NNN Perspectives

Patch can’t patch holes in their business model

August 16th, 2013

Last week the buzz surrounding AOL’s announcement to close or sell 400 out of 900 Patch Network owned and operated sites received lots of media attention, but much of it was focused on the wrong thing. There’s no question that the narrative captured on tape by a staffer is something most people don’t hear every day on business conference call, thus confirming that Patch has a “unique” culture. But the core issue raised by this announcement surrounds the viability of the Patch business model. When over 40 percent of your market profile goes away, it leads the average observer to question whether your model works and moreover whether it ever had the kind of footing that could one day deliver steady and substantial revenue.

When it debuted Patch seemed novel in concept. It would offer a national platform with a symmetrical design and deliver consumers first rate national content and up to the minute news within their community. The visionary design powered by an AOL engine would attract more advertisers, both local and national. The promise of Patch seemed pretty terrific! The problem is that it just never worked.  Each site had a dedicated ad seller and a dedicated editorial director. That’s it – two people per property.  This anemic staff just couldn’t keep up with the need to populate sites with accurate, timely and compelling information; as that started to lag the user experience suffered and ad sales began to wane.

Patch competes with local newspaper brands. With larger staffs that have real journalistic chops and a more committed understanding of the communities that they serve, newspaper brands are in a whole other league. The business side of newspaper operations is managed accordingly and relies on multiple revenue streams for survival. The sheer power, authority, and credible voice that newspaper brands have established were never going to be threatened by a Patch like product because the infrastructure that newspaper has built is terrifically difficult to replicate.

So the news last week was an indirect endorsement of newspaper brands reinforcing the vital role they play in the lives of their readers. For many they operate as a daily companion, offering a healthy diet of news and information that help people lead better lives. As newspaper brands expand into other platforms, the appeal of a tech based asset like Patch begins to wane and we get back to the most significant piece of the equation – content. You can’t just patch the holes in AOL’s game plan. To compete, requires a better business model.

See what Ad Age is saying about the recent downsizing.

Washington Post is Billionaire’s Baby

August 6th, 2013

As you may have already heard, Jeff Bezos bought the Washington Post yesterday for $250 million dollars. So to the good people working at the Washington Post, what does this mean? With the “changes” that Bezos hopes to make, he will be taking what is already a highly respected and authoritative voice in news and expand its voice into platforms that are highly trackable and cater to the reader’s habits and interests.

Bezos will not “be leading the Washington Post day-to-day…the Post already has an excellent leadership team that knows much more about the news business than I.” However, if Bezos carries over the success principles that he’s had in his main enterprise Amazon.com, the Washington Post will have many exciting new chapters to come.

Read more here.

Boston Globe Utilizes Twitter as a Microblog

July 18th, 2013

Keeping true to its award winning journalism while adapting to the way readers consume information, the Boston Globe was in constant dialog with its readers during the pivotal events following the Boston Marathon bombings.  With second to second information updates, journalists updated their Twitter feed virtually as quickly as the events unfolded. In the days of and following the bombing, the impact of @BostonGlobe skyrocketed over regular tweet volume tenfold with over 120,000 mentions on 4/15 and 4/20.

For more stats, read here.

Digital display advertising grows 20% in Q1

June 6th, 2013

IAB released its report on Monday for ad revenue in the first quarter of 2013 which showed  an increase of 15.6% YOY.  Digital Display was the fastest growing category  due in large part to the fact that social media and online video each experienced 30% annual growth within this category.

These large jumps in display revenue bode well for newspaper publishers.

Read more here.

Tablet content is a work of art for publishers and advertisers

May 17th, 2013

Key takeaways from a new NAA report on tablets include:

  • Create a user experience that combines print sensibilities with the functionality of a digital device by having features such as the sensation of turning pages, columns of text and finite pages, along with the ability to update in real time.
  • Cater to tablet user habits by acknowledging usage is mostly in the evening – 5 to 8 p.m. or 8 to 11 p.m. – with the majority using it in the latter timeframe.  Some publishers have reacted to this by creating an “evening app” that updates content specifically to cater to this crowd, a la an evening newscast.
  • Ease of use is of the utmost importance. The ability to download and save content is a feature many media companies are taking on so that users may enjoy content without an Internet connection.
  • Advertising is unique on the tablet. Interactivity with the touchpad makes it more engaging, while the larger screen increases ease of use and visibility. According to Insight Express, tablet advertising effectiveness outweighs that of mobile in awareness, purchase intent and brand favorability.

Click here to download NAA’s report.

