E.W. Scripps presented today at Noble Financial Equity Conference at Club Med Sandpiper Bay. The San Angelo Standard Times is an E.W. Scripps newspaper.
CEO Richard Boehne spoke of changes in the newspaper business:
So broadening the newspaper brand, if you follow the newspaper industry at all, newspapers are going through a dramatic season of transformation from a business that was about 80% advertising for many years to one that has become more and more reliant upon subscription revenues. Like many of the other companies we've put up what's technically called a paywall. We're training people to pay for digital content very successfully. The newspaper industry has been sort of rolled into the operating room. It's being rebuilt. It's getting a tummy tuck and a chin tuck and having some other work done. It'll come out the other side as a very different business. There's absolutely no going back, a business that's much more dependent on direct subscriber revenue.Scripps profits are driven by political advertising and local television news.
Boehne spoke of Scripps niche in political ads:
Nobody does political quite the way we do. We have a dedicated political advertising office in Washington, D.C. We're in that business 365 days a year, year in and year out. Nobody brokers political advertising better than we do. It's just a way we take out more than our share each time these races come up.Political advertising works because of targeting. Here's what Scripps doesn't want you, the subscriber to know.
Scripps's strategy is "fusion of internal consumer/advertising data with 3rd party data" like property tax records, voting records, social data, subscription/viewing data & more. Who knew that paying for digital content would give your newspaper provider more information to package and sell about you?
Sales is the company's major focus for digital.
That dedicated sales force will market fusion data to advertisers. Subscribers are being double sold, first as the primary revenue source for newspapers and second as the recipient of multiple targeted ads, the nauseating political kind and otherwise. What's it like being trained?
Following the money, the newspaper division provides 17% of Scripps profits and 20% of cash flow. Scripps froze their pension in the aftermath of the financial crisis and successfully reduced a $100 million underfunded pension liability. Oddly, $100 million is also the amount the company set aside to buy back stock.
Does this sound like light or blight? Will any Scripps paper quote their CEO on any of these topics shared at ClubMed Sandpiper Bay? Doubtful.