Sunday, October 21, 2012

The Plight of the Newspaper (and Preparing for the Future)

A couple of years ago, I was speaking at a conference and someone from the audience asked me what I believed to be the biggest marketing challenge of the next five years. I answered with the death of the newspaper, which surprised many, who thought I would point to declining subscription bases or overall drops in arts participation.  We had just experienced the death of four major newspapers – the Seattle Post Intelligencer, the Rocky Mountain News, the Tucson Citizen and the Christian Science Monitor – at a time when most non-profit arts organizations had important symbiotic relationships with their hometown newspapers.  

So let me pause to ask – if your newspaper were to go out of business today, how would that impact your organization?  

And here’s why I am asking. According to the Newspaper Association of America (NAA):

·        Total print advertising has dropped from $47.4 billion in 2005 to $20.6 billion in 2011 – the lowest print advertising has been since 1983 (not factoring for inflation).
·        In 2011, the total daily circulation of all the newspapers in the United States was 44.4 million, the lowest on record since 1940.
·        Citing a 2010 Scarborough report for adults 18+, 47% of the U.S. population 35 years and older read an average issue of a daily newspaper in comparison to only 26% of the population under 35.

According to The Pew Research Center, since 2003, the Internet has been on par or more popular than newspapers as a news source, and currently just 21% of young adults report newspapers as their primary source of news. As the Internet has become increasingly popular as a news source, newspapers have invested tremendous amounts of resources in building their online presence, but here’s the problem – for every $1 gained in online advertising, newspapers lost $10 in print advertising in 2011. And the reason? In print advertising, newspapers are dominate, but online, they compete in a very crowded marketplace, where Google and Facebook combined will share just under 30% of total online display advertising revenue in 2012.  

Using the statistics provided online by the NAA, in 2005 1,452 daily newspapers shared $47.4 billion in print advertising for an average of $32.6 million in print advertising per daily paper. Six years later, 1,382 daily newspapers shared $20.6 billion in print advertising for an average of $14.9 million in print advertising per daily paper.  

In six years, the average daily newspaper lost more than 50% of its print advertising revenue, placing in jeopardy the entire business model of most newspapers and leading to drastic changes. Newspapers around the nation are slashing their newsrooms, laying off veteran reporters and in the best case scenarios, replacing them with freelance reporters with little experience. In worst cases, they aren’t replaced at all.  Just recently the theater world received news that veteran Philadelphia Inquirer arts writer and critic Howard Shapiro, after 42 years with the paper, was reassigned to cover South New Jersey in what seemed like an attempt to make him miserable enough to leave. And it looks like it worked.

With fewer reporters and less experience, not only has coverage decreased, but quality has diminished as well.  Many of us shook our heads when a small online magazine named Pasadena Now hired two writers in India to cover local events but just recently we’ve learned of Journatic, a company that outsources journalism to the Philippines for US newspapers.  Others have transitioned from primary reporting to aggregating content from other news sources and then providing commentary on the aggregated material. When I was at the Smithsonian, one such company drew inaccurate conclusions by providing editorial on aggregated stories. When I called to tell them of the inaccuracies and offer to set up interviews so they could report on the story directly, the freelance writer told me they didn’t pay him enough to do any original reporting. Unfortunately for us, other outlets picked up his story.  I understand cutting as much fat as possible from budgets during tough economic times, but at some point, there isn’t any fat left, and what remains is only muscle. Cutting further sacrifices your ability to deliver an excellent product, which is why I advise arts organizations to avoid cutting investments in the artistic product itself if at all possible when making budget adjustments.  By sacrificing quality, I’m afraid newspapers could be pouring gas on an already blazing fire.  

Every great arts city has a great newspaper. Every great theater town, a well respected critic. If your city is affected by cuts to arts coverage, let your voice be heard. Activate your bases. Support outlets with extensive arts coverage with your advertising dollars. That said, I advise non-profit arts organizations to prepare themselves for the possibility that their local newspaper could go out of business.  Cultivate relationships with bloggers, social media mavens and other influentials in your community. Develop online communities where your audiences can speak to one another. Produce and distribute original content yourself. Diversify your advertising strategies. Budget resources to grow your database. Hopefully these efforts will be for naught, but if the day comes that your local newspaper declares bankruptcy, you’ll be better prepared.

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