The Slow Death of An Industry: Newspapers

For years newspapers were America’s leading source of information, but the cry of this American tradition can be heard as it slowly marches to a dark and dusty grave. During the last decade newspaper circulation has been declining, but nothing has fueled that fire more so than the Internet. According to Tim Arango of the N.Y. Times, drop in circulation has accelerated since last year. A seven percent drop, in fact, from April 08 to 09!

In an effort to hold on, many newspapers have gone online. There has been a rise in the number of online web audiences, but the overall potential still doesn’t seem enough to save the traditional paper. In a way, they may be helping to dig the grave. Lets see, do I pay for a paper or go online and get my news for free? Once people have the opportunity to get their news for free online they will most likely stop buying the paper. It’s really a tough spot the industry. It almost seems like a lose/lose situation.

As an advertiser, I deal frequently with a few local newspapers. In the last few years my boss and I have basically come to the conclusion the it’s not worth it to advertise in the paper. We’ve spent who knows how many hundreds of dollars in the last year on newspaper ads and it just did not seem to make one bit of difference. We even offered coupons or incentives such as “mention this ad in our store” to receive a discount. Zip… Zilch… Not-a. Now I’m not saying advertising in all papers is a mistake. Our local papers are particularly dull and don’t offer people much incentive to buy them. By the time the paper comes out, half the town has already heard the latest news through the grapevine. However, despite poor results from the local papers, I decided to run an ad for my father’s business in hopes to target the local crowd with an appealing summer deal. Looking at the one/two year old ad rates I decided to go with a 2 column X 3″ format for $30. Now this was an old price and I assumed it would be a little more now. However, when I called in this size ad was now almost $50.00! Ouch! After retracting our ad we are re-evaluation the advertising strategy. If we sell the lawnmower in the ad is it going to pay for the ad placement? With the past low response rate we are hesitant to place the ad. Driving the lawnmower outside and tying balloons to it might be a better idea.

I brought up this story to bring to light another point. Sure newspapers are struggling. Sure they need to generate more income to pay the bills and balance the decline in circulation, but hiking up ad prices to do so? Not a good idea. For the previously mentioned ad to go up $20 in past 2 years or so is ridiculous, especially under the current circumstances. I checked around and ad rates are going up everywhere. I don’t understand their business strategy at all… unless they want to lose their job. I’m not saying I know the way to solve the problem, give me a little while to think on it and I might come up with some solutions, but raising ad rates in a dying publication and offering services for free online is just going to kill the paper faster.

Source:
Arango, Tim. Apr. 27, 2009. “Fall in Newspaper Sales Accelerates to Pass 7%”
http://www.nytimes.com/2009/04/28/business/media/28paper.html?_r=1