Amid the commotion caused by the Denver Post's front-page editorial on November 4 (click here for the story), another development involving the paper -- an updated circulation report -- has received only modest play. Nevertheless, the numbers are beyond dismal. According to the Audit Bureau of Circulations (ABC), a newspaper industry organ, the total paid circulation of both the Post and the Rocky Mountain News tumbled by 11.9 percent -- a total much worse than the average 2.6 percent dip experienced by newspapers nationwide. The Sunday Post's figures were even worse, sliding 13.5 percent.
Why was the report so dreadful? According to Dean Singleton, the Post's publisher and the driving force behind MediaNews Group, one of the nation's largest newspaper firms, "It's almost totally due to third-party sales," a term used to describe papers delivered to non-subscribers in upscale areas as part of agreements with advertisers. Earlier this year, the Post cut back radically on the concept, resulting in what Singleton calls "a two-time hit" in ABC surveys -- the six-month and one-year reports that apply to the period when the slicing took place. But a piece in the Rocky suggests that third-party sales don't entirely explain the massive circ shortfall.
The Post was once a big believer in third-party sales. Indeed, a New York Times article cited in this 2005 Message column pointed out that "on an average Sunday, more than 100,000 copies of the Post -- more than one out of every eight printed -- are delivered to homes in Colorado that did not request or pay for them." But as the years wore on, pressure increased on ABC to stop allowing papers like the Post to prop up circulation figures using this approach. As far back as last year, Singleton says, "we began hearing that they would take third party out of the definition of paid circulation." He expects the process of doing so to begin at the ongoing ABC convention and meeting taking place through November 9 in Chicago.
In the aforementioned 2005 Message, then-Denver Newspaper Association president Kirk MacDonald defended third-party sales as "a conscious strategy that's designed to do two things. One is to give advertisers a way to extend their reach to desirable geographies in which they may have store locations, and the other is to increase readership." Likewise, he denied that there was anything untoward about the practice, declaring, "Sponsorship copies have absolutely no relationship with circulation fraud. We report them in audits, and we feel strongly about the benefits to advertisers and readers." In echoing these sentiments, Judd Alvord, the DNA's vice president of circulation at the time, cited internal surveys stating that the freebies were read almost as often as copies purchased by subscribers.
If all this was true, the Post would've had loads of incentive to maintain its third-party sales whether ABC counted them as paid circulation or not. Instead, Singleton says, sales reps began informing advertisers that the practice would be going away, with the exception of Newspaper in Education papers and a few odds and ends, as of April 1.
Afterward, Scarborough Research, an outfit that measures newspaper readership, as opposed to circulation, found that about 1.3 million people in the Denver area see the local dailies either in print or online -- and that figure was very close to the one dating back to the third-party heyday. "It didn't change," Singleton points out, "which shows that third party wasn't as effective as we might have thought it was."
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Even so, the Scarborough digits looked a lot better than those related to circulation. No wonder Singleton is among those urging ABC to alter its methodology and begin following the Scarborough blueprint. "The industry is moving very rapidly to readership as the metric, not circulation," he says. "Radio and TV use audience ratings, and newspapers are going the same direction."
That's probably true, but it won't address circulation troubles that go beyond those traceable to third-party sales. A November 5 Rocky report by the redoutable David Milstead subtracts third-party papers from overall circulation, and the resulting deficits remain far greater those recorded at most major metro dailies. Here's the key paragraph:
A count of circulation that eliminates all discounted sales showed Post circulation dropping 9.1 percent, to 184,874 copies; the Rocky dropping 7.4 percent, to 197,773 copies; the Sunday Post falling 7.2 percent to 493,939 copies; and the Saturday Rocky dropping 0.5 percent to 430,667 copies.
Judging by those numbers, third-party sales only explains away about a third of the circulation decline. That won't put Singleton or any of the other Post executives in a partying mood. -- Michael Roberts