Which comes first, the clout or the ads? Birmingham Weekly faced this conundrum five years ago. The young weekly paper needed to pay the bills, but advertisers — many of them local restaurants with tight budgets — were wary of buying ads in some upstart paper and were already sending their ad dollars to Birmingham’s more established publications instead.
When he talked to local restauranteurs, publisher Chuck Leishman says he always got the same response: we’ll advertise if you’ll trade. The restaurants weren’t willing to plunk down cash for ads, but if they could advertise in exchange for meals, Leishman had himself a deal.
He ended up with a bunch of gift certificates kicking around the office. Pasta has many virtues, but it can’t edit copy. Leishman needed to turn those meal credits into cash flow.
A few years and a few failed experiments later, he now has a nifty way to do just that. He sells restaurant meals in the form of the Weekly Card, a sort of credit card for local businesses. But where credit cards users pay interest above and beyond the cost of goods, Weekly Card members score a discount. A mighty fine 40 percent discount.
Members pay a fee of $24.95 when they sign up for a card. It can then be used like a credit card at twenty-eight local businesses, most of them restaurants and cafes. Every purchase is 40 percent off the retail price, and users can keep adding credit to the cards as they wish.
“It’s free money,” wrote one ecstatic commenter on the Weekly Card website. “It’s like having happy hour all the time.”
As he’s developed the Weekly Card, Leishman has also created a new publishing model, one that integrates print and online, engages the local community and — crucially — makes a buck. Now he’s eager to share that model and has started a company, WeeklyCard.com, to provide Weekly Card services to other newspapers.
How did you come up with the concept?
Well, necessity is the mother of invention. Birmingham Weekly five years ago didn’t have very many restaurant ads…We were trying to figure out ways that we could get more business in to the paper. Restaurants like to advertise but generally can’t afford ads. Over the years I’ve been asked a million times: I’ll advertise if you’ll trade. And so I started thinking: “How can we take advantage of that?” So we talked to various gift card companies and we came up with a solution that would allow people to get on our website and register for a card then make purchases on the website as well. We finally came up with the Weekly Card concept after a couple aborted attempts at other things.
When did you debut the cards?
This is program number two we’re on now. We’ve been trading ad space for credit at restaurants for about four years. The current program started in December of 2005.
How many people have purchased cards so far?
We have about 1600 Weekly Card members.
Do you know if this been done at other papers?
Some papers have trade programs where they get gift cards or coupons from restaurants or businesses and then resell them. [Examples include the Boston Phoenix and Creative Loafing.] But nobody is doing this idea where you can purchase and then go use a card like cash at a business. And that’s the real key to this; it’s actually the key to keeping the restaurants happy. At the point of sale they don’t want to have a hassle. The card makes it easy because they give it to the server like a credit card.
What’s the incentive for businesses?
I think right now we probably have about thirty restaurants and a couple of retailers involved on the merchant side of things, and I’ve had very few drop out. Essentially it allows merchants to advertise at their cost of goods because instead of paying us cash for ads they pay us whatever the cost of goods at the restaurant is. It’s a great thing for the business.
So there is a one-time charge of $24.95, and then cardholders can add credit? And is there an additional mark-up each time they add credit?
Anytime they want they can get on the website and buy more. Just $24.95 and then you can buy at 40 percent off forever.
Any other perks for card members?
At times I’ll get concert tickets. I’ll trade a concert company for color or something in an ad and [get tickets], then we value-add those tickets to purchases. We say, hey if you buy $100 worth of credit for $75 then we’ll give you a pair of Sheryl Crow tickets. So it’s a little incentive for our Weekly Card people.
Does the credit on the cards expire at some point?
It does, it’s like a gift card. If you haven’t used it in eleven months then we just take you off the list. [If members accidentally let their cards expire] we’ll just re-establish them.
Almost all of the participating businesses now are restaurants. Are you hoping to expand to include other types of businesses to the program?
I think [focusing on] local business is probably the best thing. Like we have a florist who is local, we have a Mountain High Outfitters. They are locally owned so we’re able to work with them directly.
Do you have separate salespeople that focus strictly on the Weekly Card, or do all of your ad salespeople sell the card as well?
Our situation is unique in that we have sales people that wear multiple hats. Everyone is on salary, so commissions rarely come into play. I would suggest that papers have a dedicated person (or two depending on the size of the market) that handles sales and customer service.
When reps are calling on a restaurant or other local business, do they try to sell an ad first, and if that doesn’t work, move on to selling the Card? How does that work?
At first, we would talk cash as a lead-in and then move to acquiring credit for space. As our card membership base grew we reached a critical mass where we could sell just about all our credit. Now we prefer to offer our Weekly Card program to 95 percent of restaurants. If we can sell the credit to our card members, it is much better than invoicing a restaurant for the money.
By using the Weekly Card program you’ve added a critical mass of restaurant advertising in the paper? Do you have any idea whether that has helped your traditional ad sales to restaurants?
Most definitely. We have more restaurant ads than any other publication in the market including the daily. We are fairly well known as the restaurant rag in our market.
Explain the services provided by your new company, WeeklyCard.com.
The program we’re going to start to roll out to other newspapers in other markets is actually an improved model from the one we’re using here in Birmingham. It’ll give other newspapers an opportunity to participate in a trade program without having to go through all of the trials and tribulations we went through to form it. We would take care of all of the website functions [and] provide them with all the back-end technology. We’re all looking for new revenue streams… We have to be able to give people a reason to come to our site and a reason to keep picking up the paper.
What are the advantages of a Weekly Card program?
I think all weekly newspapers are finding that traditional forms of revenue are going away. Personals are almost completely gone, and classifieds have been really hit hard by Craigslist. So a lot of papers…are trying to find other ways to create revenue. Concurrently everyone’s developing their websites and trying to figure out how to make money on the websites. The Weekly Card program convinced me that this is part of the future of what we have to do as newspapers. We have the dynamic which is the paper and the website, and if we put those two together we have something that no one else has…This is a way to combine the web and the newspaper to get long-term advertising out of it…I could see in the future us having a thick paper that has all trade ads in it and having the commerce just happen on the web, which also brings people to the website.
Weekly Card website
Emma Pollin is a freelance writer based in Oakland, California.
Is your paper undertaking any innovative business initiatives you’d like AAN News to profile? Email Jon Whiten at jwhiten (at) aan.org with details.