WSJ on Borrell: Newspapers Losing in Local

The WSJ is covering the recent Borrell report with a newspaper slant:

Over the past two years, the number of local salespeople peddling online ads for newspapers has ballooned to 15,500 from 5,900, according to estimates from media-research firm Borrell Associates. Traditional media companies have believed strongly that they have an edge over Internet companies because they are based in the communities they serve.

But whatever edge may have existed appears to have evaporated. Newspapers now control only 27.4% of the local online ad market, down from a 35.9% share in 2006, according to Borrell.

There are several reasons why newspapers so far have failed to crack this market. Because online ads are far less expensive than print ads and thus offer lower commissions, it’s difficult to get salespeople to focus on selling the digital products.

The piece discusses increasing competition from all sides and how newspapers are losing print revenues to more nimble competitors who aren’t protecting traditional revenue streams (except YP). The overall report isn’t quite as dire for YP, notwithstanding the sensational title “end of yellow pages.”

There’s a great deal more to discuss here but I’m out the door to the airport.

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Backfence co-founder Mark Potts has some reflections on the local online ad sales issue and newspapers.

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7 Responses to “WSJ on Borrell: Newspapers Losing in Local”

  1. Tim Cohn Says:

    This amid the Newspaper Association of America and Nielsen Online releasing figures stating newspaper sites attracted an average of nearly 66.4 million unique visitors per month (40.2 percent of all internet users) in Q2, a 12.2 percent increase over the year-earlier period.

  2. Jim Moran Says:

    Of those 10k additional online ad salespeople, I wonder how many are traditional reps simply given an additional product in their catalog. I suspect training is another driver for declining newspaper share.

  3. Stan Gauss Says:

    Jim, I would guess upwards of 80% of those sales reps were either moved from print to online or as you said were given another product to sell. Audience based sales training is a big key to growing advertising share and I believe newspapers are finding it hard to develop that model.

  4. Greg Sterling Says:

    That’s where all this succeeds or fails — at the level of the rep. You have to have the right product to sell but the reps have to be trained and capable of selling those products, as well as “incentivized” to sell them.

    The central problem however is that online doesn’t generate as much revenue as print. YP is in a much better position vis-a-vis their print product than newspapers.

  5. Tim Cohn Says:

    Isn’t the success or failure of any advertisement first determined by its ability to deliver results for the advertiser who bought it – regardless of which media they bought it from?

  6. Stan Gauss Says:

    Tim, I believe the answer is yes but the sales executive needs to be trained how to discuss those successes and failures in such a way that the advertiser can make strategic decisions.

  7. Ransom Thoughts » Blog Archive » Newspapers, we’re rooting for you! Says:

    [...] Comments from Greg Sterling on the article: http://gesterling.wordpress.com/2008/07/31/wsj-on-borrell-report-newspapers-losing/ [...]

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