Today a new initiative was launched in the USA to support the newspaper industry. The Newspaper Project is to present "insightful articles, commentary and research that provide a more balanced perspective on what newspaper companies can do to survive and thrive in the years ahead".
Their first ad makes that point loud and clear.
On January 27 the first issue of The Printed Blog appeared in Chicago, using one of the most popular Internet applications to turn into one of the oldest media. The idea is simple, bring local news provided by free reporters (citizen journalism), attract local advertisers (buy an ad for $15-$25), offer it to local readers, for free and PRINT it. Joshua Karp, founder and publisher, hopes eventually to reach, twice a day, a multitude of neighbourhoods in major US cities. In Chicago for example, there could be 50 local editions. The paper printed on a 27 *43 format, presents news that has been chosen by the readers of The Printed Blog site, selected among articles of 300 bloggers.
The business model is based upon advertising revenues; advertisers can reach a well selected audience and are prepared to pay more for a printed advertisement than an online ad.
I came across a very interesting list of articles on the Life, Death and Rebirth of Media via Patou Nuytemans. It includes articles from the USA and Europe about the developments in the print media. An excellent read.
After three months of intense meetings, interviews and research the French government published the recommendations to support print media in France. In the context of the growing importance of online news and the economic situation of the print media "Etats Genereaux de la Presse Ecrite" was created. This Conference worked on four aspects of the print media business: the journalist function, the industrial process, print media and Internet and print media and society. Earlier this month the group presented its conclusion in the "Livre Vert". On the basis of these recommandations President Sarkozy decided to give all 18 year old French a free newspaper subsription of one year. The French government is also to double its advertising budgets spent in print media to 40%. Other measures have also been announced. Together with the ban on advertising on public broadcast television, the French have put together robust measures to support the print media.
Erwin Busselot from Kodak forwarded me a slide that puts the news (see post of September 7) about declining sales of newspapers in more perspective. This slide - although from 2007 - shows the difference in evolution between the continents.
I saw a graph in Wired confirming what so many analysts have already been suggesting: the collapse of newspaper advertising revenues in the USA. The Newspaper Association of America presented figures that indicate a loss of $3 billion (- 14%) of ad expenditures during the first six months of 2008. Total revenues for 2008 are expected to be below $ 40 billion, which is the lowest level in 12 years. Also online expenditures were down: - 2,3% in the second quarter, but showed an increase of 2.3% over the first six months.
(Chart: Alan Mutter)
I sat in a presentation some weeks ago about the effectiveness of newspapers. InBev, BrandScience and Nielsen presented their findings on the ROI of newspaper advertising. All of them used econometric models to demonstrate the value of newspapers (otherwise they would not have been invited to do their presentation). The presentation pointed out some stimulating data. BrandScience used a database of 200 cases including newspaper campaigns, the average Revenue Return on Investment ranked as follows: inserts topped the list followed by newspapers, magazines, radio, online, direct mail, outdoor, television sponsorship and television.
A case study on the support for the Jupiler Blue brand showed also the superior ROI of the combination of newspaper and outdoor advertising. The result mentioned a poor 8,8 % - 9,8% contribution of advertising to total sales of the brand.
In driving back to the office I thought about two things: one, where does the creativity of the ads gets into the equation? What is the role of the Cannes Advertising Festival and all other creativity awards, when everything can be modelled without taking into account creativity. In a world of product parity, creativity and design can call for premium prices and consumer interest. And two, when advertising contributes less than 10% to total sales, is that because we do not spent enough time, money and energy on creativity and design? The jury of the Effie Awards will be able to judge whether we have used the right mix of econometric modelling and creativity. If not we probably should be more humble about our role as communication specialists.
EMS, the European-wide media study revealed last week the results of its latest survey. EMS researches the affluent and influential people in Europe and is a valuable balance to many single-media, single-country studies. The study confirms what so many individual surveys have indicated: print media are steady or slightly in decline. On average pan-regional titles were read by 25,3% of the EMS sample, which is a decline of 1.1% compared to last years figures. Individual titles had very little movements, with the free newspapers increasing their average issue readership (AIR).
The EMS survey makes a distinction between the Top 13% and Top 3% (EMS Select) in its sample. The more affluent the higher the readership for print and reach of television. AIR for pan-European (News and Business) print was at respectively 7.2% and 15,3%. Reach of pan-European TV (News and Business channels) was 42,7% for EMS and 53,8% for EMS Select. Next year digital usage will be added to the survey. This will offer an even more complete view of media consumption of this exclusive and influential group of people. Especially in B-to-B and corporate marketing this survey is relevant as C-suits (which are often the target audience in B-to-B) are among the target group of EMS.
