January 2009

No one is gaing readership ... the winners are those who have lost the least

No one is gaining readership ... the winners are those who have lost the least

The newspaper industry as a whole is in dire straights. Several large publications, including dailies in Chicago and Minneapolis-St. Paul, have declared bankruptcy in the past year while traditional powerhouses, like the New York Times, are bracing for an unprecedented 18% losses in revenue for the coming fiscal year.


The financial quagmire — which has forced deep cuts in staff from Spokane to Tallahassee – is the result of two very real, very difficult-to-resolve problems:


1. Loss of ad revenue

The economic slowdown has spurred more careful ad spend as companies look to maximize what remains of their often depleted marketing budgets. Sinking circulation numbers are making newspapers far less attractive than newer forms of digital media that are reaching more people for less money. In this economic climate, no company is prepared to pay more for the chance to address fewer people (See the included graph for an eye-opening look at the loss of readership – no one is making gains, the winners have just lost less). So newspapers just need to attract more readers, right? Easier said than done, as we’ll see in issue #2.


2. Doing it for free

More and more audience segments are turning to the Internet and mobile sources, like RSS feeds, to get their daily dose of the world around them. While newspapers are enjoying a rise in the number of visitors (a 12 percent increase from 2007 to 2008, according to the National Newspaper Association), the measure is doing little to bolster the medium’s weak financial position. Online ad revenue has yet to follow the rise in traffic; no one seems quite sure why but the companies who once were willing to pay for ads in the physical paper are not buying with regularity on the Web sites and publishers have been slow to push their salespeople to find companies already embracing Internet ads. In addition, the content on the Web site is provided free of charge. Essentially, newspapers have traded their paying customers (loss in circulation) for readers seeking free access (rise in Web traffic). It’s no coincidence the two actions have occurred in the same stretch; it’s human nature – why pay for something you can get for free? How many of you would pay for a haircut on Tuesday afternoon if the same barber was going to cut your hair for free on Tuesday morning?


But don’t take my word for it. Check out media mogul Ted Turner’s take on the shift from traditional newspapers to digital media.


The final bark

Publishers must figure out a way to better leverage their established roles in their local communities via the Web content. Growing readership in the traditional product is losing proposition. How best to accomplish this is the million dollar question. Readers are not apt to pay for access to the Web site; just ask the New York Times. But, newspapers can’t afford to continue providing the content without generating revenue as a result. If you have a good idea, you have a bright future!  



To co-op a phrase from a popular Stephen King series “The Dark Tower,” the world – my friends — is moving on. Nowhere is this idea truer than in the often overly insulated world of marketing communications.


Marketing professionals tend to cling to known successes and easily replicable formulas more tightly than a rookie bull rider on the first night of the rodeo. Advertising firms spent more than a decade burying their heads in the sand to the changing face of television. Companies still buy help wanted ads in newspapers despite tanking readership numbers as well as a plethora of more economical and farther reaching Web sites at their fingertips.


This same resistance is being felt as the world moves into a new digital age. The Old Guard – of which I’m a proud, due-paying member – is brisling as brash young marketers espouse the benefits of the rising new media. RSS feeds can deliver up-to-the-minute information on product availability, news and promotions faster than the geekiest geek can update a Web site; streaming video can reach 10 times the audience in half the time and at a quarter of the cost of traditional TV ads; and e-mail can send a highly targeted and animated marketing message out to hundreds of thousands for a fraction of the price tag associated with mailing a similar product.


Yet despite all of the advantages attributed to new media, I hope my gray and battle-seasoned colleagues stand firm on one element: The human element. As the world becomes more and more interconnected via digital technology, there is a frightening tendency to compensate with an equally high level of reductions in human interaction. Once stalwarts in the old school consumer relationship paradigm, customer service reps have been replaced with cheaper but far less helpful automated services or a push to have consumers send e-mails.


Skilled sales people have suffered a similar fate. As firms look to continue tightening their collective belts, the notions of video-conferencing, e-mail and even social networking sites are quickly usurping the perceived need for a trained and deployable sales force.


While disposing of a skilled sales force saves money in the short-term, it also puts the long-term profitability of the company at serious risk. Jim Ristow, executive director of Home Entertainment Source, one of the nation’s largest electronic buyers, equates Circuit City’s decision to drop its most seasoned salespeople with the firm’s eventual bankruptcy. He noted the failure of the remaining, less experienced salespeople dramatically reduced closing at the outlet in the final years of business.


The Final Bark

Watch the included video for an interesting take on new media and sales. The clip suggests new media has changed the way sales leads are being generated but the human relationships formed between sales people and clients remain important to the overall success of a sales force.

I’ve never shied away from a good heated debate. Confrontation and dispute are the cornerstones of innovation. Two people standing in a room agreeing with each other is rarely the background for a story that ends with progress or, at the very least, change.

Along those same veins, I’ve never been afraid to admit mistakes, omissions or errors. Failing to do so translates into a failure to learn and grow, both professionally and personally.

In the last two days I’ve received some e-mails from colleagues who, out pure entertainment, decided to take me up on my offer to read this blog. Both noted at least one major omission in my analysis of social networking sites; and, to be quite honest, their criticism is spot on.

I failed to recognize the ability of a site like Facebook to generate positive word of mouth.

Interestingly enough, the Word of Mouth Marketing Association — yes there is such a monster — notes on its Web site that facilitating positive word-of-mouth referrals begins with meeting and exceeding customer expectations in terms of service, product quality and responsiveness.

Score one for this old dog. As I stated in a previous post, new media or traditional media — it all begins and ends with the consumer.

