By Steve Passwaiter and Rick Ducey

For broadcasters, it is an article of faith that “localism” is a point of differentiation that adds value to their operations. Localism tends to mean local news, sports, weather, traffic, local events, coverage of local government, and other promotional and volunteer involvement in the community. There’s a lot of chatter about what it takes to succeed with true “localism.” This past year has seen some notable localism failures. Other efforts are in a nascent stage.

One case in point is Allbritton Communications, based in the Washington, D.C.-area. Its television stations are affiliated with ABC, with the largest property being WJLA-TV, the ABC affiliate in the Washington, D.C., market.

Our primary interest was the fall 2009 announcement of Allbritton’s plans to launch a Washington, D.C.-focused news site that will combine with the WJLA and NewsChannel 8 television and Web operations. To launch this new local news site, Allbritton hired Jim Brady, the former executive editor of Washingtonpost.com. The site is set to launch in spring 2010 and will have about 50 more news staffers on hand.

We recently talked with Allbritton’s senior vice president of legal and strategic affairs, Jerry Fritz, who supports Robert Allbritton (the family-owned company’s chairman and visionary) and Fred Ryan. These three executives are the key architects of this strategy. Fritz has a long history with the company that spans more than 20 years.

While the timing seems very fortuitous, Fritz tells us it’s really the culmination of a plan that was devised back in the late 1980s, when Allbritton (who used to own The Washington Star) saw an opportunity to build a strong local franchise to compete with the news-gathering prowess of The Washington Post.

The first effort under the plan was the launch of NewsChannel 8 distributed over local cable systems. NewsChannel 8 was, at first, a separate operation from the local broadcast television station. A truly, locally focused news operation, NewsChannel 8 broke down its news for the area’s three separate and distinct geographies with a mix of local, lifestyle and political programs. It was a pioneer and in its early days it was a tough sell for audiences and advertisers. Its programming and appeal have grown as the product has matured and its mix of local news and lifestyle shows (political talk to local golf) now attract larger audiences plus a mix of larger and smaller advertisers. NewsChannel 8 also has benefited from the growth in the news product on WJLA. WJLA has completely rebuilt its local news operations following a downsizing many years ago.

From its base in local television, Allbritton leveraged its core assets across media platforms to exploit some of the unique attributes of the D.C. market.

That included developing an online newspaper to address the market opportunity of providing news, commentary and an advertising vehicle to government contractors, lobbyists, trade associations and others seeking to influence the nation’s seat of government.

Politico.com, designed to be the ESPN of politics, was Allbritton’s initial online effort under the new strategy. While Politico was designed around the Web, readers and advertisers clamored for a print counterpart. Allbritton responded with a three-times-a-week print product that was quickly ramped to five days.

Since then, Politico has created a national network of newspapers and Web sites that share Politico stories in exchange for Web ad avails, which Politico sells to national advertisers. It is a classic win-win.

In fact, Politico’s timing has been perfect. Many newspapers have closed their D.C. news bureaus, and local newspapers are struggling to fill the news gap. Recent filings with the SEC have detailed just how successful the operation of Politico has become in a relatively short time as revenues have topped the $20m mark and cash flows have reached seven figures.

Now, both WJLA-TV and NewsChannel 8 share facilities and some staff members as they gather, collect and present local news and information to the D.C. market. Adding Politico, the Allbritton operation finds itself as one of the country’s leaders in the gathering and dissemination of political news. That has positive rub-off effects on both WJLA and NewsChannel 8. Washington is still very much a company town.

So, it’s in the same vein that we look at this soon to be launched local news oriented Web site. Adding 50 journalists to an operation that already includes a prominent local television station and its cable news spinoff plus the acclaimed Politico gives Allbritton’s operation one of the largest news gathering operations in the market. As the company focuses on enabling its journalists to file news across any platform, it’s easy to see the combined Allbritton portfolio giving some heartache to The Washington Post (and few know that property better than Jim Brady). The company just recently brought a senior sales executive to lead the advertising sales effort for the new metro new site.

