As a former newspaper boy, editor, and executive at the Daily News and the International Herald Tribune, I shed a tear every time a newspaper folds, goes bankrupt or announces more layoffs. For those still standing, ad revenues are declining and readers are migrating to online information sources. Even Dick Tracy, as portrayed in a recent Saturday Night Live skit, can't save the newspaper industry singlehandedly.
To survive, newspapers need to do more than dump their print content online (which further cannibalizes the print editions) and charge for it. That is not sufficient. Instead, they need to develop new business models and find new ways to appeal to their readers. In the process, I believe that newspapers will no longer be about either "news" or "paper". And, although this may sound nonsensical, nor will they be purely about content. At least not the content they currently deliver to their audiences.
As I discovered when I founded the Daily News online (nydailynews.com), newspapers license a great deal of their content from third parties (think sports scores, cartoons, weather reports, stock quotes, photos, opinion columns, and much more). Today, not only is much of the same content in newspapers found in other sites, these sites often offer better tools and functionality. Think Fandango for movies, or Google Finance for stock quotes. Moreover, most consumers traditionally do not buy newspapers for their content but rather for the classifieds, advertisements, movie listings, coupons, or even Sudoku (which saves the day in the SNL skit). When I worked at the International Herald Tribune in the 1980s, about 10% of subscribers did not even speak English but liked the status of getting the newspaper.
The most valuable asset a newspaper has is not the content, but rather its brand. To be profitable and relevant, newspapers need to do more to leverage their brand and their recognition in the local marketplace. For example, VG Nett, a European newspaper, started a weight loss membership club for its readers that now generates over $1 million annually. No doubt, newspapers can develop many other revenue generating services, including resume services, job banks, retraining services, classes, membership clubs offering discounts to select stores, and more. Or perhaps create contests, such as local version of American Idol where the newspaper discovers and then promotes local talent for singers, artists, athletes, journalists and so on.
The same thinking must extend to the web sites of newspapers, particularly as daily newspapers (with the possible exception of the Sunday paper) face a real threat of disappearing. Online editors should position their newspaper sites as the essential starting point for reader needs in the local community, guiding users in their daily lives in much the same way that newspaper editors traditionally chose the most interesting stories in print to appeal to readers. To serve as the ultimate community portals, newspaper sites need to aggregate all local listings, control the local dialogue, let users create their own community pages, and add user generated content and local reviews. Local information and community still matter even in the 21st century, which is why the brands of city newspapers remain valuable.
To fulfill this mission, newspapers need to act more boldly by aggressively partnering with others to aggregate content and information that appeals to their audience and to monetize the service stream as consumers search and transact from the site.
To do so, newspapers need to hire aggressive business development teams to effectuate the right deals and partner with other local media to offer multimedia such as video, blogs, and radio. They also need to hire graduating journalism students who understand how to work in these various media simultaneously. Lastly, with the larger audience, the newspaper should seek to market other "paid services", as described above, develop fun contests that build mailing lists, develop specialized email newsletters, provide lead generation services for marketing companies, and leverage all of the new technology distribution mechanisms.
Because of their strong brands, newspaper web sites have been able to garner strong web audiences. Even newspapers in mid-sized towns are generating close to 100 million page impressions monthly. If they were to charge for their content, these sites would see dramatic decreases in traffic with little benefit, as users would move to other free non-newspaper sites. Besides, if you take typical direct marketing results, a newspaper would forfeit 95% to 99% of its traffic as it converts to a paying site. That is quite a gamble for content that is duplicated on many other sites.
Instead, newspapers need to continue to experiment and test new concepts to extend their brands. They need to create entrepreneurial cultures, hire lots of young online marketers and reward individuals within the community to experiment. And they need to so quickly, as new web sites that aggregate content such as Huffington Post (which recently launched a local Chicago edition) or others that provide user generated content such as Yelp are already encroaching on a newspaper's traditional territory and have already developed larger web audiences than most newspaper sites.
Of course, a reinvention that focuses on the newspaper's brand may reshape journalism in significant ways. A paper's ability to invest in investigative journalism or serve as a countervailing community force may no longer be feasible for most newspapers. But newspapers may find a larger, more profitable purpose as they fully serve their local communities in new and improved ways. There should be no fear of failure, as newspapers are already failing.
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