Ken Doctor of Newsonomics offers up 11 news industry metrics to watch in 2011.
Here’s an interesting look at one big development (that ad people might want to know more about):
How good are the margins in the fast-developing marketing services business? Tribune’s 435 Digital, GannettLocal, and Advance Internet are among the leaders selling everything from search engine marketing and optimization to mobile and social to local merchants. It’s a big shift for big newspaper companies used to selling larger ticket ads to relatively few customers. There is no doubt that local merchants want help in digital marketing. The number to watch for the newspaper companies is their margin on sales — after paying off technology partners from Google to Bing to WebVisible. Once we see how those margins settle in, we’ll know whether marketing services is a big, or small, play to find local news company profit growth.
Newspaper ad reps have long called on these local merchants, so they have a foot in the door. But I’m curious, does 435 Digital, for instance, routinely recommend digital media buys that include properties not owned by Tribune?
Most local merchants do not reach out to a local agency for help with their marketing needs, however nimble, or small, said agency might be. Instead, they deal directly with the publication or broadcast unit and focus on the media buy, not the creative product that runs in that venue. In many cases, I believe the local merchant could benefit greatly from working with an agency or a freelance team to craft their message and make their ads worth running.
Big agencies, like big media businesses, are going to struggle to scale their operations down to service this local market. To make it work, one needs lots of clients, and it’s not easy to manage lots of clients. It may be that media companies and marketing services providers can adapt to the challenges presented here, but it’s just as likely that an entirely new kind of enterprise will rise up to meet this demand.
Crowdsourcing is one new answer to the creative need, but it’s not an holistic answer. Clients, big and small, also need the guidance of a brand builder. Whatever route to the creative product one takes, the work needs to be born from a smart strategy, or it won’t perform.