Allbritton already has a deal in place with the market’s leading news/talk radio station as well to share content and to provide weather reporting from its team of meteorologists. While it doesn’t seem that Allbritton wants to get itself embedded into the longer view stories that The Post covers, it does seem that there’s a probable audience for hurried Washington audience members who want to get the news in an easy, connected and time saving way.

The Allbritton mission is to produce and serve unique content which has appeal beyond the Washington market. The plan is to capitalize not only on local ad spend across broadcast, cable, print and online platforms but also to get access to content syndication and barter ad inventory nationwide. Allbritton understands that it can be profitable to serve not only local audiences and advertisers well with smart execution but that this entire operation can be leveraged to grow out of market revenues. Could this example serve as a possible model for other broadcasters looking for a digital strategy that actually makes money?

A few weeks back, in an Advisory, we released the following chart of the “Quarterly Revenue Index.” The Advisory was released the day after we got the final Q2 number filings from the different media groups. Our idea was to look holistically across a few ad segments, and make some comparisons about where we are and where we’re going.

It seems appropriate to revisit this comparison, given some of the dialogue I’ve recently seen in print and online. Everyone knows the ad market has been bad. The more interesting question is whether we have entered a fundamental shift in spending behavior. For some time, I have been telling people that we will see a change in advertiser spending patterns. The change in spending will be driven by de-leverage or debt financing (mortgage refinancing, etc.) coming to an end. No more easy money.

In local, a specific example might be a kitchen remodeling contractor. To get work, during the cash-out re-fi boom, the hardest part was answering all the demand. There was so much work that a contractor could pick up job after job with out much extra effort. The result is that these verticals did not move spend to interactive as quickly as others. The reason: too much work and no reason to change. Now that is over.

When things are going well, people tend to do the same things the same way as yesterday. In the case of the hypothetical kitchen remodeler, it kept advertising in the same places during the boom. According to psychologists, there is certain predictability to such behavior. When the environment changes radically (e.g., the economy falls off the cliff), people change their behavior and start to act differently. In a couple of quarters we’ll know for sure if this is the case here when we update Q3 and Q4 numbers across media.

Next week, Kelsey clients will get to see data at BIA/Kelsey’s Orlando conference that showwhere SMB spend is going based on more recent research (completed last month). Guess where?

Net/net: We expect interactive advertising to start to gain momentum over the next year as advertisers reevaluate their spending behaviors.The following is a financial summary of the Q2 ad market across media.

1Q and 2Q Results

Using major publicly traded media companies as proxies for the media industry as a whole, we see there was an overall reduction in advertising revenues in the first quarter of 2009 compared with a year ago. Radio groups were the hardest hit with a 22 percent fall, followed by television with an 18.6 percent decline, and newspapers with a 15 percent decline. In Q2, radio groups were down 20.6 percent, television declined 20.4 percent and newspapers decreased 7.5 percent.

Radio and television ad spending typically see a bump in the second and fourth quarters, as was the case in second-quarter 2009. While some ad revenues lifted in the second quarter, the numbers were still far below the same period in 2008. Radio and television saw the largest declines: 20.6 percent and 20.4 percent, respectively.

The Internet Results

Over the past 18 months, the Internet category overall has held up fairly well, and is virtually unchanged, as can be seen in the chart below. Television and radio revenues, on the other hand, have dropped precipitously. As we have stated previously, when spending returns, interactive will disproportionately benefit.

Quarterly Revenues Index of Publicly Traded Media Companies

Sources: BIA/Kelsey, Company filings, Capital IQ (2009)

In the second quarter of 2009, the Internet category shrank 3.4 percent relative to the same time last year. However, there are signs of deceleration in the slide down. From the first quarter to the second, the decrease was only 0.2 percent, compared with 7 percent from fourth-quarter 2008 to first-quarter 2009.

I was recently able to catch up with Michelle Moore, director of search engine strategies at Metric Voodoo. We’re sitting on a panel together at SES San Jose next month and had some time to discuss the areas where mobile local marketing needs improvement, or requires different ways of thinking. These will also be key areas of discussion at TKG’s Directional Media Strategies conference in September. Here are a few excerpts from the interview.

MB: What are the biggest market factors that you see driving mobile search adoption on the part of both users and content owners or advertisers (i.e., smartphone penetration, better device standards, etc.)?

