The Great Seattle Advertising Experiment: What Will Happen to the Seattle Post-Intelligencer's Print Advertising Dollars?

The Seattle Post-Intelligencer today because the first major metro newspaper to stop publishing in print but keep the news brand alive on the web. Seattlepi.com’s Executive Editor Michelle Nicolosi promises bold experiments, “to break a lot of rules that newspaper Web sites stick to.” And to be sure, the entire news industry will be watching to see what an editorial staff of 20 can accomplish compared to a staff of 165. (Given their intent to look “everywhere for efficiencies” — and that they won’t have “reporters, editors or producers—everyone will do and be everything” — I suspect they will accomplish more than most people think.)

But in addition to the key editorial question, Seattle has also now become a test case for one of the most important questions about the near-term future of the newspaper industry that is almost never asked:

What will happen to the print advertising when the newspaper stops publishing in print?

I asked this question a few months ago in theory, but now we get to see what happens in actuality.  Logically, one or a combination of the following will happen to the newspaper’s advertising dollars:

1. Vaporizes, i.e. the advertiser stops spending the money — given the economic crisis, this seems likely for some advertisers
2. Shifts to Seattlepi.com — which is hiring its own sales force following the dissolution of the joint operating agreement with the Seattle Times
3. Shifts to another newspaper, i.e. Seattle Times — through the JOA, the same sales force sold ads for Seattle PI and Seattle Times, so it only makes sense that some advertisers will shift some or all of their spending to the Times
4. Shifts to competing local online media, e.g. The Stranger, West Seattle Blog
5. Shifts to non-local media that can target local audiences, e.g. Google, Craigslist

Anyone who runs a newspaper should be watching this experiment under a microscope. Someone should even go so far as to obtain copies of the last month of Seattle PI in print and call up every display advertiser and ask them what they plan to do.

This experiment has already been playing out in Denver since the Rocky Mountain News ceased publication, but since the Rocky ceased entirely, we didn’t get to see what happened with option #2 above — and that’s the BIG question for many newspaper companies looking at online-only publishing. (The experiment in Denver could be radically altered if a new publication is launched by former Rocky staff — it’s contingent on whether they can sell enough subscriptions, which I hope they do because that is another vital experiment.)

So much of the discussion of the future of the newspaper business seemes to assume only option #1 above will occur. But that’s unlikely.

Of course the big question is whether local media can find new ways to create value — and I say “create value” because that is the key to any new business (vs. “new business model,” because those discussions typically start with what the business needs, not what the market needs). I think there are tremendous opportunities for new value creation in emerging collaborative media ecosystems, but that’s for another post.

In the meantime, all eyes are on Seattle.