By: M.L.Stein Conversion to Standard Advertising Invoices and participation in the Newspaper National Network seen as a crucial step in boosting national ROP revenues sp.
THE NEWSPAPER NATIONAL Network's success with Chrysler advertising signals the power and value of the one order/one bill concept, a top executive of the Newspaper Association of America told publishers in San Francisco. In officially kicking off the network, Nicholas Cannistraro Jr., NAA senior vice president and chief marketing officer, said the concept, combined with a competitive rate and other factors sought by Chrysler, "are what got us the business." If the idea worked with Chrysler, it can work with other advertisers, Cannistraro said in a speech at NAA's annual convention. He contended that the time is right for such a venture because "advertisers are beginning to realize they are being shortchanged by relying primarily on television with its rapidly fragmenting audience and poor TV commercial recall scores. Within one day, less than 7% of television viewers are able to recall seeing a commercial." With NNN, he explained, it takes only a single sales presentation to persuade advertisers to use newspapers. "With one phone call, advertisers are able to buy multiple newspapers and receive just one single invoice for all insertions," he said. Publicitas Advertising Services will handle the actual one order/one bill processing services, which ultimately may be run electronically via Electronic Data Exchange (EDI). "All this means simplification and standardization for the benefit of multimarket advertisers," he said. But first, newspapers must adopt standard advertising invoices (SAI) to get the system into EDI, he pointed out. Cannistraro said over 800 kits were sent to newspapers, of which 255 have adopted standard ad invoices. He called the response a "good start" but noted there are over 1,000 member papers and about 1,700 daily newspapers. "We have a long way to go to meet our goal of industry-wide adoption of SAI on Sept. 4 of this year," Cannistraro said, urging publishers to sign up. Cannistraro said NNN, which initially will be funded by NAA for three years, will consist of advertising professionals who will work aggressively to attract more national advertising from such "low use" categories as automotive, household supplies, cosmetics, toiletries, package goods, and food and beverages. Staffing for the network is expected to be completed by summer, he reported. Under a formula approved by the NAA board, 50 of the largest circulation member newspapers will fund NNN's operating costs based on each paper's share of the total combined circulation, Cannistraro said. These papers will be NNN partners. Newspapers in the network pay no participation fees and will pay a commission only when NNN makes a sale, he said. The commission is 5% with a grossed-up fee of 31/2% on the transaction. An optional fee of 1% may be charged if a sales team feels that merchandising is important to an advertiser. He offered the Chrysler program as an example. Chrysler's marketing director, Cannistraro said, would tie in with NNN if newspapers would agree to a CPM of $32 gross for a full page, produce a top quality four-color printing job, run the ad when Chrysler asked for it ? in the section requested ? and provide the auto maker with complete newspapers for quality evaluation. NNN gave Chrysler a list of potential newspapers in markets requested by the company, which picked 75 papers of varying circulation for its ads, Cannistraro said. The advertiser requested the main news section but allowed the business or sports pages as alternatives. The payoff was three ads with revenue of $1.5 million. Cannistraro termed the results "outstanding." At a March 30 meeting, he related, Chrysler agency executives praised NNN for an "excellent job." "I think we converted some doubting Thomases about newspapers," he said. However, Cannistraro, noting that Chrysler gave newspapers wide parameters in its "slow-pitch" requests, warned that future conditions by advertisers are likely to be more complex. In concluding his address, he observed, "The newspaper industry, it appears, has no problem in getting the attention of national advertisers. They understand our unique selling power, our tremendous franchise of 114.7 million daily readers and 128 million Sunday readers. It's our complexity that turns them off." Now is the time, he said, for both big and small papers to act as an industry. "Let's eliminate the problem with rates," he urged. "Let's focus on total quality management and zero defects . . . . Customers have every right to expect perfection from their suppliers; ours are no exception." ?(Nicholas Cannistraro) [Photo & ID]