Buyer Behavior:Can mainstream newspapers re-capture the elusive “young reader”?

Heather Lamm

VP, Strategic Development

MediaNews Group Interactive

April 12, 2005

Leeds School of Business

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Overview

Media consumption among young adults Implications for newspaper industry Case Studies: Newspaper attempts to reach young readers

Access Atlanta (Atlanta Journal Constitution) Orlando City Beat (Orlando Sentinel) Red Eye (Chicago Tribune) Bias (The Denver Newspaper Agency) Blue (Centre Daily Times)

Key questions and recommended actions

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Readership Trends: Declining across the population but especially among young adults

Generation X and Y: Born 1966-1976 and 1977-1994 and comprise almost 40% of the US population

Reading habits are generally fixed by age 30. Since 1972 newspapers have had progressively lower levels of regular newspaper readership among young adults

Forty percent of single-copy buyers are 18-34 years old; only 20 percent of subscribers are in that age group.

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Not surprisingly, the Internet is gaining readers as traditional media sources lose readers

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The Denver market follows the national trends

More than a quarter-million young adults (ages 18-35) in Denver spend at a rate of $7.7 billion annually, or $32,895 per capita.

Between 2001 and 2003, The Denver Post and Rocky Mountain News lost 41,470 readers (17%) between the ages of 18 and 35.

“We are facing wave after wave of young consumers who are increasingly indifferent to print. They’re steeped in gadgetry, have money to spend, and see anywhere from 6,000-20,000 marketing messages in a single day. Getting these folks’ attention within traditional print media is tough work.

Current core DNA products do not have the brand elasticity necessary to support a product with the authentic edge and tone needed to engage and entertain younger demographics. To move beyond the core audience, we must move beyond core products. We must create an entirely new brand.” (Denver Newspaper Agency)

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Changing industry dynamics are also impacting newspaper readership

News aggregation Google, Yahoo, etc Brands of aggregators rather than newspapers

Other industry analogies?

Crisis of mainstream media credibility (and voice) Jayson Blair/Steven Glass Expert opinion versus the wisdom of crowds

The rise of blogs Passive versus interactive media

Lecture versus conversation

Search capabilities Finding what you want when, how and where you need (classifieds, event listings, restaurants, weather, traffic, etc)

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What are the implications of these trends for newspapers?

Declining ad revenues Declining circulation revenue

Unwillingness to pay for content online Loss of identity as voice of community Loss of local monopoly Consolidation (corporate) and fragmentation (niche publications

and websites) Varied attempts to capture digital audience

Digital editions, newspaper websites, niche publications, etc

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AccessAtlantahttp://www.accessatlanta.com/

Model and focus: Print insert in Thursday’s AJC +

stand alone on racks + Online; free (with newspaper)

Entertainment focus with long lead time for events

Differentiation: Large marketing budget (for

newspapers!) Advertising seen as source of

credibility Content is ‘looser’ than

newspaper but not too hip: “You guys don’t have the street cred to go that far.”

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OrlandoCityBeat.comhttp://www.orlandocitybeat.com/

Model and focus: Website (separate from Sentinel

website); limited print edition; ad based business model

Entertainment focus with heavy promotion of drink specials, free music downloads and “O-Lens”

Differentiation: Web-centric model with heavy

emphasis on Search; “we over-estimated interest in the print product.”

VIP card and drink specials; O-Lens and the shock squad

Free classified ads for merchandise under $1000.

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RedEye http://www.chicagoredeye.com/

Model and focus: Separate weekday tabloid paper, 25

cents/copy, fixed inventory for advertisers; online complement

National and local news focus with deeper entertainment and celebrity content

Differentiation: Aggressive user feedback has led to

distinct personality and voice Paid model/honor boxes Advertising seen as credibility Cross promotion with other Tribune

properties

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Bias - Denver Newspaper Agency

Model and Focus: Bi-weekly, 24-to-32-page stand

alone edition + online site + events/promotions

Distributed free to key nightlife, student and commuter zones in downtown area

Voice: “the sound of young adults taking on life, love and work; confessional, topical and satirical”

Differentiation: (pre-launch) “Sometimes it’s a hip magazine.

Sometimes it’s an online forum. Sometimes it’s a daring promotion. It’s always a total P2P marketing vehicle. But it’s never boring.”

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Blue - State College, PAhttp://www.centredaily.com

Model and focus: 5 days/week print edition with

website complement; primary goal of driving readers to Centre Daily Times

Content confusion - no clear focus but too much sex and profanity?

Distribution confusion- Wrapped around CDT at first, tabloid later

Website confusion - Five minute blue?

Differentiation: ???

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Buyer behavior and news

Consumer behavior What is driving the shift of consumer consumption of news? What determines where and how people consume their news?

Is the decision-making process different for younger readers? Content and medium

Is changing consumer behavior making news “objectivity” impossible or undesirable?

Did newspapers drive young readers away or did young readers respond to and maximize the new online medium? Television remote vs. cable TV vs. Tivo

Distribution How does the shift in consumer behavior from passive to active

consumption change the way content is disseminated, displayed and communicated? What does that mean for the newspaper industry?

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And finally…

What are some of your suggestions for how newspapers can recapture these young adult readers?