MM: Technology adoption with regard to smartphones is outstripping most previous major technology adoption rates, including touch-tone phones, cassette tapes, hi-def TV and DVD video players. There’s an entire generation in high school right now who’s never known a time without cellphones. This ubiquitous adoption is already causing a measurable trend where smartphones are replacing computers, especially with regard to localized searches. People’s habits are changing — when that happens, it forces market adjustments all the way around, not only with how advertisers will get their messages in front of consumers, but also what sorts of targeting these users are willing to accept. Phone searchers love being “helped,” but they hate being “tracked.”

MB: What are some of the most common mistakes or misconceptions of companies entering the mobile space (media companies, app developers, Web publishers, advertisers, etc.)? What about misconceptions preventing companies from playing in the mobile sandbox?

MM: I think there’s still a disconnect between the left and right brain that prevents advertisers from recognizing opportunities in the mobile space, especially for small to medium-sized business. For example, local search — which is one of my main prongs of attack with any business that has a physical location … it takes me about a dozen repetitions and even demonstrations over several weeks of the immense practicality of local business search on a phone before the little lightbulb starts to glow. Ultimately, I have to sit back and wait for my clients to actually use their phone in this manner to make a decision or a purchase or answer a question, and then point out to them afterward why they ended up using the vendor they selected.

“Do you remember why you ended up calling CVS Pharmacy?” 

“Yeah, the first phone number I found for Foster’s Pharmacy wasn’t in service anymore.”

“OK, so what happens when you change your business phone number and no one bothers to update all your local business listings that are floating all over the Internet?”

It’s as if small-business owners think that because they have a Web site with their name and address and phone number, that’s all they need. They don’t think far enough down the smartphone path to realize that their site might be all in Flash, or that the average local business search through a smartphone portal may put results from Citysearch or Superpages above your business’ own domain name … and oddly, SMBs are who absolutely need to succeed in this arena or get overrun by the big chains.

MB: Is the state of the economy currently having an effect on this adoption, any more so than other media? In other words is mobile’s “experimental” nature preventing companies from utilizing it as a content and/or ad delivery platform in uncertain economic times?

MM: I think this depends on who you’re asking. I don’t know a single consumer who’s given up their mobile phone. But I read all the time about companies abandoning or “back-burnering” their mobile marketing initiatives. It makes me want to ask marketers, “Why are you doing this when that market is one of the only markets not shrinking?” Fewer and fewer people read printed newspaper, but more and more people use cellphones.

MB: Conversely, are mobile’s targeting capabilities, greater ad performance (CTRs etc.) and measurability making it resonate to a greater degree during these times when advertisers are demanding more concrete ROI?

MM: You’d think, wouldn’t you? I’m not sure about national numbers, but in the South, where most of my work is done, it seems that there’s a different barrier to entry. Much like with social media, there’s a general lack of awareness [and therefore confidence] in mobile marketing. I’m constantly preaching a reduction in faith-based advertising models like television, radio and newspaper, and a shift to trackable advertising, whether it’s plain old PPC or mobile advertising. But there seem to be a lot of marketing execs who lack experience with the medium, making it harder to convince the rest of the C-suite to support mobile marketing initiatives. It’s like the fact that you can measure ROI at all doesn’t matter — they’re not willing to dabble in mobile unless you can prove ROI to start with. It makes no sense to me.

MB: It’s my contention that mobile and local are so closely related. Online searches with explicit local intent are about 10 percent of overall searches. On mobile, it is currently about 2X-3X more than that, and growing. Do you agree?

MM: Yes, I do agree. Every statistical report I’ve seen in the last eight months indicates that at least 25 percent of all searches on phones are local business searches. This is why I start my discussions by showing folks the Sprint commercial that was released in May — “Right now, 6,000 people are researching restaurants in the back of a cab.” How many “right nows” are there in a typical day … times 6,000.

MB: Some of the money spent at the local level (online and off) is national advertisers targeting locally. About a $17 billion chunk is the SMB segment. Very fragmented and hard to wrap your arms around. How will mobile advertising be bought and sold to this SMB segment? Self serve a la AdWords? Local sales channels like newspapers and Yellow Pages?

