Sunday, December 02, 2007

At Gannett headquarters, the band plays on

[The Titanic: Was it an iceberg -- or management's hubris?]

I started Gannett Blog a year ago because I expected big changes at the nation's No. 1 newspaper publisher. A powerful media conglomerate with 50,000 employees was steaming deeper into treacherous waters, and there didn't seem to be many bloggers writing about the outcome. What piqued my interest: CEO Craig Dubow's newly announced Information Center model, a cornerstone of Gannett's strategic plan. I was skeptical. "This looks an awful lot like rearranging the deck chairs on the Titanic,'' I wrote.

I wondered how Gannett, battling for survival, could reinvent itself without a massive investment in its understaffed newsrooms. Training employees in new multimedia skills was crucial, and more humane than junking them in layoffs. But retraining alone would take too long. What Gannett needed instead was journalism's version of the Manhattan Project: GCI had to immediately hire hundreds of software engineers, website designers, online marketing specialists, bloggers and videographers, plus online advertising salespeople.

It needed more reporters, editors, photographers and artists to gather the exclusive content -- from city council meetings to high school football games -- that would give Gannett papers and TV stations a competitive edge. In other words, management and the board of directors had to deliver this message to Wall Street:

For years, we've had a great run. No competition meant we could deliver profit margins of 20% or more by slashing news staffs and news hole while jacking up advertising and subscription rates. But those days are over. Rivals like Google are surging. Revenue is falling. Gannett's stock is in tatters. GCI needs to slash its dividend and plow the savings back into its papers and other businesses.

Gannett needs bold, fresh ideas. What it got: the Information Center, a warmed-over rearranging (see "Real Life, Real News" and "News 2000") of the same overstretched resources. Attention Gannett's board: They thought the Titanic was unsinkable, too.

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1 comment:

  1. At a time when many, many newspaper sites are struggling to just maintain current audience levels, Gannett's papers are nearly uniformly gaining by 30 to 35 percent year over year.

    As Steve Yelvington says, newspaper sites don't have a sales problem, they have an audience problem.

    Until newspaper sites can get well beyond the current pathetic (about 4 percent) average daily unique penetration in home DMA's, revenue growth will not be nearly what it should be (even as healthy as it is now).

    Gannett's info center was not as revolutionary as some think -- all of the ideas have been around for a number of years -- but it's a great uniform strategy that is absolutely on target.

    Now if they would just do something about their site design -- even the new designs need work ... that would help, too.

    Audience first.


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