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| Welcome to the Circulation Blog! This blog is devoted to newspaper execs charged with marketing the newspaper to readers. It focuses on topics related to building readership, improving operations, and audience metrics. We encourage single copy and home delivery stories that demonstrate audience growth and/or increase revenues. Share something new on the distribution side of the business or an innovative way to improve subscriber retention or build relationships with retailers. If it is circulation or audience related, we want to hear about and share it with your colleagues.
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December 2009 - Posts
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In the Face Of Retailer Centralization and Limited Resources Three Newspapers Coordinate Promotions
The Columbus Dispatch, The Akron Beacon Journal and The Cleveland Plain Dealer executed a multi-market promotion in Speedway with advertising support from Frito Lay.
Rapidly shifting technology and a down economy has changed the operating environment for single copy newspapers, making it harder to build and maintain the relationships necessary to put on successful co-promotions with retailers.
Promotion budgets have shrunk, and with a focus on revenue by both newspapers and retailers, there's less room to negotiate price promotions, with neither party wanting to give up the margins. As single copy prices have risen, sales volumes have fallen, heightening the need to maintain good retailer relationships.
In addition, with retail consolidation, there is less local ownership, which may require multi-market efforts involving two or more newspapers to coordinate a promotion.
For example, The Akron Beacon Journal, The Columbus Dispatch, and The Cleveland Plain Dealer joined forces in June 2009 to offer a multi-market promotion in Speedway stores, the largest convention store in their area, with advertising support from Frito Lay.
Each market offered the chance to win a "staycation" with area partners like the Columbus Zoo, which provided a weekend trip to their attractions for a family of four. The partners, in turn, were featured on the entry form in all three markets. The newspapers, Speedway and Frito Lay all received revenue gains from the month-long promotion.
Each market negotiated a "staycation" with in market partners in trade for being on the materials in the other markets. For example the Columbus Zoo provided a weekend trip to their attractions for a family of four and was featured on the entry form in all three markets. Speedway newspapers during the month of June in all three markets had a mail-in entry form. The customer could choose their "staycation" as well as $100 gas card from Speedway and Frito lay product for 1 year. Frito lay provided $10,000 to support in each market, additional in-store placement and product.
The newspapers coordinated shared POP, in paper ads and e-mail blasts.
The results were significant for all of the players. On June 1, The Columbus Dispatch raised the price of the daily paper for the second time in 2009 from $.75 to $1.00 and the promotion helped to minimize losses while providing 36.32% increase in revenue for June comapred to the same period a year earlier.
The Cleveland Plain Dealer comparing June '08 with June '09 during the promotion was able to show almost flat sales daily and Sunday despite a price promotion with Speedway last year and is now selling at 75 cents daily. The Akron Beacon Journal saved 10% of daily and copies as compared to our average decline due to the daily price increase in 2009 from $.50 to $.75.
Speedway is very pleased with the newspaper category after showing a 6.8% revenue increase the category in the last 12 weeks. Speedway is also very pleased with the execution of a multi-paper promotion in this category and another major category. Frito Lay the other major category, also showing strong revenue growth, is showing a 7% YTD increase in the identified markets and a 3% increase in "trips" (people purchasing Frito products). Similarly, Frito Lay is down .5% in units but is showing double growth in this class.
Sources: Dinah Eng, Akron Beacon Journal
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Single Copy Promotion Strengthened a Long Term Relationship
The Sacramento Bee earned improved point of sale locations and increased sales 5.8% when they partnered with Raley's grocery store to promote newspaper sales and reusable bags.
California passed legislation in 2008 that required retail stores to promote reusable bags. This became a big initiative for the chain, so it was an opportunity to help the retailer. A $.99 Raley's re-usable bag and the Sunday Bee could be purchased for $1.99. Normal pricing to purchase both items is $2.49 + tax producing a savings of $.50 to the customer.
During this time, the Bee continued to contribute to Food for Families, the charity for this chain. This also helped The Bee gain additional positioning within the store. While the promotion was for a Sunday Bee, they were able to place additional displays within the stores all week. The Bee also contributed custom designed promotional materials including in paper ads, rack cards, wobblers, and store stackers.
The retailer was very supportive with the rollout of this promotion. They shared the cost of the bag and sent communicated with each store about the promotion, which helped gain the additional sales positions and solidified the relationship with this important retail chain.
Sales of The Bee increased 5.8% during the promotion run over prior year and Raleys sold a total of 675 bags averaging 96.4 bags per week over the length of the promotion. More importantly, The Bee earned better display placement and many of these displays are still in the same visible spots, some still are display the bags on the sides of the displays. Equally important is the Bee strengthened the relationship at both the corporate and store level.
