalism in and carry it to peoples' homes. Not anymore. There are examples of journalism succeeding outside of newspapers, but trying to build a physical, for-profit business around journalism seems to be a losing battle [1].
The nice thing about leaning on advertising for your revenue is that it pretty much scales with your readership which pretty much scales with the quality of your journalism and ease of access to it. The not nice thing is that the internet and Craigslist provide basically the same quality of information for free, so this once comfortable equation is suddenly completely failing newspapers. But the equation itself really hasn't changed, so it's not like newspapers can just throw away their journalism.
So the OP suggests newspapers add "digital marketing" to their sales pitch? Sure, okay, that could be very lucrative for newspapers. How does that relate to being a newspaper? If the digital marketing strategy pans out, what incentive is there for newspapers to keep providing that sillly, unprofitable journalism thing?
The relevance for newspapers is that they can take their current strengths and relationships and find a new source of revenue that's relevant to their current considerable customer base. Most journalistic enterprises are running short of cash today. They're far more likely to be killed by standing still than trying new things.
If the danger is that newspapers become too successful at selling online services such that they no longer feel the need to pay for quality journalism, I'd consider that to be an extremely premature concern on the order of worrying about looking too strong on your first trip to the gym.
7 comments
[ 2.8 ms ] story [ 26.4 ms ] threadHis idea of "fixing revenue problems" is having newspapers pay his company a bunch of money so they convert money that probably would already have been spent on local advertising into money paid for web services. No mention of how much cannibalization was involved in the case studies.
Think of it this way, a small print ad costs $100 for one-time placement. Most real newspaper customers are the ones who can afford $10k-$100k per year.
For that same $100 monthly, we can give that customer a website, SEO, and social-media management--basically opening up a newspaper's customer base to a much wider audience.
BTW, we only do a revenue share, so that bunch-of-money is coming directly from new customers.
When a local newspaper becomes a service agency to the same businesses it covers, will it be able to report on them fairly? Do newspapers who use your service disclose that relationship when a story includes a reference to a business that is paying them to run their web site?
It's why advertising departments and newsrooms are separated at a newspaper.
The truth is that running someone's print campaign and running their website is no different...
There is a difference between "journalism" and "newspapers". In a sense, journalism (hard news, soft news, tech news, whatever) is this wide idea, and newspapers are just one implementation. In the past, scarcity of information combined with advertising helped support the business end (see also: TV, Facebook, everything, etc.). It worked so well, in fact, that it could overcome the ridiculous costs of actually making this physical thing to put the journalism in and carry it to peoples' homes. Not anymore. There are examples of journalism succeeding outside of newspapers, but trying to build a physical, for-profit business around journalism seems to be a losing battle [1].
The nice thing about leaning on advertising for your revenue is that it pretty much scales with your readership which pretty much scales with the quality of your journalism and ease of access to it. The not nice thing is that the internet and Craigslist provide basically the same quality of information for free, so this once comfortable equation is suddenly completely failing newspapers. But the equation itself really hasn't changed, so it's not like newspapers can just throw away their journalism.
So the OP suggests newspapers add "digital marketing" to their sales pitch? Sure, okay, that could be very lucrative for newspapers. How does that relate to being a newspaper? If the digital marketing strategy pans out, what incentive is there for newspapers to keep providing that sillly, unprofitable journalism thing?
[1] This is old information now, but I think the basic idea still stands: http://www.mint.com/blog/trends/the-death-of-the-newspaper/?...
If the danger is that newspapers become too successful at selling online services such that they no longer feel the need to pay for quality journalism, I'd consider that to be an extremely premature concern on the order of worrying about looking too strong on your first trip to the gym.