Renee Montagne: On Fridays, we focus on your money.
Renee Montagne: Today fewer people are spending that money on newspapers. Daily newspaper circulation reached its peak in 1984 and has been declining ever since. In what is by now a familiar announcement this week five dailies owned by Knight Ridder say they are cutting jobs. We called Jeff Kahler, a consultant to the newspaper industry; he says some of the declining circulation is by design when it comes to readers. Some companies are now putting quality over quantity.
Jeff Kahler: For years, the objective in the industry was expansion and to deliver the highest circulation number possible. Some newspapers sold a lot of subscriptions to entice new subscribers. But when you factor in the high cost of discounting, that's a lesser unit of circulation. So some of these losses are, uh, thinning the herd, if you will.
Renee Montagne: But still a lot of other newspapers are in fact losing readers and they certainly don't want to and where are they going? The Internet, I gather, is doing rather well.
Jeff Kahler: Yes, we are talking, Renee, about eye-balls. Are eye-balls reading the print newspaper or are they getting their information off the computer. I think that newspapers have made a fundamental shift where circulation was the gold standard to now the concept of readership. Are people reading your print version? Are people going online to read your online offering?
Renee Montagne: So specifically, what would be your recommendation to a newspaper that is trying to survive?
Jeff Kahler: I do say Number one, Renee, that newspaper companies are streamlining their businesses; they're shedding, lesser quality circulation. Number two, they are now going to market with a rifle, and not a bazooka. To target your sales and target your readers, this requires powerful data bases, and with these data bases, they're selecting the most attractive readers, readers who are loyal to the newspaper, readers who will support the advertisers. Number three, they are definitely extending their franchises. We see a lot of niche editorial and niche advertising products. And this is an attempt to cater to specific groups, urban readers, diverse readers, older readers. So you'll see products such as a Quick launched by the Dallas Morning News, catering to the younger readers. There will be numerous ways for readers to interact with the content provider which as we used to know was only the newspaper, but now which (is) the newspaper media-franchise.
Renee Montagne: Thank you very much for joining us.
Jeff Kahler: Thank you, Renee.
Renee Montagne: Jeff Kahler is a consultant…
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