Saying demand has plunged 25% at its more than 2,600 properties, Marriott International just confirmed that its full-service chains including Marriott Hotels & Resorts and Renaissance Hotels & Resorts will deliver newspapers to guest rooms only on customer request, rather than automatically, starting June 1."We want to give guests the choice of whether they want a newspaper or not," CEO J.W. Marriott Jr. says in a statement. "I visit more than 250 hotels a year, and more often than not, I'm stepping over unclaimed newspapers as I walk down the hallway. This new program is more guest-focused."
Based on preliminary data, the company projects that newspaper distribution will be reduced by about 50,000 papers daily or 18 million papers annually. USA Today's circulation is already set to fall by about 100,000 just from lower occupancy in hotels, when the Audit Bureau of Circulations releases data for the six-month period ended last month. USAT's "Blue Chip'' hotel program accounts for more than half of its 2.3 million circulation.
Bet it will be more than that. More than a third of USAT's circulation is hotel room delivery and, like someone quoted here, I have been in hotels where I have walked over newspapers each morning as I head to the cafeteria for breakfast. Give them options, and they won't take it.
ReplyDeleteI would not be surprised if more hotels follow suit?
ReplyDeleteOh no!
ReplyDeleteWhat will I do now for a doormat when I'm on the road on assignment?
Has anyone else ever noticed in the fine print of the hotel bill that they actually charge you the 75 cents for USA Today? I’m assuming that this is so GCI can claim every paper outside a hotel door as paid circulation – a clever trick indeed.
ReplyDeleteGannett has known about the hotel "doormat" problem for a long time and even looked for innovative ways to get the papers from the hotel hall into the room (but then didn't folo through because there was no ROI or new revenue associated with the proposed fixes). One observation was that people don't even realize the paper was outside the room until they leave. By then, with suitcases and carry-ons and coffee in hand, the inconvenience of bending over and picking it up is too great. Would you unpack everything at that moment? Gannett even knows hotel customers like the brand and want to read it. The focus was one the wrong things. Gannett didn't fix the known problem. Its innovators tried to help, but usually get blocked at the Operating Committee Level (which members must be paid added bonuses for using the terms ROI and top line as many times as possible in the same sentence). The people proposing innovation are the worst innovators in the company.
ReplyDeleteUSA TODAY circulation in hotels has been reported being over 50% of total circ. The room bill or folio doesn't always charge the guest but has what is known as the newspaper acceptance statement suggesting a refund if the guest refuses a paper. Audit Bureau rules for 3rd party or Bilk papers make a huge exception for US TODAY versus "normal" papers where that form of circulation is being reduced due to costs and ad value of the lower quality circ.
ReplyDeleteOccupancy in hotels is down an estimated 20% which should have a very direct impact on USA TODAY in addition to lower sales at retail and subscriptions. There will probably be a huge impact of advertisers who are told everybody in hotels wakes up the the paper.
2:41 I agree. Damn. A HUGE impact. Under this program, the cost of USAT actually buried in the cost of the room, but few customers knew that. For complainers, some hotels would subtract the cost of the paper from their bills if they didn't want it, but there were few takers. According to the story, Marriott plans to give away newspapers free in the lobby, but I wonder if that giveaway changes the circulation count for ABC.
ReplyDeleteOne in five of USAT's paid circulation is in a Marriott. Looks like Moonie jumped ship at just the right time!
ReplyDelete"Blue Chip" sales have been propping up circulation numbers for years as true single copy sales have declined. Now that Marriott has taken this action, other major chains are sure to follow suit. Craig Moon's departure was timely, indeed.
ReplyDeleteDoes the USA Today marketing department - which remains top-heavy with vice presidents - ever do anything to actually market the newspaper to readers? I'm not talking about the subscription deal of the day. I mean do they actively try to get people to pick up the newspaper on a daily basis?
Aside from plastering the USA Today logo on the sides of dog food bowls, what does the marketing department do? I'm not trying to be flip or cruel. I ask that question in all sincerity because I just don't know what they do.
"Now that Marriott has taken this action, other major chains are sure to follow suit."
ReplyDeleteI suspect you're correct. That's what sheep do ... they follow.
Marriott says they're doing this to get on the green bandwagon. Like I said, there's a lot of sheep out there.
You are right, 4:14 PM. That's a question for Susan Lavington, senior vice president for marketing at USA TODAY. Aside from the "We're all in this together" tagline, I'm not sure what elese has transpired under her watch.
ReplyDeleteMaybe Jim could ask her?
Jim plans to check this situation out in person.
ReplyDeleteHe intends to wear a bellhop uniform and go door to door, "surveying" what people think about this change.
Be sure to tip him well so that he leaves promptly.