America turns to newspaper media when shopping

April 30th, 2013

The recently released How America Shops and Spends report conducted for NAA by Frank N. Magid Associates explores consumer behavior and related attitudes regarding advertising media. Data from 2,000 interviews ensure a well-rounded snapshot as to where people turn when they shop.

The findings revealed:

  • Consumers take action as a result of newspaper advertising: 81 percent in the past 30 days.
  • More than one-third of “non-readers” (35 percent) actually use the newspaper during the week.
  • Newspapers lead all other media sources for seven-day usage to plan shopping.

For more information, please send an e-mail to jim.conaghan@naa.org.

Newspaper media industry report highlights diversified revenue stream

April 15th, 2013

A new report from NAA titled “The American Newspaper Media Industry Revenue Profile 2012” showcases the full newspaper media footprint. For the first time ever, this report contains extensive  data on new revenue sources,  including e-commerce, events, commercial delivery and printing.

The report notes that 40% of total revenue comes from non-advertising sources.  Along with this, circulation revenue is up for the first time in about 10 years.

“America’s newspaper media are transforming themselves,” said Caroline Little, NAA president and CEO. “In virtually every community they serve, newspapers have the biggest newsrooms, the best-known brands and significant audience market share. Now they are building on those to find new ways to serve audiences and local businesses.”

As the way people consume news continues to change, so will the forms of newspapers. Meanwhile, newspapers continue to maintain their integrity and to produce the world-class journalism that keeps readers loyal and informed.

Read more about the trends in the NAA report here.

Nielsen reports well educated viewers watch less TV with their morning coffee

April 5th, 2013

A recent Nielsen study shows that homes with a more educated head of the household were watching 50% less TV in the AM than the lower educated counterparts. “Overall, the report shows that higher education and income levels were correlated with less TV usage, particularly at the early and late parts of the day,  Nielsen said”.

It is plausible that the more educated consumers are actively engaged with their local newspaper in the morning. As the NAA reported last year in their Multiplatform Usage Study, conducted by Frank N. Magid Associates, 31% preferred to consume their paper in print in the AM before work/school.

Intuitively it makes sense no? If you are an advertiser looking to reach an engaged, educated and affluent audience that acts on your messaging, look no further than your local newspaper.

Read the full article about the Nielson study here.

You can download the NAA Multiplatform study on this page

Digital first strategy is “Chapter Two” for the ever resilient Times-Picayune

February 22nd, 2013

After making a bold move to switch from seven days of print to three days a week in October, the Times-Picayune has once again captured national attention.  Its publisher says ““This is a 50 chapter book. This is chapter two. So far, so good, but we’ve got a lot to learn.”

By cutting print distribution in half, daily circulation grew about 1 percent from the third quarter of 2012 (before the print change) to the fourth quarter in 2012 (after the change). And, average Sunday circulation is flat.

Moreover, digital changes are working! NOLA.com had 3.4 million unique visitors a month in 2011. In 2012, it rose to 4.2 million. NOLA.com’s mobile platforms combined had more than 12 million page views in December 2012.

Not only did the numbers get a lift, the whole office environment got a facelift. The new office in downtown New Orleans has 360 degree windows with a great view of the city and people don’t even have assigned desks. Instead carrying around Macbooks and iPhones to write and produce work on the fly.  The cultural changes are paying off during a big time in the city: The Superbowl. NOLA.com’s coverage racked up 1.9 million page views in two weeks. It published 614 stories, 1,317 photos and 93 videos.

This is just the beginning of what could be a prize-winning story; stay tuned for chapter 3!

To read more on what the Times-Picayune is going to rewrite newspaper history, read here.

A 141 year old pioneer presses forward with innovation

February 7th, 2013

More color and more analytics are just some of the things that papers like The Columbus Dispatch are doing to revolutionize the way they go to market. In response to reader research and large amounts of feedback, the print product has transformed into a more compressed version of its previous self – now a slim 14.6” tall x 10.5” wide. “Bigger than a tabloid but smaller than a traditional broadsheet” is how it’s billed.

And the size of the paper itself isn’t the only tradition that’s been left behind. The business model has gotten smarter focusing on core readers while concurrently increasing subscription prices. While The Dispatch lost approximately 8-9 percent of readers when they implemented this strategy, the increase in revenue offsets any loss and then some, as much as 5 to 1.  They are also trendsetting by implementing multi-headed pricing strategies…having plans like Sunday delivery only, e-editions, Web digital access and 7 day home delivery, readers have a plethora of packages to cater to their needs at a slight premium price over simply having both print and digital 7 days a week.

Watch to see if the innovation and rejuvenation of this paper catches on…

To read more about what innovations are happening at The Columbus Dispatch, read here.