A sustainable revenue model

Take a look at the traditional newspaper business model from the outside in:

Consumer engagement is a raw material newspapers collect and bundle for resale to their primary paying customers — advertisers — who nowadays fall into two primary camps:

– Big-box chain retailers, who use newspapers to distribute their glossy, free-standing inserts, and

– Small/medium non-chain retailers and service businesses, who face their own huge disruptions from the big boxes but cannot afford rich, diversified marketing programs.

In the glory days, consumers were willing to subsidize a newspaper’s cost to deliver its convenient bundle of news, information and advertising. This allowed newspapers to set a high price for advertising — too high for many SMBs.

But times have changed. Through consolidation in the retail sector, there are fewer big box stores to advertise. Those that remain can communicate directly with consumers via their feature-rich websites, which makes them less dependent upon local newspapers.

This makes it a time of need, and opportunity, for both newspapers and SMBs.

If newspapers want sustainable local revenue models, they should help SMBs make it through big-box disruption, and this current pseudo-depression, as a local business partner with viable marketing solutions. Print can be part. Web can be part. E-mail can be part. So can mobile, SMS, outdoor, broadcast and cable.

CraigsList and Google Adwords do little for brands, or sales/special offers, or new store locations, or loyalty programs. We all can appreciate how hard it is to succeed with a local storefront or service business nowadays. Newspapers could help these SMBs, and themselves, by offering the media solutions SMBs need.