The Detroit News and the Detroit Free Press are expected to announce this week that they're cutting back home delivery to three days a week. A friend from Detroit says this is suicide; people in Michigan simply will not get into their cars and go to a newsstand to get their papers. Another way to put it is that they're like those patients with terminal cancer who try crazy alternative remedies based on obscure Mexican plants--sure, it won't work, but if you're going to die anyway, why not give it the old college try?
James Surowiecki has a great article in the New Yorker this week on the problems in the newspaper industry. Felix Salmon says print subscribers aren't so great anyway, because they're expensive to get and maintain--few publications cover the cost of printing and distributing all those papers and magazines. The problem is that while the subscribers themselves are expensive, so is the advertising. So far, no one has found a way to monetize online readers the way that print publications once monetized their distribution.
There are multiple reasons for this. Part of it is the quality of the distribution--papers have a goodish idea of who reads them (and therefore advertisers have a good idea of how many people in their target audience each ad will reach), while God knows who's clicking on your web page. There's also the fact that a lot of advertising is brand enhancement, and that doesn't work very well on the web. Those tiny spaces alongside web pages are good for advertising specific goods, but not so good at putting an elegant gloss on the image of Singapore Airlines, which is why Google is so far the biggest winner in web ads.
Then there are the readers. People either like, or don't care about, print ads. On the other hand, they hate web ads. The more an ad intrudes on their consciousness, the more they hate it, which is something of a conundrum for the brand builders. And no one's yet found an effective service to strip all the ads out of a print publication.
Still, part of it is just irrational. In a lot of ways, web advertising is superior: much easier to track both views and response. But so far, advertisers will only buy it at a steep discount. Unless that changes, the future of the American newspaper is grim indeed.
That said, it takes a while to figure out how to make advertising work in a new medium. The original television ads were simply transplanted radio ads, and they were dreadful--just as the original radio ads consisted of someone reading a print ad, which didn't work very well. We may just be waiting for our advertising revolutionary who can show us how to make webvertising work.
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Megan, I'm wondering if some websites are going to have to go to a cable model -- start charging the ISPs for access to their websites. After all, the websites are the reason I pay my cable company such an outrageous amount of money for internet access. It's only fair that the biggest website get some piece of that, no?
The best web ads I've seen are the somewhat interactive ones. I'm not particularly interested in clicking on an orbitz ad, for example, but mousing over and seeing the baseball player shift his shoulders is kinda cool.
And, hey, maybe the next time I think about buying a ticket, I'll check out orbitz... because why? I remember them as that ticket place that had that baseball player guy.
Here is the biggest problem though: if I go to Orbitz and say "$400! I'll be dead in the cold, cold ground before I play $400 for a ticket to Vegas!" (or whatever for wherever) then I will open up travelocity, and expedia, and priceline, and I'll probably put "plane tickets" into the google and do price comparisons and figure out, right then and there, what I am willing to pay, whether my expectations for a particular price are reasonable, so on and so forth.
Once upon a time, you went to a store and you saw the product you wanted and you weighed that price against your time... was it really worth $5 in gas and 3 hours of your time to you to drive around town to see what the prices are... and then drive back to the place with the lowest price and then drive home?
Now, if you go to a webpage (because you clicked on an ad), you go *RIGHT THERE*. Open up another tab to the competition in less than 10 seconds. Two more clicks, two more tabs, two more competitors. Less than a minute.
The ad, if anything, reminds you of that thing you wanted more than it reminds you to buy it from this particular guy... imagine a mall full of candle stores and nothing but. Any given store is going to advertise, sure... but it's not like you can't go next door once you get to the mall to get the exact same thing for 3% less. The ads are actually counterproductive, almost. They get you to the mall, sure... to buy stuff from the store next door.
Anyway, sorry to ramble. The point is that advertising used to work a particular way because the customer had to physically show up to get that thing they wanted. Print, radio, television... at the end of the day, you had to get up off the couch and get in your car. (Or get off the couch and pick up the phone and call for some Freedom Rock.)
An ad on the web is like an ad in the hypothetical candle store mall for a candle store. Sure, you may actually go to that particular store... but it's right next to a store that's just as good. It's right next to three dozen of them.
Since we're giving everyone bailouts now anyway, why not throw in an extra billion dollars or two for the automakers with the proviso that they spend this on print ads.
