Should Local Publishers Really Try to Morph Into Marketers?

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Lots of local publishers are toying with the idea that their future is as a marketing agency — as opposed to just a publishing company. Just look at Gannett’s recent acquisition of mobile reward and loyalty platform Key Ring. This is the type of move that you think would be met with lots of questions by media business followers — but instead has become a clear part of Gannett’s strategy.

With publishing revenues constrained in recent years, moving to marketing services sounds like a great idea to many companies. After all, publishers are in a great position to do so. They already have feet on the ground selling ads; they have developed trust in the marketplace; and they still have large distribution channels for getting a message to the market. Oh, and companies also seem to be more willing to pay for marketing services these days than they are for newspaper ads.

The problem is: no matter how many new marketing products that media companies offer — from SEO consulting to daily deals — most are still not fully aligned from an organizational or mentality standpoint to make this leap.

It’s easy to see this by asking publishers a few simple questions:

1) How much money and time is spent on your content management system (training, using, optimizing, changing, etc.)? Okay, how about your ad management system?
Why is it that most publishing companies spend lots of time worried about how well their CMS works and building a custom one in-house — but when it comes time to their ad management system they don’t. It’s usually just one department that focuses on their ad tech and they typically go with an all-purpose company such as Google’s DoubleClick. If publishers want to offer marketing solutions, it’s going to take the right ad technology to do so.

2) What agency experience did you bring in from outside?
If most publishers heard that a local marketing agency was going to start up a local news site without hiring anyone with news experience to run the organization, they’d laugh at the idea. The reality is, if most folks from other industries did start a news site (not sure why they would) then they would probably be smart enough to hire someone with publishing experience to run it. Publishers should look to people with the right experience to help in this new area.

3) Who’s in charge of the new marketing services division?
Usually after asking if they hired any agency people, I’m told that they don’t need to because they have the best ad sales guy running this new division (if it’s even a separate division). Sales people aren’t marketers and good sales people will tell you that.

I think that publishers can make the transition from a publishing company to a marketing solutions company. To do so is just that, a transition not a new product offering. It’s more than changing the name of the organization to fit a new model or even changing the leaders title from “Publisher” to “President.” It’s a change in what industry they are are in. That doesn’t mean they can’t still have a newsroom or produce content — after all, that brand and trust is going to be important. But it does mean content won’t be the focus, and that’s scary for a lot of folks.

Newsrooms as Loss Leaders
As local media companies this transition to marketing companies it’s easy to ask (maybe too easy): “Why keep the newsroom around?”

Desert Digital Media Vice-President Chris Lee told Nieman Lab that they keep their newsroom for two reasons. One is because it helps “aggregate users, and creates brand awareness and affinity to brand.” The other is because it’s their mission.

Unfortunately doing something because it’s part of the organization’s mission and principles won’t cut it for most for-profit companies. But I do think he is onto something with the first part.

Marketing companies need to be agile, and they need to have products that offer effective marketing solutions to local and regional marketers. A lot of publishers have already created a lot of these products that live outside of the main news product. And these solutions are easily created, scaled and marketed because of the existing news product.

The news site may even become a loss leader for these new marketing companies. They are just like the milk in the back of the grocery store — it gets people to come in the door so you can sell them something else. Sometimes that something else is display advertising, or maybe now it’s a new e-commerce site the company has built. It’s also a brand. Being able to use this brand will help set up meetings with clients that most marketing agencies would have trouble getting.

However, just like loss leaders in retail, before giving up resources and money to the product, its actual value should be quantified. Publishers who are focusing on providing entire marketing solutions should understand the value the news website brings to the company and have that conversation with the newsroom.

Change Should Be Strategic
In one of the newsrooms I worked with, I was informed that my new initiative was already known as the “flavor of the month.” It was true: in a short amount of time the management team had already decided that there was something else that was the most important thing that the newsroom should focus on.

This mindset is now built into so many media companies. In an attempt to find something to help make the company more profitable, lots and lots of ideas were tried. That’s great — but there is a sense that in many cases no one bothered to follow through or figure out what worked and what didn’t. Because of this, organizations tend to not buy fully into new ideas or concepts.

The companies like Gannett who are making strategic acquisitions to position themselves as dominant players in the marketing and ad tech industry are heading in the right direction but acquisitions are only part of the game.

If your media organization wants to be a marketing services company you need to align your company with that vision. Most publishing companies probably aren’t ready to go all in mainly because it’s very risky and requires changing their revenue model.

If a publisher isn’t ready to commit to a a strategic shift, then it can’t really become a local marketing services company — they just happen to sell marketing products. And if you can’t be the best at what you are going to do then why do it?

Matt Sokoloff is a 2012-2013 Reynolds Journalism Institute Fellow working on a project to help local independent websites and bloggers gain additional revenue opportunities. Matt’s background is in building digital products for media organizations. Read more about Matt’s current work here and talk back at [email protected] and @MattSokoloff on Twitter.