Hed TK

Hed TK

By Peter M. Zollman

Traditional classified advertising publishers are under siege. Yet ad revenue growth, especially in employment advertising, is masking the major problems they face from shifting audience habits and new advertising models:

Yellow-page publishers in two countries have purchased classified advertising publishers, and are beginning to merge the service and retail businesses represented in those books with searchable classified listings in an online environment. Watch for more of the same.

Broadcasters are dabbling in classifieds, especially in the United States. Expect a big push next year, when they donít have the Olympics and elections pumping up traditional on-air ad sales.

The EBay juggernaut continues ñ threatening major players like Loot in the U.K., Trader Publishing in the U.S., and Trader Classified Media throughout its global markets. Earlier this year EBay bought Mobile.de, a leading European auto site. And, of course, it just invested $10 million to $12 million in Craigslist, the ìcommunityî Web site that has built a highly profitable business by giving away most of its ads for free.

Online social and professional networks are building interconnected webs of users who can promote goods, services, jobs, whatever, through new tools to new audiences, bypassing ìthe old way.î

Auto dealers, employers and real estate agencies are expanding their direct-to-consumer Web services, hoping to eliminate the middleman ñ you, the publisher.

And then thereís local search, embodied by Google, Overture and new online (and telephone) services that can make it easier, faster and cheaper to buy or sell a car, home or ìstuff,î or to find a new job or employee.
But publishers still donít respond aggressively.
In recent surveys of newspaper employment and real estate sales efforts, we found a morass ñ ranging from ìsalesî reps who told us to ìgo look in the paperî when we asked for ideas on writing an effective ad, to classified ad-takers who ñ honest to Pete, we arenít making this up! ñ told us they couldnít give us prices for an employment ad. (One said she wasnít comfortable quoting rates.)
At a speaking engagement recently for a large group of European publishing execs, I was asked to review what newspapers have to do if they want to survive in classified advertising.
Here (for a much lower fee!), is my ìTop Five.î

1 --- Make sure your print ads and content complement your Web site, and vice versa. Make sure your online products are market-leading, rather than trailing. They should ñ no, must ñ offer extensive photo tools and other multiple-media options; accurate and easy search capabilities; local editorial content and flavor (which most dot-coms canít provide), and an easy-to-use product thatís better than your competitorsí (local and national).

2 --- Sell well. ìPricing and packagingî is an art that, done right, can increase revenue, enhance market share and give the advertiser a ìone-stop shopî for selling his product or finding the right employee. Itís essential, too, that your sales reps understand what theyíre selling, and present it correctly. The Internet has overtaken local newspapers as the No. 1 source for home-buyers in the United States, yet most of the newspapers we recently surveyed with Belden Associates were downright awful when it came to explaining their Web real estate products and services or ìcomboî products.

3 --- Sell print and online classifieds online. Iíve harped on this subject so much my fingers hurt, but most newspapers still have a weak (or non-existent) online tool for selling classifieds. It increases revenue, improves customer service and cuts costs. Stop thinking about it ñ just do it!

4 --- Promote like crazy. If you advertise your services only in your paper, youíre preaching to the choir. Spend real money ñ just like your advertisers do. Direct mail works well (especially in conjunction with a lead-generation service identifying active advertisers). Targeted phone calls work, too, where theyíre legal and ethical. Outdoor is effective, as are radio and television. If you donít want to spend cash, use barter. But just waiting for advertisers to call, or sitting back expecting the audience to use your newspaper and Web sites to find a new car / job / home, just doesnít cut it any more. Theyíre going elsewhere. You need to find ëem, prove to them youíre the best in your market, and keep ëem coming back.

5 --- To all those CEOs and corporate boards out there, keep investing! This is not the time for ìtaking the profitsî and returning them to shareholders. Even if you have the greatest online products; the best-trained staff of any newspaper or dot-com anywhere; a well-designed online sales tool thatís growing in use and generating boatloads of revenue, and the most effective promotion of all classified advertising media in your market, nowís not the time to give up. The audience is still finding its way in this new world; the advertisers are still trying new approaches to see if they can shift dollars for better results, and the technologies are evolving. So if you think ìweíve got this all figured out,î youíd better think again.