Truly, the spirit of Christmas is filling me.
Sorry, I think it was the spirit of schadenfreude.
Eat it, MSM!
The Detroit News and the Detroit Free Press are expected to announce this week that they're cutting back home delivery to three days a week.
Eliminating home delivery I can understand, but what is the point of cutting back to three days? If people are prepared to go out and buy the paper on one day, they will be prepared to do it the next.
And if the paper is not prepared to pay to deliver the paper on one day, why is it prepared to pay to deliver it on the next day?
The answer to internet advertising is the loss of privacy.
If advertisers had a profile of each of us, they could pay to get ads that are specifically relevant to us delivered to us.
Been googling for cars a lot? Here's an ad for a Camry... cruise around a lot of football sites--- here's an ad for Dish Networks NFL All Access package. And not fire and forget, but a permanent profile of a user would attract some big ad bucks.
That is the strength of internet advertising--- if you can figure out how to limit your ad so that only people who are interested in your product see it, it's VERY cost efficient. But that's awful hard to do unless you have a very regional business. Otherwise you're paying for some dude in Croatia to see your ad for an F-150.
I think us internet users are at a crossroads: we can keep our awesome anonymity, but at the cost of weakening the traditional media without coming up with much besides Dramatic Gopher and blogs to replace it, or we can hand over our info and let media companies transition to the internet and still make some money.
Sort of the media tragedy of the commons---- everybody takes as much as they like and then acts amazed when the whole thing goes to hell.
I'm not sobbing about the approaching death of traditional newspapers. So far, even among my newsjunkie friends, the only people I've heard complaining about it are--surprise!--journalists.
Like the Scribes' Unions, buggy whip manufacturers, and the Big 3 automakers, there will be much self-serving gnashing of teeth until the newspapers are finally gone for good, and then everybody will look around and realize that we don't much miss them after all.
There's one thing about this I don't understand. Print subscriptions are down down down. Detroit is going three days a week. Yet still, we're told breakfast is the most important meal of the day. Without the newspaper, WHAT WILL I READ WHEN I EAT MY CHEERIOS!
The best solution for newspapers is probably a few years off, but it involves Megan's favorite technology: the Kindle.
Instead of paying people to bring a paper to your house, the news people would be better off posting it to a website accessible be a reader. The layout could be just like the paper version people are used to, but it wouldn't use any expensive raw materials and it could be "delivered" as easily as an e-mail.
Even better than a Kindle would be a full-size flexible screen that mimics the look and shape of the newspaper (there was a scene in Minority Report where someone read such a newspaper and it updated instantly, like a website). It's science fiction for now, but I don't think it's as far-fetched as flying cars or robot maids.
If advertisers had a profile of each of us, they could pay to get ads that are specifically relevant to us delivered to us.
How is this done with the traditional radio/print/tv media? Certainly ads could be targeted by regional IP addresses. Websites could also conduct surveys to determine their demographics. Many websites have specific subjects as well, allowing for targeted advertising. I know that certain websites have been extremely successful with advertising. However, I think the one-size fits all type advertising might not work. Isn't this why you would hire a 3rd party advertising agency is because they would know on what websites your ads would have the most impact?
Craigslist killed the classified ads. It's my understanding that the revenue from the classifieds was really critical to most newspapers -- more important than you would think. That kind of revenue from paid content seems not to be coming back to the newspaper companies (regardless of how they publish).
It's not done except in a scattershot way in traditional media.
But net advertising is very different from the traditional media. Just as our daily surfing routine is pretty unique to us and our interests, the ads are going to have to be that way too, and not in a generalized way.
Advertising on TV is useful to establish brand awareness and sort of worm the company into the popular consciousness. Web advertising... not so much, especially since everyone totally ignores run of the mill ads.
So I think advertising will have to become as specific as each persons surfing routine and calibrated not just towards the 18-34 demo, but that specific person.
For instance, advertisers would spend their money well to get my eyes on kickboxing shows, mixed martial arts stuff, history, sci-fi books, Talking Heads, sports cars, laminate flooring, and salt water aquarium ads. Anyone else in the Toxic demo?
I think this may be less crazy than it sounds. It's my understanding that newspapers have always offered weekly delivery, some variation of Fri-Sun delivery, and Sunday only delivery. This just eliminates one of those options (presumably the lowest-margin option).
