Home' Local Media Today : December 2011 Contents 2 | suburban publisHer | december 2011
In terms of impacting ad revenue,
we encourage newspapers to engage
advertisers through deals and give them
the option of rolling over the profits into
additional ad buys – which can be a big
win for both parties. The revenue oppor-
tunity for newspapers is substantial. In
some markets, it’s a multi-million dollar
Deals programs are a great way to engage
new advertisers and to highlight the promo-
tional power of newspapers. We’ve seen new
and current advertisers expand ad buys in
print based on the success of their deal.
Having a deals program will help you grow
your email database, approach advertis-
ers with new solutions and position your
paper as the go-to place for savings and
promotions in your community. This not
only strengthens your deals program but
your core print and digital business.
Who buys deals? Clearly restaurants
are hot customer categories. What
are some others that may not be quite so
obvious? And, what does the typical deals
consumer look like?
The short answer is that everyone
buys deals. They are not for one par-
ticular demographic. Generally speaking,
newspaper readers tend to be better edu-
cated and more affluent than consumers
at large, and in our experience advertisers
prefer the people who buy deals through the
paper as opposed to pure-plays. We need
to stress this advantage to merchants.
In terms of the types of deals that are
strong we certainly see great performance
from restaurants, beauty and recreation
but we are noticing a trend towards theme-
based deals stores – for example, home
improvement or holiday stores. In addition,
experiential deals, such as travel packages,
concerts tickets and sports events are on
the rise. Restaurants are big sellers, but
experiential deals drive the most revenue
Many newspapers are already in
this space. Can you give us some
insight into their digital deals experi-
ence so far? Hindsight wisdom learned?
Pitfalls to avoid?
In mid-November, we hosted a webi-
nar with The Washington Post titled
“Lessons in Deals Success” that reviewed
the first year of their program and what
worked and what didn’t. Here’s a few of
the items we covered:
Building and understating the value of
your email subscriber is vital - espe-
cially when you are looking to secure or
expand your marketing budgets around
deals. 80% of deal purchases come from
your email database so the larger your
database the more you make.
Analytics and data will continue to
play an increasing role with deals. The
Washington Post is focused on using
tools like Tracking Links to understand
the impact of their promotions.
Contests and deals are powerful pro-
motional tools that can drive revenue
and audience growth in a dramatic way
- especially when combined together.
Learn from your mistakes and don’t stop
trying new things. The Washington Post
started out as The Capitol Dish with
only dining related deals with limited
I want to dig into the topic of ‘daily
deals’ but first, can you please give us
a thumbnail of your background and
In the late 90’s, I met my business part-
ner, Doug Villhard, while we were work-
ing in the New Media division of Pulitzer, Inc.
Our work at Pulitzer provided us a front row
seat to observe the challenges facing local
media companies in the digital age. We knew
that despite all of the obstacles, local media
had the opportunity to thrive in the new world
of digital advertising and promotions. We’ve
been working with newspapers and local
media ever since.
Together Doug & I founded Second Street,
which was one of the first companies in the
country to specialize in private-label pro-
motions platforms for media companies.
Today more than 2,400 local media companies
are using our platforms, such as UPICKEM,
Deadline Deals, myCapture and eBlast Engine,
to manage promotions such as contests, daily
deals and photo e-commerce programs. We
also have a dedicated affiliate success team
to share industry best practices with our
partners and help them generate revenue,
drive traffic and build email databases. As
passionate advocates for newspapers, we’re
very proud to now be generating tens of mil-
lions of dollars in revenue for the newspaper
industry each year.
We all know about the phenom suc-
cess of Groupon and Living Social; are
digital deals here to stay? What are the trends
and outlook for the big players and how does
this bear on local outlets looking to continue
and/or get in on this business?
Consumers show no sign of deal fatigue
and advertisers love performance based
advertising models so we strongly believe
that deals are here to stay although the model
will likely continue to evolve in the years to
come. It’s tough to speculate on the future
of individual companies like Groupon and
LivingSocial but clearly there is a shakeout
taking place in the pure-play space which
creates an opportunity for newspapers. If
newspapers double-down, I strongly believe
that newspapers will take a larger share of
the space from pure-play sites because they
already possess a winning combination of
established brands, significant audiences,
connected sales forces and unmatched promo-
tional reach that pure-plays can’t match.
But, newspapers need to continue to invest.
For example, having a dedicated salesperson
to focus on deals can make all the difference.
The sites that are successful prove this out
again and again. A dedicated person can
bring that focus and help raise the profile of
deals internally with other sales teams.
Local media companies have estab-
lished brands and loyal audiences
which are presumably key ingredients to
new deal launches. Is it a no-brainer that
local newspapers should get into this space?
And, what are some of the key initial steps
they should be assessing as they consider
their digital deal options?
It’s a no-brainer for local newspapers
to consider creating a deals program,
but there’s real work that needs to be done
before jumping in. Here are five questions
every media outlet should answer before
embarking on a deals program.
Do I have buy-in and support at the highest
levels of my organization?
Am I willing to invest in a dedicated sales
Am I willing to use all of my print and
online promotional assets to promote the
Can I grow my email database without
relying on purchased lists?
Do I have the right technology partner to
make it happen?
Are certain types of markets more
likely to succeed with digital deals and
can you give us some insight into market
characteristics that are best? Not so good?
There isn’t one magical market profile for
success in daily deals. Having said that,
smaller markets tend to be less competitive
and can be easier for local media to dominate
as opposed to very large markets. Again, that’s
not to say that local media can’t win in larger
markets – just an encouraging thought for
small market players. We’ve seen success with
partners ranging from The Washington Post to
The Statesboro Herald – the best predictor of
success is your level of commitment.
Let’s talk revenue potential – what is there to
gain in this space? What impact does
the deal business have on existing print
and other digital ad revenue?
Q & A with...
An OffiCiAl PubliCAtiOn Of
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Chairman of the Board / SNI Vice-Chairman /
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First Vice Chair / SNI Treasurer
Gareth Charter | Holden Landmark Corporation
Second Vice Chairman
Gloria Fletcher | GateHouse Media
Clifford Richner | Richner Communications, Inc.
Gordon Borrell | Borrell Associates
Immediate Past SNA Chairman/
Current SNI Chairman
John Humenik | Arizona Daily Star
Robert Brown | Swift Communications
Brandon Erlacher | The Elkhart Truth
Terry Kukle | Metroland Media Group Ltd.
Chris Lee | Deseret Digital Media
Jennifer Parker | CrossRoadsNews, Inc.
Suzanne Schlicht | Lawrence Journal-World
Rick Surkamer | Sun-Times Media Group
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Q&a, pg 21
President Second Street Media
Topic: daily deals and local newspapers
Consumers show no sign of
deal fatigue and advertisers
love performance based
advertising models so we
strongly believe that deals are
here to stay although the model
will likely continue to evolve in
the years to come.
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