Newspapers, Distribution and Denial

Peter Krasilovsky is reporting that the long-rumored Yahoo! Hotjobs-newspaper deal is close at hand. The deal would provide additional distribution for Hotjobs and, presumably, newspaper advertisers as well. Newspaper industry-owned CareerBuilder is the leading jobs site, while Monster is the most effective revenue generator. Yahoo!’s Hotjobs is number three.

Beyond the verticals they own, newspapers desperately need to start syndicating their classified listings online — some already are — and develop a YP-like distribution strategy for local advertisers. Some are. But many newspapers are operating in a paradoxical state of panic and denial. There are moments of clear, rational thinking, often leading to panic, and much more time spent in denial.

The privileged position of newspapers in the local market and the historical margins newspapers have enjoyed have clouded their visions of their competitive position online. Offline they are the dominant driver of local shopping referrals, more than yellow pages. But online they are merely a face in the crowd with websites that are generally awkward, hard to use and obscure a wealth of content.

Even if you think that statement is too harsh compare the ease of use of a search engine vs. a newspaper site. There’s no contest at the moment.

The problem at newspapers is not one of insight or intelligence among the ranks, but rather one of culture and execution. Many “higher ups” in newspapers have excellent ideas about how to be more competitive online but the bureaucratic culture of newspapers and focus on the legacy print business often prevents forward-thinking individuals from implementing their ideas – especially if it means cannibalizing print revenues in any way.

Newspapers really have very little time to become more competitive online or they will largely become irrelevant to consumers, especially younger consumers. While news content is compelling and interesting to almost all age groups online, newspapers themselves have more limited appeal. The NAA has put out findings that indicate online newspaper readers are well educated and affluent. But these audiences don’t do much on newspaper sites other than read the news.

While print newspapers are the most powerful influence on offline shopping behavior, online newspapers come in dead last according to the Dieringer Research Group.

To deliver maximum value to advertisers (beyond those on the homepage) newspapers need to dramatically redesign the user experience they offer online. Again, this is a generalization and so untrue for every single newspaper – but it’s largely true across the industry. There are standouts like the Washington Post or NY Times and a number of compelling local experiments happening here and there.

But, as one ex-newspaper executive put it to me tonight at dinner, “They’re going to need to feel a lot more pain before they act, and by that time it could be over.”