bill melnick, partner

Newspaper Datapoint of the Day

While the unabated decline in revenue and circulation is well understood, I have to disagree that the newspaper industry as a whole is doomed if the owners undertake a major shift in business strategy. The major metro daily has some distinct advantages that are not being fully exploited because of serious strategic misteps. These misteps include:
1. Failing to understand their real competition for readers and advertisers.
2. Failure to appreciate that marketwide coverage both in circulation and content does not meet the needs of the marketplace. All local media that provides marketwide coverage is in decline including TV and radio.
3. Failure to leverage the equity in the brand and bring that competitive advantage to bear inside a new business strategy that recognizes that the center of gravity for most metro readers is no longer downtown.
4. Failure to rationalize a fixed cost structure to more efficiently serve their local readers and more importantly their local retail advertisers who constitute some 85+% of ad revenue.
5. Overinvestment in their online product in a world of oversupply of online impressions and a collapsing CPM environment.
6. Failure to create and deliver products that are bottom up based on their constituents needs but instead deciding what readers should have and thereby not serving their advertisers well.
7. Blameing the internet and the economy for poor decision making.

We at Brand Idiomatics have what we think is the understanding and business ideas that will show newspaper owners how to restructure their business inside their current circulation footprint and how to make their products align with their stakeholders needs.
Contact us at brandidiomatics.com for a no obligation no cost introduction.

Newspaper Industry: Evolution or Catastrophe?

As a long time media executive and marketing strategy consultant, I continue to believe that newspaper executives are chasing after the wrong solution. Rather than continue to invest in their web properties as a means of recapuring lost revenue, newspapers need to maintain the quality of their news gathering content. With the exception of the national newspapers, the only hope that major metro dailies have of surviving is to focus on their local markets because that is where they can leverage their brand equity and offer differentiated content. The economic key to survival will require that they be smaller businesses and more focused businesses in delivering relevant content to smaller geographies in their overall circulation footprint. This would make the papers more valuable to consumers and advertisers in those geographies.
To discuss this further, contact us at brandidiomatics.com.

Newspapers: Any Options Beyond Cutting, Selling or Closing?

While your observation that publishers are choosing between digital only or in some cases abandoning digital altogether, there is a third choice that has yet to be explored or to my knowledge been given serious consideration. As you have stated, neither betting on the web nor cutting costs fast enough has any promise because both are self defeating for economic reasons as well as product viability reasons. The web as a business remains profitable only for e-commerce or search and cutting costs that support the content which is the only product that newspapers have to sell in favor of web overinvestment is leading to eventual extinction. Newspapers are running down a blind alley if they think the web will save them as they defund content. Its as if NBC decided to scale back on programming and start building TV sets that only get one channel as a solution to their problems. There is another solution if publishers can think boldly and strategically.

All successful marketers have three things in common regardless of industry:
1. They are consumer-centric. They offer products and services that are what consumers have demonstrated they will buy in the most efficent and consumer friendly distribution channels.
2. Their products are highly relevant and often predict where consumers are headed.
3. Their products are differentiated from everything else that's out there.
There is no demand or pricing power in parity products.

As we see it, publishers are either driven by their own business needs or are capitive of the editorial desires to be the next Woodward and Bernstein. Publishers need to good marketers first and therefore focus on the three principles laid out above.

For big city daily metros it means changing editorial mission, looking at circulation distribution differently and understanding how local advertisers source their customers. This can be achieved within the current circulation footprint with a reallocation of current editorial staff and a wholesale change in advertising sales practices and pricing structures.

We at brandidiomatics.com are advisers to marketers in need of understanding and competing in a this fierce and changing consumer and business landscape. Visit our website and if you are interested lets talk about how we can advise you on how to adapt and thrive by providing a new strategic roadmap. No obligation.