Roxanne Oswald, business development director in the Interactive & Direct Marketing department at the Minneapolis Star Tribune, contributed this piece based on NAA's recently released report, "The Newspaper Online Shopping Report: Online Relationships with Retailers."
If you have only five minutes to spend with “The Newspaper Online Shopping Report,” be sure to read Part I: The Broad Definition of ‘Online Shopping’. It will release you and anyone on your staff focused on your shopping site and on retail advertisers from a narrow and outdated view of online shopping. The report gives hope that there’s a significant and obtainable opportunity for newspapers, provides overviews and ideas for shopping site features as well as point-in-time case studies of five newspaper shopping sites trying approaches to make their sites more shoppable.
The good news is you can breathe easier. We can let go of the notion that our shopping sites cannot be successful unless they are fully e-commerce enabled marketplaces. Many of us discovered that creating a transactional solution was not a core competency, did not leverage the information assets we already had, pushed us toward scant revenue streams based on a percentage of transactions, and often put us in an awkward position with our retail clients.
Instead of focusing on purchasing, the report’s position is that newspapers’ sweet spot is largely what it has always been: influencing sales by helping consumers as they shop and creating leads for marketers. Online consumers spend more time researching products online than they spend purchasing them online or during in-store visits, and marketers focus a larger share of their budgets on connecting with consumers as they research. So while it continues to make sense to offer opportunities to close sales on our sites, the prediction that online sales won’t ever exceed 15 percent of total online sales indicates we should not put all our resources toward it.
The not so good news is that consumers don’t rely on newspaper Web sites for shopping information and services, ranking them 13th among 13 categories with just 9 percent usage by “Web to Store” shoppers according to Dieringer Group’s research. Yet we do have advantages, such as an upscale demographic of our site visitors, that can be leveraged to grow advertising revenues even while we find ways to change consumer perceptions about our shopping sites.
Also encouraging is the declining share of online sales going to Web-only retailers while at the same time the online sales of brick-and-mortar retailers are rising. Many of these retailers are already part of our client base, so we have the opportunity to strengthen relationships with them as we grow our online shopping site and audience, especially if we can find ways to help them measure the impact their online advertising has on both in-store and Web site sales. But the opportunity and necessity is to bring in small and medium local retailers as revenue streams. But just as important in the next few years, their participation is imperative if we are to change the perception of newspaper sites as efficient and rewarding shopping portals.