Alcohol Fuels Alt-Weeklies’ Ad Revenues

Sponsoring Pub Crawls and Other Drinking Events Brings In More Dollars

With exhaustive bar and club listings and a drinking-age reader demographic holding expendable entertainment income, alternative weeklies are the perfect alcohol advertising vehicle. At least in theory.

The equation gets muddied when you take into account the size and location of particular markets, not to mention archaic alcohol advertising laws found mostly in the Bible Belt. Then there are those pesky radio marketers to battle for alcohol and beer ad dollars. Overall, though, alt ad directors say, booze ad sales are a ripe category, and developing good relationships with local distributors is one key to plucking the fruit. A little marketing savvy taken right from the radio book doesn’t hurt either.

Alcohol is a major national advertiser

Alcohol ads represent “25 to 30 percent of our national business, so it’s significant to national and it always kind of has been in that range,” says John Morrison, sales director of the Alternative Weekly Network. The national ad firm represents some 100 AWN members and 70 or so other non-competing publications. Morrison notes that national ad sales are a very small part of the overall ad revenue for a majority of alternative weeklies, which rely heavily on local ad sales.

A lot of AWN papers have direct relationships with national liquor advertisers, Morrison says. For example, Anheuser-Busch, whose beers include Budweiser, Bud Light and Michelob, doesn’t go through AWN to book ads in a group of papers. Instead, the company’s regional offices buy ads directly from the alt-weeklies in their area. “So our numbers aren’t really a true indication of what’s going on out there,” Morrison says.

The same is true of numbers from the Ruxton Group, New Times’ national advertising division. National sales don’t account for a lot of beer distributor deals that occur sporadically on the local level, New Times president and COO Michelle Laven says.

“Liquor advertising, we break up into liquor and beer,” she says. “From a national perspective, liquor represents as little as 7 percent of the national mix, and then during fourth quarter—October, November—it can represent as high as 28 percent of the national mix. It just depends. There’s some seasonality that naturally occurs.

“On the beer side, it’s anywhere from 2 percent of the national business to 10 percent, depending on the month.” Summer is the best season for beer sales, she says.

Alt-weeklies offer the right demographics

Although the percentage of alcohol ads varies widely from market to market, there is no denying that alts are a logical placement for alcohol advertisers.

“They’re typically targeting a young audience,” Morrison says. “One thing that’s attractive about alternative weeklies, of course, is that we do have young readers. The flip side of that is that we have very few readers under age 21, so [alcohol advertisers] are not running into any kind of legality issues or issues about marketing to minors by buying in alternative weeklies, as of course they would find with college newspapers or magazines that have a higher percentage of their readers under the legal drinking age.”

With every potential AWN buy, alcohol advertisers are provided L.D.A. information, or legal-drinking-age information. “They want to know what percentage of our readers are over age 21,” Morrison notes. “In that regard, we’re young, but we’re not too young, demographically.”

According to market survey data, says Morrison, 93 to 96 percent of readership at most AWN-member publications is over the legal drinking age. Advertisers seem satisfied by those numbers. But from the papers’ perspective, is there concern about the appearance of appealing to underage readers with beer and booze ads?

“It’s not a concern at all,” offers Bill Towler, co-publisher and ad sales manager at City Newspaper in Rochester, N.Y. “We know that very few of our readers are underage.”

Towler says his paper, with a circulation just under 40,000, relies on alcohol ads for an estimated 1 percent or less of its overall revenue. But that may be changing.

Alcohol advertisers are looking for a younger demographic, but not exclusively, Towler says. “They might want to tie into some type of cosponsorship or co-promotion with what they feel puts their name in a good light in the community.” This is particularly true of wine companies, he says. The paper has joined alcohol advertisers in cosponsoring events whose relation to booze is obvious, like Mardi Gras, and others whose connection is less evident, like film and jazz festivals. The cosponsoring beverage companies “figure the kind of audience they are interested in goes to those kind of events,” he says.

City Newspaper didn’t create those events but acted as print sponsor. Food- and beverage-tasting events with beer and wine participants have also invited the paper on board as a print sponsor. The sponsorships generated some ad revenue for the paper but the ads were for the events, not for a specific brand of alcohol. The involvement of the winery or other alcohol sponsor was indicated subtly with a logo or sponsorship tag, Towler says.

State law puts restraints on spirits peddlers

Don’t try placing that type of ad in Oklahoma, though.

Jeffri-Lynn Dyer, associate publisher and former ad director at AAN-member Oklahoma Gazette in Oklahoma City, says alcohol advertising laws there are “very confusing and restrictive.”

