Roundtable 2006 murray

Vail „06

What We’ll Cover This Afternoon

“State of the Industry”

The Future of Circulation

Power of One: Single Copy Buyer Study „06

Vail „06

Newspapers ’06

FOR IMMEDIATE RELEASE

April 19, 2006

NAA RELEASES ABC FAS-FAX ANALYSIS Online Audience for Newspaper Web Sites Sets

Another New Record in First Quarter 2006

…“Newspapers are implementing circulation marketing strategies that

deliver the most value to advertisers and make economic sense, such as

home delivery and retention programs that result in less subscriber turn-

over,” Sturm said. “The focus also is on total audience, and we are

now starting to see the positive impact that publishers’ innovations and

strategies to broaden their audience online are having on our audiences

and readership.”

According to new data released today by NAA, the online audience for

newspapers hit record levels in the first quarter of 2006, with more

than one in three of all Internet users visiting a newspaper Web site over

the course of a month.

Vail „06

Newspapers ’06

FOR IMMEDIATE RELEASE

June 23, 2005

NEWSPAPERS ARE SUCCESSFULLY

LEVERAGING THE INTERNET TO GROW

OVERALL READERSHIP BASE

Newspapers successfully attracting 18-34 year olds with their websites

New York – Scarborough Research…released an analysis of

“Integrated Newspaper Audience,” a new measurement that

combines the audience of traditional printed newspapers with the

audiences of their websites. The analysis found that newspaper

websites are contributing significant numbers of readers who do

not necessarily read the printed publication, resulting in large

audiences overall. The audiences for newspaper websites tend to be

younger than those of the printed newspaper, demonstrating that young

adults are interested in and engaged with newspaper content.

The Value of Newspaper Media:

Opt-In Advertising

•Where the advertising is a destination, not a distraction.

Telling our Story:

The Value of Newspaper Media:

Opt-In Advertising

•Where the advertising is a destination, not a distraction.

Contributors & Committee Members

The Process

• Robert Bolone, Vice President/Circulation – The Columbus Dispatch • Chris Blaser, Vice President/Circulation – San Francisco Chronicle • Vince Casanova, Vice President/Circulation – Tribune Publishing Company • Rosie Cassidy, Director/Circulation Operations & Technology, Gannett Company Inc. • Chris Christian, Vice President/Circulation – The Kansas City Star • Ken Cogswell, Circulation Director – Kalamazoo Gazette • Barbara Cohen, President and Founder of Kannon Consulting

• Harry Davis, Vice President/Circulation – Austin-American Statesman • Arden Dickey, Vice President/Circulation – Knight Ridder • Nancy Green, Vice President/Circulation – Lee Enterprises • Mark Henschen, Circulation Director – North County Times (Escondido, California) • Jerry Hill, Circulation Director – St. Petersburg Times • Sandy MacLeod, Vice President/Strategy Implementation & Human Resources – The Toronto Star • Kathy Michalak, Vice President/Circulation – The Press Enterprise • John Murray, Vice President/Circulation Marketing – NAA • John Newby, Circulation Director – The Dispatch (Moline, Illinois) • Gayle Pryor, Vice President/Circulation – Media General, Inc. • Robert Rubrecht, Director/Circulation Marketing – NAA • Daniel Schaub, Senior Vice President/Circulation – The Sacramento Bee • Doug Sumrell, Vice President/Circulation, Morris Communications Corporation • Al Smith, Vice President / Circulation Cox Newspapers • Romy Trahan, Senior Consultant Kannon Consulting

• John Walsh, Senior Vice President/Circulation – The Dallas Morning News • Don Waterman, Vice President/Operations – Ottaway Newspapers, Inc. • Owen Youngman, Vice President/Development – Chicago Tribune

Development of the Project

The Process

1. Collection, Dissemination and Study of Data – Key Resources:

• Demographic and Media Usage Data • NAA’s Horizon Watching • NAA’s Circulation Facts,Figures andLogic

2. Scenario Planning Session w/ Kannon Consulting

3. Consensus Building Session & Review of Deliverable

4. Input From NAA Circulation Federation Board of

Directors

5. Final Draft and Publication; The Future of Circulation:

A Look at the Present and Long Term Outlook of

Newspaper Circulation

Actionable Recommendations

Goal:


“CIRCULATION IN THE YEAR 2006”

Produced by NAA in 1996:

Power Ideas From the Past

•Address specific delivery and leveraging the distribution network

• Distribution Centers ? (>25k)

1996 : 24.2% 2004 : 75% 2010 : ?