The recyclable bag program also helped to further alert their mutual customers about the green direction of both companies. The history of this partnership goes back more than a decade.
In 1997, The Raley's family started the Food for Families charitable organization. Since the inception of the program, the Bee has partnered with them on the charity and proceeds from sale of the Bee include a contribution to the charity. In the last 12 years The Bee has donated over $668K to the charity. In that time, together they been able to help out many families throughout the region.
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Newspapers Dominate but Online and Mobile are the Growth Segments
Newspapers inserts still dominate as a source of manufacturer and retail coupons but online and mobile are clearly the growth segment. Clearly it is an opportune time for newspapers to more aggressively pursue cross platform growth.
After several years of decline, coupons usage is rapidly rebounding and much of the growth is outside the typical package goods products such as soap and cereal. Retailers are contributing to the growth and the recession is driving consumers to boost redemption rates.
According to Borrell Associates coupon use is up "an amazing 36% over last year, but retailers are beginning to increase their use of the Internet as a distribution channel, particularly for higher-priced items." Newspapers still dominate the distribution channel accounting for 90% and Sunday inserts in particular still account for 70% of all coupons clipped, according to the study. During that time, the Internet was the source of only six percent of all coupons.
According to the Borrell study, while the Internet still accounts for less than 5% of all coupon redemptions, Internet coupons represent 20% of the value of those redemptions. This and the growth rate explains "why so many media companies are redoubling their efforts on launching coupon and shopping Web sites and mobile applications. te
Increases in usage are likely related to the Internet and mobile devices making coupons more widely available. "Coupons are just more accessible to more consumers than ever before," said Todd Hale, senior VP of consumer and shopper insights at Nielsen Co. "Without question, the economy has caused consumers to make pretty significant shifts in where they shop and how they buy and use promotions."
Another existing advantage is coupon users look like newspaper readers. Another recent Nielsen study confirms that affluent shoppers more likely to be heavy users. Newspapers have an opportunity to promote across platforms for their own online sources of coupons. The value of the Sunday insert package remains an effective promotional message for generating single copy sales. See Attracting Readers with Coupons and Contests
Sources: Chicago Tribune, Borrell & Associates, Nielsen, NAA
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E&P Special Report: "Print NOT Dead! Strategies Emerge for Keeping Key Readers, Revenue."
The impact of aggressive circulation pricing is being mitigated by development of digital strategies to reach readers through Web sites, mobile applications and e-readers.
The recent ABC FAS-FAX report documents that paid circulation has fallen as newspapers have increased prices and trimmed expenses. According to a featured report by E&P's Jennifer Saba, publishers are making higher prices stick and it is evident in increased circulation revenue reported by the public companies. Most recently year over circulation revenue grew 6.7% at McClatchy, 11% at Media General, 11.6% at A.H. Belo and 6.7% at The New York Times Co.
At the same time, newspapers are developing digital strategies to reach consumers through Web sites, mobile applications and e-readers and the result is audience growth in many markets.
The report notes that the data on combined online and print readership documents that in New Orleans, The Times-Picayune's net combined audience (past seven-day print/30-day online) rose 7% year-over-year. The Roanoke (Va.) Times' net combined audience was up 6.3%, while the Houston Chronicle advanced 4.7%.
The story also suggests that the most aggressive circulation pricing actions were this year's story and next year newspapers will focus more on rebuilding circulation and readership. Access the article here.
Source: E&P
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Newspapers Using ABC's New Consolidated Media Reports to Tell Larger Story
The Dallas Morning News, Fort Worth Star-Telegram and Gettysburg Times joined Chicago Tribune and Kansas City Star in releasing CMRs for September 2009 Reporting Period.
The Consolidated Media Report is ABC's customizable report that allows newspapers to present advertisers with a snapshot of their entire media footprint across a myriad of print and digital products. The new report is also significant because it embraces the concept that the future of newspapers, and in many cases the current success of the industry, is found in marketing advertising and content across platforms and multiple print products.
The perspective is consistent with the work of the NAA/ABC Strategic Vision committee to develop new reports and standards for evolving newspaper publishing plans, including print/digital hybrid models, targeted niche publications, e-readers, and mobile platforms. The task force of newspaper publishers and advertisers is expected to present final recommendations to the ABC board of directors in March 2010 with a recommendation that the new reporting formats become effective October 2010. The new format will include the "total circulation" of a newspapers which will include multiple platforms and include branded editions. The recommendations will provide the final qualification and reporting rules necessary for the final roll-out of the changes approved by the ABC Board two years ago.
