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October 13 2010

14:00

Does investing in print help the bottom line? Discouraging evidence from the San Francisco Chronicle

The Globe and Mail is the latest newspaper to double down on print — investing big money in a new, glossy, full-color format aimed at making the value of news-on-paper more clear. As Canadians kvell over the print redesign and read the national daily without the inky stain of newsprint on their fingers, it’s worth remembering that the San Francisco Chronicle made a similar move almost a year ago.

Last November, the Chronicle began printing its weekday front page, section fronts and select inside pages on high-gloss paper as a way to lure advertisers and strive for “magazine-quality production,” publisher Frank Vega and editor Ward Bushee said at the time. (The paper revamped its layout in February 2009.) It was an interesting move, considering that less than eight months earlier the paper, facing the threat of closure by its parent company Hearst, was shedding nearly $1 million a week. The switch was a result of a 15-year, $1 billion deal between Hearst and Canadian printing giant Transcontinental, which opened a $200 million plant near San Jose.

Looking at the numbers, it’s hard to see any improvement from the move. Circulation numbers are still in decline, and the Chronicle has scaled back glossy printing to its Sunday paper only. Which raises the questions: Is glossy paper worth it, both in terms of circulation and advertising? And if readers enjoy a smoother feel to their paper, does that warrant the extra cost?

“I don’t think so,” Chronicle president Mark Adkins told me. “You would have to be part of a broader strategy that would include more commercial printing and higher consumer pricing. It’s not a good tactical move for other papers.”

Lack of advertiser response

When it switched to glossy, the Chronicle circulated around 251,782 weekday papers, a 26-percent drop from the previous year. By March 2010, weekday circulation was down to 241,330. The economy certainly takes part of the blame, but the marketing power of a classier kind of newsprint doesn’t seem to be having much of an impact. It costs about 30 percent more to print on the new heat-set presses, which are rare (and expensive) in the newspaper industry.

“On the ad side, advertisers have not responded to it at all,” Adkins says, although the Chronicle wouldn’t reveal specific ad revenue numbers. When the Chronicle switched to glossy, it had “no advertisers lined up,” Adkins adds. The move was primarily aimed at consumers, to present a more luxurious product. But to some extent, that’s what the Chronicle expected when it restructured its business model around readership and circulation revenue, rather than advertising, almost two years ago. Even before the arrival of glossy stock, the paper had increased single-copy and subscription prices. Readers have responded favorably to the new paper, Adkins says, but they’re shouldering more of the production cost.

But back when the shift was made, Adkins also emphasized the appeal to advertisers, leading the San Francisco Business Times to write: “Without naming names, Adkins said that some advertisers who are now playing ball with the Chronicle wouldn’t before. They shunned newspaper ads because ‘they don’t deliver the brand image they require,’ he said — an obstacle the Chron’s new paper removes.”

“People are definitely and truly intrigued when they see copies of the Chronicle,” says Chuck Moozakis, editor of the print innovation monthly Newspapers & Technology. “The paper is trying to send a signal that you can have a newspaper that looks like this and not like that. But it’s a challenge now.”

Looking internationally

The Chronicle won’t be phasing out high-gloss paper any time soon — not with that $1 billion Hearst deal — but Adkins isn’t ready to champion glossy as the savior of the print industry. That’s partly because in most cases printing on high-gloss paper requires outsourcing — a costly and alienating move — to independent commercial presses like Transcontinental. Heat-set presses simply aren’t ubiquitous enough in the United States to make higher-grade printing a viable option for most newspapers.

As for Canada’s Globe and Mail, editor John Stackhouse told readers that he wasn’t looking to the American newspaper market for inspiration when it comes to his “Proudly Print” approach: “Rather than study the U.S. market which is fairly depressed in terms of newpaper innovation, we looked to quality papers in southern Europe, Latin America and parts of Asia and found a great array of ideas that encouraged us to pursue a bold and confident look as well as a design that would continue to support great, in-depth journalism…One of the principal goals of the redesign is to raise the quality of The Globe at a time when we feel many other media are reducing their quality.”

October 05 2010

14:00

Doubling down on print: Canada’s Globe and Mail unveils a new print edition to complement the web

The Globe and Mail, Canada’s most-circulated national daily newspaper, revealed its much-ballyhooed redesign on Friday. The paper is calling it “the most significant redesign” in its 166-year history, and it’s a billion-dollar bet on print at a time when the format’s fortunes would seem to be fading.

