Scripps Overhauls Web Ads; BusinessTargets Get Smaller, More Local

EW Scripps (NYSE: SSP), one of the rare newspaper publishers to report negative interactive ad revenues in Q2, is trying for a quick turnaround. NYT has an overview of the Cincinnati-based company’s plans, including altering the commission structure for online ads, reducing the reliance on convergent print/web ad sales and expanding its universe of advertisers to smaller and more local marketers. In addition, Scripps is counting on Yahoo’s new APT ad delivery and targeting system to boost revenues, which slumped 8 percent in Q2. The company reports Q3 earnings Friday.

The four-year goal: If all goes as Rusty Coats, VP for interactive, projects, Scripps will sell enough ads to support the staff and costs of the print and online newsrooms by 2012 — all without the job cuts that have become a near-daily occurrence in the newspaper industry. In order for online to start producing more revenue, Scripps believes the incentives have to change for online ads. More after the jump.

New commitment: As we detailed back in July, Scripps began experimenting with different approaches, such as trying to inspire more online ad sales activity at papers like the Corpus Christi Caller-Times by tying deals to commissions. At Scripps’ Knoxville News Sentinel, about 95 percent of the sales team’s bonuses depend on print. The Sentinel will reduce that to 70 percent by raising commissions for online ads. And while the paper will hire staffers who will focus solely on online ads, the publisher is setting up a telemarketing unit that will conduct outreach to smaller businesses.

Getting smaller, more local: One of the reasons that newspapers have failed to catch the wave of local online ad growth has been their reliance on “upsells.” By trying to get their usual client base of department stores and auto dealers to spend more on the newspaper websites as well, papers have tended to ignore smaller businesses like pizza delivery and plumbers. Scripps has started that shift away from print upsells earlier this year. As a result, Scripps says online-only revenue is up 30 percent. As for bringing in telemarketers to attract those smaller advertisers, the idea is starting to catch on at other papers that have been struggling online lately, like Dallas-based AH Belo (NYSE: AHC) (NYSE: BLC), which said last week that Q3 online revenues fell 19 percent.