“Newspaper Next” stresses the need for local and regional newspapers to tap into the existing market for local information.  It’s all about creating the modern local ideal: a website with place-specific original content, combined with community advertising.  The study expressed the need for databases with facts on local parks, restaurants, schools, medical facilities, and services. 

The financial prospects of local advertising are great.  To put it simply, the more specifically advertisers can target their customer, the more effective the advertising is.  Local newspaper websites are obligated to capitalize on this local ad revenue.  And they are perfectly positioned to do so.  The problem is, exterior forces such as Google and YourHub have also noticed the opportunity. 

GoogleMaps has introduced a feature in which local advertisers can offer free, printable coupons on the Maps feature.  Jeff Jarvis of BuzzMachine describes this service as “a stake in the heart of local newspapers.”  Jarvis goes on to comment that “one of the promises of online was the opportunity to go hyperlocal-not just for content but, importantly, for advertising.” 

Google is not alone in recognizing the power of local ad revenue.  Sites such as YourHub and Backfence are websites hoping to capitalize on the desire for local content.  These sites provide the interface for towns to participate in local citizen journalism.  YourHub and Backfence are launching online hubs in several states that provide user-generated content, photos, local calendars, blog communities, and yes, mucho advertising.  YourHub has sites for towns in six states including California and Colorado.  Backfence is currently present in parts of California, Illinois, Virginia, and Maryland.

Jarvis is not hyperbolizing when he describes the process as “a stake in the heart.”  The draining of local ads by large companies is such a shame because this is the one area in which local newspapers can and should excel. 

Some papers have recognized the local market from the beginning.  Lawrence, Kansas’s World Online Company has been an epicenter of groundbreaking multimedia since its newsroom became fully integrated (including television, Internet, news gathering) in 2001. The Lawrence Journal-World website and its arts and culture spinoff, Lawrence.com, are models of successful local hubs.  World Online’s sites have taken full advantage of the idea that only a local operation can fully exploit a community’s needs and desires (and dollars).

The Vindicator newspaper serves the Youngstown, Ohio region with a circulation of 84,602.  The paper joined forces with MediaSpan, a firm specializing in print and online integration techniques.  The Vindicator’s website, Vindy.com, has become a flourishing example of a local online hub. The site offers local advertising and original local online content, such as editor blogs and restaurant guides.  Citizens can search for jobs on the in-house jobs classifieds site, vindyjobs.com.  Vindy.com also features a “local coupons” section much like the service GoogleMaps proposed.

Another paper to venture into printable online coupons is Palm Spring’s Desert Sun, which plans to create a site called FoodPsycho.com.  The site will offer coupons from local restaurants.

Despite the valiant efforts of some papers, is it becoming too late in the game to launch a local online news site?  Jemima Kiss of Paid Content reports on the floundering battle of Seattle’s David Brewster, who is attempting to launch an online newspaper in that city. 

Brewster, who founded the Seattle Weekly in 1976, is struggling to launch his paper in the face of competition from Google and Backfence, which may develop a Seattle branch.  If he ever gets his project off the ground, Brewster hopes to fill a void left by diminishing local news sources, such as small radio stations.   

Brewster on the Seattle competition: "There are a lot of people crowding into something that doesn't have enough dollars to support anything yet.  It's all on the come. It's like everybody trying to get into the same apartment building."

Kiss quotes Nick Hanauer of venture firm Second Avenue Partners on the economic risk of investing in local: “I can’t think of a reason to invest in a company that wanted to be a local, sort of traditionally structured news organization but with online content. There’s almost no way to build enough revenue to cover the expenses.”

Hanauer’s reasoning may not be completely valid for established online newspapers looking to expand their options.  Perhaps the current climate is too shaky to invest in a completely new local online newspaper.  But what about local papers that already have a presence on the Internet and wish to expand into dynamic, profitable local hubs?  Local papers are often the most dependable brand in their communities, prime for growth into other sectors. 

Yes, there is still a healthy market for this type of expansion.  But only if newspapers act with urgency to create the kind of comprehensive site that will allow them to compete with larger companies.

“The time to act is now. It doesn’t matter what size market you are in, the threat from national online portals that desperately want to steal local ad dollars is real,” said MediaSpan chief marketing officer Mark Zagorski in an interview with Newspapers and Technology.  In other words, it’s not too late to jump on the local bandwagon.  But it will be soon. 

Acting fast will be worth it.  Although the risks are high, the rewards are palpable.  According to Zagorski: “There is real money to be made, and it is being made by papers large and small that have made a commitment to change.”    

This time, the answer is literally in your own backyard.  Think small, think directed, think local, and think fast!

 
Sources: Newspapers and Technology, BuzzMachine, Paid Content, Vindicator, Lawrence.com/Lawrence Journal-World, Backfence, YourHub, Boston Herald, Seattle Times