• Adult Carriers?

1996 : 51% 2004 : 81.4% 2010 : ?

• Deliver Other Newspapers?

1996 : 17.1% 2004 : 40.5% 2010 : ?


•Increased role for single copy, retail marketing

Newsracks Sales as a Per Cent of Total Single Copy:

1996 : 43% 2004 : 33% 2010 : ?

Bar Codes

1996: 49% 2004 : 86% 2010 : ?

Scan based trading

2004 : 55% / 3 accounts 2010 : ?

Dedicated merchandisers


Single Copy

• Third Party

- College Readership Programs

Customer Service, Distribution and Single Copy

• New Locations Sam’s Club, Costcos, Gyms, Preschools etc.

• Increased Scan Automation

• Additional Foreign Language Products

•Focus on subscriber profitability, smart acquisition and retention

• Telemarketing

1996: 59% 2004: 41% 2010:?

• Accept Recurring Credit Card Payments

1996: 30.2% 2004: 88% 2010:?

• Recurring payment plans well beyond 15%



• Average Cost of Acquiring a New Subscriber

– 1996: $19.25

– 2000: $28.20

– 2002: $30.42

– 2004: $42.00

– 2010: ?



• Direct Marketing, New

Forms of Face to Face

Sales

• Retention Programs:

Applied Technology



• Value added Programs

• Leveraging Online Assets



• IVR for Incoming Calls

1996: 19% 2004: 35% 2010:?

• Offer Customer Service on Online?

1996: 0% 2004: 78% 2010:?

• Less than 20% Offer Real Time Interactive Service


Customer Interaction: Applied Technology


• Home Delivery

– 15% are 18-34’s

• Single Copy

– 30%+ are 18-34’s


•Emphasis on readership/audience

– NADBASE for total reach of print/online

– Online + paid print + niche

+ non sub products=REACH

– ABC for preprints

– Reader Profile Service

– Readership behavior score (RBS)

Power Ideas From the Past Power Ideas From the Past

“There‟s a war going on...Between

the people who are trying to do

something and the people who are

trying to keep them from doing

something wrong.”

—Bill Creech, Retired Gen.


Drivers of Change Impacting Newspapers

“If you don‟t like change, you‟re

going to like irrelevance even less.”

—Eric Shinseki, Chief of Staff, US Army


Readers


Readers • Older, more diverse

Boomers 4 in 10 by 2010 over 45 - best readers,

control more money, 50 is new 30!


• Demographics and lifestyle drive down readership

Growing Hispanic population prefers to read

Spanish newspapers, younger people spend time with other media

Readers


•Consumer access to internet – 7 in 10 use in 2005

•Other media steal time/change habits– satellite radio, DVRs, MP3s,

blogs, podcasts, Tivo

Readers

• Readers want specific content targeted to their interests Arizona Republic - 100 products, aggregating audience, use research, doable anywhere


• Free content is changing the business model Free content on websites, free pubs, Craig‟s List

• Newspapers respond with suites of new free and niche products Corner News, Metro, Quick, RedEye, Examiner, Express, House to Home, VOW, Bluffton Today

Advertisers

• Traditional advertisers - department stores and auto changing Consolidations moving ads to regional, national buys away from local ads & into other media

• Target marketing challenging newspaper revenue models and streams increased zoning, moves to direct mail, cable TV and internet

• ROI metrics replace mass audience approaches


Advertisers

• Classifieds moving to online and paid to free like Craig‟s List

Targeted marketing programs and database intelligence collection

• Audiences with specific interests sought by marketers


Competition • Advertiser targeting driving direct mail ,

cable TV, internet use

• Internet spending accelerating

• Craig‟s List and Monster impact classified revenues

• Internet/24 hour cable source for national news


Regulation

• State and Federal regulations will continue to change the subscription and distribution models


Regulation


• Acquisition model shifting to retention/CRM model

• Distribution model increasingly challenged by independent contractors, unions and litigation

Technology

• VoicePort

• Exact Target

• PriceLine.Com Model

• Combined Call Center

• Sliceable/diceable Upgraded audience databases – G2, Astech Maxx, MSG‟s MMS, others


Newspapers:

Moving Towards 2010

Customer Service

Self-service at the website

payments, EZPay, starts/stops,

vacations, NIE contributions,

email transaction confirmation,

added value programs


Requested products Unbundling of TV Book

–Orange County, CA

Unbundling of Business/Stocks

– Austin American Statesman

Distribution

• Additional Niche Products

Neighborhood, Home, Health, Lifestyle, B2B, Real Estate


• Print Product Delivery

40% of newspapers deliver other newspapers

• Household Specific Delivery

• Competitors Combining Resources

http://denver.yourhub.com/Home.aspx

Single Copy

•3rd – Party

- College Readership Programs


• New Locations Sams Club, Costcos, Gyms, Preschools etc.

