Tuesday, April 27, 2010

ABC Fas-Fax report shows growth of e-editions; lose advantage of circulation certainty in new reporting rules

There was once a time when a sales rep reporting their newspaper's circulation could proudly proclaim, with smug superiority, that they reached X number of paid subscribers, and none of their competition could quote their audience with the same authority. The rep would then slap that ABC audit on the customers desk and know that they were in a strong position.

With print circulation numbers continuing to fall, and with the rise of the e-edition within ABC rules, the role of the sales representative has changed dramatically.

Two stories show the dramatically changing landscape of newspaper sales:

S.F. Chronicle circulation drops 22 percent -- The Bay Area has always been a strange place for newspapers, a cosmopolitan community known for its highly educated work force, its ties to Silicon Valley, San Francisco has been home to two of the worst dailies for years -- de Young's Chronicle and Hearst's Examiner. Until Dean Singleton took it over, the San Jose Mercury News was head and shoulders the best paper in the industry (though, to be fair, the paper was declining before Singleton's purchase in 2006 via McClatchy).
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The evolving newspaper audit: from certainly to ambiguity


Now the Chronicle's reporting a 22 percent drop in paid circulation, down to 241,330. (When Hearst took over the Chronicle it proudly reported that the paper had a circulation of 457,028.)

paidContent.org has compiled a nice chart showing the showing the Top 25 daily newspapers by e-editions. Topping the list by a wide margin is the Wall Street Journal with 414,025 e-edition subscribers. One would think that the move to e-edition reporting would be a boon for publishers trying to cut print runs and costs, but the problems start to show themselves when one looks at the new ABC audit report format.



The old reports were a masterful example of minimalism -- here is our circulation, its audited, and you can count on it.  Now, the report offers advertisers a confusing picture of a newspapers audience as the ABC tries to both accurately reflect reach while satisfying the needs of its members.

Is this a criticism -- I know it sounds like it -- but it is not. The reality of today's media market is that products reach their audiences through many means, and mobile media will only complicate this more. So the ABC is making adjustments, and rightly so.



For the past ten years or more the debate within the publishing industry is how best to sell web -- can the print staff handle the job, or should new teams be created?

Now throw in the added complication of selling a mix of print and electronic circulation numbers and it is easy to see the dilemma: how can a rep not only hold onto the business when print circulation is falling (while electronic is rising) but also maintain those page rates? Further, in many cases, those ads will not follow the readers -- that is, a mobile app may contain the same news but it certainly won't contain the same advertising.

I spoke to the head of a mobile app development company yesterday (story to appear this afternoon) and in his business, as in the business of news aggregators, the issue of web or mobile ad sales is rising in importance. The plain truth is that newspapers are falling down on the job when it comes to selling the new mediums.

One look at the changing look of circulation may explain this -- as well as a reluctance for reps to sell lower priced electronic products. The developer believed the answer was for the reps to package electronic with print. I didn't have the stomach to tell the head of this major development company that this has always been the issue with newspaper sales teams when new products are introduced -- reps find it difficult to sell the new product so it is rolled up into the old one -- usually at a major discount.

After all these years I am now firmly in the "create a new sales team" camp. I have two reasons for this: One, inside sales teams are either shrinking or under utilized, mobile and web can be the new "classified" sales for many publications. These teams know how to sell smaller ticket items, and the lower rate, but higher volume sales that can be associated with electronic are a perfect fit for inside sales. Two, the new products need to be profitable on their own. Helping them along by hiding costs with the print structure only complicates the mission. More importantly, it risks having the team divided by the internal politics of conflicting agendas.

Update: I see the San Jose Mercury News is now claiming that it is one of the nation's top 10 newspapers. As a former employee of Lesher Communications, later Knight-Ridder, this one gives me a sick feeling in my stomach. The Merc did it by consolidating both the Contra Costa Times and Oakland Tribune into its circulation figures. In effect, the CCT and Trib have become an "edition" of the San Jose Mercury News -- as if that makes any sense to the residence of Alameda or Contra Costa County, right?

The move could have been accomplished with a consolidated audit for the group, but by combining the papers into one audit the Merc is able to claim growth overall, even though the circulation of the Merc actually fell 5.4 percent in the latest reporting period.

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