MM: I think a handful of the major online advertising sources will be the obvious choice. SMB doesn’t have the resources for a lot of research and due diligence so they’re more likely to allow their traditional marketers or PPC management firms to take on the task of local business advertising. I think that will translate to more ad business for Google. SEO really has never lent itself well to local business presence, despite a decade of SEO “experts” telling us it works. I don’t see traditional printed ads gaining share.

MB: Any other advice for companies entering the mobile space or online publishers trying to seek out opportunities in mobile?

MM: Be proactive. Buck the old traditions and hire some new blood [says the 40-or-so-year-old]. Take steps to build an online reputation before you are forced to take steps to correct it. Be an expert in your area and make sure to let people know about it. Put yourself everywhere you can afford in order to have the best chance of being found — be that online Yellow Pages, paid ads in a search engine, paid sponsorship of a mobile portal, name on a bus stop bench, name on the back of a little league jersey, wherever you can get publicity without offending people’s sensibilities. If you can associate that with a topic consumers are passionate about, so much the better.

Leading SMB video production house TurnHere announced an affiliate program today, which will allow Web site publishers and local search sites to offer video to their advertisers. This essentially lowers the barriers to resell TurnHere’s customized video production.

Previously, working with TurnHere required a business development process that spun out certified resellers (of sorts) for its local video production. Through this system, TurnHere prioritized larger publishers, which hold the most opportunity (read: direct local selling channels).

The affiliate program now not only makes it easier for smaller publishers to get on board with TurnHere, but it also grows TurnHere’s opportunity further down the tail. This should grow the company’s revenues while putting some money into affiliates’ pockets via rev share.

To the latter point, video production capability will be a strong selling point for affiliates to grow their own advertiser bases. This can be a retention play as well as a hook to get new advertisers in the door and build long-term relationships.

This comes at a time when online video’s measurable qualities and lower price tag ($899 in this case) makes it an attractive choice over television advertising. These are some of the growth drivers in our Local Video Forecast released last summer (updated data coming soon). We’re meanwhile seeing more and more smaller publishers integrate SMB video.

TurnHere has the ability to provide this “hook” for smaller publishers, as its highly customized videos stand out among the many flavors of entry-level video in the market– some of which are more automated or involve stock footage. These definitely have their merits (including price point), but TurnHere’s decidedly more personalized videos have been a key point of differentiation for the company so far.

Lastly, this announcement is in line with a trend we’ve seen play out at TurnHere over the past year. Though its video production strays from automation, its operations are becoming more and more automated. A little over a year ago, it integrated a streamlined process for advertiser feedback and post production.

Today’s announcement similarly streamlines its business development process and allows it to take a bigger bite out of the market. This will augment the many deals it’s been able to sign with top local publishers such as Yellowpages.com, Superpages and Citysearch.

The affiliate program has already signed on a short list of smaller vertical publishers including BedandBreakfast.com and WeddingBook.com. It’s previewing many others and will soon open it up more broadly, according to COO John McWeeny.

________

Related: See our video interview with TurnHere’s Jared Simon at SES Chicago.

Don’t take The Kelsey Group’s word for the fact that more marketers are switching some of their advertising dollars into the Internet. Here’s what eMarketer wrote a week ago. “In the wake of the global economic downturn, marketers worldwide are shifting more of their budgets into cheaper, more-measurable categories.” The fact that eMarketer actually put those words into an article can only be traced to the fact that it got some hard numbers from the Society of Digital Agencies. It is no surprise that “81 percent of respondents said they plan to invest at least as much in digital marketing in 2009 as in the previous year.”

Happily, eMarketer backs up these figures with another study by Ad Media Partners. The research shows that marketing executives are planning to increase digital spending in social media marketing (77 percent), search marketing (76 percent), mobile marketing (75 percent), behavioral marketing (70 percent), lead generation (63 percent), video advertising (60 percent) and e-mail marketing (58 percent).

EMarketer sums all this up by pointing out that “the combination of accountability, conversion and the infusion of digital media into every facet of life makes the future look bright — for marketers making the move to digital.”

