Some Newspapers Booking Local Ads Online Thanks to Yahoo

Consortium Has Sold Nearly $50 Million So Far

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NEW YORK ( -- There's no Manhattan Project out there, micropayments and e-readers included, that can win newspapers their old glory back. But there are fronts where newspapers are holding their ground or even advancing a bit, like the push to wring more money out of print readers. Now newspapers are reporting success with another intriguing industry effort: chasing local advertising with technology and ad inventory from Yahoo. The Yahoo newspaper consortium has sold nearly $50 million in Yahoo inventory so far, according to estimates.

Sales are running several million dollars a week. About 150 or so papers have started using a new platform meant to simplify ad targeting and selling that Yahoo delivered last fall. Another 350 or so are up next.

30% sales increase
The new platform was largely responsible for a 30% increase in online-only ad sales across Scripps newspapers in the first quarter, according to Scripps. The 30% increase, worth about $800,000, came during a recession so harsh, remember, that it's reversed the growth of digital-ad revenue at newspapers and beyond.

Opportunities for the marketing and media industries in an otherwise bleak year

"All of the verticals -- auto, real estate, help wanted even -- are down," the company said during its quarterly conference call with analysts. "But our ability to sell behavioral targeting has really caught on with our advertisers and particularly with our sales forces."

Cox Newspapers' Atlanta Journal Constitution has sold targeted online ads for five years, but it didn't have enough inventory to carve up. The audience slices it offered were often too small even for local advertisers. Joining the Yahoo partnership tripled its inventory to cover 70% of the Atlanta area -- enough to let the paper successfully chase fast-food-franchise and telecom accounts previously devoted to broadcast and outdoor, according to the paper.

"We've been very effective at pulling money away from broadcast and converting that into digital revenue," said Charlie Chance, director of digital and recruitment platforms at the AJC. The paper can also get higher rates for targeted ads than for regular online inventory, Mr. Chance said.

Getting traction
Hearst Newspapers is getting traction with the system and extra inventory from Seattle, where has outlasted the Post-Intelligencer in print, to Houston, where the Chronicle just started using the Yahoo platform on May 1. The papers have been able to win some spending from marketers' radio and TV budgets, charging 15% premiums or more for the behavioral ads they sell, according to the company.

"Yahoo right now is our largest strategic partner," said Stephen Weis, VP-digital at Hearst Newspapers and VP-general manager at the Houston Chronicle. "We've got the largest sales force on the street in most markets. They've got an incredible scale audience. Yes, we have partnerships with other folks, but they are our largest strategic partner on the sales side right now, and I don't see that changing anytime soon."

Yahoo said the partnership might help newspapers in their recent desire to charge for circulation online -- a goal that faces significant hurdles.

"The rationale for not doing that was that you don't want to take away half your page views that you can monetize through advertising," said Lem Lloyd, VP of the Yahoo Newspaper Consortium. "If, in your market, I can give you access to 500 million or a billion page impressions that are actually targeted to certain audience segments, and your site goes from 100 million to 50 million, why should you care from a revenue standpoint?"

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