Print plunge improving consortium’s fortunes?
SANTA CLARA, Calif. (at the BIA Kelsey Interactive Local Media conference): In a fairly candid but clearly promotional conversation, Mike Silver, the new executive director of the Newspaper Consortium (and its only employee), and Lem Lloyd, VP of Yahoo for the consortium, said the 800 daily and weekly papers participating in the group are making significant sales --- and they’ve just scratched the surface of the opportunity.
(If you read our CIR overview two weeks ago, you’d know that already; if not, shame on you! Quit freeloading and become a client already!)
Silver started with the consortium just three months ago (after 22 years with Tribune and a well-deserved rest). For now, he said, the consortium is focusing on roll-outs of the Yahoo advertising platform, and growth in general. “My attitude is, Yahoo first. This is a big, whopping opportunity for newspapers,” he answered in response to a question from BIA Kelsey Group analyst Peter Krasilovsky. “There’s no lack of things for us to do right now with this relationship we have. While we’re focusing on Yahoo, we are looking for other opportunities. Yahoo can’t do everything. They don’t want to do everything. … Now that we have this new type of geotargeting or behavioral targeting, there are other things we can do.”
Plummeting print revenues are actually helping convince newspapers to sell Yahoo’s services, Silver said. “Because of some of the difficulties in print right now, I can’t think of a time when publishers were more receptive to making changes in what they do. Online is not just an add-on any more; in fact, it’s the future.”
Lloyd said a smallish newspaper in the United States had a one-week sales blitz on Yahoo products recently and generated $500,000 in revenue, mostly in contracts of $30,000 to $50,000. He said that while Yahoo can sell advertising nationally, newspapers can sell on a “tier two” and “tier three” level, giving as examples regional auto dealer networks (tier two) and individual auto dealers (tier three).
“There’s a great percentage of local intent” in the billions of searches and among the 150 million unique users globally a month on Yahoo, Lloyd said. “The trouble that Yahoo has had is that we don’t always monetize those pages, those views of local intent, in a meaningful way.” He said the consortium allowed Yahoo to capitalize on the 15,000 sales reps at its 800 participating newspapers to sell Yahoo and related inventory.
Ok, let me understand this before we all jump for joy that a “BLITZ” (which means calling hundreds and hundreds of leads) from a “smallish” newspaper brought in $500,000 in yearly contracts at the $30,000 to $50,000 level.
Mathematically, that is either 10 customers at $50,000 each or 17 customers at $30,000 each or somewhere in the middle. 17 customers max. What kind of a blitz was this?
These revenues are then shared 50/50 more or less with partner Yahoo, leaving the newspaper with $250,000 profit...for those 17 advertisers that is $272 per week in sales profits. Or is it? Most likely, most of these advertisers were not new to the newspaper, so first deduct what they were already spending in print (can someone say “switch business") to see if this Blitz truly was effective.
Now realize that the Hotjobs product is pretty darn good and these packages gives the employer all kinds of goodies from Yahoo for tracking and organization of resumes. Where do you think the loyalty of the customer will be from then on? To the newspaper franchise or to Yahoo? Have any of you ever seen how those ads are then set up by the customer? It’s pure YAHOO branding from there on out as the newspaper branding fades from the purchase for the next YEAR!
Is this a true partnership when Mr. Silver himself points out and I quote Mr. Silver from above “My attitude is, Yahoo first”.
When newspapers lose their brand in the market, especially the recruitment market, they lose everything. Is there a consortium partner out there that can say their overall recruitment revenue is higher now since joining Yahoo? Sure maybe your online portion has grown, but how much of it is purely switch business when sales reps are highly rewarded during a blitz to sell against their own newspaper brand.
Has Yahoo Hotjobs failed to live up to expectations when fighting competitors like Careerbuilder and Monster? They both spend a small fortune from their profits on national branding to bring in job seekers while Hotjobs does not. Newspapers are following their instructions and promoting Yahoo Hotjobs in their recruitment sections, even on their business cards and emails at their own expense. When is Yahoo Hotjobs going to take some of that “partnership” money and spend it on some national advertising the way Careerbuilder and Monster does? Don’t you think HR Managers across the country realize the difference?
Regardless of the “Yahoo” name in front of it, Hotjobs will always be the Number 3 until they step up and match Careerbuilder and Monster in the national branding arena.
Janet / (all) ---
Just to clarify, because *my* writing may not have been clear: When Mike said “Yahoo first,” he was NOT referring to Yahoo vs. the newspapers. He was answering a question along the lines of, “There are so many things the Consortium could be doing --- what’s next?” And he answered, “Yahoo first.” So if my writing was misleading, take it out on me, not Mike.
(You’re welcome to take anything else you want to out on Mike, or the Consortium, or whomever, of course! We love feisty comments.)