Anyone in the radio or television broadcasting industry who needs to understand how to best take advantage of digital media needs to be at the Winning Media Strategies conference to be held May 20-22 at the Marriott Wardman Park in Washington, D.C. The Kelsey Group and BIA Advisory Services have put together an event that will pay incredible dividends to those broadcasters willing to make the small investment of time and money.

Earlier this week I went to hear an economist offer his take on the current economy and how soon it would recover. Long story short, I believe the speaker, who had outstanding credentials, was overly optimistic. (I really believe he may have been on vacation on some secluded island for the past year.) In fact, his views were the most positive I have heard or read in the past six months or so. However, he did say a couple of things that I agreed with. One was that television and radio have combined their news and entertainment divisions so that a prime objective of news is now to be entertaining … that is to attract viewers and listeners. Therefore, he said, the media has good reason to say the sky is falling: It brings people in.

Recently, Sharon Begley wrote a column in Newsweek titled “Why Pundits Get Things Wrong.” She quoted a study by a research psychologist at Stanford University who concluded that there was no way to predict the accuracy of anyone’s forecasts. There was no relation to whether the forecaster was a Ph.D., an economist, a political scientist or a journalist or had any other credentials, affiliations or fame. What works for the media, she wrote, are “bold, decisive assertions that make better sound bites; bombast, swagger and certainty make for better TV.”

For more than a dozen years, The Kelsey Group has been predicting the future of the industries we cover. We take the best information we have at the time, talk to industry participants, weigh their views with our own perspectives and make forecasts of the future. We do the best we can to help our clients and the businesses we serve.

The acquisition of The Kelsey Group by BIA resulted in the combination of TKG’s strength in directional media, including all things interactive, with BIA’s strong position in television, radio and newspapers. The benefit of the merger became clear yesterday when the newly formed BIA Advisory Services released a forecast that my colleague Neal Polachek described as “an expanded and more comprehensive view of the U.S. local media sector (by widening our unique understanding) of local media by adding six categories to our forecast.”

It is a little bit unnerving to be offering a new forecast in this difficult economy. Some of the headlines about our forecast said “local ad markets shrinking,” or used terms like “declining” or “downward spiral.” Unfortunately, BIA and TKG analysts do envision local advertising revenues declining from $155.3 billion in 2008 to $144.4 billion in 2013, a negative 1.4 percent CAGR. What is notable, at least to me, is that most of that decline comes from the primarily directional media of newspaper classified advertising and print Yellow Pages. The growth is all in the equally directional Internet Yellow Pages, local search and other interactive digital advertising. There’s just not much share change in traditional direct mail, television, radio, out of home, cable or magazine advertising.

As Harry A. Jessell put it so well in today’s TVNewsday, “the newfangled competition will come, but nobody is in a better position to rule the local online world than TV stations. They have the content, the business contacts and an unmatched ability to promote.” Broadcasters should know that that was the mantra of newspapers 15 years ago. Recognition is the easy part; the hard part is following through and actually making the changes that will help you to compete.

Here is a recap of posts from last week, in case you missed any. Click below to read each post in full.

Cool Item of the Day: Watch the Inauguration on Your iPhone

Live streaming video company Ustream announced a new iPhone application today that will let you tap into whatever videos it is streaming live on the Web. Its coming-out party will be during the presidential inauguration next Tuesday. Mobile video is a topic that’s gaining steam, along with the general excitement around mobile hardware and software advances. Ustream will be the first live video application on the iPhone as far as I can tell, although the still unavailable LiveStation app (broadcast feeds) was announced last month. (read more…)

Signs of the Times in Yellow Pages

We got news this week of two directory publishing operations shutting their doors, a reflection of the challenges of running a competitive directory publishing company in the face of a difficult economy and intense competition from incumbent publishers and the Internet. HYP Network, a private-equity-backed company that built a substantial operation in Spanish-language directories through acquisition and start-up, has announced it will liquidate, citing the tough economy. (read more…)

