Customers. We love them; especially when they give us money.

But do we really understand them? As newspapers, we pride ourselves in representing the people and businesses that we serve. As an industry, we spend among the lowest percentage of revenues trying to understand them.

In truth, the views that we purport to understand are largely determined subjectively by a small group of editorial executives in each newspaper. By small I mean, er, one.

In a broader sense our traditional approach to understanding and responding to our customers is to make it up.  

Until now, newspapers were unique among fast-moving consumer goods in how little attention was paid, by the people who produce our products, to research our customers’ needs and wishes.

But all this has been changing. The Readership Project, run by Northwestern University, may prove to be the renaissance of our industry. It has consistently presented interesting, valuable and actionable information about the needs of our readers and could prove to be the driving force that turned our industry’s fortunes.

Marketers left out?

But while all this good work is going on, what is happening to our understanding of those customers who provide the majority of our revenues, and all our profits: our advertisers?

In reality, most newspaper companies - here in Europe at least - spend a pitiful amount on research and development.

While we spend some money on readership research that presents a vague picture of who our readers or our advertisers’ potential customers are, we spend next to nothing understanding our advertisers’ business objectives, needs and relative attitudes to the service we provide. Customer surveys among advertisers can drive improved service, loyalty, improved pricing and even new product innovation. They are low cost and easy to execute. At the simplest level, they provide sales managers with a regular overview of their advertisers’ attitudes and needs.

Such methodologies can be used to revitalize advertising sales operations and massively accelerate revenue generation.

Advertising clients welcome these surveys. They not only see them as a means of raising concerns and ideas but also regard them as a demonstration of the company’s commitment to them.

What’s measured

Among other things, an advertiser survey measures two key criteria: the clients’ claimed loyalty to the paper and the value that they believe they receive from the newspaper.

The results of a survey segment advertisers into segments on a three-by-three matrix according to their scores on each criteria.

Different relationship techniques are then applied depending on how loyal the advertiser is to the newspaper and the value of its spending.

Remember: Loyalty cannot be mistaken for frequency.

Regular, daily or weekly advertisers are often the ones who track their response most keenly, and whose only loyalty is to their return on investment.

Management of lapsed advertisers is a key component of any successful advertising sales program.

Broad scope

The objective of the survey should be to examine the widest number of current, lapsed and potential trade advertisers in order to ascertain the attitudes and needs of the different groups.

The sampling and contact methods will necessarily be different for these groups, and their willingness to respond will vary.

These results are then correlated with advertisers’ spending patterns, both in your own and your competitors’ media, to develop a SWOT (strengths, weaknesses or threats) analysis of the prospect base.

This information is used to segregate different types of advertisers across a number of parameters, to identify cluster groups of customer types, and service issues, for the purposes of devising future SWOT strategies.

One interesting issue relates to how newspapers often segregate their customer base according to internal definitions.

Bundled into one team

Car advertisers, for example, are often bundled into one sales team. Those who advertise on the classified pages enjoy one form of selling, while those in supplements experience something different.

These surveys also reveal that customers need to be handled according to their size and potential. A large network of car showrooms has more in common with a retail bank than with a small garage.

Loyal “service orientated” advertisers respond to a different kind of salesperson compared with volatile “response-driven” marketers.

Advertisers, by their very nature, are imaginative entrepreneurs who like having ideas and experiencing success in their own and their partners’ businesses.

They willingly participate in customer surveys to take advantage of the opportunity to offer positive criticism and original ideas.

They also welcome the opportunity to join focus groups or workshops designed to help them maximize their advertising dollar. Many potential initiatives originate with advertisers, to everyone’s benefit.

Jim Chisholm is a consultant and strategy adviser to the World Association of Newspapers and director of the association’s “Shaping the Future of the Newspaper” project, which looks at strategic developments and best practices in the newspaper industry. He can be contacted at jim.chisholm@futureofthenewspaper.com.