• Increased Scan Automation

• Additional FREE & Foreign Language Products

= PURSUIT OF THE OCCASIONAL READER

Single-Copy Buyer

Study 2006

An NAA / MORI Research Study

Single-Copy Buyer

Study 2006 Comparing 2001 and 2006:Overview & Implications

Demographic Information: The Purchaser

Profile By Purchasing Patterns

The Decision to Buy

Promotional & content factors influencing purchasing

Motivation, Preference and The role of Convenience

Pricing and perceptions of value

Spending by single copy buyers at grocery & c- stores

Single Copy Buyer Study „06

The Seven Sites: • The Hartford Courant

• Dayton Daily News

• The Oklahoman

• The Sacramento Bee

• The Florida Times-Union, Jacksonville

• The Frederick News-Post

• The Reno Gazette-Journal

Total sample: 5152 Adult Purchasers

Single Copy Sales Channels

• Convenience Stores

• Grocery Stores

• Drug Stores

• Restaurants

• Mass Merchandisers

• Others

Demographic Information

Single-Copy Buyer

Study 2006

Single Copy Purchasers

Weekdays Sundays

Men 61% 38%

Women 39% 62%

18-34 31% 37%

35-54 46% 44%

55+ 23% 19%

Profile By Purchasing

Patterns

Single-Copy Buyer

Study 2006

Rarely 0-2

Occasional 3-4

Frequent 5-6

50% of weekday single copy buyers

purchase 5 or 6 issues per week

NAA Single Copy Buyer Study „06

Monday-Saturday Issues Purchased

in an Average Week

none

one

two

three

four

five

six

The Decision to Buy

Single-Copy Buyer

Study 2006


Almost half: 48% of Occasional Buyers were

influenced to buy the weekday newspaper by

Front Page, Price or Promotion

Decision to purchase made before or after

seeing the newspaper – by frequency

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Rarely

1-2

Occasional

3-4

Frequent

5-6

In Advance

Upon Seeing

Promotional Influence on Purchasing

Decision– Today (Weekday)

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

Rarely

1-2

OCC.

3-4

Frequently

5-6

Front Page

POP Displays

Discounts

Do point-of-purchase promotional displays

influence the decision to buy the

newspaper?

Daily

18 to 34 - 32%

35 to 54 - 21%

55+ - 13%


Usual Influence of the Front Page

by Frequency

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Rarely

1-2

Occasional

3-4

Frequent

5-6

Freq/Occ.

Rarely

Never

Motivation, Preference and

The role of Convenience

Single-Copy Buyer

Study 2006


More than half: 58% of Occasional Buyers

Pick the Check-out Line as the Best Location

Summary

Single-Copy Buyer

Study 2006

• Focus on the Occasional Reader

• Casual Readers Acquire Newspapers in a manner that fits their lifestyle

• Single Copy Purchasers are influenced by:

– Front Pages

– POP Displays

– Convenient Locations

• The Newspaper must be Compelling & Relevant

• Promotion is critical


Summary:

Audience Development and Consumer Marketing

A Few Considerations


•Keep an open mind

•Remember this is about the future

•Accept brutal realities

•Challenge the Status Quo

• Focus primarily on print

• Bullish not Bearish on the industry

• Ignore current ABC limitations

What will be our Currency?

•Counting copies will not be enough.

•Tracking readership may not be enough

•Measuring total reach is where we are headed!

What’s driving the change?

–Single Copy reductions

–Free distribution publications

–Free content

–Advertiser demands


Toronto might be your future

Free Online Paid

craigslist


http://www.torontosun.com/home.html

http://www.metronews.ca/index.htm

http://toronto.24hrs.ca/

http://www.dose.ca/toronto/

http://news.google.com/nwshp?ned=us

http://us.ard.yahoo.com/SIG=12gn2hfdo/M=251521.4264360.5463879.4155839/D=news/S=81121452:HEADR/_ylt=Av_TPGk_aJ76fRT.ZUpv5tas0NUE/Y=YAHOO/EXP=1126898549/A=1894157/R=3/SIG=10niob72s/*http://news.yahoo.com

http://www.yellowbrix.com/index.nsp

http://www.eye.net/

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2001 2002 2003 2004 2005S

Free Dailies Exclusive

Duplication

Paid Dailies Exclusive

Total Reach 2,098,700 1,967,700 2,006,800 2,060,700 1,972,300

Weekday Readership - Paid versus Free Dailies NADbank 2001-2005 – Toronto CMA Adults 18+

Readership is Here to Stay

Why it is more important to measure Readership than count Circulation.