Online Video: SpotMixer Goes Deeper With Google

A week after announcing being knighted as an AdWords reseller and working with Google to offer video ad creation to its advertisers, SpotMixer has been integrated directly into the Google TV ads dashboard. This will position it more directly as a video ad creation engine within the AdWords workflow. Previously Google TV Ads used a less sophisticated video creation engine with less media assets to offer. (read more…)

Krillion Extends Ad Distribution to Topix: A Conversation With Joel Toledano

Local product data provider Krillion announced a deal today that will distribute product ads and inventory content across Topix’s hyperlocal news network. This will take the form of a geographically targeted “local best deals” section on many Topix pages. As Krillion’s data drills down to product feeds at individual store locations, these listings will promote in-stock merchandise at the closest stores. (read more…)

AT&T Launches Voice Search for the iPhone

AT&T Interactive, the new division that’s behind the company’s popular YPMobile iPhone application, has added a voice search app to its roster. Called Speak4It, the application allows users to speak local search commands into the phone to receive map-based search results of nearby businesses. The app currently doesn’t have much AT&T branding and could therefore be an experimental play that will be folded in as a value-added feature to the flagship YPMobile at some point in the future. (read more…)

What Do Local Search and Raking Leaves Have in Common?

SMBLive CEO (and blogger) Matt Howard has come up with a new metaphor for local search that I have to say I haven’t heard yet. I won’t steal his thunder, but I’ll point you to his analogy, which mostly focuses on the content and advertiser aggregation challenges at the fragmented SMB level. (read more…)

New Funding: A Conversation With Yodle

Following Yodle’s $10 million C Round funding announcement yesterday, I had the chance to talk to founder Nathaniel Stevens. The funding, for one thing, is a good vote of confidence for Yodle and its market opportunity, despite the current economic environment. It’s also supportive of the notion that many advertisers are demanding more measurability in their local advertising campaigns and moving ad dollars online. (read more…)

AOL Launches MediaGlow Verticals Division

AOL continues its evolution into a multi-pronged media company with the launch of MediaGlow, a new vertical division made up of 70 branded and non-branded niche sites, such as When.com, AOL Autos and TMZ.com. The company expects to have more than 100 niche sites by the end of the year. MediaGlow is AOL’s third “new” non-portal division. (read more…)

WebVisible Study Indicates SMB Advertiser ‘Great Divide’

WebVisible and Nielsen’s jointly produced research on local search shows there is still a gap between user behavior and SMB advertising. The annual survey was just released, including responses from 4,000 U.S. Internet users and 261 SMBs. Here are some of the key findings: (read more…)

Case Study: Weblocal.ca and Canadian Local Search

A new TKG report has been released that takes a look at Canadian local search start-up Weblocal.ca. As we wrote at the time of its launch, this is a joint venture between YellowBot and Canadian publishing company Transcontinental Media. After two months, the site already has more than 1 million monthly unique visitors. (read more…)

SMB video ad creation company SpotMixer announced a partnership today with Google to push its videos into Google’s content network, and TV Ads programs.

This essentially makes SpotMixer a designated AdWords reseller and gives its advertisers the ability to push out videos to Google’s content network (pay-per-click), or to cable television spots (CPM).

The value of the latter grows as Google’s TV Ads division continues to form distribution deals with various cable TV providers and networks. Recent deals have included NBC Universal, Dish Network and Harris Corp.

For the One True Media-owned SpotMixer, the benefits are simple: more distribution. This amounts to a greater selling proposition for its video creation engine. The name of the game in SMB online video has evolved from who has the best video creation suite to who has the best distribution.

SMBs are getting sophisticated enough to ask: Where will this video go and who will see it? Many of these platforms also offer rich analytics tools, the best of which is probably Mixpo.

SpotMixer’s deal today joins a range of distribution strategies we’ve seen in the quickly growing segment, including everything from online video networks (Jivox), cable TV (Spot Runner), vertical search sites and networks (Mixpo, Spotzer), business-to-business networks, (WellcomeMat) and IYPs (TurnHere).

YouTube is also a distribution medium used by some, but it has its downfalls — mostly involving a lack of commercial intent for its searchers. This was explored in a post earlier this week, and the overall SMB video market opportunity was explicated further in TKG’s video forecast.

