Newspapers Will Survive Only If They Remember Why They Exist

Over the past few years, facing their worst business crisis in history, and increasingly confronting the fact that they may not even be able to survive it, U.S. newspaper publishers have been desperately searching for new strategies.

They've investigated new technologies, changing business models -- including non-profit or government-funded entities -- as well as new partnerships or alliances, some of which stretch existing anti-trust rules.

But what if the answer to the industry's essential problem lies much closer to home?

The one place our big metropolitan newspapers have systematically avoided turning to for help is the communities they purport to serve. It's almost as if they think that those of us who have so loyally subscribed to them all of these decades lack empathy for what they are going through, or ideas about how they might pull through.

I suppose they don't trust us, and that is a shame.

On assignment for Stanford Business Magazine recently, I discovered a large newspaper company that not only has avoided the problems we have been documenting here at Bnet Media the past two years, but has also found a way to thrive as a business, and even to successfully convert its online readership to the paid model that Rupert Murdoch, among others, so covets.

Think this is fiction? Read on.

First, fasten your seatbelt, because we have to travel south of the border, to Mexico, and Grupo Reforma, the country's leading newspaper company. This may be the hardest step of all for any U.S. media exec to take, because I have yet to meet even one among the hundreds I know and have interviewed who thinks we have anything to learn from our colleagues to the South.

But we do.

Grupo Reforma publishes 10 newspapers in 5 Mexican cities with an average daily circulation of 1.5 million. These include the largest metro newspapers in Mexico City (Reforma), Monterrey (El Norte), and Guadalajara (Mural).

I interviewed Jorge Melendez, who is VP of new media for Grupo Reforma, and he explained to me his company's formula for success. Here are a few of his main insights:

• "[We} have an 'ultra-local' concept, i.e., that newspapers need to be embedded in our communities. We have a saying in Monterrey, where grilled cabrito [young goat meat] is one of the main regional dishes: 'When you pick up El Norte, it better smell like cabrito.'"
• "[We] long ago developed unique ways to interact with our communities and to build reader loyalty. We maintain 'editorial boards,' each composed of 12 to 14 community leaders, corresponding to every section of the newspaper, such as autos, food, fashion, sports."
• "The community boards meet with section editors at the paper every week or two to discuss three standing agenda items: (1) What the section is doing well; (2) What the section is doing poorly; and (3) What new Ideas readers have for sources, stories or sections."

The problem is that, for whatever reason, North American newspaper executives have pretty much shunned this kind of involvement with their communities, during my entire lifetime.

Meanwhile, at Grupo Reforma, this type of interactivity has been going on for 20 years, and by now, Melendez estimates that roughly ten percent of their readers have served on a board at one time or another.

"The community is a gold mine," he says. "They are extremely loyal, plus they know how we work. They know who to call or email. They are a source of stories, new sections, and opportunities."

Seven years ago, when the company realized it needed to be able to charge for its online content, it worked patiently with this community of loyal users to help convert its websites from free to paid. The overwhelming majority of readers went along with the change.

If that sounds like a dream scenario to newspaper execs on this side of the border, maybe it's because they all forgot a long time ago who they actually are working for.

To read the entire Stanford Business Magazine article, please click here.
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