Even with all the focus on local online ads by newspapers and directories sites, large parts of the space remain untapped. One of those spots is quick serve restaurants, otherwise known as fast food. In his role as a moderator on a Borrell Associates’ Local Online Ad Conference panel on portals and partnering, Lem Lloyd, VP of Yahoo’s channel sales said that Yahoo (NSDQ: YHOO) will look to that segment to grow its revenues. The 800-plus members of the Yahoo Newspaper Consortium will be key to tapping the $3 billion in total marketing dollars spent in the QSR category, he said. “Only $47 million was spent online by quick serve restaurants last year,” Lloyd noted. The main reason QSR web ad spend remains insignificant is due to the regional marketing decision-making at the major companies.
Update: After the panel, Lloyd told me that in addition to QSRs, Yahoo will aggressively pursue local online ad dollars from health and pharma marketers, as well as continuing education.
Yahoo is somewhat hamstrung in prying that ad spend loose because its 1,000-member sales force is mostly concentrated on national campaigns. But with its local partners, including the newspapers and directories services, Yahoo can partner with the local ad teams to encourage geographically-targeted ad spending. “QSRs represent a green field,” Lloyd said, as an image of a rainbow appeared on the large screen behind him.
Andy Lobred, VP for sales and marketing at Media General (NYSE: MEG) Digital addressed some of the challenges that newspapers have had in driving online sales. Specifically, it was an issue of compensation that favored the print side. The company has been working to shift that combination more towards ad sales.
Secondly, both implied that one of the other big fears that have depressed online sales has been cannibalization of traditional revenues. Rather than mainly trying to structure deals with the same advertiser for both online and print, Lobred noted that Yahoo has helped the Richmond, VA-based owner of The Tampa Tribune, Richmond Times-Dispatch and 20 other dailies increase its online ad revenues. “We’re not taking money from the legacy side, we’re developing new sources of ad sales,” he said.
As Media Gen said last month in its Q4 earnings, total digital revs grew 11 percent, while local and national online ad dollars leaped 28 percent and 20 percent, respectively.