Last week was cut short by the Thanksgiving holiday, but we still saw a few notable news items. Here is a roundup, in case you missed any posts. Click below to read each post in full.

Yellow Pages News Roundup

Here is a collection of newsworthy Yellow Pages and directional media items that I’ve noted over the past week or so. Got this press release in my inbox from Yell Group this morning, showing some creativity in linking the print directory with the mobile Web. (read more…)

IBegin Enhances Local Listings; Adds Self-Editing, Other Features

IBegin has been trying to add its own Web 2.0 sensibility to the listings business, offering free basic directories of businesses, and customization services on an upgrade basis. It now has 150 businesses and organizations subscribing, including schools, local and state government, city services, chambers of commerce, professional associations, hotels, golf courses, newspapers, TV stations and radio stations. (read more…)

Vote: Mashable’s Open Web Awards (Where’s Local??)

Mashable is holding its second annual Open Web Awards and voting is open until Dec. 15. You can vote for one company in each of the 26 categories, such as social networking, photo sharing, search & social search, etc. (full list here). But my biggest question is, where’s local? (read more…)

ILM Coverage II: The Tweet Roundup

Following the roundup of blog coverage of ILM:08, you can view all the Twitter comments that are tagged and aggregated here. There was lots of good chatter and some good gems scattered throughout the 100+ tweets from the event. (read more…)

YouTube Goes Widescreen

I noticed today when watching a YouTube video that the viewing window has switched to a 16:9 aspect ratio. For videos in 4:3 ratio already on YouTube, they simply sit in the middle of the widescreen window (see example below). This is a logical move for YouTube as it tries to monetize its content. (read more…)

Watch: AutoTrader Weighs In on Automotive Bailout

Our friend Chip Perry, CEO of AutoTrader.com, was on Fox News yesterday, making a case for an auto industry (conditional) bailout to Neil Cavuto. The argument is that a strategic taxpayer investment that comes with performance-based conditions could force the industry into being more efficient. On the marketing side, for example, Perry pointed out how the industry spends $30 billion on advertising to sell 12 million cars. That’s more than $2,000 per car, and it’s mostly going toward traditional mass media where only 10 percent of the audience is in the market to buy a car. (read more…)

What’s Next for Google TV?

One of the prevalent themes at last week’s ILM:08 conference was how the economic environment is forcing businesses of all sizes to pay closer attention to their advertising ROI. With that will come an acceleration of the existing trend toward more measurable online media. Google TV is one place that could benefit from this, as television spot advertising is expected to be one of the biggest victims of continued ad spending declines at local and national levels. Here, a double-edged sword faces many forms of online advertising. (read more…)

Zurich Conference Focuses on Print YP Innovation

The sixth annual Yellow Pages Today Conference assembled experts from the industry to give their specialist opinions around the theme of this year’s conference, “The Future of the Printed Directory.” Margit Kaluza-Baumruker, the marketing director from Herold Business Data in Austria, addressed the topic, “How does the user think of the future of the printed directory?” (read more…)

Street View on the iPhone: Pretty Nice

Last night, I finally got around to downloading the newest iPhone firmware (v2.2) that was released Friday. It includes enhancements to browsing in Safari, Podcast integration, the option to deactivate typing auto correct (thank you!) and Google Street View. The latter stands out among all the new features and is being touted as the new release’s centerpiece. And rightly so — it’s a nice integration that places a little icon right next to the “pushpin” of a given business. (read more…)

BIA Advisory Services held a webinar to discuss the state of local radio, and the steps the industry needs to take to revitalize itself. BIA President and CEO Tom Buono set the stage with some daunting figures that show radio’s depressed revenue growth as compared with retail spending over the past 40 years.

Using retail sales as a benchmark, radio’s advertising growth was more or less in parity until the early 1990s, when it began to diverge due to recession. The same thing happened in a recessionary period 10 years later, and that divergence has continued to this day.

On another measure, U.S. ad spending has increased at a 17 percent CAGR since 2000: But radio’s share of that overall advertising pie has decreased from 8 percent to 6 percent. Meanwhile the Internet ad portion has gone from 3 percent to 10 percent in the same period.

