Desperate Newspapers May Form Combined Sales Group

If there’s any good news in newspaper-land, it is that senior executives may finally be starting to understand just how far up the creek they are.  This desperation appears to be prompting collaboration, one of the strategies AP CEO Tom Curley suggested would help save the industry.

Specifically, according to the (dying) Chicago Tribune, five big newspaper groups (GCI) may team up to create a national sales group to sell advertising across all of the companies’ online properties.  This would be similar to (and compete with) Yahoo’s version of the same thing.

Our quick take:

Collaboration?  Good.  Pooled national sales force?  Bad (or at least irrelevant).  Why?  Because the amount of incremental national advertising and profit a pooled sales force could add beyond the papers’ existing salesforces and Yahoo would barely move the needle.  Also, in the past 15 years, we’ve seen a number of these combined sales efforts, and they almost never work.  In this case, for example, who will the sales group report to?  Which company will consolidate it?  How much inventory will the pooled sales force control vs. the existing sales forces?  Who will be responsible if the national sales group is missing numbers?  Etc.  The benefits just don’t outweigh the challenges and costs.

Also, the problem newspapers face is not ad sales.  It’s declining print readership.  Newspapers have to figure out a way to wean themselves off fat print profit margins, and this won’t help.  To the extent there is a “collaboration” answer, it’s probably on the content side: namely, content- and traffic-sharing agreements designed to reduce content costs while maintaining similar coverage.

See Also:
Bloody Sunday: Newspaper Circ News Even Worse Than Looks
Running the Numbers: Why Newspapers are Screwed
Newspaper Crash: Guide to Every Gory Detail

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