Michael Lavery, ABC president and managing director addressed the issue and the role of the CMR option by stating, "With business models evolving and distribution channels growing, we are working to develop flexible reporting options that allow newspapers to report data from a wide-variety of channels and products while still providing advertisers with independently verified, comparable data. The CMR is an important step in that process."
The recent release of these five Consolidated Media Reports demonstrates the applicability of the report across a wide range of newspaper members and their diverse publications. The five include the Gettysburg Times (Penn.) , Chicago Tribune, Dallas Morning News, Fort Worth Star-Telegram, and the Kansas City Star. Mr. Lavery also noted "Our newspaper members have really embraced the CMR and the opportunity to illustrate the reach and depth of their brands."
View and download newly released CMRs for:
The Dallas Morning News' CMR features circulation for Briefing, a free newspaper delivered to select households; Al Dia, a free Spanish-language newspaper; and Quick, a free weekly targeted at 18-34 year-olds. The newspaper also included Audience-FAX data for the Dallas Morning News on its report.
The Fort Worth Star-Telegram's report includes La Estrella En Casa, a free Spanish-language newspaper and DFW.com Ink, a free weekly publication catering to 18-34 year-olds. Another application of the report is evident with The Star-Telegram. The paper also reported circulation data for several weekly community newspapers such as the Mansfield News-Mirror and the Weatherford Telegram as well as six Alliance Regional Newspapers: the Colleyville Courier, Grapevine Courier, Haslet Harbinger, Keller Citizen, Southlake Journal, and the Times Register.
The Gettysburg Times, the only non-metropolitan newspaper in the group reported circulation for two additional print products: the Gettysburg Companion, a free bimonthly magazine, and El Diario Latino, a free weekly Spanish-language newspaper.
The Chicago Tribune and the Kansas City Star; both previously issued reports for the period ending in March 2009. The Kansas City Star reported its daily circulation alongside that of INK, a free publication catering to 18-34 year-olds. The Chicago Tribune continued to report print circulation from Red Eye, the predominantly free publication targeting young commuters; The Mash, a free weekly newspaper largely written by teens; Hoy, the free Spanish-language newspaper; and Fin de Semana, a weekly Spanish-language newspaper available on Sundays. The report also includes expanded Audience-FAX data for the Chicago Tribune, RedEye and Hoy.
Source: ABC, NAA
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Hearst Introduces "Skiff", Digital Partnership and Plans for Electronic Newsstand
Next year Hearst plans to launch a service called Skiff to sell digital versions of newspapers and magazines with new e-reader technology in a system that will incorporate advertising and will be more visually appealing to readers. This week Hearst was also part of a joint announcement with News Corporation, Condé Nast, Meredith, and Time Inc. that they have entered into an independent venture to develop open standards for a new digital storefront and related technology that will allow consumers to enjoy their favorite media content on portable digital devices.
John Squires from Time Inc and the venture's interim managing director, said in the statement, "For the consumer, this digital initiative will provide access to an extraordinary selection of engaging content products, all customized for easy download on the device of their choice, including smartphones, e-readers and laptops. Once purchased, this content will be 'unlocked' for consumers to enjoy anywhere, anytime, on any platform."
The announcement for the Skiff service and the digital store that will offer a comprehensive selection of newspapers, magazines, books and other content from multiple publishers, designed specifically for wireless delivery to devices and delivery via the Web speaks to Hearst's leadership efforts to take print publications into the world of digital delivery. Skiff has signed a multi-year agreement with Sprint to provide 3G connectivity for Skiff's dedicated e-reading devices in the United States and the plan is to have Skiff readers available for purchase in more than 1,000 Sprint retail locations across the U.S.
"The platforms and devices that other people are building are not really appropriate for newspapers and magazines," said Kenneth A. Bronfin, president of Hearst Interactive Media in a statement to the WSJ. "We are going to create an entity by publishers, for publishers." The same article addressed complaints by newspaper and magazine publishers that existing electronic reading devices offer limited revenue opportunities, and poor facsimiles of publications. Skiff executives say their aim is wrest control of the digital reading experience from technology companies and retailers and in favor of the publishers of newspapers and magazines. Skiff said publishers will keep the majority of revenue from digital subscriptions and advertising. Currently Amazon keeps as much as 70% of the revenue from Kindle subscription sales.
The announcement is also significant because it focuses on what is described as "rich array of innovative advertising opportunities" meaning publishers will derive revenue from content and advertising sales, as well as from print subscriptions. This is carried a step further in that Skiff is also partnering with Nielsen and comScore to help develop for publishers the necessary analytics to measure the effectiveness of e-reading advertising and facilitate media planning and buying through the Skiff platform.