At her paper, with a circulation of over 55,000, alcohol ads account for only about only 2 to 3 percent of retail advertising income. Club and bar ads add on another 10 percent, she says.

According to Oklahoma’s Alcoholic Beverage Law Enforcement Commission, domestic beer that is 3.2 percent alcohol by volume isn’t considered alcohol, but anything other than “low-point” beer is restricted severely in terms of advertising.

“For instance, if your hotels do a New Year’s Eve toast at midnight, you can’t advertise that because that would make the toast part of a package, which makes it look like free value-added,” Dyer says. “Alcohol can’t be given away free—except at a private party that is not advertised.”

So if a bar wanted to promote a toast at midnight, “you have to say stuff like, ‘Toast at midnight: $1 per glass of champagne.’ But if you do a special like that, where it’s $1 champagne or a $2.50 margarita, then you have to run that drink special—even if you’re advertising it as [taking place] at midnight or during a happy hour —from Sunday when you open to Saturday when you close, every hour that you are open.” The rules are so complicated and crazy, she says, that the paper just doesn’t run that type of ad.

When it comes to attracting national advertising dollars for hard alcohol, Oklahoma’s Bible Belt reputation hurts more than the restrictive laws, Dyer says. She mockingly imitates the perception of someone from another part of the country: “‘Goodness, people don’t drink in Oklahoma. They just drink Coors and Bud.’ I think that hurts us more.

“The national advertising really affects us, too, because being the 48th market [by state], by the time Smirnoff and Cuervo and all of them get down the list, we’re out of the picture,” Dyer continues. “We are a member of AWN, but we don’t get any liquor advertising through them. We do get some ads through local distributors of hard alcohol and import beers, but it’s strictly summer only.” Distributors run ads then to attract the attention of all the club owners who read the paper, she says.

AWN’s Morrison says distributors’ efforts to attract bar owners by advertising in alt-weeklies holds true across markets.

“We’re actually good for the [alcoholic beverage] trade, as well,” he notes. “The club owners and bar owners and so forth who are making decisions about buying alcohol, they are very familiar with our product. They see the value that our papers have to readers in the market, how important they are in terms of providing entertainment information to readers in the market. They understand the whole concept of alternative weeklies and how they can be so important in terms of marketing a brand.”

Ad reps borrow marketing tactics from radio

As a matter of fact, former radio ad man Rod Harsell, now sales manager at AAN-member Missoula Independent, has put a new spin on his background. His alt in Missoula, Mont., has a circulation of 26,000 and comes in at 167 in the size ranking of designated market areas. (“Designated market area” refers to the area surrounding a city in which that city’s broadcasting stations draw the dominant share of the audience.)

“We’re considered a white spot in the road, so we very rarely get any national buys,”he says. “That’s including alcohol buys. So in order for us to attract alcohol dollars, we have to do event marketing.”

The Independent’s latest “stunt” marketing ploy was a successful pub crawl in February tied to Fat Tuesday.

Says Harsell: “What I did was I went to six bars and said, ‘Hey, we’re going to have buses. And we’re going to come to your bar every 15 minutes. We’re going to give away a trip for two to New Orleans.’ And then I also went to Bacardi and Southern Comfort and told them that I would feature their drinks. We also had a beer sponsor, Fat Tire beer, which is [produced by] New Belgium Brewing out of Colorado.”

The event worked out so well, says Harsell, his paper is sponsoring another pub crawl for Cinco de Mayo.

Event marketing is the only way to bring in any regional or national dollars, he’s found. Those dollars represent around 1 to 2 percent of the paper’s advertising revenues. Harsell is trying to get that share up to 5 to 8 percent “if I can get on the radar of regional and national alcohol companies,” he says.

In April, the Independent will be part of a 31-week band-biography campaign with Pabst Blue Ribbon beer.

“My deal with Pabst Blue Ribbon was that I would go out and find the 31 bands, get their pictures, their bios, and support the campaign in the paper,” Harsell explains. “They are doing that in 20 to 30 different markets across the country.” He says his willingness to go out and get the bands involved is how he got the buy.

Out in market 167, grabbing national alcohol dollars is possible only if you put out extra effort.

“We have different issues in smaller markets, and the money just doesn’t flow our way unless we’re creative,” Harsell says. “I take plenty of pictures, and I make sure that sponsors see pictures of the events themselves. That really lets them know their signs are up. I get shots of people drinking their products. That’s going to ensure that next year my rates go up, and that even though the decision maker is out of state who sent me the funding, they have proof to take to the people who make decisions over them that spending money in Missoula, Montana, is a worthy cause.”

