This is really intriguing. And, maybe an additional reason for optimism. See what you think...

In the past two months Belden Associates has visited several individual newspapers or newspaper organizations headquarters and the subject which came up the most and certainly evoked the greatest interest and most heated discussion was CULTURE.

There's a growing understanding of how bad things really are...of how much work needs to be done to fix change resistant organizations...of how QUICKLY things need to happen...and, of the consequences of inaction. Yes, any radical strategic initiative to re-invent the newspaper has risk. However, from our point of view, the FAR GREATER risk is not seeking those radical, innovative and new ways to grow circulation and reach readers and satisfy advertisers.

How many times must we view those steadily declining penetration, circulation and readership numbers and not go completely ballistic and realize something has got to change and change dramatically?

Good work from a host of research organizations has pretty clearly identified the weaknesses - young adult (18-34), African American, Hispanic, female - that should be the focus of very intense strategic planning.

Yet, what many are finally beginning to address are the internal changes that MUST precede the systematic development of products to reach these and other targets of opportunity.

Silos ARE being knocked down.

...Walls are crumbling.

...Cross-functional teams are talking to each other about subjects never dreamed about just a few short years ago.

And, get this, tactics are being developed to support strategies in response to consumer demand.

That's so important it's worth saying again differently, just in case it hasn't sunk in - newspapers are beginning to evolve in to entities seeking to understand what advertisers and readers want, then striving to design products responsive to that need.

Could it really be the old - GIVE 'EM MORE OF WHAT THEY SAY THEY WANT AND LESS OF WHAT YOU THINK THEY NEED marketing axiom is finally going to apply? Gosh, we hope so.

If the strategic initiatives established during a recent '05 Planning session we participated in are any indication, REAL innovation is being considered by at least one organization and we're counting on this being the 'tip of the iceberg'. If you are doing something w- a-y outside the box, we want to hear about it, so please share when and if you can.

As researchers, we occasionally find ourselves squarely in the middle of the scope crosshairs of a high caliber rifle. "Our" findings are less than expectations or the recommendations deviate from what the Publisher client wanted or the Editor's experience 'knows better'. We consider those occupational hazards and have learned to duck and/or to don Kevlar.

But, here's a critical issue we'd be willing to 'take a bullet' for the industry. One which doesn't get talked about very often but is squarely in the path of much of the needed change we're just beginning to see, so take heed...

...REDUCED MARGINS ARE OUR FUTURE!

There, it's been said.

To genuinely set up a shop that focuses on the customer will require very significant capital investment, new skill sets and training to get there, coalitions of niche products, leveraged by the traditional broadsheet (are tabs coming?) daily and a learning organization devoid of the structure, silos and walls that prevent agile, targeted response to the marketplace.

Sidebar to Wall Street: This is a good thing. The newspaper industry has made some interesting circulation tradeoff decisions in the last few years. Maybe even some which we'd like to take back. But, a longer-term focus on the customer conceivably ushers in an era of remarkable shareholder value. There are going to be excellent 'buy' recommendations you don't want to miss. For the smart companies, the reduced margins will be temporary. Once the required investment begins to yield the potential rewards, the growth will be enviable. Taking PROPER care of customers and executing strategies for finding new ones might not be achievable this quarter, but, shareholders are always rewarded when companies do this well and consistently.

Our industry brings one asset no other can compete with IF we are clever enough. PEOPLE. There are simply more humans in newspapers collecting news and information and interacting with the community. Every shred of research suggests local news and information (in a host of varieties and points of view and writing styles) is STILL what consumers want and it is HUMANS that gather that.

As we determine how and when to distribute this news and information in a platform agnostic method, imagine how that will advance advertiser's cause and delight readers. Yes, I said delight. It is possible. The golden age of news "papering" is dawning, so let's make the most of it!!

***** ***** ***** ***** ***** ***** *****

Belden Associates, in conjunction with Classified Intelligence, has just published a fascinating report - Employment Advertising: Pricing and Packaging...and, Just Taking Orders. This is a must read for understanding marketplace challenges as we price, sell, bundle and create new products for Employers and Job Seekers in the print and online world. It's the first of a series - to be followed later this year by automotive, real estate and merchandising - all four can be acquired for $995 or each is $395.

Call me or Amanda Pruiett (214/640-3102) for your copy today.

***** ***** ***** ***** ***** ***** *****