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Panpa Bulletin : May 2007
PANPA Bulletin May 2007 21 advertising Media audiences are spreading themselves across more fragmented, but more targeted, media options. The blockbuster media properties are becoming fewer and fewer. There are two key themes here: small is beautiful and engaged consumers are highly valued consumers. This is a big change for advertising and a big opportu- nity for newspapers to "get sexy" but we'll come to that in my third point. Impact of Change I was astounded to hear Alan Rusbridger, editor of The Guardian, recently list off the catalogue of losses being racked up by the quality press in the UK last year: • The Guardian -- paper and website 45 million pounds. • The London Times -- over 37 million pounds. • The Independent -- 15-20 million pounds. • Financial Times -- 56 million pounds over three years. These losses are being sustained by crossmedia subsidies but figures of this order are threatening the very basis that has sustained newspapers in the UK for over 200 years. In the US, the newspaper industry still expects to achieve 25-30 per cent returns and fortunately Australia seems to follow the US model. But even with underdeveloped digital media such as the internet, broadband and subscription TV, there is a significant drift of adspend away from newspapers and television. It is also true that the audiences of traditional main media, particularly free TV and newspapers are in gradual decline. In the last two years, we have seen new media basically stripping out the annual revenue growth that they would have previously enjoyed. We're still waiting on the full adspend figures for 2006 but we already know that internet adspending for the year was just over US$1 billion dollars. This is highly significant because it will almost certainly put internet at #3 Medium, a nose in front of magazines and well ahead of radio. Australian internet adspend grew from $620M in 2005 to $1B in 2006 -- annual growth of 61 per cent. In the same way that we see climate change affecting the destinations and timings of the journeys of migrating birds, media audiences are now shifting around, re-grouping and changing their schedules and behaviours. We also have many more species of con- sumers emerging as they form themselves into smaller but none the less very signifi- cant niche interest groups. The old mass markets are still there, albeit a little smaller, but they're comple- mented by hundreds of smaller special interest media vehicles. Becoming sexy So what can newspapers do to "get more sexy"? Newspapers need to improve the meas- urement of the medium so that we can get a clear understanding of the levels of consumer engagement within the various sections of the paper. If you want to rack up additional sales and really compete we need to know about the readership of the various sections of the paper. Newspapers are rich in "niche" audienc- es that belong to the various special interest sections of the paper. The old system of loadings that was developed back in the mists of time must end. It must be replaced with a system that is based on the strength of newspapers to deliver the highly engaged readers of your various sections. In the digital world there are three types of media channel: 1Push Media -- the mass, high reach media that spearheaded the analogue age. Typically they are represented by EGN Newspapers, high reaching TV programs and the big three women's magazines. Today they are still weapons in our armory of media channel options, but increasingly they are shrinking in reach and circulations as consumers show a preference for: 2Pull Media -- These are the media chan- nels that consumers reach out for to satisfy specific information and entertain- ment needs. Typically the new generation of digital web-based media, subscription TV and special interest magazines which are now fast taking their place beside the Push Media Newspapers are unique in that they are both push and pull media. The sectional readership of newspapers is just retarded in its sales approach and a major opportunity exists for you to get this right by giving us the information we need to see just how "sexy" you really are! There is a third and previously unrecog- nised media channel opportunity: 3Communications media -- Good examples of this are the relationship websites like myspace, facebook and the whole mobile phone space. They owe their existence to the basic desire of human be- ings to communicate and connect with one another and now with digital technologies they give us an instant opportunity to con- nect and interact with like-minded persons and forming niche tribes with common interests. They also provide us with the op- portunity to have a voice and a point of view in a very instantaneous way. Needless to say this is creating all kinds of new communica- tions opportunities for advertisers to reach, connect, interact and affect their customers in a way never before believed possible. Newspapers have the opportunity to join this category of communications channel via their website extensions. A lot is hap- pening in this area but much of the poten- tial has not yet commercially realised. This brings me to my final "get sexy" suggestion: Break down the silos that exist between hardcopy and online advertising sales. Future newspaper advertising sales suc- cess lies in combining the power of the hard copy push and pull media capabilities with the interactive and accountable qualities of the online channel. At present, it is difficult for us to develop a seamless advertising promotion that tran- sits across the full capability of your hard- copy and online editions. It can be done but it is cumbersome and slow because selling of the two is mostly not integrated. What advertisers want is a campaign in the paper which links through to the online edition and affords the opportunity to inter- act with the consumer via promotions and measure campaign response. The word that describes this is "integration". Newspapers have to act now to inte- grate their offline and online offering in a complete and seamless communications package. In the media agency world now the rush is on to provide an integrated communica- tions offering -- one which gives a complete 360 degree media channel connection with our target audiences. The media that understand this and deliver integrated solutions capability will be the ones who are considered the "most sexy".