Google, newspapers to work together

The battle between Google and Yahoo for newspaper alliances and local sales channels just heated up another notch.

Yahoo has developed relationships with 215 newspapers in the United States for its HotJobs recruitment site, with plans to expand into other content and advertising opportunities.

Now PennySaverUSA.com, a division of Harte Hanks Inc. (NYSE: HHS), has disclosed a wide-ranging deal with Google that could potentially launch thousands of sales reps from up to 5,000 ìshopperî publications in the U.S., as local sales agents for Google AdWords and other products. The participating papers ñ more than 400 are involved already ñ will contribute information to Google Maps and Google Base, the companyís classifieds- and general-information database.

Loren G. Dalton, president of PennySaverUSA.com, announced the deal late Thursday at a meeting of the Association of Free Community Papers, a trade group, in New Orleans . The AFCP represents the ìpennysaverî or ìshopperî industry in the U.S., covering a wide range of about 5,000 community-based, highly local publications ranging from mom-and-pop ìThrifty Nickelî products to mass distribution operations like Harte Hanks Pennysavers and Flyers in Florida and southern California that distribute millions of publications every week in direct competition with daily newspapers. Many of the papers include editorial content; others are strictly advertising.

The Google ñ PennySaver relationship, which launched quietly several weeks ago, involves:

- A feed of the 1.3 million classified listings in the PennySaverUSA database to Google Base. All of the ads are then searchable by Google users; traffic is directed to the site of the newspaper where the ad was originally posted.

- A feed of PennySaverUSA ìpower pagesî - highly detailed local ad pages set up by the shoppers for paying merchant advertisers -- that is incorporated into Google Maps. The ìpower pagesî frequently include coupons; those coupons can be displayed directly on the Google Map when a user searches for, say, a Mexican restaurant in Laguna Hills , Calif. While merchants can build their own pages (at no charge) within Google, ìmost local advertisers donít understand that and donít want to have to manage that,î a PennySaverUSA representative told CI. Information on the pages includes details like store hours, brands carried, payment types accepted, and other yellow page-type material. ìThis provides richer data for Google users, especially on a very local level, and gives our merchants much more exposure,î he said.

- A prospective test between Harte Hanks and Google of a ìbid-for-print advertisingî program similar to one that Google has already piloted with 50 daily newspapers. With hundreds or thousands more participating newspapers, Google could become a powerhouse agency providing print-ad sales to large and small advertisers who want bargain space in daily and non-daily publications.

- A pilot project to train sales reps at shoppers to sell AdWords services to local merchants for placement on Google. Again, while advertisers can do that without PennySaverUSA involvement, the AdWords process is too cumbersome and time-consuming for many local merchants.

ìThis could give Google the ëfeet on the streetí it needs to explain its AdWords service to local advertisers, and give the advertisers help reaching their customers through Google,î the PennySaver representative explained.

Google local sales executives attending the meeting noted the company does not want or expect to develop its own sales teams at a local level, and feels using the ìfeet on the streetî of other companies ñ such as the PennySaverUSA affiliates ñ is an excellent, low-cost, low-risk approach to a new sales channel. ìThey have the relationships with the local stores and advertisers; we have the reach and the products,î one said.

PennySaverUSA.com runs a Web site that places classified and display ads from its own newspapers on the Web, and also works with hundreds of other affiliated properties to incorporate their material. It recently launched video classifieds, an SMS feed of ads, and a new search engine powered by Endeca. About 420 publications already participate in the PennySaver Web database; that number is expected to grow to more than 1,000 within a year.

(Both representatives declined to be quoted by name, since they are not authorized as spokesmen for their companies.)

Financial terms were not disclosed.

- Peter M. Zollman in New Orleans