Some Alt-Weeklies See Improvement in Second Quarter

Executives Note Strength of Classified, Automotive and Home-Related Advertising

Advertising sales at alt-weeklies varied from region to region during the first half of 2004, in large part following the path of the spotty economic recovery. Happily, the second quarter of the year was an improvement over the first, both for national sales overall and for local sales at selected alt-weeklies.

Local Markets

Classified sales were the strong suit in a majority of the local markets surveyed for this story, doing well during both quarters. While many local retail advertisers held onto their money first quarter, they loosened their purse strings and spent in earnest the second three months of the year. And several publishers noted another promising sign: Advertisers who have become dissatisfied with declining daily newspaper circulation and results are opening their doors to alt-weekly sales reps.

C-Ville Weekly, Charlottesville, Va.

At the 21,000-circulation C-Ville Weekly in Charlottesville, Va., retail growth first quarter was up 20 percent over the first quarter of 2003, says publisher Rob Jiranek. But compared to the fourth quarter of 2003, the paper’s biggest sales quarter ever, retail was down 2.5 percent for the first quarter of 2004, he says. For the second quarter, retail at C-Ville was up 15 percent compared to the same quarter last year.

Classified sales in the first quarter of 2004 were up 20 percent compared to the two preceding quarters, with the most growth coming from strong real estate and home services categories. The latter includes landscaping, contracting, home repair/maintenance and cleaning. During the second quarter of 2004, classifieds increased 20 percent compared to the second quarter of 2003.

Says Jiranek: “The charge is being led by real estate, auto and employment. This is due to a sustained, more aggressive sales pursuit focusing on the cost-benefit advantage that a strong alternative weekly offers compared to the daily.”

Boston’s Weekly Dig, Boston, Mass.

Publisher Jeff Lawrence of Boston’s Weekly Dig notes that because his paper is relatively young, getting ready to celebrate five years in September, its percentage growth seems dramatic. For example, retail for first quarter was up 40 percent over the first quarter of 2003, and from first to second quarter 2004 it jumped another 33 percent. Those numbers were driven mainly by sales in alcohol, film and restaurants. And in the second quarter, says Lawrence, “We’re seeing a lot more business from the retailers, like Best Buy and Virgin [Records].”

Meanwhile, classified sales at the 30,000-circulation Dig were up 50 percent the first half of 2004 compared to that same period the previous year.

Notwithstanding the strength of those numbers, Lawrence still saw reluctance among advertisers. “Coming out of last year, the first quarter a lot of buyers were still a little hesitant as to what direction they wanted go in. Last year was pretty brutal, and a lot of people kept their money close to them the first quarter (OF 2004), intending all along to start spending it second quarter.”

Illinois Times, Springfield, Ill.

At the 30,000-circulation Illinois Times in Springfield, Ill., publisher Sharon Whalen notes that the paper has made a dramatic turnaround since she and her current staff took over in 2002. The Times grew its retail 50 percent from 2002 to 2003, and the end of the first quarter this year saw a similar trend, up 44 percent compared to first quarter last year. Gains came largely from automotive and auto-service related advertising, Whalen says. “Plus, we’re doing a lot better with home-related stuff — furniture, hardware, garden.”

Whalen says strong categories first quarter also included health — encompassing hospitals, counseling, emergency room, and maternity care; electronics – mostly cell phones but also some home theater; and entertainment, including hotels, concerts, restaurants and casinos.

The upward trend continued second quarter. In overall sales, “we finished April 32 percent ahead of 2003, May 10 percent ahead, and June 61 percent ahead,” Whalen says. Display was up an amazing 60 to 80 percent during many weeks, she added, while classified generally ran 25 to 30 percent ahead of last year.

“You have to factor in that we were still crawling out of huge hole from prior ownership at this time last year,” she says, “so we aren’t a ‘normal’ paper in that sense. But year-to-date, as of the end of June, we are a full 36 percent over last year, and that’s after we dropped the personals and now have no revenue from that at all. We had nowhere to go but up!”

Retail categories that performed well second quarter included education (college classes and programs) and nonprofit, a category the paper has focused on expanding, Whalen says. In classified, the “Mind, body & spirit” section was responsible for nearly all the growth, followed by home services and antiques.

Folio Weekly, Jacksonville, Fla.

Folio Weekly in Jacksonville, Fla., had greater sales in the first quarter of 2004 than the same period of 2003, according to publisher Sam Taylor.

“We’re continuing to grow ad count and ad volume,” he says. “This is a relatively fast-growing market, so we grow at about 10 percent per year. We don’t have much of a classified presence, but it too is up.”

