Don't Shoot the Reader

By Grant Ainsley | Tips | [comments] | Posted [date]

I recently renewed my annual subscription to the Edmonton Journal. A couple of years ago, I moved from the print to the digital edition. I didn't think I would like reading the paper online, but now I would never go back to print.

Like many others these days, I like supporting good journalism. We've seen so many changes and cuts to daily newspapers, so when we get a chance to make a small contribution to journalism it feels good.

Unfortunately, what people pay in subscriptions, regardless of how many do it, won't make a real difference to the bottom lines of daily newspapers. It's the advertising that makes a real difference, but the days of huge advertising dollars flowing to daily papers are gone and won't be coming back.

The Power of Digital Advertising

I was doing a presentation last week in Sherwood Park on the benefits of digital advertising and online content marketing. It was for a Small Business Week event organized by the County of Strathcona and I extolled the virtues of small businesses spending money on ads on Facebook, Instagram, YouTube and Google. I spoke about ways they can target customers to get at exactly the audiences they want, something traditional media claims it can do, but really can’t.

I always feel a little guilty when I do a presentation on social media and digital advertising because I spent 15 years in traditional media, working for radio stations in Edmonton. Advertising dollars at the stations I worked for paid my salary. I’m grateful for that, but understand how traditional media advertising, like daily papers, can’t compete with digital advertising because they can’t target customers as precisely, can’t measure success as well and are also much more expensive.

Strike three.

Unfortunately, there’s a perception that a lack of readership is squeezing daily newspapers. There’s a feeling that if people would only start buying newspapers again everything would be ok and big daily papers would again be filled with more editorial content. We would have more journalists, better reporting and life would somehow be better too.

There’s some truth to that, but not much.

$1,000,000 a Week

I asked my audience in Sherwood Park if they remembered the days of the Careers section in Southam newspapers like the Edmonton Journal and the Calgary Herald in the 1990’s. Big ads for positions like General Managers, Executive Directors, and Sales Managers took up ten pages or more on Saturdays. Many of those black and white ads cost $4,000 at a time when you could buy a new house for $150,000.

Today the Careers section has disappeared. It was swallowed up by job sites on the internet. There has to be at least two dozen of them these days, maybe more. More often than not today, companies place job ads for free on LinkedIn, or other free sites.

Think back to the days when Careers sections were bigger than the Sports pages and do the math.

$4,000 an ad X 25 ads per page X 10 pages. That was $1,000,000 in revenue every Saturday in one newspaper.

Classified ads used to run for several pages in the papers too. They’ve been replaced by Kijiji, Craigslist and others. I looked at the Classified ads in the Journal yesterday and the section was less than a page. That’s millions more no longer coming in the door.

Readers Don't Pay the Freight

Let’s go back to the belief that fewer papers being bought and delivered through subscriptions are making a difference.

It’s about $400 to get a Postmedia paper delivered for a year and about $100 for the digital version. Let’s say people suddenly wanted to make an investment in journalism and the number of subscribers jumped by ten times. Instead of one person spending $400 for an annual paid subscription, ten people did for a total in revenue of $4,000. That would be fine, but that would only recoup the cost of one ad in the Careers section from 20 years ago. Then there’s the expense side – the cost of printing and delivering those extra newspapers. The net profit would be far less.

I fully understand the more people who read newspapers adds to the bottom line because papers can charge more for advertising if they have more readers. However, it doesn’t really move the needle because of the strength of the internet, Facebook and Google.

Don’t get me wrong. I love great local journalism. I also think the content produced by local journalists, all things considered, is better than ever. There are far fewer journalists today than a generation ago and because of social media and online news sites, they have far more work to do.

Journalism isn’t the problem for daily newspapers though. Neither is the number of people reading what they write. It’s also not the fault of their bosses making corporate decisions. When people see something wrong there’s a tendency to blame someone or something. Journalists get blamed, the people making big decisions at papers about layoffs and budgets get roasted and even the general public gets blamed for not buying enough papers.

Daily papers are facing a digital monster that has grown much too big to fit back into its cage.