Harsell’s ability to pull packages together has earned him the praise of a regional alcohol company rep, who told him he does better planning and strategy than she gets from her national organization.

“It’s my radio background where I learned all of this, too,” Harsell admits, “because I did come from the world of radio. That has helped me.”

Such marketing tactics can help any paper that chooses to put them to work, and more of it is called for, Stephanie Hansen believes. The sales director at the 118,000-circulation AAN-member City Pages in Minneapolis, Minn., says alcohol ads made up just 2 percent of total sales for the first quarter of this year. Of that, 24 percent was local and 76 percent was national.

She says alcohol advertisers, like anyone else running radio spots, have to buy multiple ads to reach an audience roughly equivalent to that of one print ad in a weekly.

“Conversely,” Hansen notes, “I would say that radio does a really good job of working on promotions for the brands and that print needs to be a little bit more proactive there. For example, doing high-ticket giveaways, like working with Corona and doing a Cinco de Mayo promotion and hitting six clubs and giving away a trip to Mexico. Those are the types of opportunities that radio really is giving advertisers, and they are going into each club and ringing all the bells and whistles.

“A lot of the print publications, and certainly the alternatives, are not as staffed promotionally as radio is. So I think we really need to look at that moving into the future as promotions become more and more a part of everyone’s buy. Are we staffed to do that? And are we offering up exciting promotional opportunities that can be executed in a two-dimensional format?”

A little farther west, in suds-soaked Portland, Ore., AAN-member Willamette Week is print co-sponsor of four—count ’em, four—beer festivals annually. With 7.8 percent of total display sales in 2003 coming from spirits, beer and wine, there’s still room for improvement, according to David K. Dronkowski, national sales manager for the 90,000 circulation paper.

Dronkowski says that cosponsoring beer festivals is helpful, even though the paper might lose money on the event, because it creates an association between the paper and the concept of selling alcohol. “By doing more cosponsorships and events with alcohol-related type things, it makes the trade think that we are definitely the place they want to be.”

Another key, says Dronkowski, is cultivating relationships with local and regional distributors. They’re the ones who are out in the field every day, who know where alcohol really sells and which types of promotions work and which don’t, and they share their observations with Dronkowski.

What they are telling him, in part, is that they believe alt-weeklies are the best vehicle to reach their target audience. But even in Portland, which is number 23 nationally in designated market area rankings, there is no guarantee of getting national ad dollars from an alcohol advertiser.

“Where my battle comes in—and I have a really good example of this from recently with Anheuser-Busch—is that they [national media buyers] believe the only way to reach those 21- to 35-year-olds is to do broadcast or to do Internet or things along that line—or like television, really buying into sports programming.”

For example, he says, Anheuser-Busch spends about $1 million on local marketing in the Portland area annually. Of that amount, a dealer co-op of regional distributors pitches in about 40 percent, or $400,000. Almost all of that money, though, is dedicated to non-print media.

“They [Anheuser] came in and did their annual plans. They meet with all the local television stations and radio stations. And they invited us to it, and we showed them a plan that was about $60,000. Maybe it was a little more. Maybe $70,000,” explains Dronkowski. “They came back to us—and this is out of a $1 million ad budget in Portland—and they were going to spend about $8,000. That’s what they were going to allocate to print, out of that entire budget. Something’s wrong here.”

But the local distributors know how effective alt advertising is for them, and decided to put up additional money of their own toward a print campaign in Portland.

“Our efforts are really in addition to what Anheuser-Busch is doing,” says Dan Lamb of Maletis Beverage Company. He declined to name a dollar amount. “In a typical fashion, in a market like ours where there are multiple wholesalers, we pool our money.”

Lamb says a corporate media buyer out of Los Angeles handles broadcast buys, but he and other regional distributors are more comfortable dealing with local print advertising. “We just thought we could do a better job of addressing the local market, rather than have someone do it who is so far away.”

Such a move is heartening, Dronkowski says.

“I’m liking the trend,” he says. “It’s very, very positive. To an extent, it’s just about having all of those clubs advertising and being in tune with the right demographic. But I think it’s also the fragmentation that’s happening in broadcast.”

The ability to download music from the Internet means fewer people listen to regular broadcast radio; cable TV has stolen viewers from the networks; and young people watch less TV overall because they’re on the Internet or engaged in other activities. Dronkowski thinks advertisers are going back to what he calls “strong-reach” media targets “instead of trying to play the electronic game, which has become so fragmented no one knows really where you need to be. And I think that’s one great asset of the alternatives, that we’re still broad-enough based, and we’re still a strong-enough-reach medium to the target that we work well.”

John Ferri is a freelance writer based in Tacoma, Wash.