2:55
ReplyDeleteThe way it usually works when hotels eliminate occupied room delivery in favor of some free copies at the front desk is that the hotel buys a dozen or so papers as bulk sales which would reduce total circulation at the hotel by about 90%. Still considered pretty low on the totem pole of circ value by ABC. It's pretty obvious given the state of the hotel industry, Starwood (Sheraton, Westin...) would do the same and probably Hilton (Hilton, Embassy Suites, Doubletree...). If this does become a trend, USAT could conservatively lose 25-30% of their total circulation (hotel circ =50% of total circ, a loss of 50-60% of hotel circ would be 25-30%).
But, there would be a huge cost savings in eliminating room delivery.
This might be it for Larry... maybe he thought he was President-in-waiting, if only for a short while. Say what you will about him, he's been an unbelievable survivor over the years.
ReplyDelete2:41 you said, "Audit Bureau rules for 3rd party or Bilk papers make a huge exception for US TODAY versus "normal" papers" So 2:41 why does Audit Bureau make exceptions on how is count papers, for USA TODAY?
ReplyDelete6:18
ReplyDeletePerhaps I shouldn't have said "exception" but for several years, as per ABC rules on how circulation is valued, I believe all papers have been reducing 3rd party and bulk sales (although "bilk" sounds funnier) as advertisers become more aware of how circulation is created and counted. Ideally intended to eliminate what was once common in circulation departments buying circulation or going to events and giving a paper away when someone buys beads or a poster, the importance of "quality" circulation has become important. But with USAT having a majority of circulation in that category, and being the largest single member of the bureau and part of Gannett which is the combined largest entity...
5;14 I thought the hotel staff delivered the papers.
ReplyDeleteWow...and the coming losses of circulation in the hotels comes on top of corporate's decision to cutback on street boxes and sales in smaller cities. See the wisdom of our rulers in the Crystal Palace.
ReplyDelete5:14
ReplyDeleteNot at all hotels. Either way, the loss is in the circulation and associated revenue.
Another result of this may be a drop in advertising by the hotel companies. Does anybody know the details of any trade agreement where a hotel company gets advertising in exchange for special pricing of papers for the rooms? For example, Hotel company A gets a special rate in exchange for taking papers for every occupied room at x amount of hotels= x amount of average papers. When occupancy goes way down, what happens to the ad rate?
I doubt that ABC would make an 'exception' for USAT. That wouldn't go over to well with other papers or advertisers.
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ReplyDeleteIn regards the ABC decision, no other newspaper used hotels this way. The tradition was to dump the newspapers in the hotel gift shop, but USA Today's idea was to have the paper delivered to the door of each resident. It doesn't sound that way now, but it was very innovative in its day, and required ABC to alter its rules so these readers could be counted.
ReplyDeleteThe rules for counting hotel circulation as bulk or paid single copy circulation are the same for all papers. Other locals, as well as the nationals- Wall ST, NYT, etc., actively seek out this type of sale. Many just have not been as successful as USAT. The hotels receive a tiered discount structure from a usually low base price that give them allowances if they choose to do their own R-T-R deliveries, more discounts if they agree to deliver every occupied room, more discounts if they place the all important opt out statement on the registration card that allows the hotel sales to be considered single copy.
ReplyDeleteIn some areas the blue chip sales are as much as 67-75% of total sales. This is almost opposite from 10yrs ago. Single copy sales, especially racks, have taken a quite a beating since the price increase. USAT is picking up racks at an unprecedented pace. Forced scan based billing at major retailers is further eroding single copy sales as USAT is now having to eat the retailers shrinkage. USAT is also trying to slice draws to reduce return expense, which is also hurting single copy sales.
In addition to the Marriott announcement, USAT is no longer brand standard at the Hilton Hotels. Meaning the properties aren't required to have a USAT for every guest, and can even opt to purchase other papers. Many Carlson brands, such as the Radisson, are no longer required to obtain a USAT for every occupied guest. This has lead to drops of over 100/day in draws at some locations.
USAT, along with locals and nationals, also gain large, questionable single copy sales from college campuses. By placing a display that requires students to scan their student ID to obtain their free paper, USAT can count the circulation as single copy instead of bulk, even though an individual person does not pay. Sold papers are paid for with student activity fees. Overall, a good program for students as they can get up to 3 different papers for free, but kind of flaky in regards to being true single copy sales.
I predict USAT will continue trying to enter into delivery partnerships with locals wherever possible, there are many now. Once that avenue is exhausted, I believe you will see USAT pull back or out of some of their more rural and smaller metro markets. They are just not generating enough revenue to afford wider distribution at this point.
The fall off at hotels is not over, and will be worse by the end of the year.
