McClatchy subsidiary is expanding its newspaper ad network p. 33

By: Dorothy Giobbe & M.L. Stein HOPING TO CAPITALIZE on newspapers' increased utilization of marketing networks, The Newspaper Network Inc., a wholly owned subsidiary of McClatchy Newspapers, is positioning itself for rapid growth as it aggressively courts clients.
TNN is, its president and CEO Jerry Grilly said, "a newspaper marketing services company specializing in securing incremental advertising for our network members or getting back lost business, primarily preprints and inserts."
TNN facilitates placement of preprints in newspapers throughout the country with one order, one rate and one bill. Newspapers' rates are blended into an aggregate rate for all participating newspapers. The network also offers clients database-marketing support, including database marketing, mapping, demographic targeting, competitive analysis and customer profiles.
Speaking at a recent convention of the California Newspaper Publishers Association in Los Angeles, Grilly said the idea is to provide an opportunity for hundreds of advertisers, who although not located in TNN's particular newspaper market, might want to buy advertising for their stores there.
TNN's sales pitch to newspapers, he said, is that they will receive significant new revenue and increased share while enhancing their relationship with advertisers. Members are charged only when TNN places an ad in their newspapers. The paper pays 8% on new or incremental business in the first year and 6% after that.
Grilly, former publisher of the Anchorage (Alaska) Daily News, said the TNN sales team is responsible for selling and servicing the newspaper to advertisers, offering creative solutions and developing effective programs and presentations for advertisers, improving advertisers' opinions of newspaper marketing and becoming advertisers' "problem-solving partner."
TNN, Grilly added, works hand-in-hand with partner newspapers to identify sales opportunities or target accounts. It only will call on accounts in an individual market that it is asked to call on.
TNN evolved from three McClatchy companies: Sacramento-based Big Valley Distribution, which networked preprint and insert sales in the California Valley; Salt Lake City-based Western Intermountain Network; and the Southern California Advertising Network, which operated in the greater Los Angeles area.
Currently, TNN operates from six offices, in Sacramento; Los Angeles; Salt Lake City; Atlanta; Greenville, S.C., and Orlando. Plans call for additional offices to be opened in Miami, Dallas/Houston, Seattle, Denver and possibly Chicago.
So far, TNN said, it has sold more than half a billion preprints out of direct mail and into 500 newspapers in 30 states. By the end of 1994, TNN hopes to service newspapers in every state.
"We're going after national, regional or local retailers," Grilly said in an interview. "We think the opportunity is now; that's why we've accelerated our expansion plans. There are some worrisome trend lines out there and if we don't get the networking concept up sooner, those [trend lines] can exacerbate."
Winning the Sizzler International Inc. account was a significant coup, said Glenn Powers, vice president of TNN. "The Sizzler account is a good example of targeting in the fast-food category, which is traditionally a non-newspaper user.
"Sizzler was targeted by our Utah office and has . . . put that business into about 80 papers across the country and extracted nearly $1 million from that account that newspapers weren't getting before," Powers said.
Part of TNN's early success has been fueled by its staffing patterns. Many people working at TNN previously worked at newspaper representative firms such as Landon Associates and Sawyer Ferguson Walker or at various newspapers throughout the country. Also, many have experience with retail accounts and selling against direct-mailer Advo Inc.
A significant addition to the TNN team is senior vice president/general manager John Fredericks, a former regional vice president and general manager for the Atlanta region at Advo.
Recently, TNN took over the Florida Newspaper Network from SFW, luring away a SFW staffer to help run it. "We have a strong success rate," Powers said. "We've been doing this for 10 years; our personnel is the best money can buy. FNN is part of our network that is going to be nationwide."
As TNN continues to expand, many of the newspaper representative firms, while supporting TNN's stated goals, are uneasy about the potential for conflict and account overlap.
"Traditionally, we don't spend much time talking to grocery accounts," said Sammy Papert, president of the Papert Companies, a Dallas-based firm. "That really falls into the retail category and that's what McClatchy has spent most of their time doing, but I wonder if it's going to stay that way . . . . I wonder if they have bigger plans.
"I have a lot of respect for their people and we value them and their clients very much," Papert said, "but right now, they're making my life entertaining because so many of our offices and non-McClatchy newspapers are inquiring about them."
Grilly said, "We are not in competition with the rep firms at all. We are focused on a different classification and type of advertising. We will work with any other network or rep firm. [TNN] really complements everybody, not competes with them."