The initiative was initially called FirstPaper and the concept originated with Hearst's Interactive Media division. Skiff is also different as a platform because it was designed specifically with magazines and newspapers in mind and with a level of quality that the current offering of e-readers are not currently capable of delivering.
By the end of 2010, Forrester Research estimates that 10 million e-readers will be sold in the U.S. Barnes & Noble's Nook e-reader device is already sold out for this year, The New York Times reported. Sony has run out of wireless e-reader, but still has non-wireless models in stock. Amazon has not reported any problems with its Kindle device.
Sources: Folio, E&P, Editors Weblog , NYT, WSJ
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Extra Promotion Offset Higher Prices For Thanksgiving Day Edition
From the Kenosha News in Wisconsin to Florida's Treasure Coast newspapers have reported strong Thanksgiving Day single copy sales, most with double digits increases, compared to last year despite charging the Sunday retail rate.
The dozen newspapers from around the country that responded to an NAA quick poll reported that in most cases sales were above a year ago, and at least twice a typical Thursday. In each case they added promotion including point of sale displays, which was necessary anyway due to the higher price. Many added radio, e-mail, web messages and in-paper ads leading up to Thanksgiving.
Scripps Treasure Coast Newspapers reported an 18% increase from last year which is more than 200% above a typical Thursday while charging the Sunday rate which added up to a 400% increase in revenue for the day.
How strong was demand for this year? The Eagle Tribune in Massachusetts increased sales from last year despite testing reader's devotion to the Thanksgiving Day edition by raising the price to $2.50 compared to 75 cents last year.
The Augusta Chronicle reported increases in sales from last year. They promoted in the newsrack via rack cards and corner cards; at retail accounts via stacker cards, online via their website. They also ran ROP promo ads two weeks out. In addition, The Chronicle sent letters to all retail account managers and retailer corporate offices explaining the pricing action with an explanation to expect very robust sales (as well as benefiting from making Sunday profit margins).
In Fredricksburg, VA they booked a healthy year over gain which equated to a 291% lift compared to a normal Thursday. They ran a front page rail ad in TMC 3 weeks prior promoting the paper, radio and in paper advertisement, stack and rack cards promoting savings found in the Thanksgiving edition.
The Daily Post-Athenian in Tennessee increased sales by 15% compared to last year and a 244% increase in revenue by coordinating promotion well in advance to advertisers and the community that the newspaper was going "to be stuffed on Thanksgiving Day".
The always creative sales group at The Indianapolis Star sold a four day home delivered subscription package including the Nov. 26 - 29 editions. This package was sold to customers for $5 (same as single copy retail) with no term or commitment restrictions. They sold 1,157 four day packages. As a follow-up, The Star contacted these subscribers on Saturday during delivery to verify delivery had occurred. During the call, they were able to convert 18% of the package subscribers they reached to a longer term subscription. A direct mail piece dropped to these customers on Monday. They still in process of contacting them this week to convert as many over to permanent subscriptions as possible.
Jim Maneta, Director/Distribution Operations Democrat and Chronicle in Rochester, NY and the team did a program similar to Indianapolis using an E-mail blast to non-subs offering special 4-day Thanksgiving weekend home delivery . They also increased their Kiosk presence at various locations (garden stores, K-Mart) and placed in-store ‘greeters' promoting T-Day sales/offering bagged T-Day paper and encouraged retailers to provide an extended shelf presence of the Thanksgiving Day paper through weekend.
The Daily Inter Lake in Lake Kalispell, Montana posted a 31% increase compared to the same day last year and it was based upon the same formula of reminding the reader about the unique value proposition the local newspapers brings to the table.
The value story is playing well right now with consumers in today's economy and the message is resonating in single copy sales. Click Here for more on the Thanksgiving Day pricing and promotional strategy.
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The Measurement: Newspaper Readership, or Circulation ?
Outside of the newspaper industry researchers and trade journalists still seem to be struggling with the question and most are several steps away from grasping the concept of "audience".
The question is presented as the title of a MediaPost article that summarizes the latest Integrated Newspaper Audience finding from Scarborough Research, in its recently released Scarborough USA+ Study, 74% of U.S. adults, or nearly 171 million people, read a newspaper, in print or online, during the past week.
Randy Novak, Director of Strategy NSA Media, responded to the posting by writing; " Why is it so hard to imagine that adults read newspapers in print, online and mobile? And why is it so hard for marketing people to understand that consumers actually want newspaper advertising; and thus should consider how to better use the medium as opposed to writing it's obituary at every opportunity? The industry is certainly not without fault, but let's gets real here... it still drives a hell of a lot more business for advertisers than it gets credit for."