Another unique market segment for USAT, the service builder category, is also taking major hits. This category includes cafeterias in hospitals, large office buildings, manufacturing plants, military bases, etc. With the slower economy, sales are down considerably in this category.
Can't forget the NIE segment. With most school systems across the nation facing proration of budgets, non-essentials such as USAT newspapers are taking a big hit.
Again, USAT will get worse, before it gets......
USA Today has pushed itself onto the public for years. Not only do they force feed this shallow newspaper to every hotel guest and on every street corner in the land, they also plant it in movies and elsewhere to market the thing. The USA Today marketing machine is what drove this newspaper to success. The journalism is below average, however. The design varies from functional and above average but appears to be in decline in recent months. Wasn't this once known as the "graphics newspaper?" The reproduction is good but who cares. There's little in the paper that is credible. It's basically an entertainment rag, filled with TV, Hollywood and news that you can get from thousands of other sources for free. I hope this move by Marriott is the beginning of the end for USA Today's stay at the top. Everyone in the industry knew it was a bogus circulation figure, and now maybe USA Today will find its real place in the market, which is someplace in the middle and geared towards people who don't really want to read any meaningful news.
ReplyDeleteBTW, I know people at USA Today and worked there for a brief time in the late 90s, and the word is that it's become a horrible place to work for a number of reasons. The fall began a couple years ago when talented people began leaving. Further mistakes were made through buyouts/layoffs, as some of the best staffers were shown the door for some bizarre reasons that I still don't understand. The talent pool is very diluted at USA Today. I feel for them but still have no love for the brand of journalism they produce. I am sure the good people who remain would be out of there if there were other jobs at better papers. But in these rough waters, it's not easy to leave a sinking ship. USA Today is going to take another fall once the economy comes back and people are able to leave. What will happen then is that only the morons will remain there. And gosh, they've hired some people who I have to wonder if they can even read. I guess when a paper is run by insecure managers, those managers surround themselves by people they know are dumber than they are.
A's hire A's.
ReplyDeleteB's hire C's.
And then there's USAT managers...
to 4/13/2009 4:22 PM
ReplyDeleteYou're right about the marketing SVP Susan Lavington at USAT. Completely ineffective in marketing. Her silly We're All In This Together campaign cost the company a couple of hundred thousand with the Arnold agency. USAT marketing is a joke except for a couple of movers and shakers doing some decent work like Mary Anne Cristiano and Ed Cassidy (he's got that silly period after his first name - what's that about?). Doubt these two will put up with this palce much longer though Cristiano is marrying John Waggoner in news so she'll have to stick around.
But you can't blame the doing-nothing Lavington for the Marriott drop and other circulation woes. This was in the works for almost a year on the watch of Michael Davidson, Andrea Bitz and the always absent Larry Lindquist and Craig Moon knew about it way back then. Those are the ones who let Marriott and others to follow sink.
Here’s a funny one- according to a new article in the Chicago Daily Herald (http://www.dailyherald.com/story/?id=286203), USAT is reporting “A very small impact” regarding the loss of Marriott’s full deliver of the paper. Here’s the great Gannett spin- reporting the loss to be 68,000 copies per day or 3% of their circulation. Marriott announces the cuts are at 2,600 hotels which is 26 paper per property. With the average property being over 100 rooms am I the only one thinking the numbers are wrong by about a half and that the loss of circulation might be closer to 6 or 7%?
ReplyDeleteTo 9:23 AM -- I'm not necessarily blaming Susan Lavington for anything...I just don't know what the marketing department does.
ReplyDeleteDoes anyone know?
I am curious to know if the marketing department does anything to help build circulation. I figure that if there is an answer to that question, Susan Lavington should be able to answer it since she is the senior vp of marketing.
Can anyone shed some light on this?
I'm watching my newspaper die and I would like to know if there are any marketing efforts aimed at trying to save it.
Ed Cassidy worked for Moon in Nashville. Moon brought him on at USAT when he built out the marketing department to include four vice presidents. Now Lavington is running the show.
ReplyDeleteSpeaking for those of us at USAT who work directly with marketing, I can promise most of them work hard with circulation and advertising with little to none resources. Both Christiano and Cassidy have had their staffs cut down to nothing and they keep producing results for us. But can't say the same for Lavington and the rest of her group in New York.
ReplyDeleteBest thing Cassidy ever did in marketing was to fire Steve Anderson and Barbara Matthews.
ReplyDeleteLavington is just another one of Moon's props just like Wilson, Webber, Ashburn and Maslosky who did exactly what Moon told them to do and nothing else. Without his protection they can't pretend any more and will be gone soon.
ReplyDeleteGreat information!! Marriott is best name of hotels and resorts...
ReplyDelete