The No. 1 reason newspapers have trouble making money off the Web is because owners, publishers and business staff members fundamentally don’t understand the Web.
Everyone is trying to force print paradigms onto a new medium. Well, guess what? They won’t work.
If you want to make money off the Web, you should look at successful Web companies: Facebook, Amazon, Google, eBay and, yes, Craigslist. They have completely different business models and ways of generating revenue than newspapers. Honestly, why are people trying to force print business models onto the Web?
Of course they’ll fail, and papers will have to lay off countless staff members because of falling revenue. What do you expect? Publishers, stop being so lazy and clueless.
And if you can’t get a clue, do the whole industry a favor and resign. Instead of trying to figure out how we can take the same advertisers and similar ads from the print edition, why don’t we think of new, innovative ways to make money off the Web?
We need a multi-pronged strategy to attract national advertisers, local advertisers and a whole new market of people who never thought of advertising before. There are three core advertisers newspapers need to attract on the Web:
- National advertisers – We’ll still need them, and they’ll provide a nice source of revenue. There is no reason to turn away from them, but it is foolish to focus efforts on a few, big advertisers when there are so many more opportunities elsewhere.
- Local advertisers – Newspapers traditionally haven’t done that well with local advertisers because rates are too high. We shouldn’t just be trying to sell ad space to advertisers, but rather we should also be trying to sell them other services. How about micro pages on our sites where advertisers can showcase their products, services, menus, etc? If we think outside of the box, we can make a lot more money, and offer our clients better services. It’s win-win.
- The never-been-advertisers advertisers – Anyone can be an advertiser on the Web – anyone. So, why wouldn’t we look to attract these people? With ads selling for as little as $5 per day, newspapers could make a killing in the long tail. Sure, $5 doesn’t seem like a lot, but it is in the aggregate if we make advertising attractive to everyone. Garage sales, youth groups, high school clubs, sports teams, social gatherings, etc. Why not?
Let’s look at what innovative companies are doing to make money off the Web and how that could apply to newspapers:
Facebook – There is a lot of innovative advertising going on at Facebook, and newspapers should pay a lot more attention to this company. Of course, many journalists and staff members at papers have never even been to facebook.com. But that has to change.
Every newspaper should take the idea that Facebook has of selling people flyers. Facebook sells ads for as low as $5 a day based on either views or clicks. If someone wants to reach more people in a given day they can pay more. If they want to advertise for multiple days, they can pay more.
But the genius of this is that it sets ad rates so low that college students can afford them (and facebook users have noticed ads from their fellow students for awhile now). I have seen a lot of campus groups advertising on Facebook, probably to the detriment of a lot of campus newspapers. Here’s the thing: advertising on Facebook probably makes more sense than advertising in the student newspaper.
Ads in a student newspaper can often run for more than $100 for an average-sized ad. There is no guarantee that a lot of students will even see it, but for $5 you can purchase thousands of page impressions for your school’s network on Facebook.
A group could get aggressive and purchase $15 of ads per day for three days. It’s still a lot less than a newspaper ad, and it will be seen by a lot more people at a place (Facebook) that is exponentially more popular than the student newspaper.
But that’s not all. Facebook has other services that are attractive to local advertisers. Facebook allows people to purchase polls and set up their own pages for their businesses and organizations. It’s just another way Facebook gives advertisers a more enticing product.
In addition, Facebook leverages its social network by allowing people to target their advertising by age, gender, location, interests and more. It’s just a much better — and more forward-thinking — way to advertise.
Craigslist – Craigslist has this great idea that newspapers should have stolen years ago – free classified advertising. Wait, what? Free?
Yes, it’s a killer idea. Think about it. While people are viewing free classifieds, you can display banner ads, contextual text ads and ads from local advertisers that might interest people looking for a similar product. And, like Craigslist, you can charge companies for certain kinds of ads, like job listings.
