NEWSPAPERS: NATIONAL NETWORK LOOKING MORE COMPUTER FRIENDLY: GROUPS SHOOTS FOR $70 MILLION IN '97 AD PLACEMENTS

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Newspaper National Network turns 3 this year with clearance to handle a new ad category-computers and software-for national advertisers increasingly buying space in local newspapers.

NNN was launched as a limited partnership in 1994 to marry national advertisers with newspapers in "one order, one bill" buys, each negotiated for the advertiser by NNN at a flat cost per thousand.

In addition to the computer category, the for-profit subsidiary of Newspaper Association of America reps automotive, beverages, cosmetics and toiletries, drugs and remedies, food and household products.

REQUIRES JUSTICE OK

Because the industry program could have restraint-of-trade implications, the U.S. Department of Justice approves the target ad categories.

The goal of NNN is to increase national advertisers' presence in local markets and smaller-circulation newspapers. The service seeks to facilitate buys that promise great coverage-but risk causing logistical nightmares-and encourage advertisers to allocate more money to print.

NNN placed about $30 million in advertising during 1995, doubled that to $60 million in 1996, and expects to place about $70 million in ads this year. Half of NNN's ad placements goes into newspapers with circulations of less than 50,000.

"Usually, factory automotive runs as ROP advertising, which means higher rates at the newspapers," says Kevin LaValla, managing director at investment banker Veronis, Suhler & Associates.

TROUBLE WITH MAZDA

That said, last year NNN ran into trouble with one buy for Mazda Motor of America, which saw its agency Foote, Cone & Belding approached by at least two rep networks angling to cut cheaper CPM deals for major-market newspapers. The deal eventually came apart.

However, NNN plans to push on that business again this year.

"We are starting discussions with them again," says Jack Grandcolas, West Coast sales director who handles auto and computer advertising for NNN.

While NNN isn't the only game in town for "one order, one bill" newsprint deals, it is the only company capable of handling a flat national CPM buy as a result of receiving approval from the Justice Department to make the negotiations in seven categories.

"It's not a new idea. . .the states collectively are probably pushing $200 million a year into the local markets," says Susan Kelly, director of advertising at Mid-Atlantic Newspaper Services, a sales rep service owned by Pennsylvania Newspaper Publishers' Association.

State newspaper associations have handled national advertising in local markets for years-for clients and markets based out of state, as well-but differ from NNN in that they sell strictly according to newspapers' rate cards.

NOT REALLY COMPETITION

Still, Ms. Kelly doesn't consider operations like NNN as competitive businesses.

"I see them as complimentary. The more of us there are out there, the better off we [the newspaper industry] are," says Ms. Kelly.

Mid-Atlantic last year handled $20 million in local ad buying, with one-fourth of that going into schedules with out-of-state media.

The out-of-state media buys are on behalf of advertisers already doing business with Mid-Atlantic, but who want to make local buys in other parts of the country. Mid-Atlantic projects it will handle $32 million in media buying this year and has placed $9 million in advertising through March.

Among the company's out-of-state projects are a Washington agency making regional buys for a client targeting residents in regions of Missouri and buys for Texas-based J.C. Penney Co. in California titles, according to Ms. Kelly.

WEEKLIES SPEAK UP

Other organizations such as Community Newspaper Co. and American Newspaper Representatives are encouraging national marketers to advertise in weekly publications.

While the bulk of NNN's buys are in dailies, the rep is seeing interest in weeklies.

NNN and the other "one-order, one-bill" networks are optimistic about 1997. Mr. Grandcolas says his West Coast office has encouraged several national advertisers to consider working in newsprint again.

He says E.&J. Gallo Winery, which has not bought heavily in newspapers for eight years, spent $1.5 million during the fourth quarter of 1996 and first quarter of 1997.

In computers, Mr. Grandcolas convinced Goldberg Moser O'Neill, San Francisco, to try a 10-market newspaper test during April for Dell Computer Corp., which reportedly is boosting its 1997 media budget 50% to $60 million.

CONNECTING WEB SITES

NNN also is planning to offer advertisers a way to extend their one-bill buys onto newspaper-affiliated Web sites, an effort Mr. Grandcolas says NNN is discussing with New Century Network, a consortium of major newspaper publishing companies including Times Mirror Corp., The New York Times Co. and Tribune Co.

The group is collaborating to cross-pollinate their online products through plans to aggregate multiple local brands online.

Real Media has worked with NNN-organized online buys on an informal basis. President David Morgan sees the Web helping facilitate national advertisers in

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