Deal of the Day

Newspapers and city magazines ought to be kicking themselves (yet again). Several start-ups have emerged in the last 12 months rolling out dazzling deals of the day for savvy bargainistas. GroupOn and LivingSocial have been the front runners, with TownHog nipping at their heals. All three are out canvassing merchants around various cities for compelling wares and services to dangle before audiences looking for "such a deal!"

I first bumped into GroupOn several months ago when searching for play tickets in Toronto. LivingSocial I read via HuffingtonPost -- and while researching this article I tripped over TownHog. All three have a similar model that advertisers love: pay nothing upfront to have someone else market your product. There is only a charge to the advertiser if the product sells. And what could be a better deal for retailers trying to drum up business than a risk-free promotion! Further, for a deal to go through, a certain threshold of takers needs to be met, if not, there is no deal. This incents consumers to virally promote the deal among their network.

Of course there are drawbacks: Retailers need to know that they can handle the demand if the deal is truly a great one. (I had a meeting with one national brand -- whose IT department found out that the company would be offering 50% off from Web site sales -- just 7 days before the offer went live. They were terrified that the servers would crash. They didn't.)

And, I have heard rumblings that some of the deal-meisters pay retailers at a slightly slower rate than others (can't confirm that). My brother-in-law has been trying to get a GroupOn rep to call him for a few months -- so perhaps there are some growing pains.

There are some newspapers like Media General & McClatchey that are catching the tiger by the tail and partnering and sharing revenue with these daily dealers. In Media General's case, Groupon is selling and developing the clever creative for offers -- while Media General markets the offering. (In some cases this creative is the ONLY web presence the retailer may have.) No word on the revenue split.

Here's the deal though: Media General like all newspapers OWNED the local market when it came to sales and fulfilling creative in print. How in the world could they let some outside organization get close to their customers -- and offer the marketing platform?? At least be the sales arm for the venture! It certainly seems that this is short-sighted at best -- and yet another lost opportunity for local news organizations to find a model that makes them relevant and solidify their reason for being.

Mobile Ingenuity

From how to mobilize to how to monetize, mobile is the topic célèbre for this season's tradeshow circuit. While many of the first generation offerings are ho-hum, there is promise that more and better is on the horizon.

The first-gen initiatives are, not surprisingly, a redux of what is in print and online. This replication consists of taking what is in a print and making the PDFs available in an eReader such as the Kindle, Nook or iPad. The product is largely contained – meaning there are no links out to the Internet. Most periodicals are using a 3^rd party developer such as Zinio or Texterity to convert the print to PDF. While others, such as Wired, splurged to create custom editions that are augmented with rich media and layouts specific to the medium. There is definitely an audience for eReaders – but it is highly unlikely to be a large enough one to save magazines’ bacon.

Optimization is the next step in the mobile maturity process. Any site, be it a periodical or a business should consider creating a truncated version of the Web offering – optimized for the mobile device.  Few are doing this well at all. Most are thinking of regurgitating the entire Web offering onto a tiny screen. This reminds me of a meeting I was in 15 years ago. I was making my case to the board of directors New Jersey for autonomy in putting our daily newspapers online – when one of the executives stood up with a boom box wrapped in a newspaper. “We wouldn’t read the newspaper on the air,” he said, “and we shouldn’t be putting the newspaper on the Web in the same format.”

And with mobile, the same argument holds; The medium demands a new product offering -- which brings me to the last phase in the maturity model. Appication are specific and compelling applications that allow users to self navigate. What is a specific and compelling app? Well it depends on the audience, and ostensibly, publishers know their audiences. Newspaper publishers, which know of every retail outlet in their Designated Marketing Area (DMA), could use temporal and geolocation data to provide restaurant lists. If the time is at 7am – diners would have greater relevance than fine dining restaurants. Because papers know of every retail location in an given DMA, they could also provide for fee search for local businesses. Let this audience search on how many fast food restaurants in a given radius, etc.

These types of apps fit in the sweet spot of publishers – although I give it 50:50 odds that newspaper in particular will “get it.” Part of the problem is that mobile is a new medium that will cultivate its own experts -- its own handlers. Yes, there may be some overlap now -- Chris Anderson's Wired editors and graphic artists lovingly create three versions of each issue: one for Web, two for iPad -- landscape and portrait orientations. But frankly, that is a luxury for staffs that have been butchered during this period of declining revenue. Secondly, and related, is that publishers can not inherently attract the best programmers out there. Best programmers want to go where they can innovate and lead – not be crammed into job band that is nestled between a Reporter III and Editor I.

So what is the solution? A shift in thinking internally. Papers have to think of themselves as software publishers – not just news publishers. They need to think like the folks that create games, utilities, and tools that we can’t live without (or at least will pay some modicum of money for). They will need to cultivate a workforce that is given the opportunity to experiment – and even fail – all in the goal of moving forward. And they will need an agile environment one that allows them to “mash up” disparate types of content – geo, temporal, internal, external sources. The technical piece is the easy part – the change in thinking – well, perhaps it is optimistic, but I think publishers are finally getting around to thinking a bit differently. We’ll see.