With Switch Flipped, PI Tests the Regional Aggregation Model
We've all got a front-row seats now. The PI flipped the switch, wholly and irreversibly. Tuesday: Mainly print (in revenue), with some online. Wednesday: a web creature, wholly digital. Or should we say Holy Digital!
Since it's the first metro daily to do it, there's a fair amount of confusion about what it may mean. The PI is now like a very young half-brother to the Times, but one with a powerful grandfather in Manhattan.
We can tell the storyline of (Hearst-owned) David (with a staff of 22 or so) vs. a sick (independent and financially weak) Goliath, a Seattle Times (with a staff of about 210). We know some of the reporting and column-writing names that will move over to SeattlePI.com, but certainly there will be less than a dozen. Those numbers say 20 or so vs. 210, though, but don't tell us about the nature of the coming battle.
The battle will be about regional aggregation, as both Seattle "newspaper" sites try some new approaches.We're emerging (again, in some places) from the cloistered model of newspaper website publishing. Newspaper companies are again reaching out, linking out, seeing themselves as being about more than their own staff-produced content. (The New York Times' Times Extra approach is still one more step in this process.)
Of course, when you no longer have a substantial reporting staff, it does focus the mind. (And the site; mouse over the local news headlines on SeattlePI.com, and you can see they come from print PI stories.) The Online PI's mind is now firmly focused on linking out to other newsy Seattle sites and reaching out to community bloggers. It has a head start there, compared to many newspaper sites, already counting dozens of community bloggers. Of course, given that it will produce so little local content of its own, it has to do that to survive and prosper.
Let's recall that the SeattlePI.com and SeattleTimes.com are now neck
and neck in traffic, according to Nielsen numbers, though the Times
emphasizes that its own numbers show it doing better with local audience. Some are betting that as 80% of its hosted content stops flowing, its traffic will plummet. Others are betting that in embracing big-tent community aggregation model its traffic will soar.
Ironically, of course, the PI will soon be linking to many Times' stories — because that's who is doing the bulk of reporting on Seattle now.
So, in part, we'll have a hosted, local content model, the Times, vs. a community news aggregation model, the PI. Newspapers have long instinctively followed the first model. As vertically integrated content owners, they felt most comfortable with it. Check, though, the list of top news sites in the US, and you'll see that three of the top four (MSN, Yahoo and AOL) are aggregators, not content producers. Maybe, just maybe, they are on to something. The PI's bet then is to apply that national thinking to a regional market.
To add to the irony, it won't be alone. I've got it on good authority that the Times — seeing this coming strategy — is planning its own expansion of aggregation, linking and blogging.
So this battle — already well-watched for the significance of a major metro flipping the switch — takes on new import as business models themselves get tested.
Buried in today's announcement was another signal that the battle won't be fought in traditional online territory.
The PI will launch its own regional digital network. Said Hearst News President Steve Swartz:
“On the business side, we are assembling a staff to form a local
digital agency that will sell local businesses advertising on
seattlepi.com as well as the digital advertising products of our
partners: Yahoo! for display advertising, Kaango for general
marketplaces and Google, Yahoo!, MSN and Ask.com for search engine
marketing,” Swartz said. “The site will also feature a digital yellow
pages directory powered by Hearst's yellow pages unit, White Directory
Publishers.”
Look at that announcement as a different twist on the regional aggregation model — aggregating services for local advertisers to prove out a new business model entirely.
The idea grows out of Hearst's emerging learnings from its ad network relationships. Lincoln Millstein, who runs Hearst News Digital, is one of the key drivers of the Yahoo Newspaper Consortium. Hearst papers have reported some big early successes through their use of Yahoo's APT platform. Their sales approach: combine behavioral targeting, more-than-newspaper inventory by extending reach into Yahoo's own local inventory and, here's the kicker, consultative selling.
That's consultative selling as in, can I sell you some search engine marketing services from my friendly web partners? Can I sell you a package of the SeattlePI.com + Yahoo News? Can I help you develop your own retail website? Can I help you make that connection to Facebook?
You get it. Become a bigger part of the advertiser's life — helping him or her solve their web problems — and the money will follow.
I might ask, why stop there? Why not bring the regional aggregation model — sites and advertisers — to another level? Could Hearst, with its national network resources, corral Seattle Weekly, The Stranger, Crosscut, local TV brands and high-profile blogs into a traffic-linking, ad-selling regional network?
Hearst isn't the only company now thinking about expanded local sales; numerous Yahoo consortium partners are getting the religion. As just one example, consider that in Lakeland, Florida, the New York Times Company is offering advertisers both "Traffic Booster" and "Business Booster" packages. Those packages offer the same kinds of consultative selling approaches.
"We're expanding the idea of local," Jeff Moriarty, vice
president, new media for The New York Times Company Regional Media Group, told me today. Moriarty says that in Lakeland, the Times is testing the consultative selling concept, under the brand "New Fusion Media." While it is still evaluating the results, first signs are positive and the initiative may well be taken to other NYTRNG markets.
Moriarty says that many local businesses rely on a family member to help with search engine marketing, for instance. Through its partnership with SEM company WebVisible, businesses now get professional targeting — and they think they are getting it through their local news company.
He also reports that his group's launch on APT — Lakeland was first, three weeks ago, with all 16 properties to be up by the end of May — has already shown some 40-50% ad rate increases, due to Yahoo's behavioral targeting.
In Seattle, today, we see the tragedy, as the now-requisite newsroom video of "The Announcement" plays in endless loop on the web. Less than 20% of the people in that room will get to play a major role in the next stage of the drama, and for all that and for the community's reporting loss, there's sadness. There's no getting away from that sadness and loss. At the same time, though, we do look forward and try to figure out how journalism will work now.
That's the porthole into Seattle through which we're now peering, and in our sights is a big experiment worth keeping our eyes on.