Maroon Ventures Blog

Via Greg Sterling, Dynamic Logic research shows consumer reaction to ads in various media. Perhaps surprisingly, consumers are a lot more amenable to ads in traditional media than new, and newspapers are at the top of the heap with 42% of respondents having a “somewhat positive” view of newspaper ads.

Is it time for print to start borrowing some of the measurability that’s common online? Why don’t more papers use 800-numbers in ads so they can track the actual phone calls their ads drive? How about the ability to track e-mail or web responses using proxy server technology (think of something like Tiny URLs in print ads that help the paper measure how many people are going to the advertiser’s site based on what they saw in print)? Online products have been doing this for a long time.

It would be really interesting to see someone buy one of the myriad newspapers on the market based on a pro forma that would allow for a sane, easy to understand rate card that completely rethinks some of the gouging that’s created advertiser disdain for newspapers.

Yes, newspapers have lost much of the marketplace status they once held. But most of them still have significant classified franchises and ad volume. And they have substantial, albeit dwindling, local audience. Cutting rate (sorry, Mark, someone had to say it) might be the right, if counterintuitive, way to re-establish some of that clout with advertising that consumers actually like. What if you coupled this with a compelling online strategy that isn’t afraid to put advertisers on the web — even at the expense of the print product if it makes more sense for the advertiser?

Maybe it’s not too late for a truly innovative — even disruptive — approach to print advertising. But it probably will have to come from someone arriving fresh to the industry with a sober view of the current economics it faces. Recent “fresh” arrivals haven’t followed this route …

Dynamic Logic research results

Root Clip, which has emerged from the innovation group at Scripps newspapers, has opened voting on its second film, Chance Encounters. The site has come a long way since I initially took note of it in this blog. Clearly, Erik Luchauer and Kevin Antoine are iterating as they go, refining the process and streamlining the user interface.

The premise of the site is that Erik and Kevin post a short video, a root clip, and other filmmakers are urged to submit the next video in the sequence. Users vote on the best submission with the winner becoming the second installment. Then on to the next round. In the end, if all goes well, you end up with a short video story that is created by myriad filmmakers in a collaborative process. Talk about social media.

The major obstacle I hit when voting on Chance Encounter was the need to register. While I understand why it’s necessary to avoid voting fraud, it was a pain to have to go and register just as I was about to vote. But go ahead and register. Then vote. It’s an interesting project that’s worth checking out.

And why would a newspaper company be messing around with this? I’m not sure, exactly. But there’s something cool here, something outside the bounds of what newspapers traditionally do that could help as they cast around for what role they’ll play in an interactive world. It doesn’t take much extrapolation to come up with ideas that could apply in local markets, advertising and news.

I don’t like to toot horns that are reasonably in my proximity but this is a milestone to which I have to draw attention.  Yahoo! recently announced that it has provided over 100 million referrals to the newspapers of the Newspaper Consortium. Multiply that by a reasonable 2.5 or 3 subsequent pageviews, then multiply that by the number of ad positions on each page and that quickly nudges the total number of impressions generated by the Yahoo! partnership into well over 1 billion. Not to mix metaphors but that’s some serious wind folks. 

Here’s the beauty of it - this is a two part solution. Pageviews and impressions are meaningless from a revenue standpoint. It is what you do with the added traffic that matters. That brings us to AMP.

For years now we’ve been dealing with the placement oriented sale. That is to say, advertisers lust to appear on business and travel sections/pages of newspaper websites but for general news, opinion, sports, etc, not so much. Essentially, advertisers were making the correlation between what type of page a user is looking at to the type of potential customer the user is. Call it Cro-Magnon behavioral targeting. AMP changes that.

With AMP, newspaper inventory can be sold based on the behavioral targeting profile of the user regardless of the section the user is reading. So while such “windfall” traffic used to be regarded as low revenue because essentially you are monetizing these pageviews at a remnant or low CPM, now it can be effectively monetized at a premium or super premium CPM based on behavioral targeting. All the while delivering a superior advertising product to newspaper advertisers. Couple that with the national sales pressure brought by Yahoo to target non-local users and you not only create a lot of wind, you will create a lot of very profitable wind through this relationship once fully launched on AMP. And this thing is just getting started.

Okay, i’ll get down from my soapbox. Something to think about though…

P.S. I am still in iPhone bliss - wonky keyboard and all.