• Readership provides a truer picture of a newspapers‟ total audience.

Circulation represents a smaller portion of the reach of a newspaper (Toronto Star – 3 readers per copy)

• Readership provides complete audience profiles. Key data required for strategic planning as well as media planning and buying.

• Readership levels the playing field versus other media. Audience is where the game is – viewers, listeners and readers.

• Readership estimates are available for content readership across media vehicles.

Combined reach of newspaper content can be measured for print and the Internet.

• Readership acknowledges pass-along and free distribution. In an era of putting the content wherever the readers are, readership captures the now

valued non-paid audience.


Challenge the Status Quo

Are we even measuring the right thing?

Good Reader? Bad Reader?


The Future Perhaps:


A Future Measurement Model Perhaps

TORONTO STAR

Total Market Reach

For 12 months ended September 30, 2005

Print Variance % Variance

Toronto CMA 2004 2005 Vs 2004 Vs 2004 2004 2005 Vs 2004

Home Delivery paid 296,000 296,000 0 0.0% 406,000 406,000 0

Single Copy paid 70,000 70,000 0 0.0% 144,000 144,000 0

Home Delivery samples 35,000 35,000 0 0.0% 35,000 35,000 0

Other samples 20,000 20,000 0 0.0% 60,000 60,000 0

NIE 9,000 9,000 0 0.0% 0 0 0

Campus 20,000 20,000 0 0.0% 5,000 5,000 0

TOTAL CMA AVERAGE CIRCULATION 450,000 450,000 0 0.0% 650,000 650,000 0

TORONTO CMA PRINT ONLY READERSHIP (SOURCE: NADBANK) 1,054,100 1,035,000 (19,100) -1.8% 1,456,200 1,425,000 (31,200)

PRINT READERS PER COPY - 0.0% 2.24 2.19 (0.05)

OnlineONLINE ONLY READERSHIP (NADBANK CMA) 500,000 500,000 - 0.0% 100,000 100,000 -

TOTAL CMA PRINT AND ONLINE REACH - 0.0% 1,556,200 1,525,000 (31,200)

TOTAL CMA HOUSEHOLDS

TOTAL PENETRATION

Monday-Friday Saturday

2.34 2.30

1,554,200 1,535,000

2,250,000 2,275,000

69.1% 67.5%


Committee Recommendations

/ Next Steps

1. Begin Hiring & Training Skill Sets

• Experts in Sophisticated Marketing

7 Recommendations

-- Analysts for understanding data, script writing and ROIs on circulation projects.

• Technology & Customer Insight

--Hire People who can make us more effective and efficient.

2. Upgrade Database Technology, Content and Applications

• Circulation will have to be successful in adapting to new database marketing technologies and initiatives

7 Recommendations

3. Improve Metrics

Three New Major Types of Metrics

1.Audience Measurements

2. Resource Allocation

3. Advertiser ROI

7 Recommendations

4. Share Accountability

• Must Share Accountability for Readership and Circulation throughout the Organization

7 Recommendations

• Must Revamp Systems

• Reengineer Processes

• Broaden Distribution Efforts

5. Re-Build Infrastructures

7 Recommendations

6. Focus on Marketing & Promotion

• Promote the Value of the Newspaper

7 Recommendations

• Must Promote the Total Newspaper‟s Portfolio

7. Build Multi-Platform Readership

• Grow Audience and Readership Both Online and Print – Cross Promotion

7 Recommendations

1. Begin Hiring & Training Skill Sets

7 Recommendations

2. Upgrade Database Technology, Content and Applications

3. Improve Metrics

4. Share Accountability

5. Re-Build Infrastructures

6. Focus on Marketing & Promotion

7. Build Multi-Platform Readership

A Final Thought

“Somebody has to do something,

and it‟s just incredibly pathetic

that it has to be us.”

—Jerry Garcia of the Grateful Dead


NAA Circulation Priorities & Projects

Questions & Discussion

Thank You.

Pick up Your Complimentary Copy Today.

News & Politics

Roundtable 2006 murray