The final bark

That fact is people are far more trusting of each other than they are of marketers or corporations. It logically follows that brands will hope to leverage loyalists by having them forward links and messages to folks in the “friends” listings and invite likely prospects to join new clubs. These efforts in and of themselves cannot be considered a complete marketing campaign; they should be paired more traditional approaches and all of it must answer to the objectives stated prior to the onset of the campaign.

Social networking, podcasts, widgets, RSS feeds, blogs … the tools at the modern marketer’s fingertips are many and varied. Yet with all the bells and whistles, the ultimate goal with these new elements remains the same: To motivate and persuade consumers.


The only way to effectively communicate with consumers is to know who they are and what they want. That doesn’t change whether you are writing copy for a newspaper ad or designing a firm’s podcast. Far too often, marketing professionals find themselves so engrossed with exploring the possibilities of their new toys they forget to actually consider how the new abilities will be used to forward their client’s message, assist in building brand awareness, increase market share and, yes even sell more products.


Social networking is an excellent example of such overzealousness. Sites like Facebook primarily operate as a means of connecting friends and colleagues, hence the term SOCIAL networking. These sites were not established with commerce in mind, yet many a young marketing pro will tell you they are clearly the wave of the future.


Oh yeah, how?

  • Targeted banner ads?Nope. The latest statistics show few Facebook users actually click the ads that accompany profile pages.
  • Groups?It’s an excellent avenue for re-enforcing existing brand loyalty but it does little in the way of paving new relationships. The people in these groups clearly have an expressed interest in the brand and would likely seek out information through other avenues if not through Facebook.
  • Leveraging the wealth of information collected through the site? To a degree sure, but if you push too far, you’ll face a nasty backlash.

 Ask a communications specialist how they use social networking sites to their advantage and you’ll likely be on the receiving end of what will sound vaguely reminiscent of a politician’s stump speech.

Here’s what Jim Keyes said about Blockbuster’s use of Facebook:

“This is beyond creating advertising impressions … It’s about Blockbuster participating in the consumer’s community.”


Notice the pure lack of substance in that response? I only have one thing to say to those touting social networking as the next great marketing tool – Where’s the beef? Show me the proof that a client’s message is connecting with consumers via Facebook, otherwise let me be, I have ad copy to write.


 Now some suggest the blog is going the way of the dodo, adding the new medium lacks an ability to effectively address modern audiences. I disagree. The secret to a successful blog is masking the marketing messages with a compelling story, one that will engage audiences over the long haul. Pairing Nike with a blog by young runner training for his or her first NYC marathon would be an excellent means of initiating and maintaining consumer interest in that lifestyle segment.


There is one new medium with which companies simply cannot live out – the Web site. Web sites — while perhaps lacking the sex appeal of some of the edgier new media — represent the most effective current tool for marketing professionals. With hundreds of millions of potential customers actively surfing the Web, a company’s site is quickly developing into its primary face in the modern marketplace. Consumers turn to it for an endless parade of reasons, from tracking down store hours or return policies to making a purchase or filing a complaint.


Web sites offer consumers the ability to interact with a company on their schedule and at their pace. This interaction, be it clicking through to particular pages or playing a selected video clip, in turn aids the firm in developing a finely tuned database. A well-constructed database allows marketing professionals to develop targeted appeals as well as anticipate
emerging consumer needs.
Check out this link to Barbie’s Web site: http://barbie.everythinggirl.com/

Tell me an 8-year-old girl isn’t going to want to explore every inch of that!

In addition, Web sites can serve as natural launching points for some of the other forms of new media. Related blogs, videos, RSS feeds and widgets can all be integrated into a firm’s base Web site.
The final bark

Web sites are essential in the new age of marketing, but no new technology exists with which industry professionals can casually dismiss that tried and true industry tenet: Know thy customer. To reach and persuade consumers, a marketing strategy must still prove itself relevant to the target audience; simply being in the same area of a vast number of people is not enough to insure your message is being heard. Don’t believe me? Try yelling something in a crowded stadium. Think anyone past the next row heard you?   

More than three decades ago I forced my way into the advertising game the old fashioned way – I rode the coattails of a family friend. Fresh from four years at Penn State, I spent the better part of two months shipping out resumes and knocking on doors. No one wanted a green kid full of theory but short on real world experience. Seeing the desperation in my face, my father traded in a favor and secured an entry level – and by entry level I mean just above gopher – position at a tiny ad agency in Nowhere, Central Pennsylvania. I spent my first years cutting and pasting ads, running down copy, playing secretary during meetings with clients and sweeping the shop floor at the close of every business day.


Those first few seasons were tough; I was sure I had more to offer the company but no avenue in which to exercise those skills. Lucky for me, I kept my mouth shut and my ears open. I listened, watched and learned – how to handle a disgruntled client, how to close a deal, how to open a pitch, how to work with the media, how to measure a print ad, when color was needed, what makes an ad work and, most importantly, how to reach and motivate consumers.


In the time since, I’ve expanded my formal training and embraced the expanded scope of what was once known as advertising. The term “advertising” gave way to “marketing,” an endeavor that melded advertising, public relations, direct sales, creative development, market research and brand management into one cohesive monster.


I thought, at least for an old dog, I had stayed fairly hip to the new methods. Now I find myself, despite the imposing title on my office door: Francis Macomber, vice president marketing, adrift in a sea of swiftly evolving technology and ever-changing terminology.


Join me as I set out to explore this new high-tech jungle of RSS feeds, widgets and Podcasts. Together, we’ll discover if these new efforts at connecting with consumers are truly the next generation of marketing or merely a lot of hot air!