In the same article Gary Meo, Scarborough Research's Senior Vice President of Print and Digital Media Services, notes that "While our data does show that print newspaper readership is slowly declining... given the fragmentation of media choices, printed newspapers are holding onto their audiences relatively well... " The analysis of Scarborough audience data not only indicated that newspapers are being read by a majority of adults in print and online, but also that these Integrated Newspaper Audiences continue to attract educated, affluent readers."
The original Scarborough release continues "While our data does show that print newspaper readership is slowly declining, it also illustrates that reports about the pending death of the newspaper industry are not supported by audience data," said Gary Meo, Scarborough Research's Senior Vice President of Print and Digital Media Services. "Given the fragmentation of media choices, printed newspapers are holding onto their audiences relatively well and this is refreshing news."
"Printed newspapers have been trusted sources of news and information for decades, and many newspapers have continued that tradition by successfully extending their brands into the digital space," said Mr. Meo. "In doing so, they are attracting an audience that has even stronger socioeconomic status - equally upscale with their print brethren, but younger."
"The Scarborough news is noteworthy in the wake of the recent FAS‐FAX report from the Audit Bureau of Circulations (ABC), which reported significant declines in weekday and Sunday printed newspaper circulation," said Mr. Meo. "While Scarborough shows declines in printed newspaper readership, these have not been as severe as those reported in circulation. This is because circulation and audience do not always march in lockstep as they are two different measurements."
Read the MediaPost article and the Scarborough Release.
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Update on the TV Book Solution
A short item recently ran in the Living section of the Sun Herald in Biloxi; "Beginning Sunday, Dec. 6, the Sun Herald will offer readers the opportunity to subscribe to a new weekly TV book titled OnTV Magazine".
The new TV book is in a 44-page magazine format and features a color cover, celebrity entertainment feature stories, complete daytime and evening listings for the South Mississippi market, Sudoku, word search and crossword puzzles and horoscopes. Although the Sun Herald will be distributing it free in all Sunday print editions in December, but beginning in January it will only be available to Sun Herald home delivery subscribers willing to pay the discounted rate of $39 per year.
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The TV Book solution in Biloxi looks very similar to the program underway at the Star Tribune in Minneapolis, and it is a model many newspapers have adopted this past year. TV books, which once were considered unprofitable, are now gaining a new identity as a niche product among newspapers that have moved to paid opt-in programs, resulting in reduced newsprint costs while creating a new source of revenue.
The solution to the issue of printing an expensive full run product for a relatively thin market of subscribers has been evolving during the last three years. The intial solution appeared to be "opt-in" for subscribers which saved newsprint and post press expenses but complicated distribution. Other newspapers did away with their TV books, some reduced the size, a few newspapers have secured sponsorships, and others went to a free opt-in model. Today, many who created free opt-in programs and eventually asked the question, "just how badly do they want it" are now successfully charging for the product.
"Nine months ago, we decided to provide enhanced content and charge for our TV book with an opt-in program," explains Michael Gorman, director of sales and retention for The Arizona Republic. "We did a survey of those who said they regularly read the TV book, which was 44 percent of our subscribers. They told us what they liked about the book and what they didn't like, and we built a couple of prototypes."
The old TV book was a 32-page guide that was minimal on content, with grids that ran from 6 a.m. to midnight in small type. After getting reader feedback, the new TV book became a 48-page guide, wrapped in a glossy cover, which includes listings for 24 hours each day in a larger font.
"We added the crossword puzzle back in, a summary of best bets by day, highlights for the week, a movie index and sports highlights," Gorman says. "We did a survey on price points that people would accept and give us a revenue stream without jeopardy of losing readers. Now we charge 25 cents for the TV book."
The newspaper ran a letter from the publisher and executive editor in the newspaper, outlining the financial situation to readers, explaining that it cost $1.7 million a year to produce a TV book that the majority of readers were not using, so an opt-in program would be commencing, offering the product with additional content.
"We were taken aback by how quickly we got responses," Gorman says. "We had 30,000 sign up by the second week of production, and now are at about 70,000, which is 16 percent of our subscriber base."
"The additional revenue now pays for the new book and the old TV book," Gorman says. "It's a nice bonus that it's made a profit on top of that. At seven and a half percent, we would have broken even on the home delivery copies, but we're at 16 percent. The key is that we enhanced the content, so we had a value proposition to it, vs. just charging additional money for it, and we focused the message on that."
Read the Entire Article...
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