How to plug the $17B newspaper sales gap
This column originally was published in the March edition of Editor & Publisher Magazine and is being reprinted with permission. To subscribe to the magazine so you can see the full array of industry coverage when it first appears in print, click here.
There’s a succulent advertising stream that could replace a substantial portion of the $17 billion in sales the U.S. newspaper industry has shed since 2007. Anyone interested?
The opportunity is called Yellow Pages advertising and there are powerful reasons to believe that a growing proportion of the directory industry’s business will be up for grabs in the near future as consumers increasingly choose to let their fingers do the walking on the web.
Although newspaper publishers are in the best position to bag a substantial share of the $16.5 billion now spent annually on directory advertising, they will not be alone in the hunt. A little outfit called Google recently zeroed in on the business by starting to sell upgraded search listings to local merchants. Because newspapers have sales forces that Google can only envy, however, this opportunity is theirs to lose.
Some 85% of the Yellow Pages business, like the bulk of newspaper sales, is derived from print advertising. But there is growing evidence that the print YP business may begin to unravel as fast as a certain other print business that comes to mind.
If you are a newspaper publisher interested in diversifying away from print while building a valuable, defensible and sustainable digital revenue stream, then it’s time to think about the online directory and web-marketing business. How-to tips are coming up. First, here’s why I think the print YP business is ripe for the plucking:
About 43% of the 18 billion web searches conducted in the typical month are for products and services that consumers intend to buy from bricks-and-mortar providers, according to a study conducted by the Kelsey Group, a market research company. That comes to 7.7 billion shopping searches per month.
Kelsey also found that 53% of shoppers prefer searching the web to paging through printed directories. Young people don’t find the fat ad books to be environmentally acceptable. Older people, while also concerned about the environment, particularly hate squinting at type that seems to get smaller every year.
Taken together, the prevailing trends suggest a gloomy outlook for print directories.
Although a majority of consumers already favor online searches for products and services, most merchants keep buying YP ads because – as many of them have told me in so many words – “that’s what you are supposed to do.” The source of this wisdom usually is a YP salesperson.
Even most of the merchants who have built websites are wasting scandalous amounts of time and money on their online presence because they aren’t doing it effectively. That’s bad for them but great for astute newspaper publishers who can clue them in to the art and science of web marketing.
Web marketing matters because Google and the other search engines don’t care about the splashy graphics or clever copy that people fuss over when they build a site. The search engines only pay attention to the boring computer code you see when you click the “Page Source” tab on a web browser.
A fair number of the people who build websites – including folks at some newspapers – don’t know how to optimize the construction of a site so it gets included in the top results on Google. Poor search-engine optimization – or SEO, as the skill is called – results in an inferior position on Google. Since 95% of consumers never look past the first page of search listings, a business that doesn’t make the front page on Google is seriously out of luck.
Newspapers can take a whack at the YP piñata by becoming the unchallenged web-marketing experts in their communities. To do so, they first need to actually become experts. Then, they need to take the following steps:
Build an online business directory. Using readily acquirable business listings, create an attractive page where site visitors can search for businesses, map their locations and submit reviews of the companies. In addition to selling display advertising, sell upgrades to your free basic listings.
Offer site-building and hosting services. Working with in-house talent or widely available third-party resources, manage the construction and operation of sites for local merchants. This not only unlocks a new, recurring revenue stream but also creates a long-term collaborative relationship where you’re seen as a trusted partner, not just another money-grubbing vendor.
Provide SEO and SEM services. SEO refers to the maintenance (discussed above) that is required to assure a site readily gains high rank in a Google search. Because SEO is an ongoing process requiring regular attention, this creates another recurring revenue stream. SEM stands for Search Engine Marketing, which involves buying and monitoring the performance of keyword ads on Google and other sites. It, too, represents an ongoing revenue opportunity. You can build these capabilities in your own organization or partner with any number of outside firms.
Final advice: Don’t delay. This is a strategic slam-dunk.
(c) 2010, Editor & Publisher Magazine