Tough Love in Bakersfield

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By: Mark Fitzgerald

When Graham Annett came to The Bakersfield Californian, he found a paper that subscribers loved, but for only as long as the introductory deal lasted ? or, too often, for as long as they could go without paying the bill. By 2002, the paper was in the mid-60,000 circulation range, but subscription stops averaged nearly 40,000 a year. Still, the Californian doggedly fought on, mostly signing up subscribers that advertisers didn’t particularly want to reach, and when they paid at all, rarely re-upped at full price. “We were renting circulation,” says Annett, vice president of circulation and operations.

So he began eviction proceedings. If you wanted the best subscription deal, you had to pay up front for at least six months, or sign up to make payments automatically through EZ Pay. The Californian aggressively pushed up the price of home delivery, but kept the old price for its longtime and EZ-Pay subscribers.

Circulation plummeted. By last summer, the paper was down 12.4% from 2002. But now, there’s evidence that Bakersfield’s tough love is paying off. Subscription stops fell to 12,000 in 2004, and are on track to be just 8,000 this year. Subscription churn is now under 23%, the paper says. The retention rate at 120 days for new subscribers, which was a dismal 35% two years ago, now stands at 85%. The number of EZ- Pay customers soared to over 40,000 this year ? representing 84% of the paper’s home-delivery base. Some 1,000 new EZ-Pay customers signed up in March alone. “We could hit close to 100% this year,” Annett says.

According to the latest FAS-FAX, overall daily circulation is up 3% to 65,044 from the same period in 2004, while Sunday rose 2% to 74,990. Annett projects the paper will be reporting further increases of 2% daily and 1.5% on Sunday for September’s FAS-FAX.

And the lost circulation is coming back in the right places. “We have an overall double-digit growth in the affluent areas,” Annett says, with 15% growth in the most affluent ZIP Codes.

Most new customers are signed up by a full-time crew working out of mobile kiosks. “We set up in front of Wal-Marts, car washes, movie theaters, Target, Best Buy,” Annett says. Face-to-face sales have a higher retention rate than telemarketing, he adds, and since the crew accepts only EZ Pay or advance payments for six- or 12-month delivery, the paper saves money because the back office doesn’t have to verify starts.

Circ revenue, the Californian says, has grown each year since 2001, even with the initial lopping off of customers. “Everything is geared toward a long-term relationship with the subscriber,” says Annett. So the Californian doesn’t do much special to boost its single-copy numbers. It has tried and abandoned promotional games and the typical donut-and-newspaper combos because the circulation gains never stick.

The next step for the Californian, execs say, is creating new products that will appeal to the audience it isn’t reaching. “One of the benefits of the research that Graham has brought in is the clarity we now have about who we’re reaching with the Californian and who we’re not,” says Mary Lou Fulton, vice president of audience development.

The paper beat craigslist.com ? just barely ? to the Bakersfield market with its own youth-oriented online community and marketplace site, Bakotopia. com. It even offers text news to cell phones in English and Spanish. And it may offer a second bilingual weekly with more cultural news to appeal to the many residents who are second- and third-generation Latinos, Fulton says. “We know the daily newspaper is a fantastic product,” he adds, “but we recognize that we’re not in a one-size-fits-all world anymore.”

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