18 April 2007

Advice for the ADN

Here's a study I wish someone at the ADN - and every other cost-cutting, reporter-firing, we-only-print-fluff newspaper in the country - would read:

Even as newspapers around the country send reporters packing at the behest of the papers’ investors, a new study finds that the fastest way to profits may be spending more, not less, on the newsroom. Two marketing professors crunched four years’ worth of economic data from 1,400 daily papers in the United States, and they came up with a formula to determine the most profitable mix of spending—whether in the newsroom, to improve news quality; in the circulation department, to hook more readers; or in the ad sales department. They found that investing in the newsroom has the biggest impact on a paper’s bottom line: Improving news quality not only increases circulation; it’s actually as effective in luring advertisers as putting money into ad sales teams. (The authors also found that having more ads in a paper increases circulation as well, because Americans love to flick through them.) The researchers then ran the newspapers in their sample through their formula and found that most papers (60 percent of papers with small staffs and 80 percent with large staffs) are near the right spending balance; however, many (22 percent of small papers and 15 percent of bigger ones) could raise profits by putting more money into the newsroom. On the other hand, cutting newsroom spending, because it exerts a negative influence on other forms of revenue, inevitably forces further cuts and sends a newspaper into a “suicide spiral.”

“Uphill or Downhill? Locating Your Firm on a Profit Function,” Murali K. Mantrala et al., Journal of Marketing

On the other hand, if I didn't have the ADN to critique I'd hardly have anything to write about. The foibles of lawmakers are only interesting for so long.

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