He says movies are a strong retail category for the 47,000-circulation paper, as are condos and festivals.

“In the past the condos would traditionally run in classified, but they [real estate advertisers] have a lot of color photographs and high-end creatives, so they like to run those in the retail part of the paper. And we have more festivals than we’ve ever had, so we’re seeing a fairly significant growth in festival advertising.”

Adds Taylor: “Our principal competitor continues to lose circulation, and consequently. as the daily loses circulation, the level of satisfaction with ad response among their ad base goes down. It makes it a little easier to get appointments to see daily newspaper advertisers.”

Morale is up, too, notes Taylor, among both advertisers and the newsweekly’s staff. With the 2005 NFL Super Bowl on the way to Jacksonville – and its attendant crowds of fans, media, and logistical support workers — advertisers are in a party mood, willing to take a chance on buying ad space.

“If this were a bigger metro area, it wouldn’t be such a big deal,” Taylor says. “We’re the 50th largest market. And to hold one of the great sporting events of the year in a town this small is a big deal.”

Taylor says similar growth continued second quarter. “We’re doing well with Alternative Weekly Network national buys, in part because we never had a lot. So when you add AWN to Folio Weekly’s ad mix, it’s a pretty big balloon up. We’re getting a nice schedule out of Comcast and others.” AWN acts as a national ad representative for more than 150 publications, mostly alt-weeklies

“Our morale is the best we’ve ever seen,” continues Taylor. “These young people that work for us are stronger, faster, brighter and better trained than any group of new hires we’ve ever had. Speaking as an owner-operator, my morale has never been better because every reason we got into being alternative has been validated: Serve readers first; quality is absolutely essential. There’s not much room for anything in the world that’s second-rate. Around here we say, ‘If you’re good at what you do, you’re gone.’ Because everybody else is good. You’ve got to be exceptional at what you do, and that means telling the stories of villains, victims, and heroes well.” In addition to providing strong editorial content, he says, alt-weeklies need to “make sure your ads are well laid out and well placed. That is good service to readers, too.”

Isthmus, Madison, Wis.

Classifieds saved the first quarter from being a total flop at 61,000-circulation Isthmus, in Madison, Wis., where urban rebirth is driving a hot real estate market.

“Real estate is really hopping,” says the paper’s administrative director, Kathy Bailey. “Now, we did revamp our real estate pages, and they’re much stronger than they have been. Plus, we have a lot of growth in downtown and a lot of the urban areas with condos going up. So it’s more than just our rentals. Real estate is popping pretty big here.”

Help wanted ads are up slightly, and the automotive classified ad section is growing, she says.

On the other hand, Bailey says, her paper’s display advertising took a dive. A big part of that was the lack of national advertising, as in none.

“There was no national business in Madison for the first quarter. That was really big for us. That really impacted us,” Bailey says. “Because we’re a top-100 buy instead of a top-50 buy, we didn’t get any liquor or tobacco.”

Isthmus books its national ads through AWN. Bailey notes that when advertisers buying national placements are cutting back, they tend to stick to the top 50 markets.

The one shining star in retail the first quarter, according to Bailey, was special sections, notably Isthmus’s dining magazine, and Abode, its home tabloid.

“We were going gangbusters until [first] quarter,” and that quarter was “really sobering for us,” she says. “We were on par to having a record year [for the fiscal year of July 2003 through June 2004], and then our national tank went dry and display went flat to less than flat.”

Second quarter offered some relief. Insert sales were up over 80 percent compared to the second quarter of 2003; classified line sales were up more than 11 percent; and supplement sales, such as Isthmus’s Best of issue and its Annual Manual, a resource directory to local organizations and institutions, were up by 20 percent. Both the volume of color used in ads and the amount of ad building and design done by the paper’s production staff were almost 20 percent higher than they were the same quarter last year.

“Looking at the six months now, we rebounded a little bit the last quarter,” Bailey says. “Overall, we’re up both for the quarter and for the six months.”

New Times Media Papers

During the first three months of 2004, retail was flat overall for the 11-paper New Times chain, but retail did OK during the second quarter, says Michele Laven, president of Ruxton Media/New Times National Sales. On the positive side, the chain’s Dallas, East Bay (California), St. Louis and Houston publications all saw increases in the first quarter.

“We had some nice industry growth in those markets. We saw actually significant auto growth in several markets,” she says, echoing the observation of her counterparts involved in national sales. The papers also saw a surge in medical advertising.