Ken Doctor is a smart guy, and I enjoy reading his assessments of the industry. But I think he’s overreacting a bit in his recent post on the turbulence at Yahoo! and its impact on the newspaper consortium. Without a doubt, the papers I’m talking to are concerned. But they also realize there are several important things that are playing in their favor:

1. On Yahoo!’s search deal with Google: Ken is right that it’s unknown what the newspapers will get here. But it’s important to note that when the deal was negotiated, the guaranteed revenue was based on how Google, Yahoo and other contextual ads were performing on newspaper sites. Even if the Google ads were made available to the newspapers, there’s a strong chance the newspapers have a better deal as it’s currently structured than they would with Google contextual ads instead of Yahoo!

2. On the turbulence at Yahoo!: Yes, they are seeing a lot of turnover. But where AMP is concerned, we’ve seen nothing but razor focus and dedication. Yahoo! has staffed this effort very adequately and has significantly increased staff to work with the newspapers. With one exception, I’m not aware of any Yahoo!’s who are involved with the consortium who have moved on to other companies. In addition, Yahoo! is doing a bang-up job on AMP. It’s freakin’ impressive and I believe it will be a game changer for newspapers

3. On the contention that graphical and text ads will converge, Ken does have a valid point where yield is concerned. I don’t think the two ad formats will merge. They serve significantly different purposes. The real merger comes on how pages are monetized. A product like AMP might be able to look at all the available advertising opportunities on a page and decide which mix of graphical, text and other formats will drive the highest effective yield. If it happens to be a Google ad, so be it. Where I think Ken misses the point is that the potential to serve Google ads via AMP wouldn’t be detrimental to Yahoo! It’s actually to their advantage to have a mechanism that can make these decisions on pages across the Internet, helping myriad content providers to get the highest yield possible on their pages, regardless of the inventory served to get that yield. If I’m getting the highest yield possible, I’m not sure if I care if the ads come from Google, Yahoo!, Microsoft or the TV station I compete with in my market.

4. While Yahoo!’s woes do cause turbulence, I don’t think it calls into question the deal newspapers did with Yahoo! If anything, it makes the newspapers a key player in these talks and a force to be reckoned with regardless of the outcome. Without going into details, the Yahoo! deal has considerable change of control language baked into it (as every good contract does), and I think the newspapers are well protected.

Was the deal with Yahoo! a bad idea, or “playing with fire”? I really don’t think so. Yahoo! has been a stand-up partner thus far and I believe that will continue. The deal was a calculated risk, as are all major partnerships. But I wouldn’t call it playing with fire. If Yahoo! were to change hands, it puts the newspapers in a good spot to be a player in whatever emerges. I’m not saying I”d want Yahoo! to change hands. I think the newspapers are better served as things stand. But I wouldn’t rule out the possibility that the newspapers emerge stronger in a change of control.

In short, don’t count Yahoo! out. They still have incredible audience, great technology and smart people. And their current leadership strongly advocated the newspaper deal. Hang on to your hats. This is going to be an interesting ride.

Full disclosure: I was one of the newspaper execs who helped negotiate the deal with Yahoo!, and Maroon Ventures is acting as general manager of the newspaper consortium.

Via Lost Remote, I stumbled across this Slate piece on how we read online. Fascinating and pretty much on the mark. So much so that as I was reading it, I found myself skimming through the denser paragraphs and gravitating toward the bullets and short graphs.

And I love this quote, comparing people who are reading in a utilitarian, gain-information fashion and those who read for the sheer joy of it:

“I suppose ludic (pleasure) readers would be the little sloths hiding in the jungle while everyone else is out rampaging around for fresh meat.”

Gotta run now. I smell fresh meat out there somewhere …

Scripps’ Jay Small notes that RootClip, a startup video play that emerged from the company’s new venture fund, is starting to generate some positive buzz. RootClip really is one of the more innovative video plays I’ve seen in a while, and as Jay notes, it’s one of those things you wouldn’t expect from a newspaper company. Talk about innovation …

Also, just noticed that RootClip received a redesign recently that is a major upgrade. Nice work. If you haven’t done so  already, stop by and check out RootClip.

The Silicon Alley Insider’s Henry Blodget has a gleeful post today lauding the demise of the newspaper industry. Their loss, he argues, is interactive advertising’s gain.

“The $42 billion that was spent on print newspapers in 2007 isn’t going to vaporize–it’s just going to go somewhere else,” he writes.