I personally get Sunday only delivery because it's the only day of the week I have a reasonable chance of getting to physically sit down with the actual paper.
I can't believe all you glibertarians are such evil Scrooges. Don't you realize that if we don't give an immediate bailout to the newpapers, millions of innocent, hard-working people will be thrown out of work? Pensions will be lost; entire neighborhoods reduced to penury? How can you be so hypocritical as to give the financial industry a bailout, but not the newspapers? One in ten of every job in America will be lost! General Mills will tank if people have nothing to read with their Cheerios; the pen industry will fail without their vital ink suppliers; even the hot dog vendor outside of the New York Times building will live out a life of squalor--think of his kids! The entire economy will fail without a massive and immediate newspaper bailout!
Oh, sorry, wrong thread. ;)
That is the strength of internet advertising--- if you can figure out how to limit your ad so that only people who are interested in your product see it, it's VERY cost efficient. But that's awful hard to do unless you have a very regional business. Otherwise you're paying for some dude in Croatia to see your ad for an F-150.
This isn't strictly true. Most ads, anymore, are not served directly from the website -- they are served by a third party service that can use criteria such as the content on the page, and the geographic data associated with the IP range of the user's ISP, to target ads by content and location, all the way down to a major city if desired. The website simply has to provide space on the page for the ads to display.
For example, if you are in London looking at an article about computer technology, then the ad host might observe keywords like "Intel" and "Apple Computer" in the referencing page detect a London IP range assigned to a big-name financial business, and then then send an Intel advertisement to the website's overhead banner slot and a MacBook Pro ad over to the sidebar, listing the five nearest Apple Stores and details about Corporate purchasing options.
It doesn't have to get that specific and often doesn't, partly because each layer of targeting increases the number of variables that have to be compared and advertising options to be served, but the technology is already installed and is currently used in greater or lesser capacity.
It looks like the Detroit News and Free Press are going to a digital subscription format in PDF, which will eventually cut down on their newsprint and distribution costs. Maybe this the way to make newspapers viable again?
http://www.wwj.com/News--Freep-Poised-For-Big-Changes-/3476632
Megan, I'm wondering if some websites are going to have to go to a cable model -- start charging the ISPs for access to their websites. After all, the websites are the reason I pay my cable company such an outrageous amount of money for internet access. It's only fair that the biggest website get some piece of that, no?
I believe ESPN360 already does this. If your ISP doesn't have a deal with ESPN, then you can't watch the video of the game being broadcast.
Another way to put it is that they're like those patients with terminal cancer who try crazy alternative remedies based on obscure Mexican plants--sure, it won't work, but if you're going to die anyway, why not give it the old college try?
terminal cancer metaphors are tricky. But it seems to me that the terminal cancer patient people value life a great deal. I don't get that sense from our journalist people. They debase their own publications and thereby their livelihoods and thereby their lives a lot frequently I think. A lot a lot frequently now that I think about it.
Nobody has explained to me why the business of selling eyeballs to brand-builders should survive.
People have proven more and more willing to PAY for good media, or put up with A LITTLE advertising for free media.
The days when most information and entertainment is outrageously expensive to provide (and therefore justifies either massive sponsorships or massive fees) are coming to an end.
The dirty little secret about newspapers is that most people were just buying them for the horoscopes, funnies and crossword puzzles anyway. They've been obsolete for a long time now.
"If advertisers had a profile of each of us, they could pay to get ads that are specifically relevant to us delivered to us."
You're making a classic mistake in your understanding of brand-image advertising. Those geeks on "Mental Engineering" on PBS make the same mistake all the time.
Clue: The target of a brand-image ad is not the customer. Nobody chooses Coke over Pepsi because of those digital polar bears we see on TV every Christmas.
The purpose of branding is improving your company's visibility to POTENTIAL INVESTORS. It's all about puffing up the share price.
Another way to put it is that they're like those patients with terminal cancer who try crazy alternative remedies based on obscure Mexican plants--sure, it won't work, but if you're going to die anyway, why not give it the old college try?
Megan, this might be an apt analogy but it's in very poor taste. I know people who went to Mexico on a last ditch effort to save their son with laetrile injections, and died a few short months later. If the analogy involved doing some last ditch desperate action to save a business, to save a love relationship, to save just about anything other than the death of a loved one, I could seeing using it. But not this.