In the entertainment category, “clubs maintained strong in several markets,” Laven says. The event business mostly stood still with a little bit of growth in some areas, such as festivals. “Movies saw significant growth,” she says, “but I think it was one movie, The Passion of the Christ.” The distributor “advertised in the alternative press for multiple weeks, which we usually don’t see — that type of frequency and that type of size out of any one movie.”

Laven says music label business stayed flat, which she’s actually happy with.

“We really had to work hard to maintain that business,” she says. “You have an industry that’s showing a decline of 30 percent, and you have all of this consolidation. In this case flat is good. How terrible is that to say? But it’s true.”

Employment and real estate classifieds had some nice growth first quarter on a chain-wide average, particularly real estate, which was up 12 percent, she says. And all cities saw growth with placements on their Back Page, the special classified section offered on the back cover of every issue.

Classified continued to grow at New Times papers during the second quarter, with increased strength in employment. Second quarter showed an improvement not just over first quarter but over the same period last year.

Laven reports that overall at AAN papers during second quarter, retail is doing OK. “When you have 11 markets, some are going to do well and some are going to do fair.”

National Sales

On the national sales front, a decidedly anemic first quarter gave way to a brighter second. The caveat, national sales directors say. is that although advertisers are finally spending, getting their dollars takes more work than in the past.

Alternative Weekly Network

Alternative Weekly Network, the national ad representative for more than 150 publications, has broken into “some more mainstream categories, and automotive has been the big one,” says John Morrison, AWN’s sales director.

Significant first-time national buys came from Saturn, Audi and Scion, a Toyota brand aimed at the youth market. Toyota advertised with AWN last year in select California markets where the product was launched. This year the Japanese carmaker rolled out Scion on the East Coast. In June, the Euro-styled car was unveiled in the Midwest where, Morrison says, Toyota is making a large-scale buy in alternative weeklies.

Morrison is excited to have won the automotive category, which he’s been trying to crack for many years. “We’ve always thought we had some good demographics to appeal to that category,” he says. Carmakers are promoting “the youth appeal of several of their models, and they see us as a good way of doing that.”

According to AWN’s AdRap newsletter, “June was easily AWN’s ‘Best Of 2004’ revenue month. Hitting the finish line at just under $1.1 million, the 4-week total was well ahead of the previous best of $847,000 in April and a whopping 41% better than June 2003.”

Morrison is encouraged because “we have seen an uptick over the last couple of months. We’re still down just a little bit over the whole first half of 2003. With the momentum of the last couple of months, we’re hoping to exceed 2003 overall.”

Village Voice Media

Autos were also a breakthrough category in an otherwise down first quarter in national sales for Village Voice Media, says Jim Wolf, vice president of national advertising for the six-paper chain. Entertainment, alcohol and apparel sales were healthy in the first three months of 2004, but tobacco advertising – which was once alternative papers’ strongest category — declined.

He notes that although the start to 2004 was a little bit slow, “now we’ve actually been tracking stronger and stronger against year-ago performance throughout the year. There’s been a consistent improvement for us every month” of the second quarter.

Wolf says that in addition to an improved business climate, the second-quarter upturn was the result of sheer effort. “That’s how we’ve started to see the numbers we’re seeing right now. It’s been a mixed bag.” A large part of last year’s success came through more traditional-type advertisers, but now that the media company is “really scrapping for as many sales as possible,” it’s looking everywhere, not just at traditional advertisers. “We’re working much harder to get to last year’s levels,” Wolf says.

Ruxton Media Group

Michele Laven also saw some positive signs ahead on the national front after a dismal first quarter. “Last year, [first] quarter was a very strong quarter for us, and this year it was a terrible quarter nationally,” says the president of Ruxton Media/New Times National Sales. The downturn came on the heels of a good six months in the last half of 2003. “It’s like it came to a screeching halt.”

She thinks the poor quarter was due in part to advertisers holding back on their planning because they were concerned about the pace of the economic recovery.

“Normally plans are built in the beginning of the year,” she notes. This year a lot of planning for 2004 took place throughout the first quarter, and not until the second quarter did she start seeing real activity. “Clients are interested in talking to us,” she said late last spring. “So that’s the flip side. I think it’s looking up.”

As for second quarter, Laven says, “National has definitely picked up. …There was a six- month period where national was really tough,” Then “April and May were fair.” But in June, “we had a little bit of growth over June of last year, so I was very encouraged by that. And that growth has kept up through July.

“I think we’re working twice as hard to earn the business,” she says, “but the business is definitely out there to be earned.”

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