The renovations to “Canada’s National Newspaper” are part of what editor-in-chief John Stackhouse boldly calls his “Proudly Print” approach, with print as one component (with online and mobile) of a three-pronged news attack. The redesign tries to make the differences between print and web more clear. Full-color printing and a high-gloss wrap — the first of its kind in North America — aim to help lure advertisers. There’ll be more magazine-like stories, including photo-driven features plastered boldly on the front page. A slightly narrower size means shorter, punchier stories. And that’s not to mention the informational accoutrements, like sidebars and info graphs, and the litany of new inserts and content realignments. The redesign “once again demonstrates our commitment to the newspaper business,” according to publisher and CEO Phillip Crawley.

This is a big-time overhaul for the Globe, and not only because the paper sees it as a reassertion of dominance — i.e., shelling the struggling National Post, its conservative competitor since 1999, in the national newspaper war of attrition — over the Canadian media landscape.

But whenever a redesign happens, criticism follows. The prevailing question in this case is fairly obvious: Why invest in an 18-year, C$1.7-billion printing deal — with the same press as the San Francisco Chronicle — at a time when newsprint seems like yesterday’s medium?

“It’s going to be a millstone around the Globe’s neck,” says Mathew Ingram, a senior writer at GigaOm and former Globe web editor (and Lab contributor). “That’s 10 years you’re going to be paying for something that’s going to restrict the paper’s ability to do things that are focusing on the web. That’s not a thing a newspaper needs at a time like this.”

But the Globe sees its investment as a bet on print having a complementary role to online news going forward. “Our readers are digitally-minded people,” Stackhouse told me on launch day. “We publish a paper for people who are online a lot and still want a printed product at their doorstep every day to make sense of a world that flew by them while there were online.” Stackhouse, who took over as editor-in-chief in spring 2009 after a career as a business reporter, knows what he’s up against, and he’s making an argument about what a 21st-century newspaper needs to look like.

The Globe has always been the highbrow stalwart in Canadian journalism — and judging from its minimalist yet dramatic ad campaign, the paper still sees itself at the head of table. (For more proof, check out this nifty microsite.) Stackhouse uses the term “the daily pause,” when readers feel obligated to close their browsers and read insightful, show-stopping journalism. That’s what newspapers should strive to give their readers, he told me. He says there “needs to be more selection. We need to bring more insight to issues that matter most and focus on issues of consequence and try to have fun with it.”

The Globe, like most other newspapers, realizes there’s still money in print advertising. According to a profile of the Globe in last month’s Toronto Life magazine, the paper’s online component brings in roughly 15 percent of the revenue generated on the print side — not far off the totals for most large American newspapers.

Whether or not Crawley’s doubling-down strategy will work remains to be seen. Eighteen years is a long time. Critics wonder if placing such emphasis on print will limit the Globe’s ability to take the reigns of a slim Canadian online news market. The responses look a lot like this tweet, from Toronto-based technology consultant Rob Hyndman: “The Globe’s changes are about fear of loss, not about moving towards a positive goal.”

The Globe surely sees things differently. Its prime competitors — the National Post, the Toronto Star, and free dailies like Metro and 24 — are all print products. In fact, the paper’s weekday circulation jumped 5 percent last year and its print revenue increased 10 percent, while everyone else took a step backward. In Canada, the world of print is still the gladiator ring. The Canadian online news marketplace is underdeveloped: There’s nothing like Salon or The Daily Beast or The Huffington Post to draw eyeballs away from sites — GlobeandMail.com, CBC.ca, CTV.ca, GlobalTV.com — already affiliated with traditional news organizations. Speaking at the Economic Club of Canada on the eve of the launch, Stackhouse pinpointed four online competitors — The Huffington Post, Bloomberg, Yahoo Finance, and the BBC — none of which are Canadian. Without a sea of competitors galvanizing innovation and growth in Canadian online news, the Globe seems to think it makes sense to stick to the gravy — a move Ingram thinks is a mistake.

“Now is the time to seize the day, to become a leader,” he says, “because the Globe doesn’t have a huge amount of competition in print or online. It feels like it’s the only game in town — except maybe the CBC — and that lulls the paper into a false sense of security about its future.”

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