Then he guesses the breakdown will look something like this:

Surviving newspapers, 25%, magazines, 0%, TV, 0%, Outdoor 5% and Digital 70%

But I wouldn’t count those dollars before they’re hatched, Henry. The Internet’s assault on newspaper ad revenue is as much about value destruction as it is about switching dollars. Think about Craig’s list, where advertising that used to cost money is now, for the most part, free. Think of the major job and auto boards, where ads now cost several hundred dollars instead of the several thousand that advertisers paid for newspaper reach. Maybe advertisers are finding new ways to spend those dollars on interactive campaigns. But I think they’re really just pocketing much of the difference.

Jack Lail has a good post on Random Mumblings arguing that we’re in the “golden age of web news.”

Lail writes:

“It’s a deadly serious battle for audience and ad dollars.

“But it’s also fun, tremendous fun. The community will certainly win through more intense and competition-honed news coverage and some damn good local news Web sites.

I’m deeply worried about the economic woes the newspaper industry is facing. I’m even more worried about what will become of journalism amid this turbulence. As news moves online and the economic model turns upside down, will the capital J survive?

In the April issue of Wired magazine, a profile of the all-out war between geek blogs Engadget and Gizmodo shows there might be hope. (I’d link to it but couldn’t find it anywhere on Wired’s website. Hmm. That might be another post. On the magazine industry’s online woes …).

The article details the cutthroat battle between the two blogs to win audience and nab the best and fastest gadget scoops. As I was reading it, I quickly recognized several of the heated newspaper battles I’ve been involved in. The Birmingham Post-Herald (now defunct) vs. the Birmingham News. The Albuquerque Tribune (now defunct) vs. the Albuquerque Journal. And the Rocky Mountain News vs. the Denver Post (now in a joint operating agreement). The adrenaline and competition in those battles bred some great journalism. There also was excess and questionable practices. But I think in the end, the readers won for having two or more competitors vying for their attention

The Wired article details the race to dominate gadget punditry in all its excess and glory. And it made me believe that maybe the capital J will survive. The heated journalistic competition that once drove the great newspaper battles is just moving online with different rules and economic models. Does it make sense for bloggers to get paid based on the traffic the generate? Don’t know. But I’m sure we’ll find out as that model and others evolve. And I love the idea of two or more snarling online competitors dogging local public officials the way Gizmodo and Engadget’s bloggers dog the tech industry.

Perhaps the thing that gave me the most hope in the Wired article was this quote from Gizmodo’s Brian Lam

“Bloggers and trade journalists, so desperate for a seat at the table with big mainstream publications, have it completely backward: You don’t get more access by selling out for press credentials first chance you get, kowtowing to corporations and trade shows and playing nice; you earn your respect by fact-finding, reporting, having untouchable integrity, provocative coverage, and gaining readers through your reputation for those things.”

Amen. Bring it on …

Rob Curley rocked the house at the University of Tennessee’s “A Public Conversation on Web Journalism” last night with a 2 1/2 hour rollicking look at his greatest hits, which include some amazing examples of what Web journalism can be.

But I was most geeked when Curley looked forward to identify trends he sees on the horizons, one of which is widgets. Our subsidiary, Maroon Gadgeteering, just released its first widget and we completely agree with Rob. In an online universe were content is becoming progressively more distributed, widgets will be a key way to ensure your presence across the internet.

I also had fun during the panel discussion I took part in earlier in the day, though I have to admit I was lobbing a few grenades around just to see what would happen. When asked where in the lifecycle web journalism is, the panelists tended to say infancy or adolescence. “But what if,” I asked, “it’s really a senior citizen?” Is it possible we’ve seen the best of journalism on the web already and it’s downhill from here? I’m not sure I believe this, but an argument could be made that as the mainstream media contract, there will be a vacuum that will be difficult to fill. Citizen journalism is great, but it’s work. And it takes a lot of work to do great journalism. I think a lot depends on our ability to develop a business model that provides online revenue commensurate with the work that capital J journalism requires. (We’re working on that … but it’s going to take us a little while. Har.)

And finally, keep an eye on the University of Tennessee’s journalism program. The Tennessee Journalist site just nabbed eight regional Society of Professional Journalist awards. That’s amazing. Their site is driven by Django and is a great example of what college journalism programs should be doing online.

Other coverage:

Katie Allison Granju’s post on KnoxvilleTalks. She’s updating regularly with new info and details.

Randy Neal’s notes on Curley’s speech and the panel discussions from Thursday.

Tennessee Journalist

Jack Lail’s recommended readings for journalism grads. Great stuff that you should be reading if you’re about to enter the job market …