Thursday, December 08, 2005

Whined and Dined

Here's an interesting and peculiarly effective strategy publishers could try to boost print advertising: whining. Sez Business Week:
Wal-Mart Stores Inc. placed full-page advertisements in 336 Midwestern newspapers after publishers nationally complained they are ignored by the world's largest retailer.
...
The ads, which ran in smaller papers in Missouri and Oklahoma between Nov. 30 and Dec. 6, were a test for a possible change in newspaper advertising policy at Wal-Mart, which publishers say has ignored their dailies and weeklies for years.
...
Retail and grocery store ads together account for anywhere from 60 percent to 80 percent of revenues for community newspapers, said Brian Steffens, the executive director of the National Newspaper Association.

Grocery stores purchase the bulk of those that advertising, with local grocers often placing full-page ads several times a week. Wal-Mart has grown in recent years to be the nation's largest seller of groceries with the expansion of its supercenter store format, but it generally has not taken out weekly ads to showcase its grocery prices in local newspapers.

"If one local grocery store goes out, a community newspaper loses at a minimum one or two full-page ads or inserts a week," Steffens said.
...
In the spring, the NNA surveyed its members on their relations with Wal-Mart.

Of those that responded, 81 percent said they had a Wal-Mart store in their circulation area. And, of those, 62 percent said Wal-Mart had a negative impact on the community, 25 percent said neutral and 13 percent said it was a positive effect.

The results were similar when asked how Wal-Mart affected the newspapers, with 67 percent saying negative and 4 percent answering positive.

Nearly 60 percent said Wal-Mart never advertised in their papers, but about 80 percent said Wal-Mart sometimes or often asked for publicity, such as pictures in the paper of Wal-Mart presenting a charity check. The NNA did not list its methodology for poll.

Neither the NNA nor Wal-Mart were willing to discuss how much the ads cost.

As a rule, ads printed in the paper make more money for the publisher than inserts, which Wal-Mart has tended to use in the past on the few occasions it did advertise. Inserts require more labor to put into a paper and are usually printed elsewhere, rather than on the newspaper's own presses, so the paper cannot charge for its printing costs.

No comments: