Deals Build Longer Term Ad Biz For Papers
Daily deals aren't done for newspapers. If anything, they're just warming up.
Three different media companies reached this conclusion through somewhat different paths they reported on Tuesday, when they made a forceful case for daily deals as a vehicle to build a broader advertising base, develop a closer direct commerce relationship with readers and continue to deliver and expand upon a brisk business despite a crowded marketplace.
And the companies — Shaw Media, Deseret Digital Media and the Omaha World-Herald — fired one other shot across their daily deals competitors' bow, summed up by Jeff Shabram, director of digital at the World-Herald: "A media company is the only one that can build a sustainable business out of it," he said.
Take that, Groupon and Living Social.
Shabram's remarks came at a panel session on deals at the Key Executives Mega Conference, a joint meeting of the Inland Press Association, Southern Newspaper Publishers Association and the Local Media Association in San Antonio, where any notion of daily deal fatigue was quickly dispelled.
Shabram's argument for sustainability was rooted in local media's deeper connections to its markets in addition to a more sweeping hold on its eyeballs. He also said that newspapers' greater scrutiny in choosing the right deals to present to readers was a major differentiator.
"We have all the firepower in the world to promote effective deals, but it's the impact of quality deals that's important," he said.
That sentiment was echoed by Ben Shaw, chief digital officer of Dixon, Ill.-based Shaw Media, which has 60 print and online publications in the Chicagoland area. "We really focus on high quality deals," Shaw said. "For the future, it's a very important thing to do to establish a direct commerce relationship with our audience."
It's also a crucial vehicle to develop new business with advertisers who've largely stayed out of newspapers' reach until the deals front opened up, Shabram said.
"We wanted to be able to get them back in the advertising game," he said, asserting that 52% of the paper's deals have been converted into advertising, often by incentivizing businesses to convert their net proceeds over to ads.
Shabram said that the right approach is to develop a long game, not the in and out of setting up one-time deals and never working with the client again.
And that can translate into a bigger deals platform than companies might initially anticipate developing. For Deseret Digital, that involved the rapid evolution from a Deal of the Day program two years ago to an expansive Deals Mall today, currently running 102 offers and growing.
Bill Quick, general manager of DDM Deals for Deseret, said that mall has yielded some surprising revelations about user buying habits. Among them: While 60% of the deals come from those featured on the site's home page and its most heavily-promoted offers, 40% come from the site's categorized deal pages, far from the front page glare.
Quick likened growing Deseret's deals program to inventing the pizza stacker, that miniature plastic table that keeps the top of the take-home box from collapsing into the cheese. Deseret didn't need to invent the pizza or the box to become a viable player in the game; "We're taking something and adding some tweaks," he said.
That said, publishers also shouldn't expect a one-size-fits-all solution on the deals front either, Quick cautioned. "There's not a silver bullet when it comes to deals," he said.
But there is the occasional home run, or at least a triple. To that end, Shaw pointed to his company's two deals products, a network of event- and family-oriented deal aggregation sites branded as Planit and a more focused subset of that product, the weekly-offered Big Deals.
Of the latter, Shaw said his biggest score to date was a deal with a water park that netted $78,000, signaling some very big fish swimming among the smaller offers that largely populate the space.
And that's more than enough for Shaw to keep his growing number of fishing lines in the water as the deals phenomenon shows no signs of slowing in uncertain economic days.
"We think that deals are a natural outgrowth of a down economy," he said. "It's making money, driving traffic and it has real scale."