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How Morris is reversing the biggest disruption: Loss of advertising accounts


blog_header_disruptiveInnovationPosted by Steve Gray

About five years ago, on a weekend, Derek May — then publisher of the St. Augustine (FL) Record — was doing what many publishers were doing at the time: Trying to figure out the steep decline in advertising revenue he was seeing in his unit’s financials.

What was the main cause of the decline? The recession was the driver, of course, but was it mainly hitting certain categories of advertising? Certain types of advertisers? Big advertisers? Small advertisers?

Thanks to his background in accounting systems, he was able to plunge into the Morris Publishing Group’s business data warehouse to sort it out. After a while, he realized none of the standard reports answered a key question: How many businesses were advertising in the most recent period compared to the previous period? So he pulled out the data and built a spreadsheet.

Then it hit him between the eyes: The total number of advertisers was down steeply. And as he compared periods farther and farther back, he found it had been going down for a long time. The loss of accounts was a big deal.

Wondering if this was just a fluke in St. Augustine — hit especially hard by the recession, like all of Florida — he dug into other Morris markets in Georgia, Texas and elsewhere. He found the same pattern in every market.

He was on to something big.

So big that I think it’s accurate to call it the biggest single disruption hitting newspaper companies. Market by market – in the United States, at least – the list of active advertising customers been shrinking for many years. The recession didn’t cause the decline; it only accelerated it. Advertisers have been quietly opting out of pricey newspaper solutions for a long time, substituting other ways of reaching potential customers. Digital alternatives have given them many more choices in recent years.

The bottom line: Our industry’s customer base is shrinking, and we have to figure out how to reverse it.

Five years later, Derek is head of the newspaper company (Morris Publishing Group). And he’s made reversing the loss of accounts a top priority across the company for more than a year. There’s much still to do, but thanks to his passionate commitment, we’re showing encouraging signs of improvement.

I blogged about this initiative last year, here and here, as we developed our plans to mobilize for account growth. Now we have some good results to share, and some learning about what seems to be working. The chart below shows our progress:



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