“Lots of ad dollars for radio are going towards television and the Internet,” contended Buono, adding that EBITDA has decreased around 20 percent on average during the same period for the largest publicly traded radio station groups. Stock performance also paints an undesirable picture, with valuation declines that are greater than all other forms of traditional media.

Picking Up the Pieces

So what can be done about this? BIA Vice President Mark Fratrik argued that radio stations need to better position their unique assets to maintain listeners and advertisers. These include uniquely local content such as news weather and sports, as well as things that can’t be replicated or commoditized such as personalities and advertising that have local flavor.

The local radio industry’s aggregate revenues are less than their consumption volumes, relative to many other media, added Fratrik. Newspapers conversely have disproportionately high revenue compared to their (quickly declining) consumption. This could be an opportunity for radio to gain share with strategic content planning that targets the right demographics.

But there is more to it than content, says BIA Chief Strategy Officer Rick Ducey. A platform strategy has to be recognized, given broadband penetration, online usage and device convergence. These factors point to radio’s need to be in more places, including digital online streams, and on mobile devices like the iPhone.

“People are connecting in different ways and on different devices,” said Ducey. “Radio has done a good job at getting online. Once online, there are new revenue opportunities.”

Further strategies include planting radio chips into more mobile and consumer electronic devices, and the development of branded online destinations and geodomains. This allows content to be “hyperlocalized” in a way that draws out more of the local flavor that Fratrik argued above.

For radio to make some of these shifts, Ducey argues that it should be a natural transition, given some of the similarities it already shares with the Internet and its audience. These include being a free medium that is consumed at home and work by large audiences and that includes locally relevant content.

“All of these attributes can parlay into online media and mobile media,” said Ducey. It can “create traffic and stickiness, which will attract more advertisers.”

Online efforts can not only create auxiliary outlets and sources of revenues but can also revitalize the core “air” business, added Ducey. Streaming audio is a high-growth area and can be a place to add content such as niche data casting, additional channels and iTunes tagging.

“Not a lot of people are doing this, but we see it as the leading edge to what we’re going to see in the future,” he said.

Down to Business: Selling Ads

An important question that joins radio’s content and delivery strategies is, how does the local sales channel evolve in a world of evolving advertisers? This is a slightly different version of the same issue that faces newspapers, Yellow Pages, cable television and any entity selling into the SMB market.

Kelsey Group CEO Neal Polachek argues that broadband penetration, device convergence and game changing devices like the iPhone have a big impact on local sales rep. Reps who once only needed to know their own media inside and out now need a broader understanding of the many forms of media that their advertisers are asking for.

“They’re going to have to be able to understand and offer a value proposition against a whole new set of advertising products,” argued Polachek. “Reps are going to be increasingly selling cable, online, search marketing, mobile and local radio.”

Whereas local sales reps traditionally had the confidence in their level of knowledge with one product, they’re currently facing sophisticated small businesses that know more about some products than they do. The role and impact of the rep is also degraded as we enter an era where local ads are bought based on performance rather sold based on perception.

“Reps 20 years ago did a good job at selling their category,” said Polachek. “Today, they need a broader sense of the product set and they’re going to have to be more analytical in nature [and] understand and explain metrics coming out of different media. This is going to require revitalization, recruitment and retraining of these reps.”

The Best and Worst of Times

The state of the economy will make all these efforts more difficult than they already are. The good news is that recessionary periods have often spawned the biggest technological and communications revolutions of our time. In recent history, Microsoft and the PC era came out of a recession, followed by the beginnings of the Internet era. Then Web 2.0 was born out of the remains of the tech recession that started eight years ago.

Chances are the next shift in how we live our lives and consume our content will materialize as we come out of the current recession. And the seeds for that communications or technology shift will be planted in the coming months. This could be an opportunity in disguise for anyone in the business of delivering content, including radio. This means experimentation and smart planning around new ways to package and deliver content could uncover the next lottery ticket.

“When we come out of recession in nine, 18 or 24 months, whatever it will be … we’ll be left with a different media landscape than what we’ve had,” said Polachek. “From now till then, we’ll need intense learning about where this thing is going to come out in the end.”