Newspapers Talk About National Online Ad Market - Again

Story in today's Chicago Tribune: 5 newspaper giants in talks about online ad network

I must be in an endless loop akin to a Groundhog Day scenario, because I've seen this headline before. About a dozen times since 1995. [Heck, I was part of the effort on a few occasions.]

This time, according to the article, the new network is to "help them recapture ad revenue leaking away from their print products." Well! Ok then. I get it. The first kajillion times didn't work because newspapers weren't losing enough money. Most observers thought it was because there was no consistency of audience, content, platform, and quality among the websites and the local staff knew that corporate was putting no teeth into the mandate.

And, yes, the new consortium "would both overlap with and compete against another network set up last year by Yahoo Inc..." The deal with Yahoo wasn't enough, uh, why? "What's missing [in the Yahoo partnership] is the ability for the newspaper companies to sell their own national ads across each other's sites." Wow - now I see the light. Apparently, newspapers are super stars about selling national ads on websites.

I'm a firm believer in monetizing websites. I know that it can be an advertiser's nightmare to try to buy ads in a string of newspaper websites. But the reason it has never happened is not for lack of a dedicated sales team that will "sell for newspapers."

Fool me once, shame on you. Fool me a dozen times...nope.

Online Newspapers - Lots of Good News

Local newspapers, and local online newspapers, have plenty to tout according to two reports published this July.

The Bivings Group released their 2007 study of the top 100 newspaper Web sites, and their conclusion is, "Overall, use of online features by newspapers improved across nearly all the categories when compared to last year's research..." Their study is chock full of interesting tidbits, including:

• The use of RSS increased in 2007 by 21 percent since 2006. Now 96 of the papers we researched are using this technology. Within this group, 93 papers offer partial text feeds, while three offer full text RSS feeds. No papers have begun embedding advertisements in their RSS feeds.
• Ninety-two percent of America’s top 100 papers now offer video on their websites. This represents a significant jump from 2006, where just 61 percent offered video. In this group, there is a mixture of local, Associated Press, and original content available on newspaper websites. Thirty-nine papers offer original content, 26 use AP video streams, 13 offer video content from local news outlets, four papers use all three technologies, and 10 papers use a mixture of two different types of video.
• The number and quality of reporter blogs also improved in 2007. Now, 95 percent of papers offer at least one reporter blog. Ninety-three percent (88 papers) of these blogs allow comments. In 2006, 80 percent of the papers offered blogs, with 83 percent (67 papers) allowing comments.
• The use of RSS increased in 2007 by 21 percent since 2006. Now 96 of the papers we researched are using this technology. Within this group, 93 papers offer partial text feeds, while three offer full text RSS feeds. No papers have begun embedding advertisements in their RSS feeds.
• Ninety-two percent of America’s top 100 papers now offer video on their websites. This represents a significant jump from 2006, where just 61 percent offered video. In this group, there is a mixture of local, Associated Press, and original content available on newspaper websites. Thirty-nine papers offer original content, 26 use AP video streams, 13 offer video content from local news outlets, four papers use all three technologies, and 10 papers use a mixture of two different types of video.

This is just a sample - check it out.

Aaannd, on another note, the Newspaper Association of America has some new research out, and their conclusion is:

More than 59 million people (37.3 percent of all active Internet users) visited newspaper Web sites on average during the second quarter of 2007, a record number that represents a 7.7 percent increase over the same period a year ago, according to custom analysis provided by Nielsen//NetRatings for the Newspaper Association of America. In addition, newspaper Web site visitors generated nearly 2.7 billion page views per month throughout the quarter, compared to slightly more than 2.5 billion during the same period last year. The second quarter figures are the highest for any quarter since NAA began tracking these numbers in 2004.

So when those online sales reps from the local newspaper show up at your business, pay attention.

What Local Media Sites Earn

Local media depends on local advertisers for their bread and butter, and gauging by the growth shown in the latest report from Borrell Associates, WHAT LOCAL WEB SITES EARN: 2007 SURVEY, the local media is doing something right:

"We gauge this year's U.S. local online advertising at $7.5 billion,
growing at a clip of 31.6 percent over 2006. Newspapers continue to
hold the dominant share. They control 35.9 percent of all locally spent
online advertising, but pure-play internet companies (Google, Yahoo!,
Monster et al.) are hot on their heels, with 33.2 percent. Yellow pages
operators control 11.7 percent; Other Print (e.g., Homes & Land and
other local magazines) 9.2 percent; TV stations 7.7 percent and radio
stations 2.2 percent."

Here's the problem:

When you talk $7 billion, every company wants a piece of the action.

When you talk about $400 or even $1400, which is how small local businesses buy advertising, no company wants the action unless it's free of human (translate=expensive) interaction.

What do most small businesses want? The kind of service they are prepared to provide their customers for a $400, or $1400, sale. In some cases, the kind of service they provide for a $20 sale.

The missing piece in the local online advertising market continues to be the dissonance between the companies that want that ad dollar, and the companies that shell out that ad dollar.