Wednesday, February 06, 2008

The paperless newspaper business

Mediapost has a story on how the newspaper business is trying to reinvent itself.

If only all traditional media and advertising mediums would jump on board.....

Here's the story (remember you read it ON LINE!):

Newspapers Turn to Online Networks for Display Ads
by Erik Sass, Tuesday, Feb 5, 2008 8:01 AM ET
LOCAL NEWSPAPER WEB SITES ARE seeking safety in numbers and convenience, joining large networks for online display ads. These networks are proving to be a key part of online strategy for newspapers, which must build their display ad revenues to offset slowing growth in online classifieds.

One company, MediaSpace Solutions, has formed relationships with about 4,500 newspaper partners globally--most in the United States--which are organized into smaller network buys along behavioral, geographic and demographic lines. Examples include its "family channel," Hedge Funders, Gen XYZ (covering 18-35) and Wired Boomers.

MediaSpace can handle all the logistics and measurement of a display ad campaign on its networks, including an in-house creative operation, consultative media planning, consumer and media research, purchasing ad space, collecting traffic data from comScore and click-through rates.

Citing comScore data, Deborah Armstrong, MediaSpace senior vice president of sales and marketing, noted the desirability of local newspaper Web sites as ad platforms. "Newspapers dominate their local markets--in some cases they have two or three times the traffic of local TV or radio Web sites," she notes.

In addition to the Web sites themselves, MediaSpace can also place display ads in e-newsletters and email updates--for example, sports or health.

Of course, Armstrong noted, different target audiences "don't always work on the same platform," prompting MediaSpace Solutions to create a combination online-print service, Online:Onpage, that can run adds in newspapers as well as Web sites. Armstrong said "integration really does give you the strongest local reach." For instance, it helps reach older readers who may still favor print. At the same time, "frequency builds consideration."

In a big potential market with few players, one of MediaSpace's main competitors is Centro, which has formed relationships with over 3,000 local newspapers and publishers in the U.S. alone. Like MediaSpace, Centro does research, creative, trafficking, billing, analysis and optimization. It also serves as a media-buying proxy for its advertising clients, with buys distributed based on newspapers' back-end data from impressions to click-throughs, to time spent, to interaction rate.

All Centro decisions are made on research and target demographics. This data lets Centro "grade" and sort local papers to achieve geographic and demographic targets. It offers a range of buying options, and has executed campaigns for about 150 Fortune 500 companies.

Online display ads are an increasingly important source of revenue for newspaper Web sites, which have seen growth slow in online classified ad revenues over the last year. This is due partly to the way online classifieds have been sold, as "upsells" to print classified listings. As print classifieds continue to tumble, posting double-digit losses during all quarters of 2007, there are fewer opportunities for these online upsells.

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