Some Cheese for that Whine… Newspapers (Part 1): Changing Distribution

dog-newspaper-21I recently finished a series of “Some cheese for that whine” on the book industry. Now, it’s time to turn our focus to an arguably more doomed industry: the newspaper industry. There are a lot of major issues facing the news world today, and competing with the internet is among the most demanding.

The image of a young boy with a baseball cap, riding a bike with a satchel of newspapers is a pretty American image – but the movement toward digital media may mean no more newspaper boys, and no more having fido fetch the paper (though who gets to tell them they’re fired?)

Newspapers have been threatened before. They were said to be doomed with the birth of radio… and again with the birth of TV. However, this time is different.

Before, newspapers continued to fill a unique niche. Unlike TV, they could go with you anywhere… and unlike tv or radio, you could read the newspaper whenever you desired. When competing with the internet, though, they face a distribution method that is more tailored, more instantaneous, is updated and available 24-7

… and is less profitable. Surely, you’d think, if readers truely value all these things OVER the traditionally published paper they’d be willing to pay more for these features. But I’m afraid you’d be wrong. Consumers are used to things being free online. Anyone can publishing anything (note: this blog) online.

Advertising
Traditionally, the newspaper and magazine industries made the majority of their profits through advertising – which should lend them an advantage on the web. Furthermore, advertisers like that on the web they can track effectiveness more easily, through click-through (how many viewers click on their ads, or who are inspired to act because of it). The web then allows them to see what those viewers looked and how long long they looked at it.

Because they can see definite numbers, web advertising is very appealing. As Jerry W. Thomas, points out in his article “Advertising Effectiveness,” with other forms of advertising it’s very hard to measure effectiveness.

Unlike most of the business world, which is governed by numerous feedback loops, the advertising industry receives little objective, reliable feedback on its advertising. First, few ads and commercials are ever tested among consumers (less than one percent, according to some estimates). So, no one—not agency or client—knows if the advertising is any good. If no one knows when a commercial is good or bad, or why, how can the next commercial be any better? Second, once the advertising goes on air, sales response (a potential feedback loop) is a notoriously poor indicator of advertising effectiveness because there is always so much “noise” in sales data (competitive activity, out-of-stocks, weather, economic trends, promotional influences, pricing variation, etc.). Third, some of the feedback is confusing and misleading: agency and client preferences and biases, the opinions of the client’s wife, feedback from dealers and franchisees, complaints from the lunatic fringe, and so on.

Despite all the benefits of web advertising, studies show that it is actually less effective then print advertising. And, news and media companies are less effective at competing on the web, where there is more ‘noise’ (competing sources of information). This means the website receives a smaller share of viewers, because the viewers have more options, some of which may appeal to the more. Newspapers have also done a fairly poor job of transitioning to the web in a competitive way.

Re-evaluate
Until someone sits down and looks at the idea of what a newspaper is, in its most basic form, wipes away all the preconceptions (paper, form and shape of articles ,etc) that newspapers will continue to struggle online (Note: One interesting ‘place’ on the web that is doing this is Huffingtonpost.com – but I have no idea how their business plan is set up, or if they are currently a profit publication).

As Sam Martin said during an interview with Mr. Magazine,

You know the newspaper industry is in such turmoil right now because they just can’t keep up with the news. I think we’re seeing an increase in op-ed style articles. We’re also seeing an increase in trend stories. That’s the only way for print to survive right now. It can’t compete with online news reporting. Print has to become either a thought leadership proposition, or it has to become a deep dive into trends.

Online news reporting is simply more timely then any print publication can ever hope to be. I foresee newspaper’s changing  – either they will become e-papers, sent to each of our inboxes or e-readers, filtering through all the ‘junk’ out there for us; they will becoming primary source locations – you go to their sites to see the ‘raw’ footage, interviews, etc. and then you can ‘create’ content from that or reference it (sort of what the AP does now … ); or as a location that gathers and re-produces the best of web commentary like 8020 Media tried to do (to follow the 8020 Saga, check out Mr.Magazine’s coverage of it starting with his interview of Mich Fox last October, and ending with his most recent post on the company).

The Cheese….
Newspapers will need to adapt and change their business models and the way they perceive the internet and themselves if they want to remain competitors in what will be a fierce digital future.

Stay tuned for part II….

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One Comment on “Some Cheese for that Whine… Newspapers (Part 1): Changing Distribution”

  1. Musca Law Says:

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    Musca Law
    Musca Law


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