By making classifieds free, it encourages a lot more people to use them, which is great. That gives us a bigger opportunity to sell ad space. But there is another way to make even more money off of classified ads…
eBay – EBay has figured out a myriad of ways to charge people for services. All of those services are cheap in the abstract, but can add up to a nice chunk of change for eBay.
Craigslist has very plain classified ads. The user interface is ugly, it’s hard to make products stand out, and, frankly, it’s just not that enjoyable. But it’s free, so who cares?
Well, eBay likes to charge people to get “themes” that make their listings look better and stand out more. Newspapers could have free classifieds that look bland, but if people wants to have a theme they can pay $0.10 or whatever to get a theme that will turn their boring listing into a full-fledged micro site with an eye catching layout. If they want their listing to have a picture next to it, instead of just text (like eBay offers) we can charge them $1.
If people want their listings to be “featured” we could charge them $10-20 (eBay sells a lot of these). A featured listing is a listing that will automatically appear at the top of any search for a particular topic.
If people are looking for Nintendo Wiis on eBay, they will always be greeted with the featured listings first, which makes those listings stand out more. EBay provides a great example of ways to charge people to get extra features, because eBay has a myriad of ways they “help” people sell their products better. Combine this with a lot of what Craigslist does, and newspapers could have a dynamite classified advertising system that would easily outpace Craigslist.
I have news for journalists, Craigslist isn’t that great of a site. It’s ugly, it has too many listings for a lot of searches (featured listings would help alleviate this), it has a lot of disturbing people on it looking for or selling illegal services and there are a lot of scams. But it’s free, fast and highly searchable. It’s infinitely better than the expensive and hard-to-search listings that newspapers tried to pawn off on us.
If newspapers came along and offered classifieds that looked good, were easier to search and had a lot of the features that eBay has, they could turn the tide against Craigslist. But no one will listen to this advice. I’m not sure why I am even offering it.
Google – The biggest revolution Google brought to advertising is that it made ads contextual. It tries to match ads with content in order to get a much higher click through rate, and it works.
Newspapers need to match ads better with content. It doesn’t matter how prominent you place an ad if it doesn’t make sense for the content. Would a story about tween shopping habits really be served well by Budweiser ads?
Newspapers should also consider using Google ads to help make money on certain sections of their sites, like classifieds.
Amazon – Amazon has spent a lot of money and resources on making recommendations to people. Amazon doesn’t wait for people to figure out what they want to buy — it recommends items that it thinks a user might want based on their previous purchases and browsing experience.
Why don’t newspapers take this concept and apply it to their content? Why make everyone view the same content that a bunch of old, white males find appealing? Why not have a Web site that gives users news based on their previous browsing experiences?
Yes, we want to give people the same main, core content, but most content in newspapers and on their Web sites is pretty subjective in where it gets placed. Outside of the top stories, we should let users read what they want to read. Amazon is a great place to start to see how to do it well.
But this means hiring major-league programmers. Papers are woefully understaffed when it comes to technology people. Unfortunately, not enough publishers and top editors have bought into their importance, nor do they know how to even hire technical talent.
The Washington Post does have a feature at the bottom of stories that shows other stories that people read who read the same original story as you, and it’s a good start. But they should do a lot more. The Post and other papers need to dynamically generate sections of their home pages with content for individual users based on their previous browsing experience.
When journalists, however, complain that the Web is killing journalism, I just laugh. Journalists are killing journalism with their inability to understand the Web or their willful ignorance of technology.
Many journalists pride themselves on being technophobes. These are the last people on Earth who are going to get the Web or make compelling products for the Web. If your paper is overrun with these people it will never turn itself around unless you get rid of them.
There is a lot of money to be made on the Web. Instead of thinking inside the box — or the print edition — we should look at what top Web companies are doing to generate revenue on the Web. Compelling (Web centric) products and forward-thinking (Web) advertising will help save a lot of newspapers and make them stronger.
Anything less will doom a lot of papers. But don’t say there is nothing we can do, because there is plenty. We just haven’t been trying very hard.
Let’s try something new.