Union-Tribune throws in the towel in classified-ad game
With its recent move to give away classified ads, the San Diego Union-Tribune marked its territory as the France of the newspaper industry, a real trailblazer when it comes to surrendering.
Faced with Internet upstarts like craigslist and eBay, the paper's crack team of big-thinking executives threw their hands up in the air and waved the white hankie on their way to Starbucks. By giving away three-line ads to individuals, they decided it was better to beg for mercy, becoming the first semi-major metropolitan newspaper in the country to take the "We give up" approach.
Of course, giving up is helluva lot easier than fighting and coming up with new ideas, especially with football season coming up. Instead, the U-T decided to toss in the towel in the fifth round, hoping that free classifieds will make the paper beloved again, a move labeled as "bold" by an industry analyst.
At its heart, the announcement is an acknowledgement that the paper has massively screwed the pooch in the lucrative classified-advertising dodge. Given a decades-long head start and gobs of cash, they were caught sleeping at their desks. Now they're shocked to discover that the business has passed them by, like aging hookers in Chula Vista.
Classifieds were the little gold mine of the old-time newspaper game. If you wanted to sell your car, you needed to deal with Guido down at the newspaper. Like legal notices and stripper ads, they traditionally helped supply the backbone of the industry, as long as the newspaper ad execs could convince gullible business owners that Joe and Martha actually picked up the paper and read it.
By giving away their product, U-T executives are, in essence, announcing to the world that the three-line has no real value.
"This is not a move out of desperation," said Scott Whitley, the U-T's director of advertising in the paper's own coverage of its "bold" move. "It really is about growing readership with content-and advertising is content."
That in itself is a fairly shocking statement, considering it is the exact opposite of the newspaper game's traditional formula. In the wacky past, the idea was that readership powered advertising sales; the more you could prove that people read the paper, the more you could charge for the ads. In those days, free classified ads were the sole domain of alternative weeklies, which the dailies look upon with arrogant disdain. A newspaper's readers represented real value, they claimed, nose on high, as evidenced by the ducats people would pay for a chance to read their pages and sell their used couches. It wasn't about the free classifieds; it was about readership, they sniffed.
Readership is at the heart of the entire advertising game. If you can't prove people are actually reading the publication, then the ads are considered worthless. And that's why there are much deeper ramifications to the U-T's gambit.
By announcing plans to use free classifieds to con people into picking up the paper, the paper's managers are, in fact, announcing that the other "content" isn't cutting it, that people aren't rushing out to newsstands to read the latest laugh riot Logan Jenkins has crafted about his wacky dealings with the Escondido water board.
While this may not be shocking news to the average Burger King fry cook, the U-T executives seem to be acknowledging they don't have a clue how to achieve an expanded readership, which might give the classifieds actual value.
As with most U-T reporters having to write about their own paper, David Washburn, the poor sap picked to write the classifieds story, couldn't help but let slip a teensie bit of skepticism at the paper's own claims. "The Union-Tribune is a privately held company and does not release financial results," he wrote. "But executives said the newspaper's classified revenue has actually grown by double-digits over last year's."
Uh huh. And because it's such a fast-growing, vibrant business led by a pack of rabid, meat-craving U-T bigwigs, they're just going to go ahead and toss a chunk of the money into the toilet. But the article also noted that ads from individuals are now only a small portion of classified revenue, making it clear the business has sailed past those same honchos.
For the U-T's sake, this radical experiment had better work. Once you start giving it away for free, there's no turning back. This is no "tweaking of the model." This is tossing the model up in the air and hoping it lands in a better position than it's in now.
By abandoning the field, the U-T executives may be simply pissing away a revenue stream they'll never get back. Sooner or later, larger advertisers may start to ask those perky U-T advertising reps why a classified is so damn expensive for them, even though it's not worth a dime to the guy on the corner running a software business out of his garage.
At the same time, the U-T execs seem to be missing a fairly basic concept here. Craigslist and eBay thrive in this world because they are more than a bland group of listings stripped on a gray page. Both offer vibrant, fun experiences, places to get things done and share information and ideas, in addition to making a few bucks.
As long as the U-T is the same ol' paper, it will continue to get its butt whumped by the upstarts, even if it gives away classifieds.
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