Newspapers are probably the biggest losers of the growth of the Internet. Advertisers shift to the cheaper and more accountable Internet advertising possibilities and readers value the speed and the interactivity of Internet news. Zenith Optimedia expects that by 2010 newspapers will take 23,7% of all ad spend (in 2006 this was 28,4%). By contrast, the Internet will represent 13,6% in 2010 (6,8% in 2006). Research among 250 newspapers in the USA shows the paradox newspapers are facing. The Internet offers them a platform to compete with television and radio in bringing video news and generate the related (lower) advertising revenues. On the other hand providing news for the Internet places heavy burdens on the quality of the journalistic work. Andrew Keen has written an excellent book on what he calls the Cult of the amateur. The web does not allow for in-depth, high quality news analysis. Integrating editorial teams for the paper and the web version of the newspaper has been the first step newspapers have taken. But the future of these already downsized teams depends on the capacity to attract advertising money for the web-based newspaper.
The contradiction in this situation is that Google, the exponent of the Internet, demonstrated the value of newspaper advertising in conjunction with Internet advertising. Media are connected: newspaper ads drive consumers to the web. The Google research showed the effectiveness of newspaper advertising but also the effectiveness of the combination: of those who researched a product they saw in the newspaper, 67% did so online.
Advertising budgets will continue to be in transition between the different media untill there is a new equilibrium. However I'm not expecting to happen to newspapers, what MTV believed to happen to radio when they aired at their launch the clip "Video killed the radio star".
I was invited by Kris Decoodt last week to Microsoft's Digital Inspiration event in Louvain-la-Neuve. Microsoft wanted to brief brand owners, creative and media agencies and programmers on the latest developments at Microsoft. I sat in a session specifically designed for agencies, but was somewhat disappointed. There was some interesting research about the use of online media and its function. On the basis of worldwide research among 400 respondents Microsoft deducted that 19 percent of all time spent with media is spent online. And almost 40 percent of this is used for communication, 18 percent for information, 16 percent for entertainment, surfing, transaction and creation all score less than 10 percent. The flaw on online media is the shared attention: 71 percent of online activities are conducted while people are doing other things. Internet access is interwoven with working, eating, watching TV, listening to music or chatting to friends as the report mentions.
Some interesting examples on online advertising were shown by David Pugh-Jones. A couple of these examples uses the Q-code or UpCode. This code gives access to more detailed information when captured with a mobile phone. A year ago I wrote about this application in Life with Print, and at the DRUPA it will also be featured.
The number one sensation was of course Steve Ballmer, Microsoft's CEO. The Aula Magna of the University was packed with Microsoft believers, what became quickly clear when Steve B. made some jokes. He presented an interesting overview of which business Microsoft is in (its basically a software company, working for desktop and enterprises, is involved in non-PC devices and online advertising). With a goal of being on every desk and in every home. His most important quote was that content and communication media will come together and that we will consume content in a more social context. Video can be watched on different screens, be it a TV, a computer, and iPod or a game console. Barriers between the media will disappear and content will be exchangeable between these media. In this context Steve B., as he refers to himself, also announced that in 25 years time people will not make a distinction between print and TV. I would be interested in Rupert Murdoch's perspective on this.
(Picture:Bert Claeys)
A beautifully designed campaign with a quality message for this leading UK newspaper by Wieden & Kennedy.
It's done. Rupert Murdoch has bought the Wall Street Journal. Today the Wall Street announced the deal that has led to heavy disputes in the Bancroft family. The Bancrofts hold 64% of the Dow Jones controlling stocks and at least two thirds needed to approve of the deal.
It seems that the take-over by media mogul Murdoch had more to do with US newspaper heritage and media sociology than with finance. (Money was probably no issue with a proposed price of $60 per share that represents a 69% premium to the pre-offer stock price).The WSJ is one of the oldest family owned newspapers in the US and now becomes part of the stable of Murdoch including media brands as Fox News, MySpace, National Geographic, Times of London and many others. And becoming part of a media conglomerate that produces content for the masses was probably the biggest hurdle to take for the family. What will become of the WSJ stature once taken over by News Corp? Can it maintain it's position as one of the worldwide references for financial news? These questions relate to an interesting discussion taking place the the media industry: is popular culture bad for us? Is popularised news bad for readers and viewers? Some two years ago Steven Jonhson published "Everything is good for you. How popular culture is making us smarter". This book like the book from Gust de Meyer (De beste smaak is de slechte smaak) demonstrate that the popular culture of videogames, television (including reality-TV), film and Internet has made people more intelligent. The complexity of the media and content is posing new challenges to our minds that make our minds sharper. Interesting to watch how the WSJ will continue to challenge its readers.
Google announced last year a test involving 50 US newspapers and a limited number of advertisers to bid online for advertising space. Today the service called Google Print Ads is available for all advertisers and includes over 225 newspapers (combined circulation of nearly 30 million). The Google sales pitch demonstrates the commitment to integrated media campaigns as it presents 4 reasons to consider newspapers as a "important component of any advertiser's media mix". Newspapers give advertisers significant local reach, they reach an attractive demographic audience, they are a key resource for shopping information that drives offline and online purchases and finally newspapers are relevant throughout the entire purchase cycle.
It will be very interesting to see what Google's initiative will do to the top-line and bottom-line results of the participating newspapers. And also to the reaction of the traditional traders in ad space; the media agencies.
The newspaper world is going through a contradictory development. On one hand the advertisers are more and more turning away from newspapers as a medium to advertise their brands. (Newspapers' share of total ad spend was down from 38% in 1996 to 31% in 2006). At the same time plenty of innovation is taking place in the newspaper industry. Just to mention the two most important: the reduction of the size and the growth of the free-newspaper category.
During the period between 2001 and 2005 the number of paid-for dailies worldwide jumped over the 10,000 mark the first time, representing a total circulation of over 450 million copies (+13%). The free newspaper market includes 189 titles with a total circulation of over 28 million in 2005 (+137%). This upswing in circulation includes the decline of one-size-fits-all newspapers. Newspaper are becoming more targeted and complementary to broader audience newspapers.
Now they have secured readership print publishers will need to rethink how to position their brands towards the advertisers and agencies audience. The advertising revenue model will need some rethinking to regain share of the advertising spend.
Yesterday was the launch of the revised -what is called the most trusted newspaper- The Wall Street Journal print and online version. About half a million copies were handed out for free and access to the news site was also free. Most apparent change is the smaller size -almost one column- and the way the articles are displayed. Less articles on the cover page and less articles are continuing on following pages to facilitate reading. Today's front page features only four articles that are continuing on two following pages. I mentioned in other posts that newspapers are working hard to get the hybrid model right. WSJ positions the print edition as providing "what the news means" and the online version as "what's happening right now". With almost 800,000 paid subscribers to the online version it is already one of the biggest news sites.
A recent study from Pew Research in the USA shows that 34% of newspaper readers only read a print version and only 4% both print and online. WSJ now offers both in one package -for subscriptions and advertisers- bridging the two reader groups with a complementary product. I'm curious to see how this will evolve commercially and will keep you posted.
February and March promise to be busy period for cross-media researchers and planners of cross-media plans. FIPP organises its second Research Forum in Amsterdam on February 15/16. Topics relate to measurement of readership, evidence of magazines and internet integration, multi-channel measurement and other.
The Online Publishers Association organises in March its Forum for the Future and will cover subjects that have to do with competitiveness, innovation, cross-media and advertising industry.
At CeBit in March FIPP will organise the first digital conference for magazine publishers. The Conference is dedicated to questions related to the online and off-line integration of magazine brands.
Over thousand Internet users in Germany have been asked about their reading and media preferences. two-fifth of them read a printed edition of a newspaper and one-fifth calls up a website of a newspaper regulary. Two-thirds of the Internet users say they prefer the paper version over the digital, only 20% say that the print version will not play an important role within ten years.
Kyoo Kim, vice president sales at U.S.-based msnbc.com at the Beyond the Printed Word Conference: "Every morning in Africa a gazelle wakes up knowing it must run faster than the fastest lion or be killed. Every morning a lion wakes up knowing it must outrun the slowest gazelle, or starve. So it doesn't matter whether you're a lion or a gazelle; when the sun comes up you'd better be running." But when you can not beat your competitor you join them! This years Conference organised by Ifra dealt with the integration of the digital world in the newspaper publishing world. It put special emphasis on Web 2.0 applications that make services, interactivity and user content standard.
Ifra, one of the world's leading organisations for newspaper and media publishing announced the winners of the XMA Cross Media Awards. These Awards are honouring new and successful trends and practices in multiple-media sports coverage. Nine prizes were awarded in three categories, depending on the circulation. Winners include The Guardian, Nihon Keizai Shimbun, New York Times and titles from Germany, Argentina, Spain, Croatia and Belgium.
For the first time consumers in Europe are spending more time online than reading magazines and newspapers. Research shows that consumers in the UK, France, Germany, Italy and Spain are devoting more time online (4 hours/week) and watching TV ( 12 hours/week). Time spend on reading print remains at 3 hours/week. These data will force marketers to rethink communication strategies.
