Monday, June 11, 2012

Got a digital product plan?

Second of two parts.  The first is here.

With Main Street merchants diverting ever more spending away from traditional advertising to the online, mobile and social media, newspapers seeking a healthy share of local marketing dollars need to be selling way more than banner ads.

We’ll describe an effective digital product mix in a moment.  First, here’s why this matters:   

Although roughly half of local marketing dollars today go to newspaper and broadcast advertising, BIA/Kelsey predicts that only 30% of an expected $151 billion in local expenditures in 2016 will be spent on the legacy media.  Prior to the arrival of the Internet, Main Street merchants typically put 70% of their marketing budgets into print and broadcast advertising. 

Today, local businesses are investing in websites, social media campaigns, mobile couponing, search advertising, email marketing and other tactics that enable them to establish direct and sustained relationships with consumers. Even the best print, broadcast and banner ads can't equal the power of digital targeting to put the right offer to the right person at the right place at the right time.

To get competitive and stay competitive, publishers must offer a number of complementary digital marketing solutions. The good news is that these products represent an opportunity to build high-margin, recurring revenues that enable publishers to amortize their direct sales costs over many years. Here are the products and services you need in your digital toolkit:

Website design/hosting.  A merchant’s digital presence starts with her website, which must be constantly refreshed and maintained to not only sustain its relevance to consumers but also to assure high visibility on Google and other search engines.  

Search optimization. Because only 5% of consumers click past the first page of web search results, businesses must pay close attention to continuously grooming their sites to get them into prime positions on Google, Bing and other platforms. The task never ends, because search algorithms continuously change and the social media increasingly will influence search results in real time.

Reputation management. Beyond Google and Bing, there are millions of other venues on the web where a business can be mentioned. Reputation management services assure that information about a business is up to date wherever it appears. At the same time, such services identify unfavorable mentions (like negative reviews on Yelp) so a business can take rapid remedial action. Given the rise in location-aware mobile services, accurate information about a business is more vital than ever.             

Mobile-site hosting. While websites can be accessed via smartphones and the iPad, many of them render poorly on mobile devices – or not at all in the case of Flash on Apple products.  With nearly 50% of the U.S. population carrying smartphones and some 20% of the population using tablets, consumers increasingly are turning to these devices to make purchasing decisions. Merchants whose sites perform poorly on mobile devices run the risk of being overlooked and under-patronized.

Social marketing. Facebook and other social media offer appealing opportunities for merchants to make one-on-one connections with consumers – and to leverage these fast-growing platforms to generate viral (and cost-effective) word-of-mouth referrals for their products and services. Successful social marketing programs require constant attention to building audience, creating content and curating connections. Because these chores are a lot of work for the typical small business, there is an opportunity for publishers to do the work for them.

Direct marketing.  Merchants seeking to develop direct relationships with consumers need to assemble increasingly sophisticated databases of information about as many individuals as possible.  Newspapers can help them build, manage and market to customers via email, snail mail, the social media and other vehicles.

Deals and coupons. Several of the platforms described above make it easy for publishers and merchants to offer a wide variety of discounts and coupons, including offers targeted to select audiences or sent dynamically to users of mobile devices.

Search/social advertising. While the keyword advertising programs at Google, Bing, Facebook and many other websites are promoted as self-service platforms, the work of creating, managing, evaluating and fine-tuning a digital ad campaign is intimidating and time-consuming. Significant profits can be reaped from managing campaigns for merchants.

Rich analytics. Owing to the many complex elements of a digital marketing program, a key component of any program is a comprehensive and responsive analytics package to plan, monitor and measure each of the various initiatives – and to continuously reinforce for merchants the value of the services (including, yes, print advertising) provided by their local publishing partner.

Publishers shouldn’t try to launch all these initiatives at once.  The products have to be deployed in a logical, well-planned sequence. But you have to start now, because it's tough luring back clients who have committed to different digital marketing partners.

Just google “web hosting” or “social marketing” to see how many competitors you already have.

© 2012, Editor & Publisher


Blogger Mary Kay said...

The old business model was advertising arm for local businesses attracting viewers of ads through news.

The new business model is advertising arm also attracting viewers through news but recognizing that today's advertising vehicles are different than yesterday's.

Newspapers really missed the boat. All these opportunities were there for them from day one. Now they face their own Kodak moment.

9:46 PM  
Blogger LocalNewsGuy said...

The regional news organizations of the major market newspapers have legacy managments comprised of executives who rose through their old committee oriented structures. They should be incredibly profitable today because the demand for news and information is insatiable. But even great business plans cannot get financing - even though they would be highly profitable and rapidly growing. I worked with a group whose members were willing to invest millions of their own money to buy the Inquirer and make the necessary changes. But no one else would go along. The VC industry is a herd-oriented as the papers. No wonder the rates on the first are in decline and papers are closing.

5:17 PM  

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